Do You Support a Trade War With China?

What’s the story?

• China on Monday announced retaliatory tariffs on $60 billion of American goods, including peanuts, sugar, chicken, beer, swimsuits, and dog collars.
• Beijing’s move comes in response to President Donald Trump’s announcement on Friday that the U.S. would raise duties on $200 billion in Chinese products from 10% to 25%.
• Markets took a nosedive on Monday, with contracts on the Dow Jones Industrial Average sliding as much as 619 points.

What are people saying?

• Trump urged China to make a deal, warning the trade war could escalate further.

• This followed a tweet on Sunday, where the president said America is “right where we want to be with China. Remember, they broke the deal with us & tried to renegotiate. We will be taking in tens of billions of dollars in tariffs from China. Buyers of product can make it themselves in the USA (ideal), or buy it from non-tariffed countries."
• The Brewer Group CEO Jack Brewer said now is the right time to play hardball with Beijing.

“Right now we have great earnings in this country. I don’t know that the President would have come out with a stance this hard if we didn’t have a 3.2% GDP number on the last report. When you are in the middle of a negotiation this big, you have to use all your guns.”

• Not all business leaders share Brewer’s enthusiasm.
• “Our industry is particularly exposed for a host of reasons,” Rick Helfenbein, president and CEO of the American Apparel & Footwear Association, told Yahoo Finance. “We are kind of trapped. These tariffs will hurt us. They will hurt retail particularly badly.”

“It’s painful,” said Helfenbein. “All of a sudden [last] Sunday at noon, the President tweets ‘we’re going to 25%.’ That bothered us. We weren’t able to grieve on the last $200 billion, and we don’t know if we’ll be able to grieve on the next $325 billion.”

• Phil Streible, a senior market strategist at RJO Futures, told Bloomberg that all corners of the market – and globe - should expect fluctuations from the escalating trade war.

 “Everything’s all connected,” Streible said Monday by phone. “The trade tensions breaking out and the escalation of tariffs back on the U.S. products is weighing in on not only global growth, but commodities as a whole.”

What do you think?

Do you support the U.S. trade war with China? Why or why not? Take action above and tell your reps, then share your thoughts below.

—Josh Herman

(Photo Credit: iStock / Eblis)