Why Trump gets to China by trading

Suddenly, Donald Trump’s trade war is in much more attention.

Instead of fighting all the fronts against the world, it is now much more like a fight in the usual Trump: America against China.

A 90-day pause for higher “retaliation” tariffs leaving dozens of countries still leave a universal tariff for 10%.

But China-who comes with everything, from iPhones to baby toys and accounts for about 14% of all US imports-was allocated for a much tougher eye speed of 125%.

Trump said the increase was related to Beijing’s readiness to avenge 84% of the team on American goods, and the step that the president called “lack of respect”.

But for the first time, a policy that made it to the White House on the back of the anti -aid message, this has much more than simple revenge.

Trump is about the unfinished case of this first term in office.

“We didn’t have time to do everything right now,” he told reporters.

The goal is nothing less than overcoming the created world trade -oriented system as the world’s factory, as well as the once widespread opinion that underlies it – the idea that most of this trade itself was a good thing.

To understand how important this is the thinking of the US president, you need to go back to time before anyone thought about him as a possible candidate for the post, not to mention the probable winner.

In 2012, when I first reported Shanghai – Chinese Business -Copyal – the strengthening of trade with the country was noticed by almost all – world business leaders, Chinese officials, visiting foreign governments and trade delegations, foreign correspondents and experienced economists.

This increased global growth, providing endless supplies of cheap goods, enriching the Chinese army of new factory workers, more and more built into global supply networks, and providing profitable capacity corporations that sell their products to their recently cut secondary class.

For several years of my arrival, China has surpassed the US to become the world’s largest market for Rolls Royce, General Motors and Volkswagen.

There was also a deeper justification.

As China became richer, so the theory was, the Chinese will start demanding political reform.

Their expenses will also help China move to consumer society.

But the first of these aspirations never happened, and the ruling Communist Party of China only strengthened power.

And the other did not happen fast enough, and China not only depends on the export, but also plans to become more dominant.

His sadly known policy – published in 2015 and called “Made in China 2025” – he outlined a huge state vision to become a world leader in a number of key production sectors: from aerospace to an electric vehicle.

That is why only a year later the full political unknown began for the US president, forcing the case repeatedly on the path of the company, that China has highlighted the American economy, running a decrease in Rustobet and cost workers of the blue collar of their livelihood and dignity.

Trump’s first trade war broke mold and smashed consensus. His successor, President Joe Biden, most of his tariffs in China.

And yet, despite the fact that they undoubtedly caused some pain in China, they did not do much to change the economic model.

Now China produces 60% of world electric vehicles – a large share made by its own home brands – and 80% of the batteries that nourish them.

So, now Trump has returned, with this strength for escalation.

This may be the biggest shock that has ever been put into the created global trading system if it were not for all the other measures outside the upcoming tariffs that the US president has made in recent days.

What is next depends on two key questions.

First, whether China accepts this proposal for negotiations.

Secondly, believing that in the end it will make it, whether China is ready to make such serious concessions looking for America, including complete overhaul of its export economic model.

Responding to them, the first thing we can say is what we are in a fully uninformed territory, so we must be wary of those who say that Beijing is likely to respond.

But there are certainly reasons to be careful.

The vision of China to its economic force is one, based on strong exports and a rigid protected domestic market – is now closely linked to the idea of ​​national rejuvenation and the rule of one party system.

For example, its tight control over the information sphere means that it can hardly reset its barriers to US technology companies.

But there is a third question, and it is possible to answer America.

Do the US believe in free trade? Donald Trump often suggests that tariffs are a good thing, not just as a means to achieve the goal but also as a goal.

He talks about the benefit of the protectionist barrier for America to encourage domestic investments, to encourage US companies to return these foreign supply networks and raise tax revenues.

And if Beijing thinks that this is really the main purpose of the tariff, it can decide that there is still nothing to lead.

Instead of advocating the idea of ​​economic cooperation, the two largest superpowers in the world may be blocked in the fight for the economic rule of the winners.

If so, it will really mean the destruction of the old consensus and a completely different, perhaps very dangerous, the future.