Inside The U.S.-China Trade Deal with Mitch Silk

 In this episode of Roots, Rights & Reason, host Lee Smith sits down with Mitch Silk to explore the remarkable path that led him from a teenage job in a Florida restaurant to representing the United States at the highest levels of international trade negotiations.

Silk offers a rare, behind-the-scenes look at the Trump administration's landmark Phase One trade agreement with China, sharing firsthand accounts from the negotiating table while examining the strategic challenges that continue to define the U.S.-China relationship. From trade and intellectual property to Taiwan, global energy, and economic diplomacy, this conversation provides valuable insight into America's evolving role on the world stage—and the relationships, leadership, and strategic thinking required to protect its interests.

Follow Lee Smith on X https://x.com/LeeSmithDC

New episodes drop every Wednesday at 3 PM ET.

To watch Roots, Rights and Reason, visit The Roots, Rights & Reason Show: https://www.americasfuture.net/the-roots-rights-reason-show

Subscribe to our Rumble channel: https://rumble.com/c/AmericasFuture

Follow Us On Social Media
X: https://x.com/Amerifuture
Facebook: https://www.facebook.com/AmericasFutureInc1946
Instagram: https://www.instagram.com/americasfutureusa

Subscribe to our Newsletter to stay informed: https://americasfuture.net/subscribe/
Catch up on all past editions here: https://americasfuture.net/newsletter

Transcript

SPEAKER_02 0:21

Hi, I'm Lee Smith. Welcome and thanks for joining us for this new episode of Roots, Rights, and Reason. This week we're talking to former Treasury Department official Mitchell Silk about the Trump administration's trade war with China and what it means for the future of the United States. When the first Trump administration took office, it inherited a deeply unbalanced economic relationship with China. The U.S. faced a roughly $500 billion bilateral trade deficit, widespread intellectual property theft, forced technology transfer, cyber intrusions, and extensive non-tariff barriers that disadvantaged American companies. And it inherited two decades of dialogue that had produced countless meetings with China, but few measurable results. And thus, rather than negotiating for the sake of negotiation, the Trump White House established clear objectives, reduce the trade deficit, open China's markets, and protect American intellectual property and technology. Through persistence and disciplined strategy, this approach ultimately produced the Phase I trade agreement, the first major effort to secure measurable commitments from Beijing rather than broad statements of intent. When President Trump returned to office in 2025, however, the landscape had changed dramatically. The competition had expanded well beyond tariffs and trade balances. Critical minerals, semiconductor technology, energy security, agricultural exports, supply chains, and even platforms like TikTok had become central negotiating issues. This evolution reflects what might best be described as an era of managed interdependence. The result so far is not a comprehensive resolution, but a carefully managed equilibrium. China gained stability and economic predictability. The United States preserved its core strategic positions while securing limited but meaningful economic concessions. The challenge now is to protect American prosperity, strengthen national security, while recognizing that strategic rivalry is likely to remain the defining feature of the relationship for years to come. Our guest today, Mitchell Stilk, is a lawyer, author, and former U.S. Assistant Secretary of the Treasury for International Markets. He helped shape the Trump administration's international economic strategy. A China expert, Stilk is the first Sigju to hold a Senate-confirmed post at the Treasury Department. His latest book, A Seat at the Table, an inside account of Trump's Global Economic Revolution, offers a behind-the-scenes account of the administration's trade negotiations, economic diplomacy, and strategic competition with China. Mitch Dilk, thank you so much for joining us here today. You were, you basically uh led the Trump team, the first Trump team's phase one trade agreement with China. You know more about uh China and uh the Chinese economy and the financial system than virtually anyone else in the world. But I think it's important, it's vital for people to understand how you became one of the world's leading experts on China. For instance, how did you learn Cantonese?

