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Could The China Trade War Be Nearing An End?

Westlake Legal Group Trump-invites-trade-war Could The China Trade War Be Nearing An End? white house Trade War trade Tariffs Front Page Stories Featured Story Economy China Trade Talks China

Ever since the Trump administration began shifting how it dealt with China on trade, doomsday prophets have been warning us that we would all feel the economic pain of new tariffs and our economy may not survive it.

So far, that doesn’t seem to have played out as dramatically as predicted as the trade war has ebbed and flowed over two years. And now, if the White House is correct it its assessment, the war may be nearing its end.

While Americans certainly have paid billions more per month, and have been encouraged to buy American to help minimize the sting, according to a Friday announcement from the White House, Trump and Chinese President Xi Jinping hope to sign the first phase of a tentative trade deal at the Asia-Pacific Economic Cooperation summit on Nov. 16-17 in Santiago, Chile.

Initially, the White House decided on a good faith action to suspend an Oct. 15 scheduled increase in tariffs on $250 billion worth of Chinese goods. But the tariffs on another $400 billion of goods from China, as well as new tariffs scheduled to take effect in December, have not been included in the phase I portion of the new deal.

For now, it looks like the initial phase will be all about China buying American agricultural goods as it battles challenges in its own agricultural sector.

According to Trump, China has also agreed to continue purchasing more U.S. agricultural products. Chinese purchases of U.S. agricultural products have been resuming as China’s farmers continue to battle an African Swine Flu and Fall Armyworm infestation that’s been destroying their pig and crop numbers.

Treasury Secretary Steven Mnuchin clarified that China will eventually buy between $40 to $50 billion worth of agricultural products a year.

While there is no text for phase one of a deal with China, in principle, other parts of the deal will include addressing issues like non-tariff barriers to U.S. agricultural exports to China, financial services and market accessibly, intellectual property protection, stopping the transfer of technology, and possibly an agreement on currency manipulation.

Some of these issues will be covered in other phases as well.

The Daily Signal suggests the phased approach may be a work-around for the two leaders to gain trust in the wake of other potential deals that failed earlier in 2019. If the deal is agreed upon in November, planning for future phases will likely begin immediately.

Which raises the question: what will those who warned engaging in a trade war would lead to never-ending negotiations and increasingly high prices have to criticize if the administration manages to get a phased deal going?

What will happen if it works?

The post Could The China Trade War Be Nearing An End? appeared first on RedState.

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Not again: China balks at signing “phase one” accord with Trump?

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Last week, Donald Trump announced that China had already agreed to terms on a a first-step trade deal with the US. According to Bloomberg, either Trump spoke prematurely or Xi Jinping has tried to play games once again. China won’t sign the “phase one” deal without more negotiations, Bloomberg reports this morning, leaving the status of talks unclear:

China wants further talks as soon as the end of October to hammer out the details of the “phase one” trade deal touted by Donald Trump before Xi Jinping agrees to sign it, according to people familiar with the matter.

Beijing may send a delegation led by Vice Premier Liu He, China’s top negotiator, to finalize a written deal that could be signed by the presidents at the Asia-Pacific Economic Cooperation summit next month in Chile, one of the people said. Another person said China wants Trump to also scrap a planned tariff hike in December in addition to the hike scheduled for this week, something the administration hasn’t yet endorsed. The people asked not to be named discussing the private negotiations.

The details of the verbal agreement reached in Washington last week between the two nations remain unclear. While Trump hailed an increase in agricultural purchases as “the greatest and biggest deal ever made for our Great Patriot Farmers in the history of our Country,” China’s state-run media only said the two sides “agreed to make joint efforts toward eventually reaching an agreement.”

This looks similar to the chain of events that led to rapid-fire tariff hikes between the two nations. At one point, Trump thought he had an agreement with China to reset trade and intellectual-property policies, only to have Xi yank the rug out from underneath him by withdrawing almost all of the concessions. At the time, it was thought that Xi wanted to take Trump’s measure and got surprised when Trump immediately escalated the fight.

Perhaps the amount of surprise might have been overstated at the time. If Xi tried making the same play over the weekend, he won’t have any right to claim surprise over what might come next, as Jonathan Swan points out:

But was this a deal at all, or did Trump overstate progress as an actual breakthrough? For China, the phasing Trump offered presents internal problems for Xi. While China has offered separate deals in areas of trade, it wants all of the punitive tariffs lifted first:

For Xi, it’s seen as politically unfeasible to accept a final deal that doesn’t remove the punitive tariffs altogether. Nationalists in the Communist Party have pressured him to avoid signing an “unequal treaty” reminiscent of those China signed with colonial powers.

