President trump doubles the tariffs on some Chinese goods after negotiations failed to make a deal and he threatens to impose more tariffs on all remaining Chinese imported products for about $300 billion worth of goods.
“For many years, China trade, it was unfair, nonreciprocal, unbalanced, in many cases unlawful. So, we have to correct those…”, Larry Kudlow said.
Kudlow stated that tariffs must be reinforced until the unfair trades with the Chinese will be in much better condition. Therefore, an agreement is needed to take place. He also states that America is not in a trade war with China but in a trade negotiation because they’re talking with them and will talk some more.
“I think that China felt that they were being beaten so badly in the recent negotiations that they may as well wait around for the next election, 2020. if they could get lucky and have a democrat win – in which case they would continue to rip-off the USA for $500 billion on a year…”, Trump said.
Kudlow restated that there has to be very strong enforcement provisions on intellectual property theft, forced technology transfer, ownership of American companies, cyber interventions, and tariff and nontariff barriers. A statement shot on the Chinese’s malpractices.
Some Chinese officials said that the agreement offered by the Americans were too one-sided. But Kudlow implies that the trade between the US and China has been too unbalanced for a long time. It is always in favor of the Chinese, and because of these problems of unfair and unlawful practice, they have to come up with a very strong agreement. This is so they could correct the wrong practices in order to benefit both countries.
Apparently, there’s no scheduled talk with China. However, the Chinese invited the ambassador to come over to Beijing, and with the upcoming G20 summit that will be held in Japan toward the end of June, there’s a chance that President Trump and President Xi Jin Ping might be able to talk about said issue.
Even though Trump impose tariffs on 5,000 goods, China hasn’t retaliated in applying some countermeasures, which surprises Kudlow. But, he expected that it’ll happen any time soon.
On the other hand, Trump already launched the process to impose 25% tariffs on the rest of Chinese imports from China to America. Kudlow says, he’ll have announcements and hearings, but it might take a couple of months to materialize.
“…the deal will become far worse for them if it has to be negotiated in my second term.”
“Our country can take $120 billion a year in tariffs, paid for mostly by China, by the way, not bias. A lot of people try to steer it in a different direction… is ultimately paid for largely by china.”, Trump said.
Chris Wallace says that it’s not true. China doesn’t pay the tariffs but the American importers and the American companies, which oftentimes pass it to the consumers. But Kudlow implied that both sides will pay, and it will be largely by China that will suffer GDP losses as a result of diminishing export market.
A study appears that tariffs on Chinese goods will cost an average U.S. family of $4767 a year and cut the employment by almost a million jobs. And if the 25% and more tariffs will be imposed, including the 300 billion worth of goods plus the Chinese retaliation, it will cost American families of 42,200 a year. Cut the employment more than 2 million jobs and GDP growth reduced to more than 1%.
But Kudlow refute these studies and said that these are only exaggerated numbers. The United States’ economy is booming and GDP is going up. He’s confident that with the rising economy, America will be in a good shape given the president’s policies.
He also reiterates that the tariffs are needed to negotiate in order to correct more than two decades of unfair trading practices with China. This is a risk that the US should take and can take without damaging their economy.