Trump's Trade War Escalates as China Retaliates with 34% Tariffs

https://www.nytimes.com/2025/04/04/business/china-trump-tariffs-retaliation.html

by Anon84 • 1 year ago

178 197 1 year ago

llm_nerd• 1 year ago

Many American tech leaders helped usher in a Trump presidency in the belief that he could be their strongman protecting them from meddling foreign governments: No more EU levying fines or China making demands, they thought, or else Donald would target them with punitive tariffs! They had the mob boss on their side and this was their time to trample the world.

Zuckerberg explicitly stated this in his Rogan interview.

Pretty funny how that turned out. American tech is going to be on a carousel of ass kickings. The fines and punitive measures are going to be coming at a torrential clip, and of course the US economy is going to be in for an extremely rough few years, and tech is the first thing that sees budget cuts. Quite aside from the entire industry being gut punched by the stupidest tariff regime in human history.

Art of the Deal

throw0101c• 1 year ago

Art of the Deal

Reminder that Trump had no part in writing the book:

* https://en.wikipedia.org/wiki/The_Art_of_the_Deal

More seriously, this 2018 article from Indiana University negotiations professor David Honig has (re-)popped in recent months:

Distributive bargaining always has a winner and a loser. It happens when there is a fixed quantity of something and two sides are fighting over how it gets distributed. Think of it as a pie and you’re fighting over who gets how many pieces. In Trump’s world, the bargaining was for a building, or for construction work, or subcontractors. He perceives a successful bargain as one in which there is a winner and a loser, so if he pays less than the seller wants, he wins. The more he saves the more he wins.
The other type of bargaining is called integrative bargaining. In integrative bargaining the two sides don’t have a complete conflict of interest, and it is possible to reach mutually beneficial agreements. Think of it, not a single pie to be divided by two hungry people, but as a baker and a caterer negotiating over how many pies will be baked at what prices, and the nature of their ongoing relationship after this one gig is over.

[…]

One of the risks of distributive bargaining is bad will. In a one-time distributive bargain, e.g. negotiating with the cabinet maker in your casino about whether you’re going to pay his whole bill or demand a discount, you don’t have to worry about your ongoing credibility or the next deal. If you do that to the cabinet maker, you can bet he won’t agree to do the cabinets in your next casino, and you’re going to have to find another cabinet maker.
There isn’t another Canada.

[…]

Trump has the same weakness politically. For every winner there must be a loser. And that’s just not how politics works, not over the long run.

* https://medium.com/@davidhonig_67081/distributive-bargaining...

* https://blogs.iu.edu/keep/distributive-negotiation-vs-integr...

* https://www.pon.harvard.edu/daily/negotiation-skills-daily/n...

mnky9800n2• 1 year ago

It seems there’s a lot of money to be made if you are willing to navigate eu business rules to build European copies of American technology companies. Like I have thought about starting a European based, European values cloud data science platform. There’s a lot of people who would simply want to move away from azure, Google, etc. even though Europe can sometimes be draconian and highly segmented.

tgeorge• 1 year ago

https://archive.ph/QrBwf

drumhead• 1 year ago

No Hyper-economy, like China or the EU is going to stand about and take what seems like economic intimidation from the US. All the unaffiliated nations are going to be collateral damage in this clash of the economic titans.

The best thing everyone can do is maintain low tariffs and try and strike free trade deals with each other. But the consequeces of Trumps Trade war are going to be disasterous for smaller developing nations and their economies. We'll see more poverty, more political instability, civil wars, coups and other unpleaseant activities.

The USA will probably get higher inflation while the rest of the world sees lower inflation if not deflation.

We'll have to find a way of getting through this window of misfortune to the other side, where I suspect we'll all be poorer and less free.

hello_moto3• 1 year ago

And billionaires are still going to be rich.

I hope one day USA wakes up and realize the solution is wealth tax to these billionaires

morkalork• 1 year ago

A wealth tax isn't the only solution, it's just the more civilized option that's in everyone's best interest

electriclove2• 1 year ago

Like what Norway did? https://www.theguardian.com/world/2023/apr/10/super-rich-aba...

blooalien2• 1 year ago

I hope one day USA wakes up and realize the solution is wealth tax to these billionaires

That only works if everyone everywhere does it all at the same time, so they've nowhere to move to/hide.

mnky9800n2• 1 year ago

Why does America get inflation and everyone else gets deflation in your view?

guerrilla2• 1 year ago

Things will cost more in the US than elsewhere assuming we (abroad) don't also attack ourselves.

bryanlarsen2• 1 year ago

Chinese firms that used to produce goods for the US are now going to sell these goods in other countries instead, increasing supply in the other countries, lowering prices.

rsynnott3• 1 year ago

In this scenario, the US voluntarily goes quasi-autarky, but everyone else continues to trade.