“The U.S. must concede on its December tariff threat if they want sign a deal during APEC summit, otherwise it would be a humiliating treaty for China,” said Huo Jianguo, a former Chinese commerce ministry official who is now vice chairman of the China Society For World Trade Organization Studies. “The U.S. has definitely shown some good gestures but we shouldn’t exclude the possibility of another flip-flop.”

That might have been why the Chinese didn’t talk up the prospects of this deal right from the get-go. Their state media apparently never mentioned that a deal had been reached, and even warned the US about getting over its skis, as well as Trump using any potential misunderstanding to escalate the trade war:

Chinese state media warned the U.S. over the weekend to “avoid backpedaling” on the partial trade agreement, and expressed caution about the initial phase of the deal which President Donald Trump called “very substantial.” …

“While the negotiations do appear to have produced a fundamental understanding on the key issues and the broader benefits of friendly relations, the Champagne should probably be kept on ice, at least until the two presidents put pen to paper,” said China Daily on Sunday. …

“As based on its past practice, there is always the possibility that Washington may decide to cancel the deal if it thinks that doing so will better serve its interests,” China Daily said.

“The US should avoid backpedaling, as it has in the past, and instead cherish what has been achieved as a manifestation of a healthy and steady China-US relationship that serves the interests of both countries and the world,” it said.

Xinhua also never claimed that a deal had been struck:

And investors in the West didn’t see it as a deal, either:

Wall Street analysts were largely skeptical of Trump’s announcement on Friday of a substantial trade deal, as Evercore ISI strategists noted that it “focused on the low-hanging fruit, with a lot vague or not addressed.” …

China’s trade negotiators want to meet for more talks in the next couple of weeks, people familiar with the matter told CNBC’s Kayla Tausche on Monday. Before Chinese President Xi Jinping signs the “phase one” trad agreement, the nation’s negotiators want to add more detail.

Credit Suisse doubts this “mini-deal” will lead to the end of the U.S. trade war with China, saying it sees “daunting obstacles” to a full resolution. But Credit Suisse does see some good news in the early agreement.

So perhaps Xi doesn’t want to sign the “phase one” accord because there’s nothing yet to sign. Neverthless, Trump spent yesterday promoting the agreement and claimed that China had already begun purchasing “very large quantities” of agricultural products from “OUR GREAT PATRIOT FARMERS & RANCHERS”:

It sounds like both Trump and China are playing wheels-within-wheels games in these negotiations. Nothing is certain until pen meets paper, and even then, China has shown an amazing amount of, er, flexibility when it comes to meeting the terms of international agreements.

The post Not again: China balks at signing “phase one” accord with Trump? appeared first on Hot Air.

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Trump: “Big day of negotiations with China” tomorrow with Xi deputy

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Could an end to the trade war with China be near? The highest level negotiations thus far since the two countries started lobbing full-scale tariffs at each other will take place tomorrow. Donald Trump announced a meeting with China’s Vice Premier Liu He on Twitter, but suggested he might not be all that eager to cut a deal, but China has also sounded less than positive about the potential for a breakthrough:

The U.S. and China have begun their principal-level negotiations in Washington on Thursday. Trump’s comment about a meeting with Liu contrasted with a report from the South China Morning Post that said the two sides made no progress in deputy-level trade talks this week and Liu will cut his visit short.

Stocks surged after the president’s tweet, rebounding from a wild overnight session sparked by the SCMP article as well as multiple other media reports.

Signs point to a potential change of direction. Rather than reach one overall settlement, the two countries might decide to make a series of targeted pacts where they can find agreement on trade issues:

Bloomberg News reported overnight that the White House is working up a partial deal to suspend next week’s tariff increase in exchange for a currency pact. The New York Times also reported that the Trump administration is grant licenses for some U.S. companies to sell nonsensitive supplies to Chinese telecom giant Huawei.

A deal on currency manipulation and Huawei would appear to be a balanced approach to each country’s interests and leverage. That could unlock other parts of a broader set of agreements down the road as a confidence builder. It’s not a bad place to start, but it doesn’t dig deeply into the US’ core issues of market access and intellectual-property protection, at least not yet.

Even before Trump’s tweet, rumors had floated about a potential trade deal with China. The Washington Post noted that investors got bullish yesterday afternoon after those rumors began to circulate, mainly leveraged off of the Bloomberg report. The Post also cast some doubt about Trump’s reluctance to deal:

Whether these escalating problems can be resolved during two days of talks is unclear, but the prolonged trade war has shown growing signs that it is causing problems for the economies in both countries. The Fed released the “minutes” of its September meeting on Wednesday, and the word “trade” appeared in the discussion 28 times. It said, among other things, that “trade policy concerns continued to weigh on firms’ investment decisions,” a sign that companies were cutting back while they await a resolution of the White House standoff with China.

