Reference News, August 14 report: The UK's Financial Times website published an editorial titled "Trump's Pay-to-Play Economy" on August 12. The translation is as follows:

Donald Trump's passion for deals has no end. He threatens to impose tariffs on American trade partners at different levels and implements them. He also threatens to significantly increase tariffs on specific industries, forcing domestic and foreign companies to make massive investment commitments to the United States. However, his equivalent exchange strategy has recently shown a more dangerous shift.

According to the Financial Times on August 11, chipmaker NVIDIA and Advanced Micro Devices have agreed to pay 15% of their chip sales in China to the U.S. government to obtain export licenses for semiconductors to China. This move is unprecedented: experts say no American company has ever agreed to pay part of its revenue to obtain an export license. This legally questionable arrangement highlights that the era of American business under Trump will be one where commercial decisions are influenced less by the invisible hand of the market and more by the pressure from the White House.

Many large corporations have realized that they either need to develop personal relationships with Trump and be ready to offer incentives or remain quiet, hoping the president won't target them.

Last week, Apple's CEO Tim Cook announced a plan to invest $60 billion in the United States over the next four years and gifted the president a glass ornament mounted on a gold base. Subsequently, Trump announced a new plan to impose tariffs on imported chips but stated that Apple would be exempted.

Trump believes the idea that companies should pay for certain privileges is fair and reasonable because his top priority is to make deals. Imposing tariffs on imported goods that he prefers to be produced in the United States is also reasonable to him, as it can bring additional tariff revenue.

The deal Trump struck with chipmakers opens the door for similar deals in other industries and products. This new change may weaken the current business vitality, and corporate boards may hesitate in hiring decisions, investments, or even cut sales to avoid provoking the president. This chip deal also increases uncertainty in the business community. If savvy CEOs can simply lobby and provide compensation to get Trump to change his mind about certain regulations, long-term planning will become more difficult. This "pay-to-play" business environment will further widen the already existing huge gap between major American corporations and smaller companies with less influence.

The cost of Trump's transactionalism is evident: replacing an economy based on the rule of law with one dominated by arbitrary transactions. Such a system rewards a few powerful individuals and punishes the weak and those without connections, ultimately eroding the stable foundation on which the United States' prosperity has long relied. (Translated by Tu Qi)

Original article: https://www.toutiao.com/article/7538384120871699007/

Statement: This article represents the views of the author. Please express your opinion by clicking the [up/down] buttons below.