The pressure Trump has applied already extracted meaningful concessions from China, Pillsbury argues, pointing to Beijing’s implementation of new intellectual-property courts.
Pillsbury argued staging a deal to package up things like greater access to China for U.S. investment firms and purchases of U.S. farm products in exchange for some easing of tariffs at first would make sense for both China and Trump. That could leave difficult topics such as a U.S. push for a reduction in Chinese industrial subsidies and other economic reforms off the table for now.
But some other people close to the administration see that as risky. Such a move could draw Trump into a bad short-term deal with China, they say. A more likely scenario may be Trump pausing his assault on China once tariffs are in place on all Chinese imports and offering businesses at least certainty over the landscape rather than focusing on a deal.
Market Plunge
Then again, those people say, a lot could still depend on markets. A thousand point drop in the Dow Jones Industrial Average may not sway the president, but a 5,000-point move could.
That the U.S.-China relationship is at its lowest point since Trump took office has created a window for his hawkish advisers to push for a more aggressive approach. The only thing in their way is their own lack of coordination, according to Derek Scissors, a China expert at the American Enterprise Institute who has advised the administration.
“The president is upset with China,” he said. “The door is open for critics of China to take a whole number of actions and they’re completely disorganized and have no sense of priorities.”
This article was provided by Bloomberg News.