How Trump’s Trade War Went From Method to Madness

How Trump’s Trade War Went From Method to Madness

I’ve been covering this trade war for almost three years now, and oftentimes it looks very chaotic. The China trade deal is
dependent on one thing, do I wanna pick it. If we don’t make a deal with China I’ll just raise the tariffs even higher. Thank you very much. And it’s really hard to think
back to the beginning of it, but how it really started actually seemed like there was a strategy to it. Over the course of the
U.S.-China Trade War, Trump’s aggressive policies
and unpredictable behavior has managed to bring the Chinese
to the negotiating table. We’ve come to a very
substantial phase one deal. China will continue to eat your lunch unless somebody takes a stand, and it just so happens
that it was Donald Trump that took the stand. We’re close. With the promise of that phase one deal looming on the horizon, can
that same aggressive strategy produce meaningful reform in China? I wrote a paper during
the Obama Administration saying people are not taking
China seriously enough, and the President has
to be directly involved for American policy to
actually make sense. I think in some ways it’s better to wait ’til after the election with China. But, I’m not gonna say that. I just think that. Now the President is directly involved and American policy doesn’t make sense. The reality is that the
Trump Administration has done this in a much
more aggressive way than previous administrations have. It was an asset going into this trade war. It may have been a liability in the end. This is a case study of when negotiating tactics
turn from method to madness. We can’t continue to allow
China to rape our country, and that’s what they’re doing. It’s the greatest theft in
the history of the world. President Trump ran a successful campaign of denouncing China’s
unfair trading practices. They take our money, they take our jobs, and we owe them $1.6 trillion. I think it’s important to understand that the President inherited
a very difficult situation, one where we probably
should have addressed some of these problems
with China a lot sooner. But I think the President
had great wisdom and courage to step up and realize that we really can start to make progress. And after becoming President his team began devising a strategy on how they could rebalance
the relationship with China. And this man, Derek Scissors, was part of those initial conversations. The goal starts with we’re gonna focus on intellectual property, which we were trying to decide
how do we get the Chinese to reduce their intellectual
property coercion and theft. They weren’t gonna stop,
but how can we reduce it? How can we show we’re
serious about this issue, change their behavior? And that got pulled into
the President saying, “I want high tariffs. “I wanna reduce the trade deficit.” Which is a completely different goal. Putting tariffs on all firms
doesn’t discourage theft and coercion of intellectual property, ’cause it doesn’t punish the guilty. It punishes everyone. Tariffs are really the big
bazooka in the trade world. You don’t like to use them normally, or if you do use them in the trade world, you tend to use them
for short-term leverage to try and get someone
to the negotiating table. In March 2018 Ambassador Lighthizer, the trade representative, was
testifying on Capitol Hill, and he was kind of laying out
what he called an algorithm. The purpose of your algorithm
is to pick out things to the extent you can
that are in that category. Things that are in the category
have the maximum effect on China and the minimum
effect on U.S. consumers. The initial number that folks at the U.S. Trade Representative’s
office came up with was $34 billion. And the President looks at it and says, “Well, that’s not big enough.” And we’ve seen this a
lot in our reporting, covering this trade war, that the President really
likes round numbers. A second list of $16 billion of Chinese goods is published, raising the total initial
tariffs to $50 billion. And while looking back,
this may seem haphazard, it is part of President Trump’s strategy. And this is just the beginning. I wanna tell you that. This is just the beginning. Donald Trump has always
had two things he’s tried to accomplish
through these trade wars. One is selling it
domestically to his base. He wants to be seen to be
punching China in the nose. And the second thing is his
old art of the deal approach, and that is he likes to destabilize people across a negotiating table. This administration has
kind of prided itself on being unpredictable. Kinda the notion that unpredictability is a real strength in a negotiation because if they don’t know
what they’re gonna do, somehow they’re gonna give you more. But not everyone agrees
with that sentiment, at least in regards to the larger intent of getting a deal done with China. To me they haven’t been
unpredictable at all. I think the President has been saying for two and a half years that he wants to have a deal with China
if he can get a deal that is good and that
is in U.S. interests. And he’s gotten a deal with Korea, and he’s gotten a deal with Mexico, and he’s gotten a deal with Canada, and he’s gotten a deal with Japan. And we’re having these
negotiations with China. Early on the maximum pressure strategy only resulted in the Chinese responding with tariffs of their own, going after areas that could
hurt Trump’s political base, imposing tariffs on the auto industry, pork, and especially soy beans. Once the Chinese stopped buying soy beans the impact on the
markets was pretty stark. Immediately the price collapsed and farmers started getting hit. So when you engage in this
tit-for-tat tariff war the question is really who can live with the pain for longer. And obviously that is a
question of political will, and that’s always gonna be the case. And there’s sort of no way around that. Fortunately for us, President Trump has shown that he has that political will. For the rest of 2018 the two countries would raise tariffs back and forth. The U.S. would go from its
initial 50 billion in tariffs to 250 billion. And China’s total tariffs would now hit 110 billion of U.S. goods. Eventually these tariffs would
have their desired effect. In December of 2018 President Trump and Chinese President Xi Jinping would meet face to face in Buenos Aires. Start on meeting we’ll be talking about a number of topics. At that dinner in Buenos Aires, the two leaders agree that
they won’t raise tariffs on each other anymore
or at least for 90 days while they try to negotiate a new deal. Over the spring the two
sides keep negotiating, but the Trump Administration seems to be moving the goalposts, or at least that’s how the Chinese see it. One, they refused to lift
tariffs as part of any deal and secondly Trump seems