Paradigma11• 1 year ago

Because China will flood the markets with its products that it can no longer economically sell in the US.

akmarinov• 1 year ago

Wonder whether Americans or the Chinese can weather tough times better.

Chinese don’t get to protest or voice dissent and Americans can’t be bothered to

alephnerd5• 1 year ago

It will suck on both sides, but the majority of American households can weather a $2-4k blow over the next year as supply chains react.

Congress stepping in to exclude Canada and Mexico and the NAFTA exemption cushions the blow significantly.

Most of Latin America being placed at the lower end of the announcement means manufacturers who used to be competitive until China Shock set around 2014-16 can be cost competitive again.

Other large markets like India, UK, and Vietnam are negotiating as well and India expects as Bilateral Trade Agreement to be closed by Aug-Oct.

josefresco• 1 year ago

$2-4k blow over the next year as supply chains react.

It's gonna take a lot longer, and cost Americans a lot more money for "supply chains to react" and move manufacturing to the US.

TheOtherHobbes2• 1 year ago

Half of Americans say they live paycheck to paycheck, so no - the majority of households will not be able to survive for long if they have to spend an extra few thousand to stay where they are today.

Those that can will be cutting spending, which will ripple across the rest of the economy.

There's no sign that negotiation is even possible, never mind likely.

One tell is that tariffs have been applied to the Heard and McDonald Islands, which are inhabited by penguins and produce no imports or exports.

These are not the actions of a rational administration.

eCa2• 1 year ago

Nearly half of the US live paycheck to paycheck[1]. Their lives are not getting easier.

[1] https://www.cnbc.com/amp/2024/11/19/bank-of-america-nearly-h...

thefreeman• 1 year ago

Congress stepping in to exclude Canada and Mexico and the NAFTA exemption cushions the blow significantly.

I know the senate voted this through. But it still has to pass the house doesn't it? I doubt it will even get to be voted on with Mike Johnson as speaker.

doom2• 1 year ago

It's too bad that INS v Chadha essentially gutted the National Emergencies Act, which could allow Congress to end some/all of the tariffs. In it's original form, the NEA allowed Congress to pass a concurrent resolution to terminate an emergency without needing the president's signature. Now it has to be a joint resolution, which can be vetoed by the president, and what president is going to sign off on the termination of an emergency they themselves declared?

dazilcher• 1 year ago

a $2-4k blow over the next year as supply chains react

Can you explain the magical supply chain adjustment that will lower prices after a year?

kashunstva2• 1 year ago

but the majority of American households can weather a $2-4k blow over the next year

- Wasn’t this the administration that campaigned on lowering costs of goods? Now, not even a half-year in, the narrative is “Sorry, deal with it, while we chaotically disrupt global markets.” - The administration is apparently intent on a strategy that builds the U.S. manufacturing base. That’s not a one-year horizon, if ever.

UncleMeat• 1 year ago

The expanded child tax credit was ~3k per year. It absolutely clobbered child poverty rates. This sort of delta in expenses can change a family's fortune significantly.

3vidence• 1 year ago

Feels like peak HN to just say all Americans can weather extra thousands per year...

Tadpole91812• 1 year ago

And, of course, all those Americans who were already poor and are now even poorer will have the extra time and money to start businesses and manufacturing lines. Especially with the 30% increase on prices for all the machinery and raw goods they may need to import.

naveen99• 1 year ago

Both sides just survived covid in their own ways. There was suffering though, just like there will be again.

wtcactus3• 1 year ago

Well, Chinese don’t have proper elections so there, I don't know.

But you can be sure that in the USA, this will all stop in 2 years with the midterms, and be reversed in 4 with the presidential elections. No one other than Trump’s fan base likes this even now, imagine in a few months when people start feeling the terrible repercussions.

piva00• 1 year ago

The whole issue is that no one can be sure it will stop in 2 or 4 years. That's precisely the risk: will it stop? Will it not? Either way, I'm not investing some millions of dollars to setup shop in the USA if all that investment will go bust if the next election cycle removes tariffs.