SPEAKER_01 3:46

Well, Lee, first of all, thanks so much uh for having me on. It's it's always great to see you. Uh love, love chatting with you, so thank you again. Um, you know, I'd like to say that I had it all mapped out when I was like 13 Lee. And the reason why I say 13 is because that is the point at which I um took up my uh kind of professional career. Um I was very focused. My first job uh was uh washing dishes and acting as a prep cook in the back of a Chinese restaurant in southern Florida. Uh I graduated to Bus Boy and then ultimately to waiter. And uh it didn't take me too long to figure out that if I wanted to maximize my earning potential, I really needed to speak the local bingo so I could get my food out of the kitchen quickly enough to serve it hot and good quantity quickly to my customers so I would make better tips. And over the course of a couple of years, driving my friends crazy on how do you say this and how do you say that, I actually became pretty fluent in what I understood was Chinese. Uh it turned out, and I learned much to my chagrin about four years into it, that the Chinese that I was learning was the dialect spoken by about 90 plus percent of the Chinese in America, but only 5% of the Chinese in mainland China. Root Awakening stood that if I wanted a career in China, I really needed to learn Mandarin. So as soon as I finished up high school, I went to the Mandarin, I went to uh Middlebury's Intensive Summer Chinese program and then spent a year in Taiwan, after which I was fluent. And that was really the beginning and the end of it. And I would like to tell you, Lee, that um like I had my I was focused on becoming an assistant secretary at Treasury. I was focused on being a uh you know a senior negotiator in the phase one trade deal. But that's we all know that I've been yanking on your leg big time if I could tell you that. But the interesting point to draw out of it, Lee, is that you know, my new book, um, Called the Seat at the Table focuses on what I call my four Ps Providence, personal touch, perseverance, and uh progress over perfection. And the first P, Providence, I think really explains uh so much about my career. If it wasn't for the Chinese restaurant, if it wasn't for Middlebury, if it wasn't for my ending up at Georgetown undergrad, which then led to Maryland Law School and uh, you know, studying under one of the greatest professors of Chinese law that ever uh was in the United States, I would never have had a a great, wonderful career on Wall Street uh in big law for over 30 years, uh eventually specializing in energy and infrastructure. And those were really the two things that the secretary was looking for when hiring up. Uh, and that was why my application was so appealing to the secretary and the under then undersecretary David Mel has because of my expertise in China. Uh I'd spent over 15 years working as a lawyer in Greater China, and because of my expertise in energy and infrastructure, and those were two key areas that define my portfolio when I served as assistant secretary for international markets.

SPEAKER_02 7:09

Did it surprise people when you were doing I mean, first of all, uh, you know, it's interesting that you worked at the Chinese restaurant and you learned Cantonese. Uh, it's fascinating that you learned Mandarin that quickly. I guess it was probably because you'd already mastered Cantonese, but since they're different languages, it's still not that easy. Um, but I mean that that they uh also uh a Hasidic Jew working at a Chinese restaurant, um, it's just it's a what it's actually a wonderful picture of America, too. Um you know, it's just it's just a very nice picture that that's where you that's where you learn your language, and that's really where your career began. It's fascinating. You spent so much time in in in China though, and understanding it. And this is one of the things that was uh appealing. This is Secretary Minuchin, right? During the first term, Secretary Steve Minuchin. Um what did they want? What did they want from you? When they when your name went to the top of the pod, they said, uh huh, President Trump, it's very important. Uh China's very important. We need this guy uh for what reason? What was it that they were particularly interested in?

SPEAKER_01 8:16

Lee, I want to I want to hold that for just one quick second because your your intro to the question was such a great one that it triggered a story, which is the the reverse of my situation. I don't know if you remember Ratners uh on the Lower East Side, a great restaurant.

SPEAKER_02 8:33

Yeah, sure. I should I should say I should say something that Mitch Mitch and I have a lot in common, which is in Brooklyn and New York. This is a place that that we we both know very well, so he's gonna make certain references and and uh I I hope the audience will will follow up on this, that you'll follow these different things.

