President Donald Trump has galaxy brained himself into a something of a quagmire with China. For the better part of the past year, he’s been imposing and subsequently escalating tariffs on goods imported from the nation in an effort to force them to renegotiate what he considers unfair trade practices. China hasn’t been too interested in doing this, though, and American businesses and consumers continue to suffer from the new taxes that must be paid on products shipped across the Pacific.
Trump has responded the only way he knows how: doubling down. On Friday, he ratcheted up tariffs from 10% to 25% on $200 billion in Chinese goods, claiming that broken-down trade talks between the two nations are continuing “in a very congenial manner,” that “there is absolutely no need to rush” and that the “massive” tariff payments “go directly to the Treasury of the U.S.”
The problem is that this money is not coming from China, as Trump has claimed repeatedly. It’s instead coming directly from Americans. On Sunday, Larry Kudlow, Trump’s chief economic adviser, went on Fox News to try to explain what’s been happening. It wasn’t very hard for Chris Wallace to get him to begrudgingly admit the president is wrong and that it’s Americans who are footing the bill for his trade war.
“The president says China pays the tariffs,” said Wallace. “They may suffer consequences, but it’s U.S. businesses and U.S. consumer that pay. Correct?”
“Uh, yes, to some extent,” Kudlow stammered. “I don’t disagree with that. Again, both sides will suffer on this.”
Larry Kudlow admits that the Chinese do not directly pay tariffs on goods coming into the U.S., as Trump has repeatedly, and incorrectly, claimed.
Via Fox pic.twitter.com/sbXvfBbktf
— Kyle Griffin (@kylegriffin1) May 12, 2019
Hours after Kudlow’s appearance, Trump once again touted the money the United States is receiving from the tariffs — which, it bears repeating, are being paid by American companies and consumers. “We are right where we want to be with China,” he wrote. “Remember, they broke the deal with us & tried to renegotiate. We will be taking in Tens of Billions of Dollars in Tariffs from China. Buyers of product can make it themselves in the USA (ideal), or buy it from non-Tariffed countries.”
He added that the United States would make up the money China is no longer spending “with our Great Patriot Farmers (Agriculture)” and “distribute the food to starving people in nations around the world! Great! #MAGA.”
Regardless of any half-baked plans to parlay the trade war into a cure for world hunger, it’s almost impossible to argue tariffs are good for Americans. Companies that rely on imported raw materials and consumers who buy those companies’ products have been hit hard. So too have farmers, who are reeling from both the tariffs on imported goods and the retaliatory tariffs affected nations have placed on American agricultural products. Some of the president’s closest Republican allies are pleading with him to lift the steel and aluminum tariffs he placed on Mexico and Canada. Why? Because their constituents are suffering.
Incapable of backing down, Trump’s only recourse has been to claim that tariffs are actually a good thing — falsely, ludicrously insisting China is paying them — while at the same time frantically haranguing China for its unwillingness to cave to his demands. “Would be wise for them to act now, but love collecting BIG TARIFFS!” he tweeted on Saturday. He posted another tangled thread of nonsense Monday morning, claiming China “wants to make a deal so badly” and that tariffs are “very good for USA.”
…completely avoided if you buy from a non-Tariffed Country, or you buy the product inside the USA (the best idea). That’s Zero Tariffs. Many Tariffed companies will be leaving China for Vietnam and other such countries in Asia. That’s why China wants to make a deal so badly!…
— Donald J. Trump (@realDonaldTrump) May 13, 2019
“China has taken so advantage of the U.S. for so many years, that they are way ahead (Our Presidents did not do the job),” he added. “Therefore, China should not retaliate-will only get worse!” If it does “get worse,” Americans could be forced to pay more for iPhones, shoes and other products the administration has so far avoided slapping with import taxes.
The president then, once again, tried to Trump-splain to China what is in their best interests.
I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don’t make a deal because companies will be forced to leave China for other countries. Too expensive to buy in China. You had a great deal, almost completed, & you backed out!
— Donald J. Trump (@realDonaldTrump) May 13, 2019
Despite Trump’s Twitter overtures, it doesn’t appear China has any intention of suddenly giving in to his demands. “China has not only the determination and capability, but also willingness to fight a prolonged war,” Wei Jianguo, a former vice minister at China’s Ministry of Commerce, told the South China Morning Post. “The decision makers already fully understand the pattern of the US in the trade talks.”
“China will not only act as a kung fu master in response to U.S. tricks, but also as an experienced boxer and can deliver a deadly punch at the end,” he added.
China’s “deadly punch” is likely to be a combination of retaliatory tariffs on American agriculture products, as well as simply drawing out negotiations until Trump leaves office. Trump seems to acknowledge this could be the case. “China is DREAMING that Sleepy Joe Biden, or any of the others, gets elected in 2020,” he tweeted on Sunday. “They LOVE ripping off America!”
American businesses, consumers and farmers may be having the same dream.