President Trump Gets China To Abandon Trade War: Media Cheers… Just Kidding – Silence All Around
“We will not fight a trade war,” say Chinese officials, “and we will stop increasing tariffs on each other.”
These words are the culmination of a promise given on the first day that Trump announced his presidency.
Let’s go through the last few years and months of Chinese trade negotiations before presenting the agreement reported a few hours ago.
Trump talks about the $375 billion trade deficit between the US and China during his very first political speech in the campaign. “I love China” would later work its way into common speech.
JANUARY: Trump Threatens 1974 Trade Act Fine
In January during a speech, Trump talked about using an old law that would allow him to investigate poor intellectual property practices in China and then follow up with high tariffs in retaliation, but Trump wouldn’t talk about how high those tariffs would go, only saying the number would be big.
“We’re talking about big damages. We’re talking about numbers that you haven’t even thought about.”
MARCH: Mnuchin Unhappy With Chinese Practices
In a release handed out on March 22, 2018, Treasury Secretary Steven Mnuchin said that he wanted to work on the trade deficit while point out:
“…more sins from the East, including the skirting of trades laws to access intellectual property and “cutting-edge technology... [and] the Chinese use of “wrongful practices [such as] systemic, government-driven investment in U.S. companies, unreasonable requirements and limiting restrictions intended to pressure U.S. firms, and cyber-enabled intrusions.”
Mnuchin also correctly identified that Chinese trade practices were written to be aimed directly at the United States.
APRIL: Trump Tweets On Car Tariffs
Last month, Trump took to Twitter to complain about the unfair import taxes placed on American cars being sent to China, saying that Chinese cars sent to America are not hit with any similar taxes. It wasn’t long until Trump received a roundabout answer:
Within less than two days of Trump tweeting about high tariffs on the automobile trade between the US and China, President Xi announced that he would be relaxing the “unfair” tariffs from his country.
A Chinese delegation led by Vice-Premier Liu He began talks in Washington led by Treasury Secretary Steven Mnuchin.
The talks were announced to be scheduled for two days, and they were intended to build from talks that started a few weeks ago and held in Beijing.
Met with Vice Premier Liu He and the Chinese trade delegation @USTreasury today with @CommerceGov @USTradeRep. We held important discussions on rebalancing the U.S.-China trade relationship. pic.twitter.com/r0R1w2p2eR
— Steven Mnuchin (@stevenmnuchin1) May 18, 2018
On the same day, Trump lashed out at previous administrations for their dealings with China:
“We have been ripped off by China. And an evacuation of wealth like no country has ever seen before given to another country that’s rebuilt itself based on a lot of the money that they’ve taken out of the United States.”
As a final nail, Trump said that China had “become very spoiled.”
He’s right to take past administrations to task. I’m astonished to witness a President go after China on anything.
One company in China, a telecom manufacturer called ZTE has been forced to suspend their business operations due to American sanctions, which are punishing the company for exporting materials to North Korea and Iran. Trump said that he and the Chinese President were working to help get ZTE back on track.
YESTERDAY: China Agrees To Reduce $375 Billion Trade Deficit
As the talks turned positive, we announced that the Chinese had agreed to “substantially reduce” the trade deficit, with one estimate from a White House insider saying it might be reduced by $200 million by 2020.
But, Trump isn’t foolish enough to pull a number out of the air when he knows he can negotiate for more… and eventually flip the imbalance so that America is sending more goods to China, and China is sending more money to America rather than the other way around.
NEW: Today’s Announcement
Speaking with the state-run news, Vice-Premier Liu He said:
“The two sides reached a consensus, will not fight a trade war, and will stop increasing tariffs on each other.”
Saying that the agreement is a “necessity,” he added:
“At the same time, it must be realized that unfreezing the ice cannot be done in a day [and] solving the structural problems of the economic and trade relations between the two countries will take time.”
In Washington, a joint statement was released saying that the Chinese agreed to “significantly” increase their purchase of American-made goods.
In the future, said Vice-Premier Liu, China must look at trade difficulties “calmly” while maintaining “dialogue” to “properly handle” any issue.
Source: Yahoo News, White House Press Office