SPEAKER_01 8:53

Yeah, so Ratners was a legend, as you'll recall, on the Lower East Side, frequented by um the you know the residents of Lower East Side who were largely Orthodox and many Hasidic Jews. Great soup, great roles. I used to go there all the time. There was a group that went in um that had recently come into the United States, all all fluent Yiddish speakers. As you as you know, Lee, and and as the audience is about to learn, Lower East Side abuts Chinatown. Um so almost invariably there would the the waiter staff was fully Chinese at Ratners. Um to the great surprise of this group that comes in one day, the waiter takes their order, serves them, gives them the bill, all in a very fluent, rich Yiddish. The guys go up to the register to pay the boss at the end of the meal and ask what the story is. How does this guy speak such a great Yiddish? And the guy says, keep it down, buddy. He just got off the boat about four weeks ago and he thinks we're teaching him English. So a little bit of the uh little story there. But to get on to your question, um you know, if we were to go back to Trump 45 at the very beginning, and and this is an issue that the president campaigned on uh in 2016, 2017, it was really to put a lid on China. Um and if we were to go back ten years prior to that, you know, we were living through basically 10 years of quarterly, semi-annual, annual engagement through strategic dialogue, economic joint, whatever this, that, or the other meeting. And it was uh basically a system of 10 years of meetings for the sake of meetings, right, with very little by way of specified concrete outcomes.

SPEAKER_02 10:49

This started in in during Bush 43, right, with Henry Henry Paulson with Secretary of Treasury, and that was the strategic dialogue, which was right, as you point out in your book, and elsewhere it's talking for the sake of talking.

SPEAKER_01 11:03

Right. And so, you know, the secretary just basic the president just basically campaigned on a very simple uh policy. Uh if you recall the movie network, you know, where people were throwing their TVs out of their windows and saying, I'm not gonna take any more of this, I've had enough, and they throw their TV out for other reasons. This was basically the president saying, I've had enough of talking. And we want some very concrete, uh definable uh outcomes that are coming out of these talks. Um and the president's policies and his desired outcomes were pretty simple as defined by the problems as we were experiencing them. The trade deficit with China had grown to the highest level historically it ever was. When the president took office in 2017, we had some very significant issues on the protection of U.S. intellectual property. We had some cyber issues, we had some, you know, kind of aggressive predatory industrial policy issues, um, we had some ag issues, and then there were very significant non-tariff barriers that were keeping our service providers, like financial service providers out. And so the president um put together a very small task force, um, originally led by Secretary Ross, um, later went a little bit back and forth, but basically Secretary Minuchin took over in partnership with Ambassador Leitheiser, then the USTR. And the playbook, which was in a uh a binder of about two odd inches thick, was designed to get the Chinese to buy more from us, we would purchase less from them, they would lower non-tariff barriers, they would agree to ramp up and strengthen their intellectual property rights and intellectual property enforcement. Um, and based on that, we could have a deal. We went through meeting through meeting through meeting through meeting, and I have to hand it to um the uh um Ambassador Leitheiser's deputy Jeff Garrish, who basically led our negotiating team in Beijing and in Washington like a rock. He sat down at the table at the beginning of every day of meetings with his binder, and he turned page by page by page by page, notwithstanding every single attempt um to of subterfuge, um, process foul, anything else that the Chinese could would try to throw at us to to push us off on script. Um it took many, many months, uh probably the better part of 18 months, but ultimately we delivered on a deal that closed that that was designed to close the trade deficit by hundreds of billions of dollars. I think I think the purchases were north of agreed purchases were north of 200 billion. We got some very strong commitments on the intellectual property front. I um led the um as the senior uh treasury negotiator the financial services stream and participated in the energy stream. We scored some points on the board uh in getting the Chinese to commit to purchases of U.S. energy, but very importantly, we made some very, very significant progress on getting the Chinese to open up their financial services market to our guys and to other international providers. Um, and all of that was documented in the phase one trade agreement that was signed in January of 2020. Unfortunately, uh for us, um, COVID was just around the corner, and we really only had about five to six months of five to six months of actual implementation before COVID impacted and disrupted the ability to implement that agreement.

SPEAKER_02 15:00

I I want to ask about a uh um a passage in your or a section in your book where you or you show that you hold the line as well. Um and well, I mean you all held the line, but this is uh where your uh where your language skills came in very handy. Um can can can you describe that? What what what happened? I mean the Chinese they're they're they're tough, they're tough negotiators, and they were trying to get the upper hand, and you Yeah, so uh there were two instances that happened within an hour of each other.

