There are people here in America and over in China who think so…
President Trump’s initial retreat from his trade-war threats has handed hard-liners in China a victory. A longer, pricklier trade war and stiff Chinese resistance to economic reforms could result.
Mr. Trump on Friday outlined a partial trade deal that deferred new tariffs on $160 billion a year in Chinese-made goods, a move that would have had him taxing virtually everything China sells to the United States. He also agreed for the first time to broadly reduce tariffs he had already imposed on Chinese goods, halving tariffs on more than $100 billion a year worth of products like clothing and lawn mowers — a striking about-face for a protectionist president who last year described himself as a “tariff man.”
The White House called the deal a win. It said China had agreed to buy large quantities of American agricultural goods, giving farmers hit by the trade war some needed relief. It also means the United States economy will not suffer from new tariffs threatened for Sunday on Chinese-made goods that Americans love to buy, like toys and smartphones.
But the deal may be seen by Xi Jinping, China’s top leader, and his hard-line supporters as vindication of the intransigent stance they have taken since the spring, when a previous pact struck by Chinese moderates fell apart. Since then, China has asked that even a partial deal include tariff rollbacks. American officials resisted, debated, then relented.
In essence, a year and a half into the trade war, China seems to have hit on a winning strategy: Stay tough and let the Trump administration negotiate with itself….
CNBC’s Jim Cramer on Thursday laid out his case for holding a hard-line position in the U.S.-China trade war.
The “Mad Money” host said he’s cynical about free trade as opposed to most Wall Street professionals, highlighting that China’s practices of subsidizing domestic companies has negatively impacted America’s manufacturing economy, including electronics, toys and even gift wrapping, which once was a moneymaker for his father, “Pops.”
“With each of these items, I see a group of towns that’s been decimated by permanent, normal trade relations with China, just like the towns that made gift wrap for my dad’s” business, he said.
Cramer is in favor of the U.S. tariffs in place on billions of dollars’ worth of imports from China as a means to force the country to change its unfair trading practices. For more than a year, the two countries have been engaged in a trade dispute that has escalated over time through a series of tit-for-tat duties.
The Trump administration on Thursday signaled that American and Chinese trade negotiators are nearing a “phase one” trade deal, which would be the first sign of concrete progress in the trade war. Without it, the U.S. plans to impose a new round of tariffs on more products….