Will Trump’s tariff threats against China work?
“Work” in the sense of getting China to make a deal, that is? Perhaps:
China is willing to hold talks with the United States to resolve their differences over trade, China’s foreign ministry said on Monday, as alarm grows over a possible trade war between the world’s two largest economies.
Ministry spokeswoman Hua Chunying made the comments at a regular briefing in Beijing.
The MSM and many others often treat Trump’s proposals as something he wants to actually do, because they might be something he actually wants to do. But Trump also might be just making the opening move in a negotiation game.
The MSM isn’t really wrong to treat the announcements that way, however, for two reasons. The first is that Trump is to some degree unpredictable, so it’s always possible he is very serious about actually doing what he threatens to do. The second is that it is tactically good to get other countries (like China, in this case) to believe Trump is serious about the threat (of a trade war, in this case) if in fact this belief will help bring those countries to the table to negotiate about a problem.
I think this may be an example of Point 5 in The Art of the Deal:
5. Use Your Leverage ”“ Never show desperation for a deal. Deal from strength using all the tools available to you to project strength. Sometimes that requires “imagination and salesmanship.” The U.S. Government and the President have a great deal of leverage to exert, economically, militarily, politically, etc.
That doesn’t mean it will work, of course. But if it does, I doubt you’ll see apologies from those who predicted disaster.
The only things I want to see from those who predicted disaster are tombstones.
Lifted this from huxley on the Stormy Daniels post today.
Substitute “crazy” for “crooked” in this case.
Don’t be too sure I’m as crooked as I’m supposed to be. That sort of reputation might be good business, bringing high-priced jobs and making it easier to deal with the enemy….
—Sam Spade in “The Maltese Falcon”
Or it’s about the essential nature of aluminum and steel production.
The other angle that’s well known but not often discussed, is that China has really really overproduced many things: whole cities only slightly populated, and aluminum and steel. So it is better to dump those commodities on the world at a loss than get zero for it. If the scale is large enough, and it is, then it is extremely destructive for those industries globally. Great for the consumers, rotten for the producers.
Probably not. At least to the extent that we adopt ‘balanced trade’ and significantly reduce the trade imbalance.
One thing President Trump has been consistent about over the years is his view on our trade deals. This is what you might call a core value.
Part of the balancing act the president faces is maintaining a growing economy– which in the short run could be hurt by a true trade war.
That, I think, is why Trump signed the spending bill. In the short run government spending can stimulate an economy (though in a sane economy, deficit spending competes with private sector investment by affecting interest rates) and job one is sustain a growing economy. Right now corporations seem to have enough cash to expand– they just need to see sufficient market potential– whether that comes from domestic or foreign markets.
China will make concessions to open their market, but will it be token or real? How far will be take this? I suspect not too far. We’re going to continue a trade imbalance, but would $50-75 billion dollars in increased exports to China be enough to declare victory? Probably. Cutting the trade imbalance in half would be better.
If the trajectory is toward more balanced trade, which we won’t see for several years, then I think the president could rightfully declare success.
On a side note, all this hand wringing about Trump abandoning conservative principles signing the spending bill ignores a key point. President Trump isn’t a conservative. He’s a businessman. I think he is taking the long view of this– there will be another spending bill (though if Republicans in congress had a shred of integrity, they would return to regular order). Right now the priority is to retain control of the House.
Conservatives will do best to support the most conservative candidate running that can be elected. A half loaf of bread is always preferable to no loaf.
This response from Politico about the Russian spies just ousted typifies the cognitive dissonance that Trump raises in the Left. They really can’t imagine (or won’t admit they can) that his actions here are not at all crazy, chaotic, or dissonant.
Walk softly and carry a big stick covers it, I think.
Bombing Syria while chatting with Chinese leaders ring a bell for anyone?
Note the pejorative verbiage used to denounce the expulsion they would otherwise have to support, because Russia’s The Great Enemy now.
https://www.politico.com/story/2018/03/26/russia-expelled-484752
“The Trump administration is expelling 60 Russian diplomatic officials it says are spies to punish a nerve agent attack in the United Kingdom that has been widely attributed to Moscow.
The dramatic move continues a two-faced U.S. policy toward Russia – further escalating official diplomatic tensions even as President Donald Trump continues a friendly approach toward Russian President Vladimir Putin.
In a phone call with Putin last week, Trump personally congratulated the Russian leader on his reelection but did not mention the attempted murder of former Russian spy Sergei Skripal and his daughter with a banned nerve agent in the U.K. earlier this month.