Also Wednesday, the Bureau of Labor Statistics reported that the number of new job openings had fallen to its lowest level since March 2018. The labor market has cooled a bit this year but it has remained relatively strong. Any sign of weakening heading into the 2020 election could create problems for the White House.

The labor market has cooled considerably, although job losses have not increased — yet. One has to go back a full year to find a monthly jobs report where additions significantly increase past the maintenance level needed for population growth. Last month, wages stagnated for the first time in a couple of years, which is another indicator of a job-market stall on the horizon. Trump needs an economy shifting back into high gear well ahead of the election, and most certainly won’t survive a recession or even a significant period of stagnation.

So yes, Trump needs a deal, but it can’t just be any deal. He will have to show significant wins now, thanks to the length of the current trade war and the damage it’s done to the agricultural sector especially. Farmers need to see immediate and significant benefits to keep them on board the Trump train.

Under normal circumstances, the presence of Liu and Trump at the bargaining table would indicate some sort of agreement has already been reached. That may not be true with Trump, who likes to do the negotiating himself, but it’s at least an indication that enough progress has been made for Trump to insert himself into the process.

The post Trump: “Big day of negotiations with China” tomorrow with Xi deputy appeared first on Hot Air.

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Republicans Should Stop Talking Out of Both Sides of Their Mouths On China

Westlake Legal Group ap-trump-xi-press-conference-620x413 Republicans Should Stop Talking Out of Both Sides of Their Mouths On China United States theft The Bulwark Tariffs republicans Politics NBA National Review Morey Geo-Political Enemy Front Page Stories Front Page Free trade Featured Story dangerous corruption consistency conflict China Allow Media Exception

U.S. President Donald Trump shakes hands with Chinese President Xi Jinping after a joint press conference at the Great Hall of the People, Thursday, Nov. 9, 2017, in Beijing. Trump is on a five-country trip through Asia traveling to Japan, South Korea, China, Vietnam and the Philippines. (AP Photo/Andy Wong)

As tensions with China and the NBA boil over, we’ve seen a remarkable showing of unity among all corners of American life. It seems we’ve finally reached a point where people recognize what China truly is and that the long term dangers of continuing to shovel cash and influence their way outweighs the short term gains.

At the same time, I find myself frustrated by some of the double talk I’m seeing on the issue because my fear is this new, widespread epiphany may not last.

Let’s remember, it was just five minutes ago that many Republicans within the beltway and their subsequent media circles were vehemently stumping for unfettered free trade with China. I can’t count how many “Trump is an idiot and will destroy the economy” tweets I’ve seen over the past few years. The consistent message has been to call for a total normalization of trade relations with China, absent any additional tariffs or leverage being used to press them.

Take this example of contradiction at play.

I actually agree with French on that point. But here’s the thing, none of this is new.

We’ve known for a long time that China is a human rights violator. We’ve known they cheat and steal when it comes to trade. It’s well documented that they put people in concentration camps and that they’ve killed minority groups via genocide. Heck, there are stories of them harvesting organs of prisoners.

No offense to Guy, because he’s right to point out what China is doing with Muslim minorities, but at the same time, he and many others like him have found Trump’s trade war with China highly objectionable on economic grounds. But if the Chinese are evil and reprehensible, why would anyone support China being such a large trade partner in the first place? These are questions many Republicans haven’t properly grappled with, instead choosing to illogical compartmentalize them.

Getting back to French, since he knows everything about China’s history of atrocities, why has he spent so much of his time levying critiques such as this?

When you hear Donald Trump claim that he can magically negotiate “winning” trade deals with China or Japan, here’s what it means in the real world: more expensive goods at home as tariffs drive up prices, and less opportunity for exports abroad as trading partners retaliate with import restrictions of their own. We won’t see textile mills spring open across the land — we’ll just pay more for shirts and socks.

Again, French isn’t necessarily wrong in a vacuum, although he was wrong about manufacturing not coming back. It actually has increased over Trump’s presidency, but tariffs do hurt American companies in the short term (they also hurt the Chinese). Yet, if he truly believes China is a tyrannical dictatorship and is a dangerous threat, why exactly would he be stumping for the status quo of enriching them and expanding their influence?

You can’t have it both ways. You can’t stump for unlimited trade with China, allowing them exponential growth to challenge us and our ideals, while at the same time proclaiming how terrible they are and how they are destroying democratic freedoms.

It’s time to choose a side and stick to it, even if there’s a cost.

I’m not writing this to call anyone out. I’m writing this to challenge Republicans to come up with a message on China that’s not a convoluted mess. When Trump started hitting China early in his tenure, the Republican response should have been to steer him into doing it for the right reasons (to blunt Chinese aggression and influence), not castigating him for not retreating and letting China do whatever they want just because it may benefit us financially.