SPEAKER_01 15:34

Um pretty big process fouls as these things go in, you know, kind of large orchestrated diplomatic, you know, political theater. Um the first one was, you know, we we flew over um uh on on Millair, very large delegation led by the secretary. Leitheiser was there, Wilbur Ross was there, Peter Navarro was there, my undersecretary David Malpass was there, a couple of folks from USDA, uh Bob McKinney, and a bunch of folks from USTR. We'd spent the better part of two months prior to those meetings formulating uh the agreement that we were gonna table for the negotiations. I actually prepared the first draft of that document, went through a very uh heavy interagency process. It was a good, even-handed first draft to put on the table. And we understood that we were gonna be negotiating against that document, landed at Beijing Airport, red carpet rolls out, we sped through, uh, you know, no passport checking, all all formalities waived, got in our motorcate, sped down the boulevards like you've never seen before in Beijing. I don't know if you've experienced the traffic there, got to the hotel, fresh end up, went over to the embassy, and when we went into our very large skiff, uh, you know, compartmentalized room with about 50 people from the delegation, the US Embassy in Beijing informed the group and gave out copies of the document that the Chinese had tabled that morning. That morning. So, in other words, two hours prior to the commencement of the negotiations, and the document was in Chinese. It wasn't translated into English. Um you can imagine my reaction when I was asked to sit with the secretary in the back of his limousine from the embassy over to the Dao Yutai Tai guest house to translate contemporaneously from the document into English. I didn't make it much farther than like Article III or so before we got there. Um, and you know, you can imagine a lot of energy, hundred people going into the room. We sat down. There was a little incident when I'm which I'm going to come back to in a minute, so we'll pin that for just a second. Started the meeting, vice premier Liu Chu started the meeting, opened very, very nicely, very warm, great, very gentleman. And uh the secretary then took his cue and said, you know, thank you very much. Um we're here to negotiate. Appreciate that you sent over a document this morning, but we're gonna use our draft. And that was that. So it was a, you know, it was a it was not a small procedural foul that was meant to set people off kilter to kind of get them focused on on, you know, kind of confusion, as it were. Um, but the secretary didn't take the bait. Now the other issue that happened that morning was that as you can appreciate, um, all protocol was heavily negotiated uh before the meeting, um, down to you know where the third and fourth row and fifth row people sat. Fifth row, like being people that had been, you know, career diplomats for 15 years, had been living it, you know, and really like this was their chance to finally get to negotiate. As it turned out, we all you know shuffled quickly into the room, everybody took their seats, and there was one seat missing. Right? And it it it couldn't have been a fluke, it couldn't have been a mistake. Um, I sat down, we went through the first hour and a half of meetings. When we came out for our first break, our DCM of the Beijing Embassy was was in heated discussion with the head of the protocol department of the Ministry of Foreign Affairs over this missing chair. The guy wasn't gonna budge. I walked over, asked what was going on. I tried my nicest, most, you know, uh honorific Mandarin, Mr. Protocol wasn't happening, having it. Um, I tried a little bit firmer Mandarin, wasn't having it. And I made a conscious decision that I wasn't gonna make a thing of it. It it would have, it would have not been becoming what is my mother always used to say, never get into an argument with an imbecile because they'll still drag you down to their level and then beat you on experience, right? So as it happened, getting to your point on my Chinese, the governor of the Central Bank of China, the PBOC, happened to be walking by when we were heatedly engaged with Mr. Protocol. I knew him well. He had done his PhD in the United States, a gentleman named Yi Gong, and I said, Governor Yi, we have a little issue. Could you please come over? I explained the issue. He had a go at Mr. Protocol. Mr. Protocol wasn't having it from the plenty of governor, you know, of the PBOC. So I decided enough was enough. And I said, Thank you very much. I walked away. About three steps into it, I turned around and I looked very pointedly uh at the governor, uh, knowing that Mr. Protocol was in clear earshot. And I said, Governor Yi, next time you are in Washington, please come to my house for dinner. I will serve you the finest kosher delicacies, some wonderful Israeli red wine, and you know what? You can have as many seats at my table as you like in Chinese. And guess what, Lee? We got our seat.

