A Mini Deal Is Better Than Stalemate

Friday morning, President Trump tweeted, “Good things are happening at China Trade Talk Meeting. Warmer feelings than in recent past, more like the Old Days. I will be meeting with the Vice Premier today. All would like to see something significant happen!”

On Wall Street, stock and commodity prices climbed immediately, suggesting that the president’s optimism over the prospect of a deal with China was infectious. Indeed, many on Wall Street and across the country were waiting eagerly to hear positive news come from the talks with China after weeks and even months of stalemate.

By the end of the day, the President was touting as “tremendous” a limited agreement by which China would buy more American agricultural goods, offer more intellectual property protections, and limit its currency intervention. With the agreement, the United States agreed to scrap a plan to raise tariffs to 30 percent on $250 billion worth of Chinese goods on October 15.

A limited agreement of this sort constitutes a compromise from the American negotiators, who have insisted on pushing for comprehensive reform. It might represent a realization that the trade war with China has been weighing heavily on the American economy—especially in agricultural areas of the country that President Trump won in 2016. It could also represent a pause in the trade war, which is still on track to be escalated in December, at which time the United States would be taxing nearly every product that China exports to America.

While the President has maintained that the trade war has had limited impact on consumers, the administration has admitted that the tariffs could have a dampening effect on the Christmas shopping season. The U.S. Chamber of Commerce’s members were eager to avert the October 15 rounds of tariffs and to protect holiday sales revenue.

Impending impeachment proceedings might be influencing President Trump’s attitude toward China, as well. In the face of bad PR, President Trump might have been eager to get a win on the books; even a micro deal with China provides a W. It’s a quick win, at that, as the President noted on Twitter, “One of the great things about the China Deal is the fact that, for various reasons, we do not have to go through the very long and politically complex Congressional Approval Process. When the deal is fully negotiated, I sign it myself on behalf of our Country. Fast and Clean!”

We applaud President Trump for striking a mini deal with China to prevent further damage to the American economy and encourage him to put pen to paper and formalize the deal post haste.