Trump channels the worst of China to beat China

[Bloomberg]( Today’s Agenda - The Huawei CFO’s arrest is an [ominous trade-war turn](. - The jobs numbers [put the Fed on notice](. - OPEC will [take its chances with Trump](. - Time to [reform criminal sentencing]( now. - Centrism gets [surprising new life]( in Germany. - Altria’s in [the pot business](. The Trade War Takes on Dangerous New Dimensions To beat China, President Donald Trump seems to think America has to be more like China. This was brought into relief with the arrest of Wanzhou Meng, the CFO of Chinese tech giant Huawei Technologies Co. Her lawyer today said the U.S. accuses her of helping Huawei [violate sanctions against Iran](. Noah Smith writes this is a reminder that the truly important trade-war front is not the tariffs Trump obsesses over [but the high-tech industry](. Its importance is evidenced by how U.S. tech companies and the military are helping guide policy, including an armada of new laws and investment restrictions, suggesting the struggle won’t end soon. And yet! As we discussed [yesterday](, arresting Meng sure is a strange way to stop, say, IP theft. Joe Nocera suggests it’s even more disturbing than that: Meng’s arrest seems to be less about punishing sanctions violations than [a thin pretext for basically holding this woman hostage]( for a better trade deal. If so, then we should be outraged about how destructive this is to the rule of law – a rule of law that has long given the U.S. an edge in competition with China, Joe notes. We’ll lose more than a trade war if we give that up. Trump undermines U.S. strength in another way when he pushes General Motors Co. and other U.S. companies to [put country ahead of profit]( – which is basically what China does, to its long-term detriment – writes Michael Schuman. It’s not as if there is no U.S. government meddling in business, of course; GM still exists thanks to a government bailout. But American industry is generally healthier than China’s because it responds to shareholders and not the whims of politicians, Michael writes. Even in the shorter term, Trump’s trade war hurts the U.S. economy and stocks. It has shaved an estimated $2.1 trillion in market cap from the S&P 500 (before [today’s big loss](), writes Stephen Gandel. This [basically wipes out any boost]( from last year’s tax cuts – just as former Trump economic adviser Gary Cohn, who quit the White House in March over trade, predicted would happen. Further Trade-War Reading: If Huawei signals Trump’s new approach to Chinese tech companies, then it’s [bad news for surveillance giant Hangzhou Hikvision]( Digital Technology Co. – Anjani Trivedi Job Market OK Enough, We Guess The November [jobs numbers weren’t great]( – but then [they weren’t bad either](, writes Dan Moss, particularly considering this expansion has been going for a decade, nearly the longest on record. And there may be enough workers still on the sidelines that the job [boom could keep going]( a while longer, writes Mark Whitehouse. Still, there are signs of weakness ahead, including the [flattening/inverted yield curve]( and rising unemployment claims. This makes it all the more important the Fed tread carefully at its meeting next week. It will probably raise rates again, but it [should acknowledge the softer data]( lest it make financial conditions even tighter, warns Karl W. Smith. OPEC OK With Risk of Trump Tweets After a week of haggling, OPEC and some friends (mainly Russia) agreed in Vienna to cut oil production next year, by a lot more than the market expected. Oil prices surged. And you know who absolutely LOVES surging oil prices? Saudi Arabia’s good buddy Donald Trump, that is who. I am being sarcastic, of course. Liam Denning notes there are many economic reasons the Saudis and other OPEC members are [willing to risk some salty POTUS tweets](. The truly fun thing is that OPEC-Plus doesn’t really have an iron grip on the oil market, meaning it will probably have to promise more production cuts – and risk more Trumpian ire – before 2019 is even half-over, Liam writes. Criminal Sentencing Reform Now America’s criminal-justice system is mostly terrible, and outrageous sentencing practices help explain why. Fortunately, this is one of the extremely rare areas – pizza is good, puppies