SPEAKER_02 21:05

Well, that's a big part of your book. Uh talking to people, making them feel, making them feel comfortable, not just, you know, uh uh harassing chiefs of protocol in the middle of Beijing, but inviting people to your home and and cooking for them, making them feel making them feel comfortable. And that's of course why the part of why the book is called A Seat at the Table. Um and uh and I I can't recommend it enough. It's a it's a it's a really wonderful book, and as I think that viewers can tell from our conversation, there's uh lots of information and and lots of uh lots of humor as well. It's it's a terrific book. Where are we now after the phase one trade agreement? We're into the second Trump term, and people are well, I have to say, you know, I mean, I I I learned a lot speaking to you, um, and I'm I'm a little concerned looking around. It's hard. To tell exactly what the administration's China policy is right now?

SPEAKER_01 22:05

It's a great question. I'm going to hit you with uh kind of two points that I think best sum up what we've seen uh in Trump 47 on the trade side, um, starting from the beginning and then fast forwarding to where we are now. Uh at the beginning, um, let's call it uh you know uh uh Liberation Day uh tariff imposition. Um and that period I I like to use a little uh characterization called the president playing 3D chess, um fast forwarding to the Beijing summit that we just uh witnessed in A. Um, and I I kind of like to encapsulate what happened there as the Trump three Ts, namely Tehran, trade, and Taiwan. And so let me let me unpack that as quickly as possible and connect the two. So the president came out of the corner punching um with very significant tariff actions. Some of them were statutory based, some of them were by EO. Ultimately, the EO, as we all know, didn't stand up in the Supreme Court, but my position is that didn't really matter because what what happened, the result of the of the tariffs was the following. The tariffs, um, in my view, were used to impose uh the highest degree of leverage possible. The president brought people to the table. The negotiating team, comprised of senior officials from Commerce, USTR and Treasury, and USDA and DOE, were busy with over 100 negotiations, negotiations with over 100 countries at the same time. That ultimately yielded over 20 bilateral agreements. Um they were they were not formal legally binding agreements, but those agreements put a lid on over 60% of the trade deficit that the president inherited on day one, which was $1.2 trillion, which was the highest deficit that this country has ever seen. And it was not as if the the deficit went away poof overnight, but rather the agreement set out a pathway forward over a year, two years period for reduction of the deficit gap between ourselves and call it 20 other countries. Okay. But the real interesting part of those agreements is that in addition to the trade provisions, the trade team also negotiated two other dimensions into those agreements, one of which was to procure commitments for inbound investment from a number of those counterparts. Uh the inbound investment commitments that the team secured was north of $1.2 trillion. Japan, very large commitments, Taiwan, large commitments, uh, Indonesia large commitments. Um, and these were commitments that were designed to bring investment into the United States, onshore, and revitalize our industrial base and create jobs. Okay? One great example of that that's going to be relevant in the three T's is the commitment of Taiwan of over $165 billion just for their TSMC semiconductor facility in Arizona. So very significant commitments on the onshoring industrial base side. But then in addition to that, probably seven or eight of the countries also committed to uh large purchases in furtherance of the president's energy dominance policy to buy U.S. LNG and U.S. oil. So I call it 3D chess because it was a trade solution, it was an onshoring industrial-based solution, and it was also an energy solution. Now, what the relevance of all of that to China is obviously that China was the largest elephant on the table. The policy and the objectives that it achieved was able to clear the decks for the trade team to be able to then focus on the partner that presented the greatest issues. And so what did we see? In the interim, while the team was negotiating all of these agreements, uh, the U.S. was engaged in a number of rounds of discussions uh with the Chinese. May and June in Geneva and London, July in Stockholm, uh September in Madrid, and then finally October in Busan. And those were those were engagements, in my view, that were really meant to contain uh emergency circumstances by kicking the can down the road in doing two things. Number one, pausing tariffs so that the teams could bring uh blood pressure down a little bit. And then also those meetings were used to uh uh address issues that had come up through seemingly Premier uh Xi's use of President Trump's tactics of leverage, like for example, rare earths, right? Like, for example, soybeans. And so those engagements were used to manage those issues. Ultimately, the team was able to negotiate a way forward on rare earths uh and on uh applause on the Chinese ban to purchase soybeans. But really, where we ended up was at the Beijing summit uh in May. And the reason why I like to use the three T's is because the the president really delivered uh what I view as success on three major issues. On Tehran, which is which was a very, very big issue, not just economically, not just security, but also from the energy standpoint, where you know that uh China prior to the the summit was taking 90% of Tehran's crude, right? The president was able to secure a commitment um from President Xi to take uh partial um purchases of U.S. energy, was able to secure um Xi in saying that he was not supportive and would not uh allow for Tehran to continue to block and collect tolls in the Straits of Hormuz. Um and in addition to that, President Xi um stated that he was not supportive of the nuclear program of Tehran. On the trade side, it was a it was a nice showing um having so many leading CEOs. Both sides were able to go back to their respective constituencies and say that they brought the other to the table, um, particularly for us. Um the president delivered uh commitments to purchase 200 Boeing airplanes, um, commitments to purchase soybeans, um sorghum, and and American beef, and also uh energy products, mainly uh mainly LNG. But the really big issue that came out of the summit Li, I think, um, is the president's use of keeping uh Xi Jinping busy uh with the Tehran discussion and the trade discussion so that there was not as much time and energy and focus available for Taiwan. And I view it, I view that being the case because the president was keen to tow the line, which he did. He did not give in to the Chinese demands, um, and he stood by Taiwan, he stood by um the the arms assistance program that we have, which is uh uh north of 14 billion for the last year, but also recognizing that Taiwan has made the largest FDI commitment to the United States in history um through its Arizona TSMC facility.