Anyone saying they are sure about what is happening in the next 2-4 years in the USA is delusional.

dimitrios1• 1 year ago

I am not part of Trump's fan base, and I am in favor of taking action to reverse decades of negative trends I've seen happening as a result of American corporations selling their souls to the highest outside bidders. It's going to be short term pain for long term gain.

goatlover4• 1 year ago

Hopefully so, but I'm not certain elections will be the same as they have. There's reason to believe Trump has no intention of leaving office, and the Republican party has not intention of losing power. This is their chance to remake America long term, and they can't really do that if it gets overturned every 2-4 years.

16bytes• 1 year ago

How can you even remotely be sure of that given the results of the 2016 and 2024 elections?

belter• 1 year ago

China makes everything, US does nothing. Who do you think will weather this better?

_DeadFred_5• 1 year ago

Small US companies near me, reliant on Chinese inputs, aren't suddenly getting hundreds of millions to build factories that'll take years to finish. Trump’s plan assumes most small businesses can pause everything for long, expensive factory construction/toolup projects. In my area our three big manufacturers depend on Canadian aluminum and Chinese subcomponents. Tariffs won’t bring jobs back but they’ll kill the ones we still have.

Aloisius2• 1 year ago

Let's not be hyperbolic. The US is still the second largest manufacturer in the world.

tvaughan• 1 year ago

What? The US President has said repeatedly that tariffs are an easy money maker with no adverse side-effects. China is about to experience the boom times just like everyone in the US is now. You heard the US President’s comments about the recent jobs report, right?

yongjik• 1 year ago

Chinese people would understand that tough times are because Americans elected an idiot.

Americans would understand that tough times are because their fellow Americans elected an idiot.

It will be a crisis for both countries, but it will unite one and divide another. I think everyone will lose but America is likely to lose harder, bigly even.

ethbr14• 1 year ago

Chinese people would understand that tough times are because Americans elected an idiot.

Traditionally, countries get pretty unhappy with their own leadership when the economy gets bad...

There's not a lot of room for nuanced political attribution at population scale.

tonetheman• 1 year ago

Not sure why anyone would trust someone who has bankrupted 6 companies personally and directly to make any choices on the economy.

boxed3• 1 year ago

How is it retaliation to destroy your own economy by making the same bad life choices? Isn't actual retaliation to just ignore the entire thing and thank the US for the extra percentage points in advantage you got for free?

n4r92• 1 year ago

Not if this doesn't actually destroy their economy and gives them even more percentage points. Also the USA has imposed tariffs on almost everyone whereas China has specifically targeted the USA with tariffs. They have much more scope to re-source their imports.

morsecodist3• 1 year ago

If you assume the US tariffs are unchangeable then you would be right but the hope of retaliatory tariffs is that they will get the US to update it's tariffs in response to the economic harm caused. It will also harm China of course but I would imagine they hope the harm caused to the US will reduce the tariffs and leave China better off in the long run. This is not totally unreasonable, the US is ostensibly more sensitive to the economic conditions of it's citizens so one could imagine China outlasting the US in this game of chicken.

UncleEntity5• 1 year ago

I asked the google and it appears a big chunk of Chinese imports are agricultural products. Farmers not having a market to sell their products into isn't such a good thing for any administration so they seem to have a bunch of leverage on this point alone.

bitshiftfaced4• 1 year ago

If the US is consistent with the tariff policy that they've laid out, then I'd expect the opposite to happen. If China increases their tariffs and as a result increases their trade surplus, then that means that the US's tariffs go up as they are a function of the US's trade deficit.

Spooky232• 1 year ago

It’s a war, man. You inflict pain on your enemy. Trump has a pattern of tucking tail when confronted.

dr-smooth2• 1 year ago

Amazing that anybody can look at that guy and think he's "strong". It's so obvious that he's a chicken shit at heart. I mean I guess he talks big, although his language and vocabulary is so stunted, I can't even see that. I guess he was really brave after getting "shot" (probably nicked his own ear with a fingernail when he was pulled to the ground by secret service).

boxed3• 1 year ago

But tariffs are a pain on YOURSELF. It's self harm.

rjtavares• 1 year ago

You can't be bullied and not respond - that's an invite for future bullying.

Besides, this isn't at all the same. China isn't adding tariffs on the whole world like the US are.

