Among all the poor trade decisions made by Donald Trump, playing chicken with China stands out as the worst.
Despite his claims to swiftly bend other nations to his will, China operates differently. While Trump may intimidate most countries, Chinese President Xi Jinping presents a formidable challenge.
- Economic Logic Clash: Trump’s trade policy seems to contradict liberal economics, aiming to raise international tariffs to lower domestic taxes and boost manufacturing. Meanwhile, Xi seeks market dominance for its own sake.
- Power Disparity: Trump faces midterm elections in 573 days that could alter his political fortunes. In contrast, Xi can serve consecutive terms until 2028.
Trump’s escalating tariffs (10%, then 10%, later 34%, and recently 50%) on Chinese imports impose hefty costs on American consumers. This trade war resembles a dangerous game of chicken, with the U.S. potentially bearing the brunt of damage.
- Trade Imbalance:
- U.S. purchased $439 billion from China in 2018.
- China purchased $143 billion from the U.S.
Trump’s aggressive tariffs could hurt American consumers without a proportionate response from Beijing, turning him into a brash competitor rather than a strategic leader. As China remains resolute in its trade stance, the world watches as this high-stakes game unfolds.
This trade conflict doesn’t address China’s historical market practices, but it foreshadows a likely outcome: no clear winner. However, the U.S. and Western world stand to lose more in this confrontation with China’s strong-willed leadership.
