Signs point to long haul on Trump's China tariffs
Ahead of this week's G20 summit in Argentina, it's clear from an interview President Trump gave The Wall Street Journal — and from Axios' own reporting — that his faith in tariffs is as strong as ever. Trump believes to his core that tariffs work, both to create negotiating leverage and as instruments to improve the U.S. economy, though it's hard to locate many economists who agree with Trump on the latter point.
The bottom line: A former top trade official on Capitol Hill said after reading the interview: "My main takeaway is that maybe Wall Street needs to stop being so optimistic that Trump is going to negotiate away this China thing in the relatively near future. We are in for a long haul."
The interview's key exchange:
- WSJ's Bob Davis: "[T]he Chinese No. 1 goal in this G-20 is to get you to delay or suspend that [increase in the tariff rate on some Chinese imports from 10 percent to] 25 percent on January 1. ... [A]re you willing to do that?"
- Trump, who’ll meet Chinese President Xi Jinping at the summit: "I think it would be highly unlikely."
This suggests that, as Trump has been telling people he talks to regularly, he doesn't expect a breakthrough.
- A breakthrough would mean any kind of deal — even a temporary one — to stop Trump from ratcheting up China tariffs in January, as he’s scheduled to do.