Trasmatta4• 1 year ago

I'm continually surprised how many people here don't understand this simple principle. It seems to come up with every thread about Russia too.

boxed3• 1 year ago

But it's not bullying. It's self harm. You don't respond to self harm by harming yourself.

happytoexplain• 1 year ago

"Be the better person" is a good rule of thumb, but it's a bad strategy when somebody attacks you materially.

guerrilla2• 1 year ago

It's not about that. It's about China imposing tarrifs being harmful to China. The US shot itself in the foot. Should we also shoot ourselves in our feet? No, we can just stand back and let them bleed to death.

eCa2• 1 year ago

One idea is to increase incentives to buy non-US goods. And I really hope the EU puts similar incentives on services.

rsynnott3• 1 year ago

They likely expect Europe and the other big economies to join in. US attacks every country in the world, most of those countries retaliate by attacking the US (at this point, the US, which has a trade war with the world, is in a worse position than everyone else, who only have trade wars with the US), US capitulates, would be the theory. The intent is to make the problem go away, quickly. Of course, the flaw there is that this requires borderline-sane leadership.

hubraumhugo• 1 year ago

Pharma products were previously tariff-free under a WTO agreement that is based on the principle that life-saving items shouldn't face any tariffs. Looks like this exemption is now also being eliminated and will probably cause the prices of drugs and treatments in the USA to skyrocket.

alephnerd5• 1 year ago

Pharma products were previously tariff-free under a WTO agreement that is based on the principle that life-saving items shouldn't face any tariffs. Looks like this exemption is now also being eliminated

Pharma along with semiconductors is still exempted.

The biggest hit this has is on textiles and apparel as those were industries that have almost no NAFTA/USMCA presence anymore.

Electronics will be a mixed bag as most US origin electronics assembly was already returning to Mexico due to Zero COVID in China (20-23) and Vietnam (20-21), or moving to India (26% tariff) and Malaysia (20% tariff)

stabbles• 1 year ago

31% tariffs on Switzerland will be felt.

alephnerd5• 1 year ago

Pharma is exempted from the tariffs regime, but in that list it should also be the EU and India as well.

Most medicaments in the US are sourced from EU (Ireland, Germany, Netherlands), EFTA (Switzerland as you rightfully noted as well as Denmark), and India

makingstuffs• 1 year ago

Wait, they can go up more!? I remember thinking prices for really basic medication in the States was insanely expensive — something which costs $0.50 in Europe would cost $3+ in Target n co

apawloski• 1 year ago

Just yesterday people were trying to convince me that price hikes were good and would benefit Trump’s base. Now JP Morgan is predicting a global recession. I cannot fathom how this is good for America.

It just feels like a colossal own-goal that will weaken America on the global scale. Americans will suffer in a recession. And it was by choice that this administration put us here.

Is there any recourse?

krapp• 1 year ago

Is there any recourse?

Nope. The avalanche has begun, it's too late for the pebbles to regret their vote.

stoneman24• 1 year ago

Thanks for the great B5 quote.

The vast majority of us are just minor pebbles in trump’s grand experiment, just trying to find a quiet place to avoid all the noise and nightmares.

The SV mantra of “Move fast and break things” is not something that you really should apply to entire economic systems.

Someone will probably profit but it’s not going to be the average American citizen ( or citizen of any other country)

Spooky232• 1 year ago

Hope you have an opportunity to vote again, and that the coup is unsuccessful this time.

FirmwareBurner2• 1 year ago

Now JP Morgan is predicting a global recession.

Good thing JP Morgan's predictions were never wrong /s

Edit: to those who downvoted, do you have any arguments to contradict my statement and would you put your money into JP's predictions? Go ahead, I'll wait.

tim3334• 1 year ago

JP Morgan are actually saying a 60% chance. So you can't really say they were right or wrong.

UncleEntity5• 1 year ago

Just yesterday people were trying to convince me that price hikes were good and would benefit Trump’s base.

Apparently, they have a plan.

AFAICT, the plan is based on the US being "the last man standing" after WWII and turning its wartime manufacturing base into the machine which rebuilt the world but, nonetheless, they have a plan.

So rejoice in the Glorious Leader's wisdom and know he feels your economic pain and hardship. We must all make sacrifices to Make America Great Again.

lenerdenator2• 1 year ago

I hate to say it: this might be the thing that actually screws his movement.

