{"id":308641,"date":"2025-05-14T07:00:08","date_gmt":"2025-05-14T07:00:08","guid":{"rendered":"https:\/\/www.thetruthseeker.co.uk\/?p=308641"},"modified":"2025-05-15T07:02:30","modified_gmt":"2025-05-15T07:02:30","slug":"trumps-tariff-blunder-backfires-bigtime","status":"publish","type":"post","link":"https:\/\/www.thetruthseeker.co.uk\/?p=308641","title":{"rendered":"Trump’s Tariff Blunder Backfires Bigtime"},"content":{"rendered":"

Mike Whitney \u2013 The Unz Review May 11, 2025<\/strong><\/h1>\n

Donald Trump rolled the dice and came up snakes-eyes. He thought he could bully China, but China called his bluff. Now he must report his failure to the American people by trying to make the biggest trade blunder in the nation\u2019s history, look like a \u2018stunning triumph of the will\u2019. Good luck with that.<\/p>\n

Fortunately, we have a reliable metric for determining whether Trump succeeded or failed. If China makes concessions to preserve trade with the US, then we can say that Trump \u2018won\u2019. But if Trump is forced to remove his tariffs before China agrees to resume trade, then Trump \u2018lost\u2019. So, it\u2019s really just a matter of who blinks first.<\/p>\n

We figure that Trump will \u2018blink first\u2019 based on the fact, that Trump \u2018has no cards to play.\u2019 China has him over a barrel and they know it. Many analysts knew this from the very beginning, but their views were drowned out by the army of anti-China scribes and pundits who think the mighty USA can crush China whenever it wants. Now they\u2019re going to see that the world doesn\u2019t work that way. Now they\u2019re going to see that a poorly governed country that is $36 trillion in debt and sliding towards irreversible insolvency, doesn\u2019t get to make the rules. This is from a piece at CNN<\/em> (on Sunday):<\/p>\n

Top US officials involved in high-level trade negotiations with China emerged from two days of talks touting \u201csubstantial progress\u201d and appearing to confirm that a deal between the two countries had been reached<\/strong>, which could have massive implications for the global economy.<\/p>\n

\u201cI\u2019m happy to report that we\u2019ve made substantial progress between the United States and China <\/strong>in the very important trade talks,\u201d Treasury Secretary Scott Bessent said in a brief statement Sunday in Geneva, Switzerland, where the talks were held, calling the negotiations \u201cproductive.\u201d<\/p>\n

US Trade Representative Jamieson Greer indicated that an agreement had been reached Sunday, after President Donald Trump imposed sweeping 145% tariffs on most Chinese goods last month.<\/p>\n

\u201cThe president declared a national emergency and imposed tariffs<\/strong>, and we\u2019re confident that the deal we struck with our Chinese partners will help us to resolve work toward resolving that national emergency,\u201d Greer said.<\/p>\n

He added, \u201cIt\u2019s important to understand how quickly we were able to come to agreement, which reflects that perhaps the differences were not so large as maybe thought.\u201d CNN<\/em><\/a><\/p>\n

\"\"<\/div>\n

\u201cGREAT PROGRESS\u201d, he says. That either means that China has accepted Trump\u2019s unilateral tariffs or they have made important concessions. So, which is it?<\/strong><\/p>\n

We\u2019ll know on Monday.<\/p>\n

All we know so far, is that both sides agreed to establish a US-China trade consultation mechanism.<\/strong><\/p>\n

What does that mean?<\/p>\n

It means the US and China agreed to a particular framework for ongoing dialogue between the two countries on issues related to trade, tariffs, export controls, and access to markets. In other words, they agreed to pick up the phone when officials from the other country call.<\/strong><\/p>\n

Don\u2019t they do that anyway?<\/p>\n

Yes, they do, which means the terminology was created to divert attention from the fact that China has offered no concessions and is refusing to budge until the tariffs are lifted.<\/strong> All of this is very bad for Trump who wants to convince his base that \u201ctough talk\u201d and bullyboy tactics can force rivals to bend to Uncle Sam\u2019s will. But that clearly has not happened. This is from an article at the Global Times<\/em> on Sunday:<\/p>\n

Global attention is focused on Geneva, Switzerland, where China, US high-level economic and trade meeting has been held over the weekend\u2026.<\/p>\n

In response to questions about the US abuse of tariffs, Chinese Assistant Foreign Minister Miao Deyu on Sunday stated at a media briefing\u2026 that the US uses tariffs as a weapon to exert maximum pressure and seek self-interest, embodying typical unilateralism, protectionism, and economic bullying.<\/strong> This approach sacrifices the legitimate interests of countries worldwide to serve US hegemonic interests. China firmly opposes the US imposition of so-called \u201creciprocal tariffs\u201d and has taken forceful legal measures to resolutely counter the<\/strong>m, CCTV News reported on Sunday.<\/p>\n

