Despite the legions of economists and naysayers who predicted that President Trump’s trade war with China would end in disaster for the U.S. economy, things are going exactly as the president and his advisers have foreseen. On Monday, Chinese officials reportedly contacted the Trump administration to cry “uncle” after Asian markets took a deep turn for the worse and China’s currency dropped to its lowest level in more than a decade. According to reports, the latest round of tariffs on Chinese goods has the Communist government seeking a “calm” resolution to the dispute.
“They want to make a deal,” Trump told reporters. “That’s a great thing.”
In a statement to a state-run media outlet, Chinese Vice Premier Liu He said that the government was ready to talk turkey.
“China is willing to resolve its trade dispute with the United States through calm negotiations and resolutely opposes the escalation of the conflict,” Liu said.
At a tech conference, Liu elaborated: “We believe that the escalation of the trade war is not beneficial for China, the United States, nor to the interests of the people of the world. We welcome enterprises from all over the world, including the United States, to invest and operate in China. We will continue to create a good investment environment, protect intellectual property rights, promote the development of smart intelligent industries with our market open, resolutely oppose technological blockades and protectionism, and strive to protect the completeness of the supply chain.”
By “continue,” we assume that Liu means “we will start doing it for the first time.” But, you know, China has to do its little game.
To be sure, everyone with money in the stock markets (to say nothing of people whose livelihoods depend on trade with China) wants to see this dispute come to a quick and satisfying end. The Dow Jones has been in a rocky position for the last couple of weeks, and there are signs that we may be headed for a recession within the next two years. Recessions are inevitable, of course, but it would be best that we have our international ducks in a row before trying to weather the next one. Shoring up a new trade deal with China would go a long way towards soothing rattled investors.
But as Lindsey Graham mentioned on CBS this weekend, Trump had very good reasons for picking this fight.
“Every Democrat and every Republican of note has said China cheats,” Graham said Sunday. “The Democrats for years have been claiming that China should be stood up to, now Trump is and we’ve just got to accept the pain that comes with standing up to China.”
Exactly. All we can do is hope that China taps out first. If today’s developments are any indication, there is reason to be optimistic about that.