are nice, throwing people in prison for decades for minor offenses is bad – where almost everybody on the political spectrum finds common ground. Ah, but then there is Mitch McConnell. The Senate majority leader says there’s no time to vote on a sentencing-reform bill supported by Democrats and Republicans (including Trump). McConnell should make time, Bloomberg’s editorial board writes. Contrary to what we told ourselves back in the ‘80s and ‘90s, putting more people in prison for longer times [actually seems to make crime worse](, not better. Bonus Editorial: The French and German proposal of [a “Google tax” is rank protectionism]( that will backfire. Merkelism Survives in Germany Angela Merkel’s October announcement that she was stepping down as head of the Christian Democratic Union this year and as German Chancellor at the end of her term in 2021 was the latest sign of fading centrism in Germany and Europe. The mood is much brighter today, after the CDU picked an intriguing new leader, Annegret Kramp-Karrenbauer (AKK for short). Leonid Bershidsky suggests [AKK will reinvigorate the CDU](, keep Merkel’s legacy alive – and maybe be a better leader than Merkel was. Further Germany Reading: Long a European leader, [Germany’s economy is falling behind]( in innovation, to Europe’s long-term detriment. – Ashoka Mody Altria to Make You Hang Out in Its Dorm Room Altria Group Inc. is finally diversifying from normal tobacky to wacky tobacky, buying a big stake in Canadian cannabis producer Cronos Group Inc. Demand for Altria’s traditional product has been fizzling for a while, and Tara Lachapelle has been saying it needed to [get ready to profit from pot’s seemingly inevitable legalization]( in the U.S. It will be a dealer in more ways than one – next on its shopping list will be e-cigarettes and maybe even a reunion with former corporate relative Philip Morris International Inc. Further Deal Reading: The AT&T-Time Warner deal is [adding to the annoying and expensive Balkanization]( of TV. – Tara Lachapelle Telltale Charts Moderna Inc., a Cambridge, Mass., biotech that makes medicines using messenger RNA, just launched [the biggest biotech IPO in history](. It’s also incredibly risky, writes Max Nisen. Hedge fund returns may [not be as bad as they seem](, writes Aaron Brown. Further Reading Robots may not be stealing asset managers’ jobs, but [they are stealing their bonuses](. – Mark Gilbert The history of Pan Am – a fast-growing, big-spending transportation pioneer – is a [cautionary tale for Uber](. – Gillian Morris and Christina Heggie Believe it or not, Greece finally seems to be [getting back to normal](. – Ferdinando Giugliano Trump’s [gloating about French protesters]( misses the point; they’re coming for the wealthy next. – Lionel Laurent Mike Pompeo is doing his [best to demolish the global world order](. – James Gibney To help you remember to ignore 2019 predictions, here are some [truly awful 2018 predictions](. – Barry Ritholtz ICYMI Big stuff’s [about to happen]( in the Mueller probe. White House Chief of Staff John Kelly [may finally be leaving](. Rex Tillerson says Trump is “undisciplined” and [prefers doing crimes to reading books](. Trump [responded]( that Tillerson is “dumb as a rock” and “lazy as hell.” Trump tapped George H.W. Bush’s former Attorney General, [Bill Barr, to be his next AG](. Kickers What’s better than a [crack-pipe vending machine](? How about a [bacon vending machine](. (h/t Mike Smedley) Sniff around a coral reef, [get an eel up your nose](. (Trigger warning for disgusting photo of seal with eel up its nose.) Winston Churchill got [a doctor’s note to drink alcohol]( in Prohibition America. Skynet takes [another step closer to self-awareness](. (h/t past three kickers to Scott Duke Kominers) [Too many Santas](. (h/t Alistair Lowe) Birds are [fighting back against drones](. Note: Please send bacon, suggestions and kicker ideas to Mark Gongloff at mgongloff1@bloomberg.net. New to Bloomberg Opinion Today? [Sign up here]( and follow us on [Twitter]( and [Facebook](. [FOLLOW US [Facebook Share]]( [Twitter Share]( SEND TO A FRIEND [Share with a friend] You received this message because you are subscribed to Bloomberg's Bloomberg Opinion Today newsletter. 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