Regarded by many politicos as a bold choice for the vice-presidential nomination, junior Ohio Senator J.D. Vance, a onetime “Never Trumper,” evinces a populist appeal that the GOP believes has the potential to mobilize voters who feel their needs have been disregarded by the Washington establishment.
A departure from Trump’s first VP, Mike Pence, who grounded the former president with a sober affect and decades of experience on The Hill, Vance was until recently a Beltway outsider. The vice-presidential pick embodies the same iconoclastic spirit as the Republican nominee—and the same intense distrust for China—but his views on corporate tax breaks and antitrust are raising eyebrows.
China
Underscoring Trump’s China-hawk persona, the would-be VP has branded the Asian superpower as not just a competitor, but an enemy threatening the American way of life.
In an interview on site at the Republican National Convention (RNC) on Monday with Fox News anchor Sean Hannity, the newcomer to the Republican ticket took aim at China, calling it “the biggest threat to our country.”
He said Biden’s foreign policy strategy has been too focused on meddling in geopolitical conflicts like Russia’s war on Ukraine, adding that Europe should take more responsibility for its own military affairs. Should he earn another term, he said Trump would serve as a negotiator to “bring [the war] to a rapid close, so that America can focus on the real issue, which is China.”
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Vance is wasting no time in making his sentiments known—and he’s already rankling Chinese officials. China Foreign Ministry Spokesperson Lin Jian hit back at his comments swiftly, saying in his Tuesday briefing, “We are always opposed to making China an issue in U.S. elections.”
The Ohio lawmaker has long supported Trump’s “America First” agenda, and favors Trump’s tariff policy, which levied punitive duties on more than $300 billion-worth of China-made goods, including footwear and apparel items, beginning in 2018.
Vance, in a 2021 op-ed co-penned by former U.S. Trade Representative (USTR) Robert Lighthizer, seemed to admonish American corporations for the flight of industry offshore.
“That our biggest companies have taken their businesses to places like China is shameful, but our government policy shouldn’t depend on our biggest companies doing the right thing,” they wrote. Of the Trump-era tariffs, the piece stated, “These policies had the effect of offsetting China’s unfair economic advantages and sending a clear signal to U.S. companies that the time has come to bring jobs home and reduce our dependence on China.”
When asked in May about rumblings of a Trump plan to impose tariffs of up to 60 percent on Chinese imports, Vance appeared to agree.
“I don’t like China. I don’t like that China has stolen a lot of American jobs,” he said succinctly during the interview, which ran on CBS’ Face the Nation. “I certainly agree that we need to apply some broad-based tariffs, especially on goods coming in from China and not just solar panels and EV stuff. We need to protect American industries from all of the competition.”
Alongside Senate colleagues Josh Hawley (R-Mo.) and Rick Scott (R-Fla.) Vance in February signed a letter to U.S. Secretary of the Department of Health and Human Services Xavier Becerra pushing for an investigation into personal protective equipment (PPE) supply chains in the U.S., claiming that President Biden had let manufacturing that was onshored during the pandemic slip back into the grips of foreign makers.
There’s evidence that the backsliding occurred far earlier, though. In October 2020, apparel and textile industry insiders who had converted their operations to accommodate the production of masks, gowns, face shields and other essential equipment called out the Trump administration for awarding Department of Defense (DOD) Defense Logistics Agency (DLA) PPE contracts to “inexperienced” contractors including a former NFL player and a rumored arms dealer, some of whom were said to have fulfilled the contracts using offshore suppliers—or not at all.
Nonetheless, Vance appears keen to advance a narrative that only the GOP can bring industry back to the American heartland.
“We are pushing other nations into the arms of Chinese…because we don’t make enough stuff, because we pursue a ridiculous foreign policy very often,” Vance told CBS in May. “We have to be more self-reliant.”
