Trade

Trade Deal With China Is a Blockbuster

Featured image What the Democrats fear most is happening: President Trump and his negotiating team are reaching wide-ranging agreements with China that will be a huge boon to the United States. In an Oval Office press conference yesterday, President Trump and China’s Vice Premier announced a Phase 1 set of agreements that will be documented over the next several weeks. The video of the press conference is embedded below; Trump’s performance was »

Are American companies suffering from an outbreak of “bad management”?

Featured image Here’s President Trump arguing that bad management, not tariffs, is what’s hurting American companies: A lot of badly run companies are trying to blame tariffs. In other words, if they’re running badly and they’re having a bad quarter, or if they’re just unlucky in some way, they’re likely to blame the tariffs. It’s not the tariffs. It’s called “bad management.” If you think about it for half a second, this »

A trade war that’s not so easy to win

Featured image Reportedly, there is a division within the White House over how to proceed with China on trade. One camp, which includes Steven Mnuchin and Larry Kudlow, is optimistic that the administration can reach a trade deal with Beijing as things stand now. But Peter Navarro, the senior trade adviser, believes stronger tactics are required to change China’s approach. President Trump is said to agree with Navarro. But what if both »

Whither China?

Featured image The current unrest in Hong Kong may be the most important geopolitical story of this decade, depending how it plays out. Concerning which, a few observations: • We know enough from recent decades to declare how dictatorships end: they end only when the rulers lose their nerve to kill their own people in large numbers. Forget all the fancy models and theories of our idiot schools of international relations. This »

U.S. designates China a currency manipulator

Featured image The U.S. government has determined that China is manipulating its currency. It will engage with the International Monetary Fund to try to eliminate this unfair form of competition. If there is no progress within a year, China could face sanctions including its firms being prohibited from competition for U.S. government contracts. Treasury Secretary Steven Mnuchin made the announcement today. Stock prices fell dramatically, with the Dow Jones average shedding more »

Trump Makes a Deal

Featured image Hand-wringing over imminent imposition of tariffs on goods imported from Mexico can stop: President Trump announced a deal tonight: I am pleased to inform you that The United States of America has reached a signed agreement with Mexico. The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended. Mexico, in turn, has agreed to take strong measures to…. — Donald J. Trump (@realDonaldTrump) »

A Better Way to Fight China?

Featured image Scott noted this morning the 30th anniversary of China’s brutal crackdown on the pro-democracy movement in Tiananmen Square. This set me to thinking about Trump’s trade strategy with China (and now Mexico) and an old memory. Almost 12 or 15 years ago now I was teaching a class at Georgetown as a visiting lecturer, and one of my students was a young Chinese lady who seemed very bright, though quiet »

Trade War Is Hurting Trump

Featured image I think President Trump is doing the right thing in pushing back against theft of intellectual property and other Chinese misdeeds, but there is evidence that he is paying a political price. President Trump’s approval ratings normally move within a very narrow range, consistent with the electorate’s polarization. But he has been doing well lately, with his approval rating sometimes over 50% in the Rasmussen survey. But now he has »

Trump set to increase tariffs on $200 billion worth of Chinese goods

Featured image Last week, President Trump and the Red Chinese appeared to be making major progress towards a trade deal. However, Trump’s team says that the Chinese have reneged on commitments made during the negotiations. Consequently, the administration is prepared to increase tariffs on $200 billion worth of Chinese goods. It plans to announce the increases on Friday morning. The New York Times’ story on this development is full of speculation about »

An inflection point in U.S.-China relations

Featured image Michael Auslin, an Asia expert at the Hoover Institution, examines what I consider the most important foreign policy issue of our time — U.S. relations with China. Auslin believes this may be “crunch time” for these relations. Auslin is happy with President Trump’s China policy so far: The Trump administration’s full-court press against China is going strong, buttressed by a dramatic shift in opinion among the foreign-policy community, now increasingly »

Good news: China is nervous

Featured image The New York Times reports that China’s leader, Xi Jinping, abruptly summoned hundreds of officials to Beijing recently. He did so, says the Times, in order to convey a sense of “anxious urgency.” The Communist Party, Xi told the officials, faces major risks on all fronts and must batten down the hatches. “Globally, sources of turmoil and points of risk are multiplying,” [Xi] told the gathering in January at the »

Trump’s pivot to Asia

Featured image Michael Auslin of the Hoover Institution commends President Trump for his pivot to Asia. He says it’s “shaping up to be more substantive and potentially transformative than the one the Obama Administration regularly touted.” That’s a low bar. However, there is, indeed, much to like about Trump’s pivot. As Auslin says: Trump. . .has begun by blowing up past practice, specifically in no longer pretending China is a fair trading »

CNN does TPP

Featured image In a mock wistful tone, CNN reports that the TPP trade agreement is going into effect without the participation of the U.S.: A major 11-country agreement goes into effect Sunday, reshaping trade rules among economic powerhouses like Japan, Canada, Mexico and Australia — but the United States won’t be a part of it. That means that Welch’s grape juice, Tyson’s pork and California almonds will remain subject to tariffs in »

China’s slumping economy adds new dimension to trade war

Featured image There’s good news and bad news from China. It’s the same news: China’s economy is slowing. China’s retail sales are growing at the slowest rate in 15 years. Industrial production reportedly is slumping too. Forecasts are for reduced economic growth. This year, reported growth will be around 6.6 percent. The forecast for next year is 6 percent, and many are now wondering whether it will reach that mark. The case »

Trump vs. General Motors

Featured image I doubt that Robert Mueller poses an existential threat to the Trump presidency. He may pose some threat, but American manufacturers pursuing their economic interests may pose a greater one. The decision by General Motors to shut down several plants in the U.S. and to cut up to 15,000 jobs illustrates the threat. The impact of GM’s decision will be felt most acutely in the industrial Midwest, including states that »

Has Trump driven Japan closer to China?

Featured image Late last month, Japanese Prime Minister Abe visited Beijing. His visit nailed down multibillion-dollar trade deals and promises further to strengthen relations between the two Asian giants. “From competition to coexistence, Japanese and Chinese bilateral relations have entered a new phase,” Abe declared. “With President Xi Jinping, I would like to carve out a new era for China and Japan.” This was a marked contrast to Abe’s 2014 trip to »

Only Trump Can Go to China (and Smack Them in the Head)?

Featured image I don’t know why the stock market is suddenly having a case of the vapors. It could be the conventional explanations of the Fed slowly tightening, and/or the market is undergoing an entirely ordinary correction from rising too far too fast. The global economy is showing signs of slowing. Or it could be partially the ongoing uncertainty about Trump’s trade policy. I confess to remaining very nervous about Trump’s tariff »