The details are still not clear, but it appears to me that the Chinese outlasted and outmaneuvered President Trump, who once declared that trade wars are easy to win.
The agreement, as much as we know of it, postpones the imposition of new tariffs on the last tranche of Chinese goods in exchange for tens of billions of dollars worth of Chinese purchases of American agricultural goods over the course of two years. Enforcement mechanisms are unclear. It’s also unclear whether the stated Chinese purchases represent a real increase over what existed before Trump declared his trade war.
The Chinese have been negotiating for at least 5,000 years. They surely have recognized that Trump likes a stock market that is buoyant. Each upward blip in the rhetoric has resulted in surges in the market, creating wealth for Trump and friends. The Chinese also recognize that this threatened last round of tariffs would have affected toys, smart phones and all the other things that Americans are addicted to. Jacking up the price of these goods as we head into an election year would have undermined Trump’s chances of re-election.
So essentially, they gave nothing. And Trump gave a lot more.
There are other ironies. The fact that Trump was willing to waive the next round of tariffs in exchange for agricultural purchases is very 19th century. The key battleground is the technologies of the future and who dominates them. There was no mention of Huawei and its 5G dominance. Nor any talk in this agreement of dismantling or even easing the Chinese juggernaut to dominate the technologies of the future.
Nor is there any indication that the Trump administration is even close to coming to grips with the real challenges of Chinese hacking and espionage inside the United States, its use of the Chinese diaspora, its soft influence campaign which I see all around us in terms of events being staged in New York and phony headlines in the China Daily I bought outside Columbia University’s campus, its Trojan Horse assault on countries such as El Salvador that can scarcely resist, etc.
The Trump administration is failing in its much vaunted reckoning with China. I wonder why. That’s the real question to be asking. Why so ineffective?