Biden was uninspiring but ultimately did okay on a few things. The things that screwed him were inflation - some of which was Trump's fault - and his mental state, which can happen to anyone at that age. The inflation followed Harris in her run, as people were fondly remembering 2017-2019 and the era of lower prices. They thought putting Trump back in office would reverse the trend.

Well, now he's drastically kicking prices up left and right with no end in sight. It's not even macroeconomic factors doing this like it was with COVID; it's purely the strokes of his pen.

The bottom line is the ultimate thing that matters in American politics, as it is everywhere. The talk about democracy, institutions, rights, etc. are all window dressing. "It's the economy, stupid", and it's getting noticeably worse.

Of course, I could also be totally wrong like everything else has been for the last 10 years when it comes to predicting the downfall of that tyrant.

heisgone2• 1 year ago

No doubt Lutnick and Bessent are taking crazy risks with their strategy. If they are to be believed, their plan is to have a recession at the begining of the term to get long term bond price lower and refinance the debt. By their own account, they outright said to Trump things aren't going to be good until 2028. So, I guess we have to prepare for a few years of crap. Let's hope it doesn't trigger a depression that would need government bailout to save the economy.

jpster• 1 year ago

What’s worrisome is, if they’re planning on things to suck until 2028, that is precisely when the next presidential election is supposed to happen. Suppose he feels like he must have 4 more years, to take credit for the V-shaped recovery, and not go out like a loser? Suppose he declines to step down?

ajross5• 1 year ago

FWIW, that is 100% a retconned explanation. No one anywhere was talking about this theory until the last week.

It's clear that Trump demanded tariffs, tried to do it once early, and got cold feet. What happened with Lutnick et. al. is Court Politics. They saw an opening to improve their own status by selling a creative lie that would allow Trump to do what he wants. So he bought the lie and picked new favorites.

But it remains a lie. No one serious thinks that this is a good idea.

Also: refinance the debt?! First, no, that's not how federal bonds work. They're a contract and you pay the interest it says on the note. But even if you had a magic money pool around to do buybacks or whatever... most of the outstanding debt is in 30 year notes at like 3%! How low do you think they're going to get the Fed to go?

lenerdenator2• 1 year ago

I don't think they have a strategy.

These aren't people who care about the national debt. Trump has not only stated, but bragged publicly, that he does what he can to pay as little in tax as possible. He's had an appeal in front of the IRS for probably over a decade now for writing down the value of a business loss (the casino in Atlantic City, IIRC) that he received monetary gain from.

That's not what you do when you see a financial issue as a threat to the nation you supposedly love. They are too short-sighted to have a strategy.

If there's a depression or major recession, I don't think the government bailout would be the main concern. Civil unrest would be. I'm in my early 30s and I've seen four major financial crises (2002, 2008, 2020, and now 2025) in my lifetime. I'm doing alright because I come from a place of privilege. There are literally millions of people my age who aren't going to be doing alright in the situation you describe, and there's a good chance they would see that as the death knell of their hopes and dreams, all because of the shareholder and political classes in this country.

sandworm101• 1 year ago

> Trump's Trade War

That might be how it is understood locally, but on an international scale this is quickly moving from "Trump's" to "America's" trade war. Various levels of US government have had opportunity to weigh in, but have generally acquiesced to the recent tariff policies. Calling this a "trump problem" wont fly much longer. This is now American trade policy.

Herring• 1 year ago

Yeah 1) He won the popular vote. His support actually increased the 2nd time around, and 2) He should be in a tiny jail cell right now, what was Biden doing for 4 years?

This isn’t going away even if he leaves office in 4 years (which is looking unlikely).

kashunstva2• 1 year ago

He should be in a tiny jail cell right now, what was Biden doing for 4 years?

Not causing a global financial crisis, mainly. But vis-a-vis his predecessor’s recurrent criminality, it’s hard to imagine what his options were, considering the capture of the remaining branches of government. Well, that, and the Constitution.

djha-skin• 1 year ago

I'm kinda happy about this.

