Along with businesses and consumers across this country, we’re breathing a sigh of relief that the United States and China have declared a 90-day cease-fire in an ongoing trade war.
It’s no secret we haven’t been happy with President Donald Trump’s tariff-happy trade policies since he took office. Whether it’s adding levies to imported goods, threats to bolt NAFTA or insulting our allies, we still can’t say whether Trump is engaging in some grand strategy or just throwing stuff at the wall, hoping something sticks. We are increasingly inclined to think it’s the throw-and-stick plan.
But we are still praying it could be the former — or at the very least that we will get lucky and it will look like the former when all is said and done. In any event, it’s not as if Trump is the first president to bang his head against the great wall of Chinese trade policy and come away with nothing but a headache to show for it.
Indeed, give the president some share of credit for making the gross behavior of our Chinese trade “partner” serious consideration for Americans.
The problems are more than serious. China has long imported our goods, then watched as American intellectual property was, shall we say, “appropriated” through a process that requires foreign firms to hand over intellectual property in order to do business in the country. Additionally, China is still considered a “developing nation” by the World Trade Organization — a status it received nearly two decades ago when it joined the WTO, and China was nothing like the economic power it has become.
Trump is right to raise these legitimate issues. He’s right to get Americans worked up over them. Unfortunately, he’s wrong on the solutions, with policies that won’t get us anywhere closer to solving these troubles. The president’s economically facile obsession with trade balances continues to lead him to think imposing tariffs is the magic elixir.
Instead, China continues to sign trade agreements with other nations while American companies, farmers and consumers feel the brunt of the tariff pain. Should the stalemate not last, the 25 percent tariff will kick in on $200 billion of goods, and consumers will find themselves paying higher prices across a wide spectrum of products. American businesses and consumers will suffer.
Trump had the opportunity to us his self-celebrated business acumen and the strength of a GOP majority in Congress to leverage his influence with China. Instead, he chose to hastily withdraw from the Trans-Pacific Partnership, a 12-nation trade agreement that would have allowed the United States to work with Japan and Singapore in negotiations with China.
We could have also used the power of the WTO against China despite its status. Finally, aggressive multilateralism with other trading partners, focusing on targeted sanctions against companies and individuals doing business in China, would also have been a way to get the Chinese government to take notice.
Instead, it’s a stalemate with no indication of how talks will progress. If cooler heads within the Trump administration don’t prevail, the sting of the tariffs will take a bigger toll on consumers and business, risking damage to the economy as the real issues with China remain unresolved.
— The Dallas Morning News