to be constantly increasing the amount of purchases he
wants to see from China. At one point he goes from
$1.2 trillion over six years to a $2 trillion number and
that just seems both impetuous to the Chinese but also
economically impossible. By April the two sides create a 150-page document, and there’s optimism
that a deal is in sight. And the White House was very confident that this tough negotiating
strategy from the President has really turned out to get results and fixed the issues that they
went into this trade war for. My understanding is that both sides were actually discussing
where the leaders would meet to sign the agreement. However, in the final
stages of negotiating the Chinese began to walk back some of their larger concessions, most importantly, China
didn’t wanna commit to making legal changes for the U.S. And I think what happened here is that China thought that
Trump wanted a deal at any cost and that he was so out
there promising this deal that he wouldn’t mind if they took some things off the table. That’s the point where
I think the President kind of got fed up and the
events in the negotiations led to an entirely disproportionate
response on his part. In a tweet on May 5th Trump suddenly raised tariffs on the existing $250
billion worth of goods and also threatened that he would tax the remaining $325 billion
worth of Chinese imports. That tweet I read on a plane. I was like, okay, I’m
going to buy WiFi now, and I worked the entire
plane ride over there. Days later Trump again
escalated the dispute by placing Chinese telecom
giant, Huawei, on a black list. That was the biggest slap in
the face for the Chinese yet and relations further deteriorated. We’re having a little squabble with China because we’ve been treated very unfairly for many, many decades. But in another face-to-face meeting, this time in Osaka, Japan, Trump and Xi were able to negotiate another truce on further aggression. So covering this we often have deja vus, and think, well we’ve
seen this movie before. They have a truce, it goes
on for a couple months until Trump realizes China, again, didn’t live up to its promises. And that’s when Trump unleashed another series of tweets. So in early August Trump
decides to escalate things again and announces that he is gonna put tariffs on the remaining imports from China. Importantly it’s also for the first time really gonna hit consumers. It’s gonna hit things like smartphones, toys, kids clothes. And this is the first
time that the trade wars are really gonna come home
for a lot of Americans. After a year and a half
of all this madness Trump’s advisors told him if
you want to get reelected, you have to stop this now. We need to find an off ramp. And so they came to him for
the first time in September and said, “Why don’t we
pocket some of these wins? “Why don’t we get
something good for farmers “and do something like a partial deal?” The August tariff threats were split up. And the ones that would
hit consumer favorites were given a December 15th deadline, with the hopes that a deal could be struck by the end of the year. A tremendous deal for the farmers. A purchase from 40 to $50 billion worth of agricultural products. It’s actually hard as someone who’s been following
this for several years to really care about the phase one deal. Agriculture is not going to
solve the trade imbalance, it’s not going to bring back
U.S. manufacturing jobs. For this year if you sign phase one, you don’t sign phase
one, it doesn’t matter, you’re not gonna get any
meaningful economic changes from the Chinese in 2019 or 2020. One of the big questions
around this trade war is was it worth it? The real question is are we gonna get future phases in a negotiation? And are you gonna get some
meaningful changes in China? And a lot of people in Washington, certainly a lotta
long-time China watchers, feel like that’s not the case. I think we’re finally
having serious negotiations with China after many
years of frustration, and I think everyone has
finally started to realize that we have actual
leverage in this situation and that we have the opportunity to improve the type of trade arrangements that we have with China. 20 months and many false dons later, what have we learned about the use of this maximum pressure campaign? And can this strategy of unpredictability really work over the long term? Just so you understand, I’ve
been very mild about it. Very, very mild. There’s a long way I can go. I think, number one, this just shows that trade
negotiations are tough. And one of the kind of
shortcomings of this negotiation has been we’ve kind of
been all over the map. I mean, at some points this negotiation’s been all about agriculture. Other points it’s been all about the structural issues like IPR. The main problem the president has is he wants us to wrap up too quickly. The President wants this done now. He wants to run on it. He wants to say, I solved this problem. So because of that, he has lost patience with the pace of negotiations. And he’s fine with the outcome
of very high U.S. tariffs. That’s one thing everyone
has to understand. The President doesn’t think,
oh, I’ll pressure the Chinese and they’ll automatically give in. He thinks, I’ll pressure
them and they’ll give in or I’ll get to keep the tariffs and the trade deficit will fall. Both are good for me. We’re doing very nicely with China. But I like it the way it is now because we’re taking in billions
and billions of dollars and we’re giving some of that
money to farmers and others. Now that President Trump is on the cusp of signing a phase one deal, will his willingness to
use tariffs really lead to the fundamental economic changes he is seeking from China? If you wanna be a good negotiator some element of
unpredictability is useful, but I think here we’ve gotten to the point where we’re so unpredictable
that other countries are kinda throwing up their hands and trying to decide is it even really, is it even worth doing a
deal with the United States because we don’t even know if the United States is
gonna stick to the deal. I mean, I think you have to remember that two or three years ago we were being told that the U.S. had very little leverage in trade negotiations and
there really wasn’t a lot we could do to get other countries
to accommodate our concern. The reality of it is is
that countries understand that this is the biggest
economy in the world, it’s a great market, it’s an open market, and I think people are
always gonna be interested in making trade with the United States. It’s fair to say that tariffs brought the Chinese to the table, but what have we gotten out of it? And this gets back to not
so much the tool of tariffs but the strategy. If we don’t know our own goals, it’s very hard to have a win at the end.