You can’t demand unfettered free trade with China out of one side your mouth and then proclaim the vast, dangerous evils of China out of the other. That is a contradiction that can not be squared and Republicans should stop trying.

It’s good to see some are finally getting the message but they need to keep their eye on the ball going forward. China will be far, far more dangerous 20-30 years from now if we continue to heavily rely on them, passing mountains of cash in their direction along the way. It’s fair to say that I even part ways with the President on this matter. I don’t think we need a “better deal” with China (as Trump wants). I think we need to push American businesses to ween themselves off the communist teat completely. The long term gain and security will far outweigh the short term pain. China is not the only country on earth that can make cheap cloths and electronics, among other things.

In the end, the historic normalization of China was a mistake. I understand the purpose was to blunt the Soviet Union, but all we ended up doing was creating a monster. We’ve got precious little opportunity left to cut them down to size. Right now, the U.S. still holds tremendous financial leverage over them and we should use it.

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The post Republicans Should Stop Talking Out of Both Sides of Their Mouths On China appeared first on RedState.

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Cheesy: Pompeo and the protest wedge of Parmesan-Reggiano

Westlake Legal Group pompeo-israel Cheesy: Pompeo and the protest wedge of Parmesan-Reggiano The Blog Tariffs protests Parmigiano-Reggiano Mike Pompeo Italy Italian Prime Minister Giuseppe Conte Cheese Alice Martinelli

When is a gift presented to a diplomat not really a gift? When it is presented in a gesture of protest, not as a gracious welcome.

America’s top diplomat, Secretary of State Mike Pompeo is in Rome. As he and Italian Prime Minister Giuseppe Conte went through the motions of a standard photo opportunity, shaking hands and smiling for the cameras from the press, a woman approached the two men. The woman held a large wedge of Parmesan-Reggiano in her hands. She extended the cheese to Pompeo, who smiled at her and accepted it. The prime minister, however, scowled.

“I have a present for you — an Italian present. The prime minister knows what I am talking about. This is Parmigiano-Reggiano, and this is what we make best in Italy,” video footage of the event shows Alice Martinelli saying, as Pompeo beams and graciously accepts the pound and a half of authentic Italian cheese.

But Conte appears entirely unamused. “May I ask the lady to step aside, please?” he said.

“I’d be grateful if you could also help,” she appears to say back to him.

“Don’t you worry, I’m doing my job,” Conte replies.

“Take it to Mr. Trump, please, and tell [him] that we make it with our hearts, please,” she calls out to Pompeo, as security agents intervene to escort her offstage.

The cheese was used as a symbol of the possible tariffs President Trump and his administration may levy on European food products. Tariffs on Italian cheese and wine that may be coming down the road are, naturally, a concern for Italians who will feel the pinch. Martinelli was speaking up for the country’s dairies, apparently. There are 330 Italian dairies.

Conte, it should be noted, is a journalist with Italy’s satirical “Le Iene” show. Satire. The show began in 1997 and it is a comedy/satirical show. The show uses sketches and reports to comment on political affairs and consumer issues. Should she be taken seriously over an economic issue? Probably not any more seriously than anyone takes Stephen Colbert in America.

Her bid for international attention didn’t sit well with Prime Minister Conte. As soon as she approached him and Pompeo, his smile turned to a scowl. As soon as Pompeo took the cheese from her, Conte had her escorted away by the security detail. When she instructed Pompeo to deliver the cheese to President Trump and told Conte to do his job, Conte snapped back, “Don’t you worry, I’m doing my job.” He took the cheese from Pompeo and gave it to an aide.

He grabbed the 30-month-old cheese from Pompeo and handed it off to an aide. “Let me explain, this is the way to prove you’re Italian,” he said, as Pompeo giggled in the background. “Let me do the work of the president of the council. … You, step outside,” he called after Martinelli in Italian.

Protesters met Pompeo as he arrived to meet with Conte.

As Pompeo drove up to the presidential palace, he was greeted by members of Italy’s largest agricultural union Coldiretti who held up banners saying “Don’t kill Italian food” and “Mr Pompeo, we are friends”.

They brandished bottles of olive oil, Parma ham and other Italian specialities under a banner reading “A present for Trump”.

Italian Agriculture Minister Teresa Bellanova noted, “The Americans import $4.5 billion worth of Italian food products, or 10 percent of our total exports.”

She told La Stampa newspaper that a hike in tariffs would “seriously endanger jobs, companies and families” across the country, adding that Parmesan and olive oil exports brought in more than $1 billion.

The U.S. is one of the world’s biggest importers of olive oil. The same is true for prosecco and other wines. If tariffs are levied, Italian cheesemakers think that consumption will fall off in America by 80%-90%. That sounds like an exaggeration to me. Tariffs of up to 100 percent on the value of food products exported to the US are discussed. The tariffs are in reaction to subsidies received by aircraft maker Airbus.

