August 27, 2019
Is America’s Trade War with China a ‘National Emergency’?
By Buck Sexton, Executive Editor
It was a roller coaster over the weekend at the Group of Seven (G7) summit in Biarritz, France.
The posh seaside resort played host to a chat session between the leaders of the world’s seven biggest economies. It was formerly the G-8… until Russia got too grabby with Ukraine and was expelled.
The assembled G-7 squad was there to talk about “climate crisis,” “fighting inequality,” and the usual Davos jetsetter global trade stuff.
Unsurprisingly, it quickly turned into “The Trump Show.”
On Friday, President Trump responded to a press question about whether he ever reconsidered his decision to confront China’s unfair trading practices by saying, “Yup. I have second thoughts about everything.”
That certainly turned some heads. Was Trump finally open to ending the trade war?
Had he concluded that his critics were right all along, and enough was enough?
Not a chance.
Just to make it abundantly clear how the Donald views the escalating trade dispute with China, the White House put out an official statement a few hours after his “second thoughts” remark.
White House Press Secretary Stephanie Grisham blasted out an e-mail saying that, “His answer has been greatly misinterpreted. President Trump responded in the affirmative – because he regrets not raising the tariffs higher.”
As if that turnabout wasn’t enough to generate headlines, Trump then threw out this gem about his possible future trade-war plans:
I could declare a national emergency. I think when they steal and take out, and – intellectual property theft, anywhere from $300 billion to $500 billion a year, and where we have a total loss of almost a trillion dollars a year – for many years, this has been going on – in many ways, that’s an emergency.
Trump had to know that – as was the case with his declaration of a “national emergency” to build a wall at the U.S.-Mexico border – this musing in front of the global press would drive his critics nuts.
On that score, mission accomplished, Donald.
As for the China trade war itself, Trump has shown no signs of backing down. Starting October 1, he plans to raise the tariff on about $250 billion in Chinese products up to 30% from 25%. And that’s not all. The president has also indicated that tariffs on an additional $300 billion set to kick in on September 1 will be 15% instead of 10%.
The Donald is doubling down – again – despite rising concerns about a recession.
Is he right?
As has been the case for the last 18 months or so, it’s too early to tell. Today, China signaled earlier that it wants to talk. Of course, this could be to calm things down a bit across the Pacific since Asian markets got slammed last week.
Ultimately, the real problem in our negotiations with China is that they don’t want to do what we want them to do, and tariffs alone are unlikely to change that.
Trump seems unbothered…
“Our country is doing really well, we had horrible trade deals and I’m straightening them out. The biggest one by far is China,” the president said yesterday. “I think we are going to have a deal.”
But when? And what kind of deal?
For now, the trade war rages on.
And as Confucius once said, “It does not matter how slowly you go as long as you do not stop.”
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Executive Editor, American Consequences
With P.J. O’Rourke and the Editorial Staff
August 27, 2019