China Shipping Line at the Port of Los Angeles – California – USA
Photo Credit: Reuters/Lucy Nicholson

America’s trade war with China is now official. On July 6th, the US Trade Representative (USTR) announced that an additional 818 Chinese goods, amounting to approximately $34 billion, now face a 25 percent import tax on arrival at US ports. Goods affected include Chinese-made vehicles, aircraft, boats, engines, and heavy equipment. Check the USTR website for the complete list.

“We must take strong defensive actions to protect America’s leadership in technology and innovation against the unprecedented threat posed by China’s theft of our intellectual property, the forced transfer of American technology, and its cyber-attacks on our computer networks,” said US Trade Representative Robert Lighthizer on June 15th.  “China’s government is aggressively working to undermine America’s high-tech industries and our economic leadership through unfair trade practices and industrial policies…”

In retaliation, China has imposed a 25 percent tariff on 545 American products of equivalent value. American soybeans, corn, wine, fresh and dried fruits, nuts, pork, and poultry are among the targeted items.

“[Beijing was] forced to strike back to defend the core interests of the nation and its people,” declared China’s Commerce Ministry on July 6th. China will also file a complaint against the USA with the World Trade Organization (WTO).

In a PBS presentation with Amna Nawaz on July 6th, Yasheng Huang of MIT’s Sloan School of Management said that negotiations between American and Chinese commerce officials failed to reach an agreement because “the strategy pursued by the Trump administration is kind of a take it or leave it. That doesn’t really leave the Chinese with much room to maneuver.”

More tariffs are yet to come. President Trump told reporters aboard Air Force One: “And then you have another 16 [billion dollars] in two weeks, and then, as you know, we have $200 billion in abeyance and then after the $200 billion, we have $300 billion in abeyance. OK? So we have 50 plus 200 plus almost 300.”

I doubt that our president’s bully tactics will curb China’s trade abuses. Meanwhile, import tariffs put in place earlier this year on washing machines, solar panels, steel, and aluminum are already impacting American jobs. In his July 6th article in The Week, Jeff Spross concludes that our president is recklessly rushing into a trade war without any clear objectives or endgame.

“It’s worth remembering that the president was a reality TV star,” Spross writes. “And in that profession, the point is ratings. There’s little differentiation between putting on a show and getting results; the show is the result. And it’s hard to escape the conclusion that this trade war is just another show Trump’s putting on.”

Unlike America’s endless wars in the Middle East, upon which our military-industrial complex gorges itself, America’s trade war with China has an expiry date. As the global market adjusts, more American manufacturers will relocate their factories overseas to remain competitive and secure their markets.