“If you apply tariffs, really what it is you’re saying that we’re going to penalize you for using slave labor in China and importing that stuff in the United States,” he added. “You end up making more stuff in America, in Pennsylvania, in Ohio and in Michigan.”
The economy and business
The venture capitalist and author of “Hillbilly Elegy,” like the former president, is gung-ho about lowering taxes, and would likely cosign Trump’s plan to extend the 2017 Tax Cuts and Jobs Act (TCJA).
The legislation, which Trump has touted as the signature legislative accomplishment of his administration, is set to expire next year. Trump has also publicly mulled paying for income tax cuts for the wealthy by implementing an “All Tariff Policy”—a 10-percent, universal duty rate for imports from across the globe.
Vance has opposed the notion that tariffs contribute to higher prices at retail or worsen the effects of inflation, though research from the Peterson Institute for International Economics (PIIE) suggests that Trump tariff policies could cost American families more than $1,700 per year.
While Vance in 2022 signed onto Americans for Tax Reform president Grover Norquist’s “Taxpayer Protection Pledge,” which signals he will oppose all tax increase proposals, the Ohio senator’s stance on taxes is more nuanced than Trump’s.
In fact, March saw Vance introduce the Stop Subsidizing Giant Mergers Act alongside Sen. Sheldon Whitehouse (D-R.I.). The bipartisan legislation would do away with tax exemptions for merging businesses when the parties involved make a combined annual revenue of $500 million or more.
When one corporation is acquired by, or merges with, another, the buying firm usually pays taxes on the appreciated gain of stocks or assets held by the acquiree. But according to the lawmakers, “arcane tax code” contains exceptions for certain mergers when the acquiring firm is exchanging stock.
In that case, the appreciation in value of the acquired firm’s stock and assets may be tax exempt. In short, both merging corporations may escape paying taxes on the appreciation in value at the time of the sale.
“Massive corporate mergers rarely produce their promised benefits but often leave American workers and families behind,” Vance said at the time. “It’s past time to close the unfair loopholes that allow these deals to escape tax liability.”
Calling the bill “commonsense, bipartisan legislation,” the lawmaker said it “will ensure our nation’s largest corporations are held to a fair standard while preserving protections for small businesses to grow”—an unusual deviation from the party line, and from Trump, who has suggested supplementing TCJA with a lower tax rate for corporations.
Vance has also broken with the GOP when it comes to backing the Democrats’ hyped-up antitrust regulation enforcement. The Biden administration has taken an aggressive approach to hitting back at corporate monopolies, especially Big Tech—a move Vance has praised, suggesting that the government should break up Google. He’s also expressed open support for Federal Trade Commission (FTC) Chair Lina Khan, calling her “one of the few people in the Biden administration that I think is doing a pretty good job.”
The current administration’s vigilant antitrust enforcement has also impacted the fashion sector. Under Khan’s direction, the FTC in April sued to block Tapestry’s $8.5-billion acquisition of Capri Holdings, which would combine Coach, Kate Spade and Michael Kors into a single entity. The FTC argued that the deal would eliminate competition between the brands and give Tapestry an unfair leg up in the “accessible luxury” handbag market. Conservatives branded the agency’s move an overly dramatic overreach.
Vance’s stances on issues like corporate tax breaks and antitrust are already prompting some hand-wringing in the business community.
“We are very concerned about JD Vance playing an outsized role in a Trump administration,” a big bank lobbyist told the Financial Times. “Trump populism and Vance populism are not the same.”
Despite his deviations from Trumpism, any notion that Vance and the Democrats could become bedfellows, however strange, is unlikely. Sen. Elizabeth Warren (D-Mass.), who teamed up with the VP hopeful on a bipartisan bill that would claw back compensation from the CEOs of failed banks in 2023, nonetheless called him a fake populist in a call with reporters on Monday.
Trump’s selection of Vance is “great news for the wealthiest Americans and lousy news for everyone else,” she said. “Billionaires on Wall Street and Silicon Valley are cheering but there is no joy for working people.”