SPEAKER_02 30:18

So I know a lot of people have been concerned that um going into that summit that that uh the administration might be wobbling on Taiwan. But you're you you see that no, they came out, they came out of that uh out of that meeting uh showing that Trump the Trump team is not going to waffle, go soft on Taiwan.

SPEAKER_01 30:40

President very clearly stood by Taiwan, um which is a very clear message for U.S. policy on Asian regional security, and and also I believe is an indicator to the president's views on Middle East security, because the circumstances uh in the Taiwan Strait are very relevant to what we saw happen in the Hong Lou Strait.

SPEAKER_02 31:04

Quick last question. Um where there are a little more than two years left in the uh in Donald Trump's second term and uh Trump 47. Where do you see China trade, uh China trade negotiations or anything else having to uh go with China? Um uh and I I know this is not a large question, so if you keep it as uh as narrow as possible, um yeah, where do you see it going in the next two years? What what should we expect?

SPEAKER_01 31:34

Well, I think the simple the simple re my simple reaction, Lee, is that the tables are now cleared um of major trade friction issues um as brought out through the 3D chess outcomes that I referred to earlier. Um the table is was further set um by what occurred at the Beijing summit. And I think it's now down to the team um to uh the playbook is there. It's just a question of the time and the will to schedule the meetings uh and to conduct the meetings. And as I said a little bit earlier, Lee, you don't get a trade agreement with China over one negotiation, over two negotiations. It's a it's a minimum 12 to 18 month process. It's a long meal. Right. It's a very long meal. And so I I could see um the parties coming back to the table. Um I would I believe that the will is there. Um certainly uh blood pressure is down um to a degree. Um, and it'll be interesting to see what what comes of uh meeting schedules and meeting outcomes.

SPEAKER_02 32:53

Mish Silk, thank you so much for being here with us today. Uh and I can't recommend, again, I can't recommend your new book highly enough, a seat at the table, just so much fun. Um and thanks to all of you for watching. Thanks for joining us for another episode of Roots, Rights, and Reason. If you enjoyed today's conversation, and you surely did, please subscribe, share this episode, and visit America's future.net for our full library of podcasts. Until next time, remember that understanding our roots, defending our rights, and exercising reason are essential to preserving the greatest country in the history of planet Earth. And thank you so much to Mitch Silk. Again, thanks for being here with us today. Congrats on your new book, and we'll see you all again soon on Roots, Rights, and Reason.