The post Cheesy: Pompeo and the protest wedge of Parmesan-Reggiano appeared first on Hot Air.

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China Blinks on Pork and Soybean Tariffs

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Some news from the trade war front. China has decided to exempt pork and soybeans from future tariffs, giving a much needed reprieve to the agricultural sector in the United States. There was joking last week when China lifted tariffs on a few inconsquential items that it was an “olive twig,” but this move signals something bigger.

Via Reuters.

SHANGHAI (Reuters) – China will exempt some agricultural products from additional tariffs on U.S. goods, including pork and soybeans, China’s official Xinhua News Agency said Friday, in the latest sign of easing Sino-U.S. tensions before a new round of talks aimed at curbing a bruising trade war.

The United States and China have both made conciliatory gestures, with China renewing purchases of U.S. farm goods and U.S. President Donald Trump delaying a tariff increase on certain Chinese goods.

This is likely happening for reasons related to China’s condition, not as a gesture of good will. China would like nothing more than to stick it to us but they rely on our agricultural products to keep their people from starving.

An outbreak of deadly African swine fever, which has cut China’s pig herd by a third since mid-2018, has propelled Chinese pork prices to record levels and left the country in need of replacement supplies from overseas. U.S. pork exports to China so far this year have largely fallen short of expectations.

That issue of diseases didn’t just come out of nowhere. It is a result of China sourcing unsafe Russian pork to try to replace what we were selling them. In other words, China needs us and they are starting to feel the pinch. Hence, they lifted these tariffs because they need the imports, not just to be nice.

It’s disappointing that just last week I saw some conservatives on Twitter snarking that Trump should retreat and declare victory. That’s short sighted and stupid. It’s exactly the kind of attitude that got Trump elected, i.e. the idea that Republicans aren’t willing to fight the tough battles. Trump is winning this trade war. For now, the U.S. has been largely left unscathed, with the markets already rebounding big after a scare a few weeks ago. The question is whether Trump can finish this before 2020. This isn’t something he’s going to want hanging over his head. That’s the only wildcard in this.

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The post China Blinks on Pork and Soybean Tariffs appeared first on RedState.

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More blinking? China to add pork, soybeans to tariff exemption list ahead of talks

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As Democrats on stage at the presidential debate took their shots at Donald Trump’s trade strategy with China, it looks as though it has begun producing some results. In a surprise move, Beijing announced that it would roll back tariffs on key agricultural products ahead of next week’s initial trade talks. China had targeted pork and soybeans in order to put pressure on Trump through his rural voter base, but appear to have reversed course:

China will exempt some agricultural products from additional tariffs on U.S. goods, China’s official Xinhua News Agency said Friday, in the latest sign of easing Sino-U.S. tensions before a new rounds of talks aimed at curbing a bruising trade war. …

“China supports relevant enterprises buying certain amounts of soybeans, pork and other agricultural products from today in accordance with market principles and WTO rules,” Xinhua said, adding that the Customs Tariff Commission of China’s State Council would exclude additional tariffs on those items.

China has “broad prospects” for importing high-quality U.S. agricultural goods, Xinhua reported, citing unnamed authorities.

Part of this is motivated not so much by trade pressures but domestic problems at home. As Reuters notes, a swine-flu epidemic has forced domestic pork prices to skyrocket. China can’t produce enough to meet demand, and the last thing they need right now is more unrest at home to go along with the uprising in Hong Kong.

However, extending that to soybeans might be more of a trade-war blink:

China is also expected to step up purchases of soybeans, historically the most valuable U.S. farm export which China has largely avoided buying since the trade war began last year.

Before the announcement of additional tariff exemptions, Chinese firms bought at least 10 boatloads of U.S. soybeans on Thursday, the country’s most significant purchases since at least June.

One has to wonder whether that reflects production problems at home, too. Either way, it will make American farmers happy, while at the same time taking the pressure off American negotiators. China’s concessions now go deep into the heart of their leverage in those talks.

This follows a grudging concession by Trump yesterday that he might consider an interim trade agreement to ease tensions, but he’d prefer to wait for a full settlement:

The president told reporters he would like to ink a full agreement with the world’s second largest economy. However, he left the door open to striking a limited deal with Beijing.

“If we’re going to do the deal, let’s get it done,” he told reporters as he left for a congressional Republican retreat in Baltimore. “A lot of people are talking about it, I see a lot of analysts are saying an interim deal — meaning we’ll do pieces of it, the easy ones first. But there’s no easy or hard. There’s a deal or there’s not a deal. But it’s something we would consider, I guess.”

