A new poll shows overwhelming support for the stance President Trump is taking on the issue of the China trade deficit. Meanwhile, Mr. Trump’s strategy appears to be making progress. On Tuesday, China’s President Xi Jinping issued a statement indicating negotiations, not a trade war, may be in the offing.
Xi said “Openness versus isolation and progress versus retrogression, humanity has a major choice to make. The trend of peace and cooperation is moving forward and a Cold War mentality and zero-sum game are outdated.” He indicated that China is willing to make concessions by easing restrictions on American cars, strengthening intellectual property rights, and opening its financial markets.
The survey was conducted by the 1.3 million-member senior advocacy organization, the Association of Mature American Citizens. AMAC president Dan Weber says the results show that Trump’s base stands with him, particularly older Americans.
“The pundits were suggesting that Trump backers may be on edge with the prospects of a trade war with China, which threatens onerous tariffs on foodstuff, such as soybeans, and goods produced in states that support the president. But, more than 19 thousand took part in the AMAC survey and more than 95% of them voted in favor of the president’s position and the comments they posted are telling.”
As one of those that responded to the poll put it: “Tariffs are generally a bad idea, but Communist China is a notable exception. Communist China has stolen billions of dollars of proprietary business and military research from America via cyber espionage. They have disrespected International Patent Laws. They flood our borders with dangerous drugs and stolen brand-name merchandise. And they are engaged in a systematic reprogramming of American perceptions of communism via media and educational propaganda.”
The overall U.S. trade deficit with the rest of the world stands at more than $566 billion overall. The bulk of it – nearly a staggering $400 billion — is the result the imbalance of U.S. trade with China. In the 1990’s the U.S. trade deficit with China averaged about $34 billion.
“The skyrocketing deficit has taken its toll on the U.S. economy over the ensuing decades. But, that’s not all. The Office of the U. S. Trade Representative [USTR] reports that China’s theft of American intellectual property costs us as much as $600 billion a year,” says Weber. “Between the trade deficit and the theft of trade secrets, we are faced with a massive one trillion dollar dilemma.“
President Trump says this is an untenable position to be in and, unlike, his predecessors, he is proposing to do something about it. He announced that he will impose new tariffs on Chinese imports – in a few months. But China wasted no time announcing that it will levy onerous tariffs on U.S. exports to that country. These developments have caused worries that a trade war is about to break out with the blame going to Mr. Trump for triggering a crisis.
“But President Xi’s statement may allay those fears,” says Weber. Wall Street welcomed the news with a rally that sent the Dow Jones Industrials Average up by some 500 points,
Neither side has put the new tariffs into effect, as yet. But, they were standing toe-to-toe to see who will blink first. The Chinese were saying they are not at fault and are challenging the proposed U.S. tariffs before the World Trade Organization, lending credence to a worst-case scenario.
But economist Larry Kudlow, newly appointed head of the National Economic Council, was saying not so fast. “Blame China, not President Trump.” Kudlow pointed out that China has been targeting the U.S. for decades with little or no repercussion. They’ve been imposing high tariffs and stealing intellectual property rights with impunity, he noted.
Kudlow was also saying he believed that it is possible new tariffs on Chinese goods might not be put into effect in the end and that Mr. Trump may simply be trying to initiate a dialogue, as Commerce Secretary Wilbur Ross has also suggested.
Princeton University economist Alan Blinder agrees. He has made an analogy between President Trump’s tariff declaration and the arms race with the former Soviet Union during the Cold War. “A threat of a trade war that doesn’t erupt into an actual trade war could conceivably do some good,” he tells reporters.
Weber says “it obviously did some good, proving that it was time the nation stood up for its trading rights; China has been scamming America for too long.”
Weber believes that America should take every measure possible to create a balance in trade world’s two largest economies and to deter China from its practice of intellectual property theft. He says the Chinese have been using industrial spies to steal and copy our technology for decades and this can no longer be tolerated.
“They are stealing trade secrets and using blackmail to get companies wishing to do business in China to transfer proprietary technologies. The Commission on the Theft of American Intellectual Property says it costs American companies hundreds of billions of dollars each year. The result is the loss of U.S. jobs and spikes in the cost of consumer goods,” according to Weber.
Treasury Secretary Steven Mnuchin appeared on CBS’ Face the Nation last Sunday and said: “I don’t expect there will be a trade war. It could be, but I don’t expect it at all. Our objective is free and fair trade.”
Meanwhile, President Trump’s trade adviser Peter Navarro put it this way on NBC’s Meet the Press: “We want fair and reciprocal trade. We want them to stop stealing our stuff. We want them to guard intellectual property, not take it from us.”
Weber points out that America’s goal is parity on trade with China. “But the Chinese have always insisted on holding on to its dominant position and previous administrations have regularly let them achieve that goal. It’s about time we have leadership willing to take a stand on the trillion-dollar threat to the U.S. economy.”