President Trump met with Chinese President Xi at the G20 meeting in Argentina last week. They agreed to put their trade war on hold for 90 days. Additional tariffs on goods were scheduled to increase on Jan. 1. Those increases appear to be still under negotiation.
Trump had increased the tariffs on Chinese imports from 10 to 25 percent. That had impacted $250 billion of goods imported from China. In retaliation, China did the same thing on $110 billion of U.S. exports. Many economists feared the trade war would stall the world economy and urged the two leaders to work out a solution.
The president tweeted on Monday: “My meeting in Argentina with President Xi of China was an extraordinary one. Relations with China have taken a BIG leap forward! Very good things will happen. We are dealing from great strength, but China likewise has much to gain if and when a deal is completed. Level the field!”
Immediately liberals jumped on the POTUS for using the phase, “leap forward,” because China had a program from 1958-1962 called the Great Leap Forward. The campaign was led by Chairman Mao Zedong and aimed to move the country from an agriculture economy to industrialization. It was widely considered to have caused the Chinese Famine. It’s a stretch to believe Trump was endorsing a famine, but liberals seize every opportunity to criticize.
The White House released the following statement on the agreement: “President Trump has agreed that on January 1, 2019, he will leave the tariffs on $200 billion worth of product at the 10 percent rate, and not raise it to 25 percent at this time,” the statement read. Over the next 90 days, American and Chinese officials will continue to negotiate lingering disagreements on technology transfer, intellectual property and agriculture. Both parties agree that they will endeavor to have this transaction completed within the next 90 days. If at the end of this period of time, the parties are unable to reach an agreement, the 10 percent tariffs will be raised to 25 percent.”
President Trump made trade negotiations one of his key campaign themes. He promised to insure America did better at negotiating trade agreements than in the past. By delaying the full implementation of the increased tariffs, did the president ‘blink’ as some critics claim? Two observations:
First, America needs to level the economic playing field. For decades, our trade agreements have benefited other countries and cost American taxpayers billions. From paying for infrastructure to providing start-up capital in developing countries to selling agriculture products at lower prices, America’s negotiators gave away more than the farm every time they sat at the table.
Second, Trump must be cautious when dealing with the communists. Their values are not our values. Their worldview is not ours. China and Russia are not our friends. They don’t like each other much, but they like America less. A U.S. President must always remember that – whether negotiating a trade or arms agreement.
In 2007, the US economy was four times the size of China- in 2011, only twice the size. At their continue growth rate, China’s economy will overtake America in 2029. Americans better hope President Trump is as good of negotiator as he claims.