Trump’s statements add to confusion sparked earlier in the day about what the White House would accept in its ongoing negotiations with China. U.S. stock indexes initially climbed on a report that the Trump administration talked about crafting an interim agreement. A White House official then said the U.S. is “absolutely not” considering such a deal, causing markets to give up some of those gains.

Asked to clarify if Trump’s position had changed from earlier in the day, White House spokesman Judd Deere emphasized the president’s comment that he would prefer a complete agreement.

On Wednesday, Trump delayed the next round of tariffs from October 1 to October 15, calling it a “gesture of goodwill.” The move allows Xi Jinping to celebrate the communist government’s 70th anniversary without the hike as context, but more practically allows a little more time for negotiations. That also puts a damper on the “interim” idea, as it would still likely lead to significant tariff increases on goods outside whatever partial pact is made.

The concessions on pork and soybeans are significant, much more so than a two-week delay in tariffs. It signals that China can’t afford to deal with a lengthy trade war, especially not this year. They may not like it, but they still need to trade in order to feed their massive population, and China might have to get used to fully opening their markets and complying with agreements to do so.

The post More blinking? China to add pork, soybeans to tariff exemption list ahead of talks appeared first on Hot Air.

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“Modest olive branch”: China lifts 16 tariffs on the eve of trade negotiations

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Blink, part II? Not only has China decided to send a team of negotiators to Washington to break a vicious cycle on retaliatory tariffs, they have also made the first gesture to reverse the cycle. Through its official ministry, China announced tariff exemptions on sixteen US imports, with more to come soon, the New York Times reports today:

China extended a modest olive branch to President Trump on Wednesday, publishing a short list of products that it will exempt from its retaliatory tariffs on American-made goods.

But the list does not include big-ticket items, like soybeans and other agricultural goods, that the Trump administration would likely consider key to getting a trade deal done with China.

Cancer drugs, lubricants, pesticides, shrimp meal and a number of other products will be excluded from a list of American goods subject to tariffs, China’s Ministry of Finance said in a statement on its website. China first threatened to place tariffs on many of those goods last year, as the trade war began to heat up.

Tariffs that have already been imposed will also be refunded, the ministry said. It added that further exemptions will be announced in the upcoming weeks.

The Washington Post sniffed, calling the gesture a “twig” rather than a full olive branch. One analyst told them that it was about shaping the public-relations battlefield ahead of the negotiations:

China extended an olive twig, rather than a branch, to the United States in their trade war Wednesday, announcing it would exempt 16 American-made products from tariffs as a sign of goodwill ahead of talks scheduled for next month. …

“China wants to claim the moral high ground before the October talks and to send a message of goodwill,” said Yao Xinchao, professor of international trade at the University of International Business and Economics in Beijing. “It’s all about molding public opinion” to portray the United States as the aggressor, Yao added.

Sure, but that and five bucks will get them a café latté at Starbucks in October. No one doubts that Trump is the aggressor in this trade war; he’s the one who slapped tariffs on in the first place. China’s keeping tariffs on ag products in an attempt to force Trump into backing down to protect his political support in rural America, but PR on that point won’t help the PRC until fourteen months or so from now — if it does at all. American farmers also have lots of frustration with China’s sharp limits on US agricultural products, which means farmers have some good reasons to stick with Trump for a while in this fight.

The issue for China is getting tariffs lifted before supply chains for US businesses get relocated permanently. Right now, American companies are riding out the first waves of tariffs with price increases passed along to consumers, but at some point it will just be cheaper to relocate their supply chains to other countries. Most of them won’t end up in the good ol’ USA as Trump would like, but they’ll go to other countries that don’t use trade to conduct espionage and steal intellectual property.

The bottom line from this concession is obvious: China sees the need to resolve this quickly. The exemptions are meant to highlight the risk to the ag sector here too, but they’re first aimed at scaling back the risk to their own priorities when the rest of the US tariffs come into effect. Once the supply chain exodus begins, it won’t be easy to reverse the damage — and both Trump and China know it.

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India Reminds: What DC Has Long Pretended Is ‘Free Trade’ – Is Not Free Trade

Westlake Legal Group world-fair-trade-day-logo India Reminds: What DC Has Long Pretended Is ‘Free Trade’ – Is Not Free Trade trade import limits trade Taxes Tariffs sugar subsidies Politics Policy News Judicial India Front Page Stories Front Page Free trade fair trade Business & Economy Brazil

Washington, D.C.’s very swampy denizens have spent the last half-century-plus perpetrating a panoply of frauds against We the People.

Perhaps the most Gaslight-y of them all – has been DCs fake free trade.

We the People have watched DCs fake free trade – dispatch millions of our jobs and trillions of our dollars to everywhere else on the planet.  And our nation – has been hollowed out and caved in.