100 thoughts on “How Trump’s Trade War Went From Method to Madness”

  1. TPP was great fucker. Obama knew how to fuck China and Trump removed that great move of Obama. The only way to fuck China is to make make deals for those products USA buy from China, instead going to China go to other Asian countries or Europe or make another west American nation rich like Mexico or other latino nations and buy from them. And Chinas economy will be fucked.

  2. The US has a long story of bombarding other countries growth, but finally they found a rival that won't go down without putting a fight

  3. Both china and usa lose. Trump still cannot force china to but usa oil and gas, but trump destroys the world trade, which is almost as same as bush who made the global financial crisis

  4. Wisdom? This 'president'? LOL, LMFAO, WTF?
    Gimme A Break!
    This guy can't play checkers, while China is playing 4-dimensional chess.
    His negotiation tactic NEVER worked, and it NEVER will.
    Brazil will Happily take up the food needs of China, and they are totally able & willing to do so.
    So, where does this leave US, Stuck with Trump The Negotiator?

  5. The trade war was not worth it, China has worked out it can't trust the US so they are now working out how to replace the US and are getting their products from other sources, some of the trade lost during the trade war with China will never return. Huawei will dispense with Google and their Harmony OS will be used by everyone in Asia, Russia and the Middle East, sinking Google and their soya will be provided by Brazil, meat and dairy by New Zealand. Those things will be lost forever.

  6. The world is getting richer and while the developing world is benefitting from advancing technology the developed world is seeing the destructive side of advancing technology as it replaces old industries. The developed world must introduce a universal basic income or as Andrew Yang calls it a freedom dividend.

  7. I agree with trumps: this is only the beginning.
    From now on China and US will start competition for at least 30years. Who’s gonna win? Who knows

  8. Before President Trump, America had over 300 million consumers out of work. How can that be sustainable? With America at work again and companies and more jobs returning to America we can produce our own quality goods that our own working people will buy without foreign terrifs. But foreign trade without terrifs causes them to dump their cheep products on our shores and kill our goods production and kill our jobs while boosting production (employment) over seas. I think President Donald Trump is growing our economy back and he is all American in his motives and deeds and that he is a brilliant economist. I think the producers of this video are of the political Trump haters hand in glove with the leftist liberal Democrats and are pissed off because Trump smashed pay-for-play and the global Clinton Foundation. Also, if i may say: Our USA is a Republic, not a democracy.

