AP
Yay: President Donald Trump took “yes” for an answer Wednesday, pausing for three months most of his reciprocal tariffs to allow for one-on-one negotiations with the dozens of nations that had come calling since he dropped the bomb last week.
Not paused, but instead redoubled, is the hit on imports from China — a move that’s beyond justified.
Not just because Beijing came back at Trump with its own tariff hikes.
Nor only because it has abused its privileges ever since President Bill Clinton welcomed it into the world trading system three decades ago.
But because its central planners are now aiming at global hegemony in manufacturing — a naked threat to every other country’s national security.
China’s state banks have pumped $2 trillion in loans into the country’s “private” industries these last four years, financing not only a ton of new factories but massive automation at existing ones — and so a 30%-plus growth in exports over 2023 and 2024.
The country’s factory output is now larger than that of five major industrial powers (the United States, Germany, Japan, South Korea, Britain) combined.
Again, thanks to massive state intervention that has nothing to do with free markets or fair competition.
And that makes no sense except as an effort to put everyone else at Beijing’s mercy.
Now is absolutely the time to blow up this relationship, before Chinese trade becomes something our economy can’t function without.
As it is, Treasury Secretary Scott Bessant is right to say Washington now retains the upper hand in any one-on-one trade war, since China exports roughly five times more (by value) to us than vice-versa.
Note, too, that much of the rest of the world has been responding to China’s games with higher tariffs — and now may well need to do more if Beijing tries to divert products from the US market to theirs.
Meanwhile, the one-on-one talks can firm up US trading relations with our allies, rather than pushing them into Beijing’s clutches.
And, no, we don’t pretend “this was Trump’s plan all along”: He doesn’t think that way — he often makes moves by instinct, sees the reactions and adjusts accordingly.
Now his team has three months to settle with our allies and other trading partners while his pro-growth policies on energy and deregulation kick in and Congress locks in the 2017 tax cuts and the rest of his program.
The road to the Golden Age is solidly on track.