And when We the People complained about the self-destruction – we were yelled at as nationalist Luddites who are anti-commerce.

Yes.  Our opposition to the guys with guns and masks taking our wallets and watches – is “anti-commerce.”

What they do not understand is – commerce occurs between peoples.  Trade Policy – occurs between governments.  And every government – seeks to advantage its people over all others.

Well, except our government, of course.  Because “Free Markets!!!” – or something.

So our half-century-plus of allowing every country on the planet to favor their peoples over ours – has gutted our people and our nation.

The planet tariffs and limits the import of our stuff – which hurts our stuff.  And the planet subsidizes their stuff – thereby giving their stuff an anti-market advantage over our stuff.

We do very little of any of this.  We do absolutely nothing about their doing it.

Fifty-plus years later – we are in the heinous mess we’re in.

In writing about trade with utterly corrupt Communist China, Nicholas Phillips wisely notes:

“(Fake) free trade with China means allowing its distortions into our market.

“Refusing to allow our government to ‘pick winners’ by rejecting industrial-policy support to key sectors means that Beijing will pick winners for us.”

If we don’t prioritize things for ourselves – the planet will prioritize things for themselves.  And much more often than not – it will be to our great disadvantage.

“Key sectors” you say?  I would say food growth and production is a key sector.

Before you can put on your cheap Bangladeshi PJs and watch your cheap Chinese TV – you gotta eat.

And fake free trade has been devastating our farmers, ranchers and food producers.

By not choosing to defend our producers – we have subjected them to the rest of the planet defending theirs.

To wit:

Sugar: Concern Increases Over Subsidies in India:

“Édgar Herrera, executive director of the (Costa Rica) Industrial Agricultural League of Sugarcane (Laica), explained…:

“‘These (sugar) subsidies are greater than those allowed by the World Trade Organization, in the order of $10 billion annually.  At the same time, it causes an artificial increase in sugar production, which surpasses India’s internal consumption.’…

“‘There is an oversupply, which has caused sugar prices to collapse below production costs. And this causes severe damage to countries that do not have these subsidies, as in the case of Costa Rica.’”

Again: $10 billion per year.  JUST in sugar subsidies.  JUST from India.

Yet again, a country is cheating to help its people – and screwing everyone else.  Not just US.  Not just Costa Rica.  Everyone else.

India’s New Sugar Export Subsidy a Bitter Pill for Australia:

“India has announced a fresh round of subsidies to prop up its ailing sugar industry and Australian growers and millers argue the export incentives are an illegal market distortion….

“Previous Indian subsidies have flooded the global market with Indian sugar, and the latest package will extend the glut….

“Brazil and Guatemala joined Australia in an appeal to the the World Trade Organisation (WTO), claiming India’s export subsidies are an illegal market distortion and formal dispute resolution has begun….

“‘We are stunned by this development, just days after the WTO formally established a Dispute Panel to investigate the legality of India’s sugar subsidies,’ said Australian Sugar Milling Council chief executive David Pietsch.

“’India’s government has approved a massive market distortion. The amount of sugar involved dwarfs Australia’s total annual raw sugar exports….’”

So we wait for the WTO to get its act together and do something about this.  If they ever do.

In the meantime, India strip mines the global sugar market – and every non-Indian in it.

Oh: And a huge reason why India’s sugar production was struggling so mightily?  Which led to their sweetening their pot with $10 billion a year in subsidies?

Brazil has LONG been subsidizing their sugar production – to the tune of $4 billion per year.  Which artificially got them – to controlling almost half of the 100+ country global sugar market.

Again: Commerce is between peoples.  Trade Policy – is between governments.

We’re now in a subsidy arms race.  With governments heading in the wrong direction – ratcheting upward, rather than down.

Which results in:

Brazil Ethanol Boom Pushes Sugar Outlook to 14-Year Low

Our farmers and producers – getting omni-directional screwed.  Yet again.

Brazil Says India’s Subsidy Will Extend Cycle of Low Sugar Prices

If our farmers and food producers can’t get a decent price for their stuff – they’ll stop growing and producing their stuff.

And then where will we be?

In the name of fake free trade – DC has gutted our industrial manufacturing.

Which is inconceivably terrible.

In the name of fake free trade – DC is on the verge of gutting our food manufacturing.

Which is cataclysmic.

Let’s stop pretending fake free trade is free trade – shall we?

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Trump: Pay no attention to that garbage ABC/WaPo polling outfit

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Alternate headline: “Presidential tweet focuses country’s attention on ABC/WaPo poll showing Trump’s job approval sliding.”

It made me laugh to think of lawyers threatening a pollster. With what? Bad Sampling in the First Degree?

