Dem
47
GOP
53
Since we don't really understand the Trump administration's tariff policy, we don't really understand, and cannot really anticipate, most of the decisions he makes. What we do know, however, is that the United States does vast amounts of trade with China, much of it in goods that are sold directly to consumers. That means that tariffs on China are more likely to produce inflation, and are more likely to be noticeable to voters, than, say, tariffs on railroad ties from India or industrial solvent from Serbia.
Yesterday, by virtue of there being no trade deal with China, tariffs on Chinese imports were supposed to be ratcheted back up to 145%. That comic-book number would undoubtedly trigger some level of financial crisis, and would have led to panic in the markets. So, it's hardly unexpected that, after much consideration (possibly as much as 2 seconds' worth), Trump decided to extend the deadline for negotiations by another 90 days. Inasmuch as we are specifically talking about China here, please feel free to insert your own orange chicken joke here.
We do not know exactly what will happen in the next 90 days (and perhaps the 90 days after that, and maybe the 90 days after that). What we do know is that China is an honor-shame culture, and so Xi Jinping understands very well that any sort of resolution will need to be structured so that Trump can declare a "win" and save face. Xi is also a shrewd operator, and has surely taken notice of the fact that: (1) Trump is being mollified with trade "deals" that give him things he can brag about, even if they lack substance and (2) Trump is leery of actually bringing the hammer down on China, even in a small way. Heck, he hasn't even been willing to force the sale of TikTok, despite very clear orders from Congress to do so.
What this means, we assume, is that sometime in the reasonably near future, Trump will fire up his orange-chicken-flavored social media platform, and will announce that he has secured a GREAT trade deal with China. The bestest, awesomest trade deal ever. And the details will be something along the lines of a tariff rate well south of the threatened 145%, along with some promise of "investment" in the United States that isn't even worth the paper it's written on. "Oh, you thought we said 600 billion dollars would be invested? Oops! We actually said 600 billion fen ($834,701). Sorry about the misunderstanding!"
Whatever is going on, despite his "markets be damned" rhetoric, Trump has now given 90-day extensions to two of the United States' three biggest trading partners (Mexico, in addition to China). The other is Canada, where things are more tricky, because it's gotten personal between Trump and the Canadians, and because Canadian PM Mark Carney was specifically elected to push back against Trump. It's very hard to know how that story will end, eh. (Z)