Trade War – Americans in Beijing

We interviewed some Americans living in Beijing to get their opinion on the current U.S.- China trade war. Living in China gives them a unique perspective on the matter as they have first-hand experience with the political climate in both countries. Their responses varied, but there was common desire to see the dispute be resolved as soon as possible, as everyone acknowledged the economic damaged cause to both sides. First let’s meet those we interviewed:

Jeffrey: A History and Psychology teacher from New Jersey.

Zeyu: An IT manager specializing in digital marketing and advertising from Massachusetts.

Spencer: An economic researcher and contributing academic editor from Rhode Island.

Ismael: An English teacher from Florida.

What are your initial thoughts on the trade war?

It is impossible to ignore the fact that the trade war has largely grown from inflammatory rhetoric and actions from U.S. President Donald Trump. His initial tariffs have provoked the Chinese to retaliate, and he has been quite vocal about his dissatisfaction with China’s prior economic and trade practices. Trump said that under the Obama administration China was “eating us alive”.

Jeffrey sees this behavior as Trump attempting to boost his chances in the upcoming 2020 election, commenting, “I think it is an attempt to posture on Trump’s part. He needs to appeal to his base and ‘getting tough’ with China is a good way to do so.” The idea that Trump’s initiation and prolonging of the trade dispute with China is at least partially motivated by a desire to appeal to his constituents ahead of the election is well founded. Since many Trump supporters in areas like the Rust Belt have seen their manufacturing jobs disappear over the years due to the globalization of supply chains, they support a hardline approach on trade negotiations towards the Chinese. Zeyu echoes Jeffrey’s sentiment, noting that “President Trump has always used canceling trade relations with China as a key message for his campaign for presidency. Thus, the trade war was inevitable.” Trump’s belligerent attitude towards China is clearly politically motivated. It attempts to gain support for the 2020 election by creating a common opponent in China that he can use to rally and unify parts of the American electorate.

However the two nations are both deeply integrated into the global economy, and are both significantly dependent on one another for continued growth. Ismael notes, “The Chinese economy and the US economy, from what I understand, are intertwined and in my eyes are more like conjoined twins than rivals.” The interdependence between the two economies has long been the foundation of a stable bilateral relationship, however, since the trade war began we have started to observe a “decoupling” of the world’s two largest economies. This “decoupling” is likely to harm the economic growth potential of both economies. Ismael comments, “It’s high time both countries started putting aside their differences and start recognizing their similarities and move forward.” As leaders of the Fourth Industrial Revolution, both the United States and China are making significant progress in many technology areas such as machine and deep learning, renewable energy and urban infrastructure development and management. Collaboration in these spaces could lead to an augmented level of overall progress for humanity, however the “tech cold war” that has coincided with these trade tensions stymies progress on both sides.

How has the trade war impacted your life?

We asked Ismael how the trade war impacted his life, and he said that beyond exchange rate fluctuations, “It mostly impacts me in the way that it’s just further international embarrassment as an American. I understand Trumps reasoning but his way of going about it has been crude.” It’s fair to say that Ismael is not alone, as many Americans are fed up with Trump’s bellicose and bullying behavior. While perhaps the trade relationship with China did need renegotiating, the crude tactics Ismael mentions such as exorbitant tariffs and direct attacks on Chinese firms like Huawei and DJI are not palatable to most of the international community.

Spencer, an academic researcher himself, cited more stringent visa regulations that have a tangible impact on those in his field, commenting, “Yes—a large operation I’m affiliated with in China may be suspended because new visas for researchers there cannot be granted and old visas cannot be renewed. The universities and NGOs with which we were partnered thus had to shift their manpower and it may be taking a heavy toll for everyone involved (American and Chinese alike). Its future, even should the trade war end tomorrow, is in serious jeopardy.” Here Spencer details irreparable damage to institutions that promote bilateral cooperation between Chinese and Americans. Trump has also been restricting student visas for Chinese students seeking to study in the United States. These types of visa disruptions affect people from both sides.

How do you think the trade war will end?

We also asked the American expats how they thought the trade war would end. Zeyu says, “I believe the trade war will have to end with either the US or China adopting change to their current trade policies. In the end, it is not a zero sum game where one party wins while the other loses. As we can already see with the current halt in trade talks, both countries are in for a no-win situation.” Basically there is a need to reach some sort of compromise, however both sides fear being viewed as weak at home, so the dispute is likely to persist.

Jeffrey commented, “I think, ultimately, a deal will get done. It is bad business for both sides. Both sides need to appear strong to their constituents so the general public needs to be patient and let both sides look strong and eventually reach a deal.” Jeffery also believes that presenting a strong face domestically is crucial for both President Trump and President Xi, and so patience is required by both populations.

Ismael hopes for a change in American leadership leading to a resolution, saying, “The optimist in me says the US will elect a new president who will get things back on track and start addressing the US’s bigger issues and build a bridge of symbiosis with China. The pessimist in me says the US and China will continue these squabbles which is dangerous.”

However Spencer isn’t so convinced that a change in American political leadership will lead to a better bilateral relationship, “It seems unlikely first that the US will have a political shift any time soon, and second that even if it did, the attitude of either party toward China is not likely to change. Both sides of the American political aisle seem relatively content with waging the trade war because it fits a large portion of their mutual goals vis-à-vis national and political interests.”

Spencer continued, downplaying the importance of the 2020 election on the U.S.-China relationship, “The main criticism of the American Left against the War is that it has been architected by the American president, but I see little evidence that should the president change to any other (Left or Right) that the new president would suspend the affair in practice.”

Ismael warned of America’s necessity to embrace the changing world order, “Soon China will be the largest economy in the world and as they look farther west through the Belt and Roads initiative they will rely less and less on the US economy. What we need to prepare for, especially in the US, is a world where the US is no longer the dominant economic power. A world where nations look to China to lead the way and not the US.” The reluctant acceptance of China’s eventual economic primacy is something that is likely to wound the pride of many Americans, and the Trump administration. However, the realistic acknowledgment of such conditions will allow the United States to adjust and strategize accordingly to a new economic and geopolitical landscape, rather than resist this inevitable rebalancing of power.

As the G20 Summit in Osaka looms at the end of June, there will likely be new developments in the latest chapter of the U.S-China trade war. Trump has demanded another round of talks with Xi, and the two are widely expected to meet face to face, however Beijing has not confirmed or provided any details. Trump has threatened another round of tariffs on $300 billion worth of Chinese goods if Xi refuses to meet.

Featured photo credit to South China Morning Post