China will firmly safeguard its development interests, uphold international fairness and justice, and maintain the international trade order. <\/strong>We are willing to strengthen communication and coordination with Latin American countries to jointly uphold multilateralism and the multilateral trading system, Miao said\u2026.<\/p>\n

China\u2019s decision to engage in talks with the US was made after careful consideration of global expectations, China\u2019s own interests, and the concerns of US businesses and consumers, and it reflects China\u2019s openness and sense of responsibility as a major global power\u2026<\/p>\n

If the US continues to cling to \u201cAmerica First\u201d and unilateralism, seeks concessions from China through pressure tactics, any dialogue is unlikely to achieve meaningful progress<\/strong>, Ying noted\u2026.<\/p>\n

The world\u2019s largest economy had already contracted in the first quarter<\/strong> \u2013 marking the first decline since 2022. The tariffs have only added to the strain, dealing a heavy blow to the US economy by exerting mounting pressure across key areas such as consumer spending, employment, investment and trade\u2026 In comparison, China has the resilience and the necessary policy tools to protect its legitimate interests. The country has maintained its position as the world\u2019s largest goods trading nation for eight consecutive years and it is a major trading partner for over 150 countries and regions\u2026.<\/p>\n

China\u2019s trade continued to expand at a solid pace in April. The country\u2019s total import and export value in April reached 3.84 trillion yuan ($531.46 billion), up 5.6 percent year-on-year. Exports stood at 2.27 trillion yuan, rising 9.3 percent,<\/strong> while imports totaled 1.57 trillion yuan, a 0.8 percent increase, according to data released by the General Administration of Customs on Friday. Global Times<\/a><\/em><\/p>\n

So, as of Sunday, there is no indication that China is going to resume trade with the US unless Trump caves in and removes the tariffs. <\/strong>So, what Trump must do now is throw in the towel to China and then claim \u2018victory\u2019 for creating the invaluable \u201ctrade consultation mechanism\u201d. He must snooker his backers into believing that his capitulation is actually a solid \u2018win\u2019 for Team USA.<\/strong><\/p>\n

\"\"<\/div>\n

Now The Bad News: China Has Replaced Us Already<\/p>\n

CHINA HAS ALREADY sold huge amounts of products originally meant for US consumers to its neighbors\u2026 And the neighbors are buying big, giving China giant an 8.1% boost in export sales, surprising analysts<\/strong>.<\/p>\n

\u201cIn early April, I said that Trump\u2019s tariffs on China will strengthen trade ties between China and the rest of the world in the next few years,\u201d said Prof Justin Hauge of Cambridge University in the UK, commenting on X. \u201cIt didn\u2019t take a few years. It took a month.\u201d<\/p>\n

This is bad news for US Treasury chief Scott Bessent as he heads into negotiations later today in Switzerland, to bargain with Chinese Vice Premier He Lifeng.<\/p>\n

THE NUMBERS<\/p>\n

Newly published figures show exports from China rose a staggering 8.1% in April, compared to this time last year. <\/strong>Most of the goods are being snapped up by Indonesia, Vietnam, Thailand, and other countries. Bloomberg\u2019s stable of analysts predicted a 2% rise and Reuters predicted a 1.9% jump.<\/p>\n

The 8.1% leap follows 12.4% growth in March, when exporters worked overtime to beat the April 2 launch of Donald Trump\u2019s \u201cglobal tariff attack\u201d.<\/p>\n

The Financial Times<\/em> quoted Heron Lim, an economist at Moody\u2019s Analytics, saying that, while China\u2019s trade with the US dropped 21% year-on-year in April, it rose by an equal percentage with south-east Asian nations and 8 per cent with the EU\u2026..<\/p>\n

China, which is focused on trade rather than politics, makes goods for anyone who will buy\u2014and that means the other 95% of humanity will do just fine as substitute customers.<\/strong> Nury Vittachi<\/a> @NuryVittachi<\/p>\n

Looks like the indispensable nation is not so indispensable after all. Here\u2019s more from the Global Times<\/em>:<\/p>\n

China moved to accelerate the replacement of US products before the high-level China-US trade talks in Switzerland..<\/strong>. China signed letters of intent with exporters of Argentina to purchase soybeans, corn, and vegetable oil shortly before the Geneva talks\u2026. Earlier in April, China signed contracts to purchase at least 2.4 million tons of soybeans from Brazil\u2026.<\/p>\n