Trump was involved “from the beginning” and “personally made” the call to take the steps announced Monday, which also include the shuttering of Russia’s consulate in Seattle, according to a senior administration official who briefed reporters. The official said Trump has not spoken to Putin since their phone call last Tuesday.”
The market liked it since it is up 669 points for the DJI or up 2.8%
Correcting the trade deficit with China is ultimately, a matter of financial survival. What can’t go on… if left uncorrected, will eventually result in fiscal collapse, i.e. Sovereign Bankruptcy.
America has no exception from economic principles. In reality, there is no “too big to fail” economic principle.
From Ronald Reagan’s farewell address:
“The past few days when I’ve been at that window upstairs, I’ve thought a bit of the ‘shining city upon a hill.’ The phrase comes from John Winthrop, who wrote it to describe the America he imagined. What he imagined was important because he was an early Pilgrim, and early freedom man. He journeyed here on what today we’d call a little wooden boat; and like the other Pilgrims, he was looking for a home that would be free.
“I’ve spoken of the shining city all my political life, but I don’t know if I ever quite communicated what I saw when I said it. But in my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That’s how I saw it, and see it still.”
The Reagan quote above was referenced in the closing paragraphs of a book I just finished, Fool Me Twice: Fighting the Assault on Science in America by Shawn Otto. The final chapter is worth the price of the book. There is a discussion of traditional attitudes toward science in China and America, with the unmistakable conclusion that a role reversal is taking place. While the Chinese have indeed been stealing intellectual property, they have also been training scientists and engineers, many in this country.
Whatever happens with tariffs and trade is not going to make a lot of difference in the long run. The era of free trade is over. Contrast those last sentences of Reagan’s address with current policies. Night and day.
The Other Chuck is correct.
Today’s immigration policies allow anyone who is anti-American to come here, live off taxpayer money without working, and help vote in the totalitarian policies of the democrat party.
Back in President Reagan’s day the door was open to those who wanted to come here, work hard to improve their lives, while advancing the cause of American Liberty.
What’s wild is that most of the intellectual property the Chinese steal from us is Hollywood styled entertainment. Having the plans to build something is not the same as having the ability to do so.
Tuvea:
The generosity shown in Reagan’s day may indeed have been abused. What’s apparent now is those days are over no matter what congress is elected this fall nor who succeeds Trump. For a number of reasons, including 9/11 and the rise of terrorism, as well as the hollowing out of our manufacturing base, we are pulling back into a defensive posture. As to your statement that the Chinese are primarily stealing Hollywood copyrights, if only that were the case. Unfortunately it goes well beyond.
Here’s the key quote from Otto’s book. It’s by Robert McKee and describes the American archetype:
“I think that the American ethos is not science-friendly and never has been. The American model is Thomas Edison and Henry Ford. [Bill Gates anyone?] Guys who never went to college and who were geniuses and invented things, and people like them. The inventor versus the scientist. Somebody who can go west, discover gold mines, and create a lot of money without an education. Unlike Europe or Japan or India, or even China these days. In those cultures they admire and compete to be a really well educated person in some field. That is not the American dream. The American dream is Hollywood, sitting in a drugstore and somebody says ‘You ought to be a movie star.’ It’s an attitude that life is a game and that what you gotta learn is to play that game well, but it’s not on a gridiron where you actually have to practice, it’s a game of manipulation and most of that game is somehow bullshit.”
Enter Donald Trump. And post-modernism.
TOC,
“Most ‘scientists’ are bottle washers and button sorters.” R.A. Heinlein
Inventive genius is far more impactive than entire generations of scientists, who fully develop what genius has revealed.
“The American model is Thomas Edison and Henry Ford.” “it’s not where you actually have to practice”
I imagine that ‘luck’ had nothing to do with Ford’s actually making the production line work. As for Edison, when asked how he felt about repeatedly failing to design a working light bulb, he replied; “I have not failed. I’ve just found 10,000 ways that won’t work.”
You’re confusing Hollywood fantasy with the Heartland’s reality.
Hmm…finding 10,000 ways that won’t work…endless experimentation to realize a theory…sounds like science to me!
America is Engineering. Applied Science in the name of invention.
China is a merchantile empire. They worry over money more than almost anything else now. Maybe not the 9 Oligarchs of Communist Party power in China, but certainly all their backers worry about money and face.