Chinese Finance Minister Lou Jiwei harshly criticized Donald Trump, characterizing him as an “irrational type” and saying that his plan to raise tariffs on Chinese goods to 45% would be a “violation of the rules set by the World Trade Organization.”
Lou said that if the United States put Trump’s proposal into effect, it “would not be entitled to its position as the world’s major power. The U.S. needs to recognize that the U.S. and China are mutually dependent on each other. Our economic cycles are intertwined.”
He acknowledged that rhetoric in a U.S. presidential campaign can become heated.
Trump on Sunday again asserted that China has waged “economic war” against the United States.
“They’ve taken our jobs, they’ve taken our money,” the billionaire businessman said at a campaign rally in New York. “We can’t continue to be ripped off like we’re being ripped off.”
At a Republican presidential debate last month, Trump said China will not allow free trade or U.S. manufacturers to compete freely.
“The 45 percent (tariff) is a threat that if they don’t behave, if they don’t follow the rules and regulations so that we can have it equal on both sides, we will tax you,” he said.
Republican rival Ted Cruz criticized the 45 percent tariff proposal, saying during the same debate that it would be passed on to U.S. consumers.
“How does it help you to have a president come and say … I’m going to put a 45 percent tax on diapers when you buy diapers, on automobiles when you buy automobiles, on clothing when you buy clothing. That hurts you,” the U.S. senator from Texas said.
It’s not that Trump doesn’t make some valid points, although the idea that we’re being “ripped off” is an exaggeration. It’s just that a tariff would harm the U.S. as much as it does China. Millions of U.S. jobs depend on exports to China, and when the Chinese reciprocate and raise tariffs on U.S. goods, tens of thousands of jobs will be at risk.
Trump rarely mentions the real inequality in our trade relationship with China. It’s much harder to do business in China than it is the U.S. You have to jump through so many hoops set up by the Chinese government, that getting all the permissions and go-aheads from Chinese bureaucrats can take months.
If Trump wants to start a trade war, we all lose.