Democrats are desperate for a recession, to give them something to run on in 2026. Their hopes for a recession lie in the “trade war” that was declared by American newspapers within weeks of President Trump taking office. But so far, no trade war has materialized. And perhaps it won’t, as American and Chinese negotiators have quickly agreed on a framework for a trade agreement:
The agreement on Sunday comes after two days of negotiations in Geneva, and has raised hopes that weeks of global uncertainty have come to an end.
Scott Bessent, the US treasury secretary, said: “I’m happy to report that we made substantial progress between the United States and China in the very important trade talks.” He said more details would be announced on Monday.
We will see what the agreement amounts to tomorrow. But in any event, it won’t be a “trade war.”
Afterwards, Jamieson Greer, the US trade representative, said: “It’s important to understand how quickly we were able to come to an agreement, which reflects that perhaps the differences were not so large as maybe thought.”
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“The president declared a national emergency and imposed tariffs, and we’re confident that the deal we struck with our Chinese partners will help us to work toward resolving that national emergency,” said Mr Greer.
There is pressure on both sides, as China’s economy depends heavily on manufacturing exports, and Trump needs to avoid substantial economic damage:
Mr Trump had signalled that he was in a hurry to get results as he announced the terms of a deal with the UK on Thursday, paving the way for progress with other countries, including China.
But the real question is how any agreement with China will advance our national security. It is fine to import widgets, but we can no longer rely on the CCP for our pharmaceuticals, our most critical minerals, and so on. That is much more important than the precise level of tariffs on inconsequential goods.