There’s one true thing in those two tweets: ABC did briefly have Trump falling 12 points behind Hillary in October 2016 — from October 20 to 23, to be exact. Other pollsters saw Clinton’s lead balloon around the same time, though. The AP had her up 13, Suffolk had her up 10, and so on. That’s not because of data-rigging or FAKE NEWS!, it’s because Trump was getting battered at the time by fallout from the “Access Hollywood” tape and the women coming forward to accuse him of various forms of sexual misconduct. Not long after, though, Comey released his letter to Congress announcing that he was reopening the Emailgate probe. And late deciders began weighing whether to sign up for another four years of Clintonism or to try to something different in a big way. The very next ABC poll taken, from October 21-24, found Hillary’s lead slipping to eight points. The ABC/WaPo poll conducted from October 23-26 found it shrinking to five points. The next tracker, from October 27-30, after the Comey letter was issued, had it down to one.

The final poll they published before Election Day put the race at 49/46 for Hillary. That turned out to be the closest match of any major pollster with the national popular vote, which went 48/46. Which was no surprise: Contra Trump, ABC/WaPo actually has a sterling record of polling in presidential contests.

But we needn’t dwell on this. Anyone who doesn’t understand yet that Trump cries “fake!” at any news that’s bad for him to try to convince people not to believe it isn’t going to be swayed at this point. Besides, I can understand why today’s ABC/WaPo poll is especially irritating to him. It’s not the job approval number in it, which is bad at 38 percent (down six points from June) but nothing he hasn’t seen before. The ominous numbers are the ones associated with the economy, particularly the trade war with China.

While a 56 percent majority of Americans rate the economy as “excellent” or “good,” that figure is down from 65 percent in November. A separate question finds 6 in 10 say that a recession is either “very likely” or “somewhat likely” in the next year. That fear compares with 69 percent who said a recession was likely in fall 2007, shortly before the recession began later that year…

The Post-ABC poll finds 43 percent of Americans say Trump’s trade and economic policies have increased the chance of a recession in the next year, more than double the 16 percent who say his policies have decreased the likelihood of a recession. Another 34 percent say Trump’s policies have not made a difference…

But sizable shares of Trump’s core supporters say they are worried about price increases because of tariffs, including 55 percent of whites without college degrees, 54 percent of people living in rural areas and 45 percent of white evangelical Protestants. Concern rises to about 6 in 10 political independents and people living in the suburbs, two key swing voting groups.

His approval rating on the economy was in majority territory in June at 51 percent. Now it’s at 46/47.

If we do end up in a recession, POTUS will use every rhetorical weapon available to him to shift the blame. It’s Jerome Powell’s fault for not lowering interest rates; it’s manufacturers’ fault for not moving their businesses out of China quickly enough; it’s Democrats’ fault for not agreeing to a payroll tax cut to stimulate the economy; it’s China’s fault for stubbornly resisting American pressure to end its intellectual-property banditry and play fair economically. Those arguments will work for fans but I don’t know if they’ll work for swing voters. A separate poll taken late last month showed most Americans will blame Trump if the economy goes south:

The Harvard CAPS/Harris poll of 2,531 registered voters at the end of August found that 57 percent would blame Trump more than the Federal Reserve or anyone else should America enter recession by the end of the year.

Moreover, 62 percent said they were somewhat or very concerned that there will be a recession in the next six months amid the China trade war, a global economic slowdown, and the waning impact of federal stimulus from early on in the Trump administration…

The Harvard CAPS/Harris poll found that 63 percent believe the tariffs are hurting the U.S. more than China. Moreover, 74 percent said U.S. consumers, not China, pay the cost of the tariffs.

The good news for him is that Americans do see the point of this war. Fifty percent approved of his tariffs on China despite the economic pain and fully 80 percent thought it was better to reckon with China’s chicanery now than to keep postponing it. That’d be an interesting electoral pitch if Trump tried it — “I know it’s tough right now but it’ll be tougher if we let China keep stealing. And unless you elect me to a second term, the next president will let them off the hook.” I don’t think he’d try that message, though; it’s too close to accepting responsibility for a negative development, something to which his ego is deathly allergic. He’ll try a combo of insisting that things really aren’t so bad and, to the extent that they are, it’s someone else’s fault.

One other ABC/WaPo detail via Charlie Sykes: Trump’s approval is at 30/64 among women, abysmal numbers that are way off his pace of 41 percent of the female vote in 2016. Obviously he’ll do better than 30 percent next November as some right-leaning women decide he’s the lesser of two evils, but you can see why I thought yesterday that a third-party run by a woman candidate could be dangerous to him. If a Carly Fiorina type pulled more women voters from him than from the Democrat, it could cost him a second term. Fiorina says it won’t be her, though, luckily for POTUS.

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