  9. Trump just flushed the American work force down China's toilet just to make the stock market go up. There is NO trade deal with China.

  10. NOPE ! He CREATES CRISIS ( Makes DEALS with pseudoENEMIES or Threatens them ) , then BAAMMM, he SOLVES Crises! See , he is DOING something ! 👎🏻🤬

  11. IF Trumps SAID “RUSSIA is IN Charge of USA /Me”!
    His supporters would SAY , “FAKE NEWS”!

    Your President, TAKES V.Putin’s WORDS OVER Military/Intel. Agencies FACTS
    (“ I KNOW MORE THAN ANYBODY , says # 45 “) ! And ALL ELSENIS FAKE !!

  12. Micheal Bloomberg is facing three lawsuits for sexual harassment and gender inequality, but he said his company had an “enviable record” of treating people equally in terms of compensation and promotions.

    Why isn't Bloomberg covering this?

  13. What TOTAL BS…. THE ECONOMY is going gang busters… what’s wrong with you guys… just admit it, his methods work and the Chinese respect a ball-buster. Get over it.

  14. Call it whatever you want but the last thing it should be called is madness! I fact quite the contrary, it is genius and regardless what the loser media wants to claim it IS working!

  15. US is a rich country… trade deal with China, no problem….just print money out of thin air…. with no collateral…China cannot do that

  16. Trade wars with US and Japan, US with Mexico, US with EU, they are all different with trade wars with China, because China is the only country that is independent from the influence of the US, and that is two economic superpowers clashing on each other, that is why it is so difficult for either side to get a trade deal, so it is gonna be extremely difficult for Trump to get the deal done within his office years; you got to spend ten years, fifteen years to slowly making into a deal that seems fair for both countries.

  17. The filthy rich cocksucker can't handle a city and he thinks he should be president 🤣 gonna be a lot of money wasted on that little endeavor. Not to mention the guy has the personality of a wet towel, that'll really go far with millennials

  18. the only ones who are "fascinated" by President Trumps' unpredictability are only the americans and their media that do not stop repeating again and again that the US has recaptured billions and billions imposing tariffs on China, ignoring that the common citizen only can be fooled until that situation starts to affect their economy – what is already beginning to happen. China's economy relies on an equivalent of more than 3 trillion US dollars apart from having an internal market 1.3 billion potential consumers which is in itself the largest weapon held by the Chinese government that can literally "turn off the tap " to many of the biggest american companies that do depend on the Chinese market to survive. not even relocating Apple or all american companies to other countries could possibly bend the chinese position wich also owning most of the foreign debt of the United States as well as the monopoly of some raw matrerias has many more "aces under the sleeve" to hit the economy American if I wanted to.

  19. Trump is a genius in dealing with China. He sees through their true intentions and doesn't get fooled into deals and promises by China that will be broken. And the fact that this video is put out by Bloomberg, who is aiming to run against President Trump in the 2020 elections, means that this video will likely have biased views. I trust Donald Trump to be successful in dealing with the Chinese more than anyone else. It is previous presidents that put us into the situation with China that we are in today.

  20. China didn't steal anything from the Yankees!
    The Ruling Elite in America (Trump incl.)
    Moved all their production lines to China by them self!
    It whas so much cheaper than in America.
    Even Trump with his big mouth had and still have his production lines in Low cost countries like China..
    They got fabulously rich from it.

  21. china…want to pay the check…of properousty….US want to use instrument/policy/manipulating..the situation….by using Tax…issue…currency…it's doesn't work for china…

  22. Of course Bloomberg calls him crazy…After all Michael is loosing millions with Trumps efforts to stop selling out to China…Im no fan of both guys by the way…

  23. What? What? The trade war hurts Americans only. China raises prices and we the consumers pay for it. Trump even admitted we americans will pay more.. that's the entire deal. Get it….trump stole from us the government of usa took the profits from the tariffs as americans paid for them tariffs. Wake the hell up..

  24. A broken clock's right twice a Day. But a broken DJT Administration's never wrong, nor ever going to be completely right.

  25. Bloomberg what an ass clown.he needs to move to a communist country and leave Trump and American gun owners alone.We will not submit to Bloombergs bullshit and he will not be elected POTUS…

  26. er… tweet at 13.50: "China has been paying tariffs on $50 billion US goods" and that's why your economy is doing so well? Does he actually understand how this works? You levy tarifs on imports, not exports. Or is he using this on-off rollercoaster to maybe hedge the market for his own gain?