Our farmers in Utah lobby so hard for water, then use it to grow alfalfa which they sell to China because they can sell it there for more money than it can be sold locally. It boils my circuits that they ask for our precious water -- to which they have historically had an obvious right, growing our food -- and then basically ship it overseas. Keep the crops at least sold in the US, and hopefully to other Utahns who have a hard time buying alfalfa because China inflates the price. 80% of our water goes to farmers here. I'm glad of it when they grow wheat and sell it to us, but not when it gets exported. These tariffs will hopefully help with that.

whycome2• 1 year ago

But youve clearly defined what the problem is. Is a tariff the solution?

yladiz• 1 year ago

It’s not the only solution, but it is one, as we saw back in the first Trump administration and their tariffs on, and the resulting counter tariffs from, China. It will almost certainly dramatically reduce demand for crops like this from the US, which will lead to less farmers (as many leave the business or go bankrupt) and ultimately less water usage by the farmers.

yannis2• 1 year ago

Yes it is not the answer. About this issue see https://www.sltrib.com/opinion/editorial/2022/12/04/why-its-...

almog• 1 year ago

Tariffs look more and more like the Bolivian Tree Lizard cleanup plans: https://youtu.be/P9yruQM1ggc

ajross5• 1 year ago

they can sell it there for more money than it can be sold locally

So, just to be clear here: you want Utah farmers to foot the bill for the trade war? If they are forced to sell locally for less, they're the ones losing money. Utahns end up poorer in this scenario.

Obviously in a trade war, everyone ends up poorer. It's just simple math. It's absolutely dumbfounding the extent to which people have simply decided to ignore an honest truth simply because of the lies of one political cult.

vdupras3• 1 year ago

I don't think it was OPs point. OP's point is that agricultural exporters in Utah profits on externalizations (aquifer depletion), which impoverishes everybody depending on that aquifer.

When you come to the realization that you can't drink money, this comes as good news.

johann8384• 1 year ago

How are the farmers selling to China at better prices and then the consumers also buying from China at higher prices than the local farmers.

How does it not short circuit and the farmers just sell locally for the price of the goods from China?

vdupras3• 1 year ago

alfalfa is water-intensive. This export is straight up resource theft.

jfengel• 1 year ago

The market is saturated. American farmers already buy as much alfalfa as they want. The next unit of alfalfa is worth basically nothing to them.

To sell more alfalfa in America you'd need more farms to raise more cattle (the main use for alfalfa), which would put even more strain on the American water supplies. That would produce more meat, which you could sell to China, but it would be more expensive than the Chinese homegrown beef, which they'd buy more of.

water-data-dude• 1 year ago

Honestly, no one should be using water to grow alfalfa in Utah. The way Western water law currently works with prior appropriation encourages extremely wasteful uses of water, just because they don’t want to lose their valuable water allocations (use it or lose it). Alfalfa is a VERY water intensive crop, growing it in the desert wouldn’t make sense without these perverse incentives.

There’s a lot of effects, but one very visible one in Utah is the fact that the Great Salt Lake is drying out, because too much water is being diverted from its tributaries. Now there’s dust getting stirred up from the exposed lake bed that’s chock full of heavy metals, which is less than ideal next to a fairly big city.

actsasbuffoon• 1 year ago

It’s a fair point, but I feel like we could take more targeted action on alfalfa without the side effects of the current policies. It feels a bit like celebrating your house burning down because you didn’t like the color of paint in the kitchen.

josefritzishere• 1 year ago

My work is raising prices about 25% just based on the asumption. Apologies to the customers.

nickthegreek2• 1 year ago

Prices are going up on everything. As a customer, I will be buying less products. Apologies to the Employees who will be losing their jobs over reduced profits.

reedjosh• 1 year ago

34% additional. AFAICT they already charged 34%.

Does that put us at 68%?

incomingpain• 1 year ago

When obama brought in his affordable healthcare, one of the big issues he discovered was that healthcare in the usa depends almost entirely on exports from china.

the other issue at the same time for the democrats was that they were losing middle american votes because the globalists shipped those jobs overseas.

There has been bipartisan support to exit globalism since; and it is over obviously. Obama, Biden, and Trump have all be making major changes to exit.

Without the need for global trade, the usa is also no longer world police. They have instead condensed their blue water navies down to super carrier groups that will project power into specific spots like yemen/houthis for example.

The usa rather abruptly switched from trying to sustain stability over the world to the opposite; they benefit from causing chaos elsewhere because backhome stability will be attractive to investors.

Welcome to how trade always was; we usually had our navies trading bullets and not goods.

