Trade War with China

plawolf said:

Looking at the official positions of both China and America shows a very interesting contrast.

The American government is going out of its way to downplay the risks and costs of a trade war, while China’s is going out of its way to stress the dangers and costs.

It looks like pretty much the same tactics as has been successfully used to trick America into every other war of choice.

The downside is that by downplaying the risks and costs of a trade war, if it does all kick off, the economic reality will end up being a far bigger shock to US consumers who were promised minimal impact.

OTOH, but stressing the costs and dangers of a trade war, and giving America every opportunity to back down gracefully, the Chinese population would be better mentally prepared for the economic hit of the trade war, and would be more determined to win it.

It looks like the bulk of American efforts are to start the trade war, while China is focusing on how to win it.

Either Trump is bluffing, or he and American are in for a rude awakening if they get their wish.

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Equation said:

Trump is using this potential trade war as a distraction from his many domestic problems back at home from the Stormy Daniels debacle to the Russian probe allegation. He is trying to get his mainstream MAGA base voters to stay on his side for the midterm election that's coming this November.

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plawolf said:

May well be, but Trump has been laying the groundwork for this trade war for some time, and the latest allegations are no worse than previous ones.

Also, if he is just playing to score some cheap points for mid-terms, then this all has to be a bluff, because China has already made it abundently clear with its response to the aluminium and steel tarrifs that its response is going to be carefully focused to hit Trump and the Republicans’ base supporters of farmers, low skilled manufacturing, mining etc hard. While trumps own tarrifs will hit middle income America as things they have grown to depend on suddenly jump in price.

So he has to keep threatening without actually pulling the trigger to reap the political boost of being ‘tough’ on China without incurring the huge costs putting action to words would cause. But even he can only do that for so long, and he can only pull that trick once.

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China on Friday called on U.S. decision makers to seriously weigh up the value of its unilateral trade protectionism.

Chinese Foreign Ministry Spokesperson Lu Kang made the call at a daily press briefing, commenting on recent remarks made by U.S. Ambassador to China Terry Branstad on possible Chinese retaliation on soybean imports from the United States.

Lu said it was not just people from the U.S. agricultural industry that were worried about the deterioration of trade ties caused by the unilateral moves of the U.S. administration.

China expected the U.S. side to heed the voice of U.S. consumers and business communities, he said.

"We have reiterated several times that China does not want a trade war," Lu said. "However, if China is forced into such a war, we have the confidence and capability to cope with any challenges."

Lu said that once a trade war was triggered, the defending party would decide the time, method and areas to counter it based on its own interests and requirements.

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manqiangrexue said:

Honestly I don't think his goal is to sell American products to foreign countries; his goal is to sell himself to to angry low skill laborers in the US so they keep him in office.

Look at the deals he's made; he proclaimed a victory renegotiating KORUS by getting Koreans to increase their allowance of US car imports from 25K to 50K. The only problem is that no US car sells more than 10K in Korea as it is so the allowance might as well be a million! And after this pissing contest making the Koreans feel victimized, only fewer Koreans are likely to buy American cars. There was no point in making this "deal" except to deceive American voters into thinking he doubled US car exports to SK while in actuality, he probably caused it to drop a bit instead. Trump willingly paid such an expense (from the pockets of the US auto industry) to play this trick on his own people for the sake of winning their votes.

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plawolf said:

Looking at the official positions of both China and America shows a very interesting contrast.

The American government is going out of its way to downplay the risks and costs of a trade war, while China’s is going out of its way to stress the dangers and costs.

It looks like pretty much the same tactics as has been successfully used to trick America into every other war of choice.

The downside is that by downplaying the risks and costs of a trade war, if it does all kick off, the economic reality will end up being a far bigger shock to US consumers who were promised minimal impact.

OTOH, but stressing the costs and dangers of a trade war, and giving America every opportunity to back down gracefully, the Chinese population would be better mentally prepared for the economic hit of the trade war, and would be more determined to win it.

It looks like the bulk of American efforts are to start the trade war, while China is focusing on how to win it.

Either Trump is bluffing, or he and American are in for a rude awakening if they get their wish.

Click to expand...

taxiya said:

You nailed it. While US can twist the arms of other governments to open up, it can not twist the arms of millions or billions of consumers in other countries to buy what they don't want. Any sensible leaders in US must ask themselves one question "why can Japan, South Korea and Germany maintain trade surplus to China?". The answer is certainly not because these countries have favorable tariff treatment from China.

At end of day, market is free and only competitive products will win. Nobody can force water to flow from lower ground to higher ground.

Trumps only achievement will be making the common Americans lives more costlier without increasing American's export. However, his trick will do his job he promised, that is reduced import with (hopeful) unchanged export therefor reduce the deficit. Maybe, reducing the deficit with any price is his goal.

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Flying_Fortress said:

Trump is coming at this from a National Security standpoint, America cannot just relie on cheap imports forever, it needs to go back to being a self reliant, self sufficient economy that it used to be. Just like China is always looking out for #1 (CHINA) while the U.S. is always at the losing end of these trade deals because China pretends it is still a developing country...what a joke.

China keeps industries running, even if they lose hundreds of billions so it is self sufficient, and for national security matters. China does not just lay everyone off and say the party's over ya hicks, go back to your farms, so it's really asinine to slander trump for looking out for his base.

If plastic junk& marvel character bed-sheets from Walmart become more expensive, and people have to buy less poorly made crap from China, I don't think there are any downsides to this, there will probably be less waste for the dump as well.

Meanwhile quality food products that the U.S. exports to China become more expensive for the Chinese middle class - China can't just ramp up Pork & Beef, Wine, Whisky you name it food production if they jack up Tariffs on U.S. exports - Trumps got xi by the balls! Chinese wine is a joke, Chinese (insert the name of the product compared to a U.S. Product) Is a joke. The Chinese middle class loses out big time in a Trade War, as no one in China likes or trusts Chinese made products.

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