The U.S. Trade Representative (USTR) nominee Katherine Tai just finished her Senate confirmation hearing.

At the hearing, the U.S. trade "czar" candidate said she wants to adopt a labor-centric trade approach when negotiating with trade partners like China. Still, she refused to give details about whether the U.S. will actually scrap the existing tariffs on China imports.

Remember, those tariffs were a primary reason for the suffering among many U.S. companies and their employees, blue-collar workers included. And it's been argued constantly by economists that tariff is not a solution for trade conflict.

We did hear that Tai wants to break with the past trade policy under the Trump administration, which was criticized for endorsing protectionism. But she is not a fan of free trade either.

Tai said that "for a very long time, our trade policies were based on the assumption that the more we traded with each other, and more liberalized our trade, the more peace and prosperity there would be". That's where she began to question the role of free trade.

She said that trade liberalization too often led to less prosperity and lower labor and environmental standards. Whether that's a fair statement or not, Tai rejected a return to the world's biggest free-trade deal, the 11-country Trans-Pacific Partnership, implying that the deal no longer brings the U.S. enough benefit.

So based on these remarks, the U.S. is unlikely to be fully committed to free trade and globalization under the Biden administration. It will probably be a less nationalistic version of "America First" with more room for negotiations and competitions.

Tai also said that she hopes to strengthen ties with U.S. allies to counter China and "seek structural changes in China."

But it would be difficult as some of the U.S. allies have been rebuilding their trade ties with China. So we have reasons to believe that with Tai at the helm of the USTR, some of the U.S.'s allies will be forced to take sides… like what they experienced during the previous administration when it came to Huawei, 5G, and foreign investment issues. 

China's stance has been clear and consistent, it welcomes healthy competition and deeper cooperation with the U.S., but opposes suppression and bullying if the U.S.'s China policy goes too far.

Interestingly, Tai said at the hearing that she now sees China as both a rival and a partner whose cooperation is what the U.S. needs to tackle global challenges. That means she will need to come up with mutually beneficial trade arrangements in the first place for China to cooperate on global issues.

For starters, Tai will be widely watched and judged when she leads the U.S. to implement the Phase 1 trade deal with China, which will set the tone for the two countries' economic relations in the next four years.