Hong Kong Human Rights Act: Another Weapon for Trump

https://trendmacro.com/system/files/reports/20191121TrendMacroLuskin-S8.pdf
Donald L. Luskin
Thursday, November 21, 2019
It proves being “soft on China” is political kryptonite. Xi dares not try to outlast Trump.
US Macro
Asia Macro
The Hong Kong Human Rights and Democracy Act of 2019 has passed Congress and will likely be signed by Trump. It won’t derail a “phase 1” trade deal, although it may delay it a bit while China squawks. HKHRA is purely symbolic, so China’s reaction is purely symbolic. It doesn’t tie Trump’s hands, or the hands of future presidents, in any way. Indeed, gives Trump new moral authority. Most important, it expresses the reality that no US politician dares be seen as being “soft on China” – so China can clearly see that trying to outlast Trump through the 2020 election is a fruitless risk. Even “engagement” evangelist Bloomberg is going to have to backtrack, which will remove any hope China may have had for being rescued from the trade war by his long-shot candidacy.