The report noted that these moves underscore China\u2019s efforts to secure alternative sources of US goods before the bilateral trade meeting started.<\/strong><\/p>\n

China signed a letter of intent with exporters in Argentina to buy about $900 million of soybeans, corn and vegetable oil, Bloomberg reported on Friday\u2026.. The Chinese delegates also held talks with local business representatives, focusing on expanding bilateral economic and trade cooperation and defending the free trading system\u2026.<\/p>\n

Despite the headwinds posed by escalating US tariffs, China\u2019s foreign trade performed better than expected in April.<\/strong><\/p>\n

According to data released by the General Administration of Customs, while exports to the US fell 21 percent year-on-year to about $33 billion last month, overall Chinese exports rose 8.1 percent, with exports to non-US markets increasing 13 percent. <\/strong>Global Times<\/a><\/em><\/p>\n

The irony of these developments is that the Communists are acting like Capitalists while the Capitalists (Trump and Co) are acting like goofballs<\/strong>. Can\u2019t they see that their dim-witted strategy has blown up in their faces? China is still trading, thriving and growing while US ports on the West Coast have turned into Ghost-towns and retail merchants are planning for a dismal future of higher prices and empty shelves. Isn\u2019t it time to make an honest accounting and try to stop the bleeding before the patient dies? Here\u2019s more from Nobel Prize winner, Joseph Stiglitz:<\/p>\n

Reducing US dependence on certain Chinese imports is not a straightforward task<\/strong>. Manufacturing of iPhones, for example, could move elsewhere\u2026 but it will take a long time and will be costly\u2026.<\/p>\n

China now has a comparative advantage in logistics, manufacturing supply chains and engineering<\/strong>. It is no accident that China dominates in the production of smartphones and so many other products: it is far cheaper to produce them there. Prices of these products will rise as supply chains are reconfigured\u2026.. China has the knowhow, the determination and the resources to make up for this deficiency of demand, <\/strong>and it may be able to do so quickly\u2026.<\/p>\n

China can also strengthen its systems of social protection and increase wages.<\/strong>.. There is scope for large increases in government expenditure\u2026..<\/p>\n

It can thus make up for the deficiency of aggregate demand from loss of exports to the US<\/strong> without resorting to \u201cdumping\u201d them on the rest of the world\u2026.<\/p>\n

Moving production to the US will require massive upfront investment<\/strong> yet, because of all this disruption, no firm can be sure about the economic environment three months from now, let alone four years from now\u2026..Trump talks about bringing back manufacturing jobs, but manufacturing jobs today make up less than 10 per cent of US employment.<\/p>\n

He is looking to the past, not the future. Even if he were successful in resuscitating American manufacturing, it would not create good jobs for workers in the deindustrialised parts of the country.<\/strong><\/p>\n

Cars these days are made by robots, with the best companies employing as many engineers and researchers as production workers, and the production-line work is often not paid well.<\/p>\n

Today, it\u2019s the service and knowledge sectors that really matter, yet almost surely America\u2019s longstanding trade surplus in these services will diminish, particularly given the damage Trump is doing to its considerable soft power: <\/strong>tourism is falling off a cliff, foreign students are discouraged from studying in the US, the rule of law is being tested and the president is waging a massive battle on the country\u2019s leading universities\u2026.<\/p>\n

China, meanwhile, has built dozens of new universities over the past decade.<\/p>\n

China holds the cards over Trump, Joseph Stiglitz, The Sunday Times<\/a><\/em><\/p>\n

\"\"<\/div>\n

I don\u2019t have a crystal ball, so I can\u2019t predict what\u2019s going to happen on Monday,(when the details of the China-US talks are published) but I expect that Trump\u2019s claims of \u201cgreat progress\u201d and a \u201ctotal reset\u201d with China are going to be exposed as \u2018wishful thinking\u2019 at best and a deliberate fabrication at worst. The days when the United States could beat China in a trade war are over, and the sooner we get used to it, the better.<\/p>\n

 <\/p>\n

Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The days when the United States could beat China in a trade war are over, and the sooner we get used to it, the better. Mike Whitney explains <\/p>\n","protected":false},"author":121,"featured_media":308642,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[78,61,66],"tags":[],"class_list":["post-308641","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-china","category-Commentary","category-Economics"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/308641","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/users\/121"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=308641"}],"version-history":[{"count":1,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/308641\/revisions"}],"predecessor-version":[{"id":308646,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/308641\/revisions\/308646"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/media\/308642"}],"wp:attachment":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=308641"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=308641"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=308641"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}