China trade reform progress
President Trump’s ongoing attempt to reform U.S.-China trade policy is showing signs of progress and bi-partisan support, both domestically and internationally.
For decades China has been ruthlessly stealing intellectual property of Americans and undercutting U.S. domestic manufacturers and industries by subsidizing its government owned industries, and then flooding the market with cheap goods. That’s neither free trade nor fair trade. It’s outright cheating.
But Trump has made it a high priority of his administration to reform that situation with tough tactics, such as raising tariff’s and other measures to pressure the Chinese to begin observing internationally accepted rules of fair trade.
While it is still too early to declare victory, there are signs the tough measures are beginning to show progress and are gaining bipartisan support.
At the recent G20 summit in Buenos Aires, Chinese President Xi Jinping reportedly made a verbal commitment to U.S. negotiators to cut its extremely high tariff on American-made cars. Some reports say it is as high as 40 percent, others that it is 25 percent.
Larry Kudlow, the president’s economic advisor, said he expected the Chinese to remove their tariff’s on American cars completely.
The Chinese also reportedly agreed to increase its purchases of U.S. soybeans and other agricultural products, which should be good for Louisiana farmers.
The two countries had agreed to a 90-day pause before any further tariffs by the U.S. are implemented, while further negotiations are in progress. The U.S. has threatened China with $200 billion more tariffs on Chinese imports by raising the rate to 25 percent from 10 percent.
Kudlow said the ongoing discussions largely depend on the Chinese implementing the commitments it has already made.
Meanwhile, Democrat leaders in the House of Representatives has signaled that they are in support of some of the tariffs on the Chinese products, especially with regard to protecting intellectual property rights.
Obviously this is going to be a difficult negotiation, but at least there are some signs of progress and that is good for both nations. But it is about time that China start playing by the rules of international trade, or else it deserves to suffer the economic consequences of its own longtime cheating.