After a series of previous failed trade discussions, the United States and China agreed to additional talks. The next set of negotiations will begin in early October. As of now, the news comes only from a Chinese source, although the phone call in question was confirmed by U.S. officials. This round of talks will take place in Washington D.C. – covering topics related to tariffs and the troubled trade status between the two powers.
Previous trade talks continued a cycle of misplaced optimism in the face of overwhelming opposition. There is little public support for the trade spat among the general populace of either country. Despite this, President Donald Trump’s continued insistence on escalating the trade war has torpedoed previous negotiations. On the opposite side, China’s prior agreements to resume some of their purchasing fell flat. Their soybean purchases are 50% lower than their original pledge.
The Unlikely Chance of Trade Agreement
Donald Trump famously gave an interview to Playboy in 1990. In that interview, he outlined his beliefs about foreign trade. While he referenced Japan in the interview, he has since applied the same statements to both China and Mexico. He struggles to understand the deeper economic impacts of a trade war. That fact is adversely impacting the U.S. economy, now that he can put his ideas into action. Recent quotes, in which Trump refers to himself as ‘the Chosen One’ further his inability to consider compromise.
Meanwhile, Xi Jinping’s previously ironclad position faltered. The situation in Hong Kong undermines his usual strength. This further complicates trade talks, with the U.S. ostensibly aligned behind democratic Hong Kong. While Trump shows no signs of looking to intervene, the nation itself readily supports the protestors.
The “Win” Conditions
Neither party seems to expect success at the continued trade talks. Rather, both are leveraging their position for the future. China’s win condition involves waiting out Trump. Xi and the Chinese leadership are fully aware of Trump’s damaged chances of reelection, as a result of the trade war. Even Trump himself made comments that China should not wait until 2020 to make an agreement – suggesting he knows that this is their strategy. An incoming Democratic president would be more reasonable in their negotiations.
In contrast, Trump believes he has little to lose by prolonging the trade war. His dead-set belief that the economy is doing well shields him from internal doubt – despite all external information to the contrary. China’s own internal conflicts could ultimately force them to the negotiating table during his potential second term. Simply by discounting the facts in front of him, he prevents an agreement from being reached.
Article By: Adam Stone
