
China Hits U.S. With Higher Tariffs on Soybeans, Cars, Oil - asaegyn
https://www.bloomberg.com/news/articles/2019-08-23/china-to-soon-unveil-tariffs-on-u-s-says-global-times-hu
======
whatshisface
The strangest thing about this event is how nobody can agree on what has
already happened. US consumers are being hurt, US consumers are doing fine,
the US economy is teetering on the brink of recession and China is steady,
China is teetering on the brink of total collapse and the US doesn't feel a
thing... all of these contradictory claims have been made to me by internet
commenters and media outlets. Shouldn't the effects of the trade war be
objective and easy to measure with typical macroeconomic indicators? It beats
me as to why there are so many contradictory claims.

~~~
SolaceQuantum
From what I understand it's the following:

* Certain sectors of US industries are being disproportionately harmed by the trade war: steel, agriculture, and similar.

* Other sectors of US industries, such as service and retail, are less affected, and are posting strong numbers. This, along with a tight job market, point to a generally strong economy even if specific industries are suffering.

* China is difficult to understand due to the government being known for opacity in their finances. Therefore, we can generally only speculate on second or third order effects of trends, eg. what does the currency floating mean? It means China is shifting financial strategies for X or Y. But we have no idea the X or Y reasoning, only speculations of possible reasons.

* There are several indicators of a recession coming on, including significant day-to-day dips and yield curve inversions and slowdowns in other regions like Europe. However, recessions can't be known until the numbers come out and womp womp we're in one.

~~~
bb88
So it might actually be worse, since news of the indicators might already mean
that cutbacks in payroll are taking place. We would see that with the August
jobs number (due out in the first week of next month). Smart companies want to
be ahead of the recession curve.

The good news is that the labor force is at record highs. IOW were as close to
full employment as we have ever been.

[https://www.cnbc.com/2019/08/02/us-jobs-report-
july-2019.htm...](https://www.cnbc.com/2019/08/02/us-jobs-report-
july-2019.html)

The bad news is there's no where to go but down.

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dragonsh
I hope this trade war finishes quicker. Everyone playing this game will lose.
Global supply chains are much more complex and complete impact is difficult to
understand. Hope sense prevail at the end.

~~~
theseadroid
Considering the huge understanding gap between regular Americans and Chinese,
I unfortunately suspect the trade war will not be over soon.

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seren
This is strategically released just before the G7, to make sure that this will
be discussed, or maybe to put some pressure on the US before negotiating with
its allies.

~~~
Fjolsvith
China is grasping at straws with this. They are really out on a limb.

------
Balgair
Per _The Washington Post_ [0]:

> A 25 percent tariff on automobiles and a 5 percent levy on auto parts take
> hold Dec. 15.

That means your car's transmission replacement goes from ~$3k to ~$3200 (due
to the additional markup on parts for time, labor, insurance, etc). Not too
_too_ bad for the end user, but actually bad for the parts companies,
mechanics, tool and die makers, and others in the supply chain. This will be
hurting your local repair shop very directly.

[0] [https://www.washingtonpost.com/business/2019/08/23/china-
hit...](https://www.washingtonpost.com/business/2019/08/23/china-hits-us-with-
tariffs-billion-worth-goods-reinstates-auto-levies-state-media-report/)

------
ourmandave
Assuming the Chinese economy can hold up, Xi Jinping doesn't have an election
coming up in 2020.

~~~
baybal2
To everybody raising this question I answer this: "A dictator faces election
every time he shows his back to anybody."

And being a head of a giant country, the man just can't avoid doing that from
time to time, unlike the head of some tiny banana republic.

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KaoruAoiShiho
Why not apply a value added tariff instead of purely import tariffs? China
actually buys more from the US from a value added perspective than the other
way around:
[https://www.bloomberg.com/news/articles/2018-06-12/the-1-4-t...](https://www.bloomberg.com/news/articles/2018-06-12/the-1-4-trillion-
u-s-surplus-that-trump-s-not-talking-about)

------
tzfld
Pretty sure both sides have a b-plan to avoid massive damage, but someone
definitely going to lose.

~~~
stefano
Most likely, they're both going to lose.

~~~
jaimex2
As an Australian I'd say yay but our economy is going down with China.

~~~
toomuchtodo
If it reduces the export of Australian coal to China, not a bad thing.

~~~
jaimex2
True, though its clean coal were told.

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aswanson
Well, that escalated at an intermediate pace.

~~~
jaimex2
They're scared of whats coming next I guess.

~~~
bilbo0s
Just Devil's Advocate, but if they're scared, why didn't they back down?

I sincerely hope someone is in the room on our side who has seriously
considered the possibility here that we may have miscalculated. There needs to
be some contingency in place so that we don't get stuck in round and round of
barrier escalation.

~~~
eznoonze
They need to appear "tough" for their internal audience, even though they are
miscalculating at every twist and turn.

------
adrianN
China should just start a carbon tax and apply tariffs on imports from
countries that don't have an equivalent system in place.

~~~
rrggrr
China is the world’s largest greenhouse gas emitter. So its a cute idea, but
countervailing tariffs would be swift and deserved.

