NY Times' Tom Friedman: China worries about Trump using trade 'to juice his base' in election

Key Points
  • President Trump was right to take on China but his mercurial nature may hinder a comprehensive trade deal down the road, says Tom Friedman.
  • Both sides need the "phase one" deal, announced last month, to actually happen, says the Pulitzer Prize-winning New York Times columnist.
  • China worries that "Trump is so unstable as a political character" that he could derail future deals if he needs to "juice his base" in next year's election, says Friedman.
New York Times' Tom Friedman: No one else would have take on China but Trump

President Donald Trump was right to take on China but his mercurial nature may hinder the ability of Washington to cut a comprehensive trade and technology deal with Beijing down the road, The New York Times' Tom Friedman told CNBC on Thursday.

Both sides need the "phase one" deal, announced last month, to actually happen, said the Pulitzer Prize-winning columnist and bestselling author, who wants to reserve judgment on the quality of such an agreement until it's done.

Friedman, who works at what Trump calls "the failing New York Times," said in a "Squawk Box" interview, "I'm a hard-liner on this." He has said in the past that while he may disagree on other issues, the president was right to act on China.

However, Friedman, who went to China two months ago, said Thursday: "There's a real worry there if they do stages two and three which would require real domestic reform by Xi Jinping, where he'd have to take some meat out of the state on industries, they're worried Trump is so unstable as a political character that if he got close to the election and he needed to juice his base, he could turn over the whole table. That's really the tension there between the short term and long term."

The White House was not immediately available to respond to CNBC's request for comment.

Chinese officials said Thursday that Washington and Beijing would begin to remove existing tariffs in steps. However, the two sides have yet to cement the initial trade deal or pick a place for Trump and Chinese President Xi to sign it. There were reports Wednesday that the anticipated meeting between the two leaders could be delayed unitl next month.

"I have to give [Trump] credit that he basically said, 'No one else would have done this but me.' And I think it's true," said Friedman. "I believe we did have to take this on, and for three reasons, basically."

"China went from poverty to middle income, I think, using a three-silo strategy," said Friedman, explaining the first silo was based on hard work by the Chinese as well as smart investments in infrastructure and education, and "delayed gratification."

"Silo two was stealing others' intellectual property, nonreciprocal trade arrangements, noncompliance with WTO rules and forced technology transfer," he said.

The third silo, as Friedman sees it, was China getting for free the benefits of the stability that the U.S. Pacific Fleet brings to the region. "They should have been paying for our presence there because our fleet reassured all of China's neighbors that China could dominate them economically but not geopolitically, which was very important for their economic expansion."

"If we let them use that same three-silo strategy to go from middle income to high income around AI, supercomputers, all these other things, 5G, we'd be crazy. Someone had to call the game, and it's good that Trump did it," Friedman said.

In May, Friedman made similar remarks on CNBC when he appeared with former Trump advisor and longtime China critic Steve Bannon. Friedman and Bannon, who might seem like ideological opposites, said at the time that they agree that the U.S. had to take on China before its economy got too big. "The stakes of this moment, I think, people don't fully appreciate," Friedman said then.