  27. This is sugar coated nonsense. The president of the US cant even explain on national TV what a tariff is and what it does.

  28. China didn't take anything, American companies gave it all to them in exchange for profit for shareholders, that simple, America did it to themselves

  29. .. says the "news network" owned by someone running against Donald Trump.
    Trust me, says the squeaky voiced billionaire.

  30. Trump: China stole our technology, we are punishing them!

    How could China steal technology that we don't even have?

    Trump: don't you get that? They stole them!

  31. The 2020 National Defense Authorization Act, which authorized $738 billion in defense spending for the current fiscal year, is almost three times larger than Reagan's Defense budget of $256 billion, one during the height of the Cold War and the kickoff for his massive Star Wars program. That $256 billion also paid for Grenada, the last 'war' that our Defense (sic) Department ever won.

    MIC-Pentagon has received double-digit budget increases every year since The Miracle of the Two Planes and Three Towers, while Americans' salaries and benefits continue to fall in relation to their buying power, which is why rent, energy and food are not included in the Consumer Price Index. That'd be a H8 crime, to, you know, tell the Truth that Pentagon has 'lost track of' -$21,000,000,000,000 now gone MIA.

    Who cares? Santa Claus is coming to town! Oops, another H8 crime. Santa is an Old White Privileged CIS Male Colonialist, like our 1,000 Generals and 1,000 Admirals. We can have a General leading every US Platoon charging up Bunker Hill and an Admiral at the bridge of every US Ship landing on Omaha Beach, and still have enough left-over Generals and Admirals to fill the studios of CNN, MSNBC and FOX News!

  32. Meanwhile the long term effects that'll last decades is that Chinese consumers will turn off US products and makes, when once before they had the cachet of being cool and desirable despite any underperformance. Added to the fact the Party will quietly fence off the 1.4 billion strong market (larger than the Western world) from expanding US brands – Apple, Boeing, Starbucks, Ralph Lauren, Walmart, Ford, GM, McDonalds, Coke, Nike, Pizza Hut, Microsoft, Levis, Marlboro, Google, Netflix, Universal, Disney, Hyatt, Harley Davidson, CK, DK, Intel, Tesla, NBA.

  33. Under the Trump administration, the influence of US foreign policy on the world has diminished in recent years. President Trump has struggled to reduce the State Department's budget and fill important diplomatic positions.

    In November, former Ukrainian ambassador to Marie Jovanovic, who testified in Trump's impeachment investigation on the allegations of Ukraine, said the State Department was in "crisis."

    The United States has been threatened by China with military and economic strength. A Washington, DC-based think tank, the New American Security Center (CNAS), warned in June that China is rapidly and secretly developing high-performance weapons and finding ways to destroy American battlefield systems

  34. LIGHTHIZER ALGORITHM: Protect US Consumer, Huawei, Hong Kong, Xinjeang
    CHINESE ALGIC RYTHM: Concentrate on US AG, Tech: Windows, Apple, Dell
    Add to that:
    1. US self Isolation from TPP & the Paris UNFCCC (Paris Agreement), NAFTA (USMCA), NATO & the EEC & the Iran Nuclear Deal
    2. SANCTIONS…. thus far Iran, Russia, China, Brazil & Argentina and now even the Euros. esp. Germany (Russian Gas).
    China on the other hand is strenghtening its ties to Japan, both Koreas, Russia, Brazil and Argentina, Europe, Eastern Europe, Turkey, Iran, the Middle East, South America & Africa. Huawei is doing fine… 5G is introduced into 40 Chinese Cities. And has not been drawn into Hong Kong. GDP Growth above 6.
    Conclusion… Trade Wars aren't easy.

  35. American corporation off shored 77,000 factories to China destroying our Middle Class beginning in 1985 Clinton administration. American companies in China dislike tariffs ts come back home to the USA. Screw multinational companies and China..

  36. the usa dont need to have that type of worry u are talking about,.. they have the cash maker, they have the power, plus u cant compare the debts of china with other country,.. the debts of china is just to high to ignore and get worry about other smaller and less important debts

  37. Why USA is not involving in development as China ? China is great in exporting materials/products in cheap price while USA exports Information Technology in high price. USA should involve its homeless/jobless people in development as China doing.

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