Negotiation, not useless tariff threat, is the way forward
US President Donald Trump and Commerce Secretary Wilbur Ross both tried to calm the panic about a possible trade war on Wednesday, just hours after China slapped a 25 percent tariff on $50 billion of imports from the US, including soybeans, whiskey, cars and airplanes.
Trump tweeted early on Wednesday morning that "we are not in a trade war with China", while Ross told CNBC that he expects the situation will likely lead to a negotiated deal. Larry Kudlow, director of the White House National Economic Council, suggested that it's possible Trump's tariffs are a negotiating tactic and won't actually take effect.
If that is the case, then Trump has already proved himself wrong. China has demonstrated that it cannot be coerced and that it is fully determined to reciprocate. Wielding a big tariff stick won't give the US more leverage at the negotiating table.
