There Is No China Crisis – Reason.com

There Is No China Crisis – Reason.com
by Daniel Drezner (Tufts)
The actual trade negotiations with China proved nothing short of a fiasco. The Tax Foundation estimates that the Trump administration's aggregate tariff increases amount to "one of the largest tax increases in decades" and says that the costs of the trade war have already exceeded whatever benefits the 2017 tax bill was projected to produce for long-term growth. Moody's Analytics estimates just one year of the trade war shaved U.S. real GDP growth by three-tenths of a percent and cost almost 300,000 jobs. The "phase one" trade deal does nothing to challenge the elements of China's behavior that the new Washington consensus finds so objectionable. If anything, it does the opposite, creating a "managed trade" arrangement that flouts WTO rules and makes the Chinese government the guarantor of agricultural and energy purchases.