~~~
bryanlarsen
per-capita China emits about half of what the US does.

[https://en.wikipedia.org/wiki/List_of_countries_by_carbon_di...](https://en.wikipedia.org/wiki/List_of_countries_by_carbon_dioxide_emissions_per_capita)

~~~
rwc
Is that also how the environment calculates the impact? As if per-capita has
any bearing on the final outcome.

~~~
belltaco
If you pee in the river once a month, but the municipality of the town
upstream decides to release its entire sewage into it, does the river
calculate the impact per-capita?

~~~
adrianN
If you kill somebody once a month but a government near you decides to start a
war, does it make your murder ethically acceptable?

~~~
belltaco
Terrible analogy. Someone making a campfire, like humans did for thousands of
years, isn't doing something remotely as bad as committing murder.

The analogy only works if what a single person is doing is inconsequential if
they are the only ones doing it. Murder certainly does not belong there.

[https://en.wikipedia.org/wiki/Tragedy_of_the_commons](https://en.wikipedia.org/wiki/Tragedy_of_the_commons)

Murder isn't a good example of it.

~~~
adrianN
I hardly think that the GHG emissions of countries other than China are
inconsequential.

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rrggrr
USD shortage. Chinese tariffs and past import restrictions conveniently
decrease pressure on their declining USD reserves (see link to article below).

[https://www.scmp.com/economy/china-
economy/article/3012460/d...](https://www.scmp.com/economy/china-
economy/article/3012460/does-china-have-enough-us-dollars-trade-war-escalates)

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lota-putty
Big bucks Poker game played in public.

------
todipa
tariffs or Tarrifs?

~~~
mtmail
Bloomberg corrected the headline now. In my option commenting on typos doesn't
add much value to a discussion.

~~~
alexpetralia
Opinion*

(Sorry)

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jhpriestley
Trump's whole schtick is to come in with an incredibly aggressive posture
(cancel NAFTA!), extract some concessions, then take a victory lap. When the
concessions don't come he gives up quickly (see the government shutdown). He
has no real plan or capacity for a protracted and painful trade war. He hasn't
made the case to his people or his allies for what the goal even is, and
whatever support he has will evaporate when the pain becomes serious, assuming
he doesn't just fold first.

~~~
duxup
He already could have taken a victory lap and done effectively nothing with
the first offer from China. He chose to double down.

I'd say there is no plan and it is just the randomness of a capricious old
man.

That's a glib take I admit, but I really think that all indications are we're
dealing with a very glib president.

~~~
imchillyb
I don't believe that you are considering that President Trump is a master
negotiator. It's what he's known for in the business world.

His hard-nosed deals bring profits for his investors, and massive revenue
streams.

Call him whatever you will, and demean him to the world, it still won't change
facts; he's an extraordinarily profitable businessman, with extreme revenue
returns.

::shrug:: The proof is in the pudding so to speak. Our President's actions
will prove themselves, one way or another.

~~~
duxup
I don't see much to indicate what you're saying is accurate.

His own waffling and capriciousness have sunk even his own initiates in
congress with his own party members. Leaks from the white house, members of
his own party, even his own people who have publicly stated he is very
impulsive (some are less generous of that).

------
tomohawk
China's been conducting a trade war for several years. US finally woke up and
now China's trying to nip any resistance in the bud. I guess they couldn't buy
off the current president like they have others.

[https://en.wikipedia.org/wiki/1996_United_States_campaign_fi...](https://en.wikipedia.org/wiki/1996_United_States_campaign_finance_controversy)

------
baybal2
I'm still baffled why Beijing is still goes THAT easy on USA.

It is fully in its capacity to make Washington to capitulate.

If they were to go with embargoes and not tariffs, things would be
dramatically different, especially if they can nuke holiday season sales.

Just a plain clothing embargo would send all and every American retailer
scrambling. There will be not enough merchandise in all India, Bangladesh, and
Vietnam combined. And it will be even worse if Chinese factories in those
countries would also join the embargo.

For things like regular household goods will also be no real alternatives as
even export oriented economies like Vietnam import god knows how much
plasticware from China just because it is often cheaper than manufacturing
locally.

Just thing of how many "dollar goods" you buy every month, and what would you
do if there would simply be none.

I instantly remember my childhood in early nineties Russia. We were one of
richest families in the city or likely the entire Russian Far East, with
father's business and mom's salary making few hundred thousand bucks a years,
but from time to time we had to subsist on millet for months in a row for a
simple reason that there were physically no other food in the entire region.

~~~
asdf333
the issue is it would also wreak serious havoc on china's economy

and while xi is president for life, he doesn't want to risk mass unrest in his
own country.

~~~
baybal2
Trade with USA is just 2% of China's GDP.

Were it to take a short, controlled dip into recession to teach US a lesson,
it would not be really noticed domestically.

And it will be a much better alternative than to let China to slowly bleed as
manufacturers leave the country just to be able to sell to US in long term.

~~~
fspeech
Total Chinese export is still going up. You only need 35% local content to be
labeled “made in country x”. This trade war will reduce headline bilateral
deficit with the US which China knows to be at an unhealthy level. There’s
additional cost compared to the past but US is sharing the burden.

