The signals from former President Donald Trump’s camp suggest a potential softening in his hardline stance on China. As someone who’s spent nearly two decades tracking the twists and turns of U.S.-China relations, I find this shift both surprising and entirely predictable.
During Trump’s first term, we witnessed an escalation of trade tensions unlike anything in recent diplomatic history. The administration imposed tariffs on approximately $370 billion worth of Chinese goods, citing unfair trade practices and intellectual property theft. Beijing responded with countermeasures targeting U.S. agricultural exports, creating significant pain for American farmers.
“The trade war with China cost Americans an estimated $195 billion in economic growth from 2018 through 2019,” according to a 2021 report from the U.S.-China Business Council. I remember interviewing Midwestern soybean farmers watching their markets evaporate almost overnight.
The rhetoric from Trump’s circle now suggests an appetite for resolution rather than escalation. Howard Lutnick, co-chair of Trump’s transition team, recently indicated that Trump would be open to lifting some tariffs in exchange for concessions from Beijing.
“I think the Chinese are going to make a deal with Trump pretty quickly,” Lutnick told Bloomberg Television last week. This represents a significant tonal shift from the campaign trail, where Trump had pledged to impose universal tariffs of at least 60% on Chinese imports.
The economic reality facing both nations has changed dramatically since Trump’s first term. The U.S. battles persistent inflation while Chinese growth has slowed to rates not seen in decades. President Xi Jinping faces mounting domestic economic challenges, including a real estate crisis and high youth unemployment.
Back in 2019, I spoke with several U.S. manufacturers who described passing tariff costs directly to American consumers. “We had no choice but to raise prices,” the CEO of a medium-sized electronics company told me. “The tariffs didn’t hurt China nearly as much as they hurt our customers.”
The Peterson Institute for International Economics found that almost the entire cost of Trump’s China tariffs was absorbed by American businesses and consumers. Their research showed that the average American household paid approximately $1,300 per year in higher prices due to these policies.
Some China policy specialists view Trump’s apparent change in posture as pragmatic. “Both sides recognize they need a more stable economic relationship,” Dr. Elizabeth Economy, a senior fellow at the Hoover Institution at Stanford University, noted in a recent policy forum I attended.
The U.S. business community has largely advocated for a more balanced approach to China. Last month, the U.S. Chamber of Commerce urged the incoming administration to “move beyond tariffs” and pursue a comprehensive strategy that protects American interests while maintaining crucial economic ties.
I’ve tracked this sentiment shift while interviewing executives from industries ranging from technology to agriculture. Most express a desire for protection from unfair Chinese practices without the collateral damage of broad tariffs.
President Xi appears equally motivated to dial down tensions. At the APEC summit in Peru, Xi extended an olive branch by meeting with President Biden and emphasizing China’s interest in stable relations with the United States.
Chinese state media outlet Xinhua reported that Xi expressed hope that “the United States and China will find the right way to get along in the new era.” This diplomatic language typically signals Beijing’s openness to negotiation.
Trump’s potential pivot doesn’t mean he’s abandoning his tough stance on China. Instead, it likely represents a tactical shift toward more targeted measures focusing on specific sectors like advanced technology and critical minerals.
The Biden administration has continued many Trump-era restrictions, particularly in semiconductors and other high-tech industries. These policies enjoy bipartisan support and will likely remain regardless of Trump’s broader trade approach.
Having covered Washington
