That didn't take long. But then again, nobody thought it would. The red Chinese--the big China, the one on the mainland--did indeed retaliate for President Trump's tariffs. Just 24 hours after the United States imposed tariffs on goods from the Middle Kingdom, Beijing announced $34 billion of its own tariffs against this country.
--Arkansas Democrat-Gazette editorial, all the way back on Wednesday
It's hard to keep up. Maybe this editorial will still be up to date by the time Gentle Reader reads the news this morning. But let's hope not. Instead, let us hope that the trade war has been abandoned by this president and his red Chinese counterparts. And this morning's front page holds nothing but smiles and happy faces from various trade representatives.
That's the hope, anyway.
Last weekend President Trump decided to see China's retalitatory tariffs on his tariffs, and raise again. Then the Chinese saw the bet. So this president, never one to back down even for the greater good (it shows weakness), decided to raise once again. He directed the U.S. trade representative to prepare new tariffs on Chinese products, this time $200 billion worth.
"These tariffs will go into effect if China refuses to change its practices," the president said. "And also if it insists on going forward with the new tariffs that it has recently announced."
The papers called this a "potential" trade war. What, exactly, is potential about it?
Unless cooler heads prevail (and where find cooler heads in this administration?) the tariffs will go on the books on July 6. The Chinese are to place higher fees on things like tobacco, cars and orange juice. Also on Arkansas products, such as pork and chicken and beef and soybeans. Which means that farmers in Arkansas and elsewhere are going to have a tougher time selling their products. But that's not all it means.
For those of us who aren't row-crop farmers or ranchers, the tariffs would mean products coming from China would cost more. And what does China export to the United States? Well, for starters:
Computers, broadcasting equipment, telephones, electric heaters, industrial printers, wire, valves, office machinery, air pumps, transformers, vacuum cleaners, umbrellas, televisions, furniture, radios, electric motors, light fixtures, seats, metal mountings, shoes, tires, plastics, trunks, sweaters, fish, jewelry, bicycles . . . . You get the point.
And if this trade war keeps up, We the People will be paying more for many of those items. No wonder the stock market takes a beating every time the president tweets about more tariffs--and the Chinese react.
Oh, by the way, many of us have 401(k)s and other retirement plans in those markets. Every which way you look, tariffs are bad news.
The Trump administration, for its part, keeps putting out the word that the United States can "withstand" a trade war. Why, of course this country can withstand a trade war. This country withstood Smoot-Hawley in the 1930s, which made a depression the Great one. But why suffer through economic calamity if we don't have to?
Withstand? That's not a policy. It's a worst-case scenario.
The president seemed somewhat surprised that China would retaliate against this country's tariffs. Or as he said Monday, mainland China's retaliation "clearly indicates its determination to keep the United States at a permanent and unfair disadvantage . . . This is unacceptable. Further action must be taken to encourage China to change its unfair practices, open its market to United States goods, and accept a more balanced trade relationship with the United States."
For a businessman of some note, we wonder if the president understands how trade works.
Sure, China sent $505 billion in goods to the U.S. last year, and this country shipped $130 billion to China. Technically that's a trade deficit. But that also means that American families got $505 billion worth of computers, telephones, vacuum cleaners, televisions, motors, bicycles and all the rest. When an American sends a dollar to China, that's not a dollar lost. He gets something in return, like that television or computer.
All that Donald Trump's tariffs might accomplish is to make things more expensive at American stores and groceries.
No doubt China cheats on the world stage, and something must be done--carrots, sticks or both--to make it play by the rules, especially when it comes to the theft, yes theft, of intellectual property. But how does making Americans pay another $15 for a smartphone accomplish that?
If there's any good news, it may be the mercurial nature of this president. Would anybody really be surprised if he switched course in the next tweet and decided to change directions? And end this trade war before the next volley?
Let's keep the good thought. At this point, that's the best we can do.
Editorial on 06/24/2018