Welcome to POLITICO’s West Wing Playbook, your guide to the people and power centers in the Biden administration. Send tips | Subscribe here | Email Alex | Email Max In December, Ambassador to Japan RAHM EMANUEL met with U.S. Trade Representative KATHERINE TAI ahead of his move abroad. Lowering trade barriers is near the top of Japan’s to-do list — they still want the U.S. to rejoin the Trans-Pacific Partnership, for instance — and Emanuel wanted to get started on the issue. The meeting in Tai’s office went poorly with the two clashing over both style and substance, according to three officials briefed on the exchange. It went so badly that Emanuel returned in January for a do-over. That interaction ended more amicably and with some progress on policy, with the two subsequently working together to craft an important agreement with Japan to lift some tariffs. Still, Biden’s ambassador to Japan told Tai in blunt terms during the second meeting that her relationships with the White House were poor and she should work on fixing them, according to those officials. Emanuel acknowledged the initial meeting was strained but said there were no hard feelings, telling West Wing Playbook in a statement that "like other people we had a meeting that didn't go well, we both agreed that wasn't constructive, reached out and had a second very good meeting and the net result was a close collaboration." ADAM HODGE, a spokesperson for USTR, said in a statement that “Tai has focused on delivering results for the President. Washington pettiness and drivel won’t distract USTR from continuing to put points on the board for American workers and businesses." USTR officials said they are working closely with Emanuel to strengthen the U.S.-Japan relationship. Tai, the former chief trade counsel for the House Ways and Means Committee whom the Senate confirmed 98-0, has her detractors and defenders alike, according to several administration officials and people familiar with the dynamic. She has largely thrilled outside labor groups and most of the congressional Democrats on the House Ways and Means Committee. But she and USTR have clashed with a number of senior Biden administration officials involved with trade policy including national security adviser JAKE SULLIVAN, Commerce Secretary GINA RAIMONDO, and coordinator for Indo-Pacific affairs KURT CAMPBELL who is on the National Security Council. Some of the confrontations are the result of Tai’s dot-all-the-i’s, cross-all-the-t’s approach which saw her derail a plan for tariffs on China in favor of new talks with Beijing. Others are due to her sharp-elbowed defense of her turf, and her belief that Congress should be continually consulted. As one senior administration official who regularly interacts with USTR put it: “There's a very fundamental reluctance on this version of USTR to do anything that involves any amount of risk-taking.” The official described Tai’s approach as “normal bureaucratic turfiness taken to a degree that's made USTR particularly difficult to work with for a lot of folks.” NSC spokesperson EMILY HORNE said in a statement that Tai “is a valued member of the President’s team, and USTR is a valued partner of the NSC. Together, we’re focused on delivering on President Biden’s agenda for working people – not warmed-over gossip.” A Department of Commerce spokesperson declined to comment. The conflicts are also part of a high-stakes battle over the future of American trade policy and the approach toward China with the politics of trade having muddled the politics within both parties in recent years. Tai has told people that she believes that TPP, which was led and championed by President BARACK OBAMA, cost Democrats the 2016 election. She has repeatedly described her approach as “worker-centered.” That’s seen her emphasize USTR’s efforts to enforce labor and environmental standards, like pushing Mexico to crack down on union busting in auto part factories. AFL-CIO President LIZ SHULER told POLITICO in an interview last week that Tai is “an example of how the Biden administration is looking through the perspective of workers in everything they do.” Tai’s team points to recent steel tariff deals with Europe and Japan and the resolution of the long running Boeing-Airbus dispute as evidence she has corporate interests in mind too. But that hasn’t stopped business leaders from complaining. Indeed, corporate lobbyists have increased their engagement with Raimondo, who is seen as more pro-business. The commerce secretary, who has a lot of fans inside the West Wing, has publicly taken the lead in preliminary talks on the administration’s proposed Indo-Pacific Economic Framework in Asia, a responsibility that would typically fall to the trade chief. That has prompted some classic turf battles. Last fall, some of Tai’s allies on Ways and Means considered sending a letter to the White House on the framework that pointed out that USTR, and not Commerce, should lead new trade negotiations. The letter was ultimately never sent. USTR disputed any tussle between rival agencies and said neither Tai nor USTR officials had a role in developing a letter. In addition to Raimondo, Tai has had tension with the White House’s national security team over China. Last year, POLITICO reported that opposition from Tai held up a plan for new tariffs on Chinese imports pushed by Sullivan, one of the administration’s most aggressive China hawks. Tai argued that the U.S. first had to open talks with Beijing on its failure to meet the terms of the “Phase One” trade deal signed with President DONALD TRUMP, and that announcing new tariffs would poison those discussions. Tai won that argument and announced last October she would begin talks with Beijing. But no new tariffs or trade restrictions have been announced. Tensions between Tai and Sullivan boiled over in the fall, when she confronted him in the Situation Room over what she believed were leaks from NSC staff to the press about their trade policy disagreements, as Axios first reported. Tai and Sullivan released a statement insisting that they are on good terms, but debates over how to handle trade and China policy continue in the administration. Said one person familiar with the dynamics of the situation: “I think she is in the middle of a fight within the administration over China strategy and she’s the collateral damage.” TEXT US — Are you NORA TODD, Katherine Tai’s former chief of staff who recently moved to the NSC? We want to hear from you and we’ll keep you anonymous. Or if you think we missed something in today’s edition, let us know and we may include it tomorrow. Email us at westwingtips@politico.com or you can text/Signal/Wickr Alex at 8183240098 or Max at 7143455427.
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