China isn't ready and these retaliatory tariffs will only punish themselves.

https://www.usni.org/magazines/proceedings/2020/february/chi...

ty68533• 1 year ago

What economist is advising Trump? Can we read their game plan somewhere?

mraniki• 1 year ago

https://en.m.wikipedia.org/wiki/Peter_Navarro

bamboozled2• 1 year ago

specifically America’s chronic and ever-expanding trade deficit — says that America is the globe’s biggest trade loser and a victim of unfair, unbalanced, and nonreciprocal trade"

Finally the source of “we’ve been treated unfairly” is revealed?

mppm3• 1 year ago

One thing that I'd like to inject into this discussion, is that the nominal trade imbalance is not the only relevant figure, and maybe not the most important one. For many goods, there is a very strong disconnect between the market value (the lowest price you can offer a group of suppliers competing against each other) and what one might call, for lack of a better word, true value (the price you'd be willing to pay if you had no alternatives). For luxury goods, these are often nearly the same, while basic goods might have a 5x difference and antibiotics could well have 1000x. When this is taken into account, the trade between the West on the one hand, and China and Russia on the other, is not unbalanced by a factor of 2, but more like 20. The West receives a huge amount of energy, manufactured products, chemical precursors, electronics, technological supplies, medical supplies and basic medicines. And in return they send champaigne, BMWs, branded clothing, intellectual property, and yes, some aircraft and photolithography machines. The effect of this has already been demonstrated once with the mostly unsuccessful sanctions against Russia, but would be felt ten-fold if there were a major disruption of trade between China and the West. China is at a point in their development, where they really could walk away from trading with the West if they really had to, but the Western economies would likely be sent into shock by such a step. Not that I think this is likely to happen, but I do get the feeling that the new tariffs are mostly giving China a leg-up towards full economic independence, while onshoring the US industry will be a very long and painful process.

bathtub365• 1 year ago

I’m not sure what you mean by “the West” in this context. No one besides the US are unilaterally raising tariffs on China. The US stands alone in this and the rest of us are fine to keep trading with China while whatever agenda is being pursued by the US regime.

mppm3• 1 year ago

I'm just making a general point, since the trade between China and the EU is qualitatively similar to China-US. And while the EU is anti-Trump at the moment, I do not think it is beyond aggressive economic action against China for political reasons, if nothing else. (And let's not forget about the new tariffs on Chinese electric cars).

tim3334• 1 year ago

I'm not sure the 'true value' is that important for trade. Taking the example of antibiotics, they may be worth 1000x the cost of production but if country A stops selling them you can just make them in country B. We got by fine without Chinese exports until they started becoming a thing from around 1990 on.

mppm3• 1 year ago

Long-term -- yes; short and medium-term -- not necessarily. For example, during and after Covid, Germany had a very severe antibiotics shortage. I think it is still ongoing to some extent. On one hand, it seems ridiculous to suggest that Germany is incapable of producing all the antibiotics it needs. On the other hand, ramping up production that has been offshored is not that easy, and is a lot more expensive initially. Same thing with the chip shortage -- these weren't even close to leading-edge chips, but trying to ramp up production domestically would likely cost 10x or more. Same with Russian gas, or any number of other things. Supply chain crunches can do a lot of damage even for individual products. If they were to happen simultaneously across multiple industries, the effect could be truly disastrous.

ASalazarMX• 1 year ago

If there's lack of a better phrasing, I would rename "true" value as "maximum extraction" value.

snapplebobapple• 1 year ago

I get what you're trying to say but I don't think it's couched in a way that is understandable to the average person. I think a more understandable way to put it is to point out USA will be ok on the very base things like food and energy (assuming they don't piss us Canadians off further) but China has competed to a almost nothing the next few rungs up the ladder to the point where production capacity outside China (and certainly within USA and the dwindling number of deeply friendly nations) is almost non existent. This includes very, very valuable things like chemical precursors and finished products in everything including biotech, building supplies, factory parts, etc. So a world where China walks away pretty quickly falls apart to a much lower standard of living for everyone in the west for a decade or possibly two. That world would be much blander food wise, much more exposed to the elements for many more of us and with much more death from treatable disease.

We have an opportunity here to rebuild the industrial capability and walk ourselves a bit further up the cost structure now with the help of having access to chinese output and what we are doing instead is pretty foolish.

That talk of what we pay vs what we would pay is being used in your argument to point out the pain of losing access to a cheap chinese product when it's more useful for antitrust discussion of where market power is being abused and instead just pointing out the direct pain of a china walking away situation in my opinion.

ChrisArchitect• 1 year ago

Earlier: https://news.ycombinator.com/item?id=43580289

Trump's Trade War Escalates as China Retaliates with 34% Tariffs

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