A trade war without end - What's the U.S. really trying to achieve?

by Zhao Yang

The United States' top trade negotiator with China has admitted that he doesn't know what the real end game is of Washington’s trade war against the world's second-largest economy. Robert Lighthizer said this on Thursday at an event sponsored by Chatham House, adding “Right now we need to stop an aggressive force… We need to figure out new rules - phase one is an attempt to find those kinds of rules - and these are setting aside all the aggression in India and in Hong Kong.”

U.S. Trade Representative Robert Lighthizer takes off his mask as he arrives at a Senate Finance Committee hearing on U.S. trade on Capitol Hill, Wednesday, June 17, 2020, in Washington. [Photo: AP/Andrew Harnik, Pool]

His speech reignited criticism of the US trade war against China, which has dragged on for more than two years at huge financial costs to American farmers and consumers. It reflects the confusion and chaos in Washington’s approach to its relationship with China. Hong Kong's SCMP newspaper quotes Scott Kennedy, China business chair at the Centre for Strategic and International Studies, as saying Lighthizer’s statement was a "damning admission and confirms the suspicion of many that the Trump Administration’s trade policy is all tactics and no strategy."

By some estimates, American farmers suffered losses in 2018 and 2019 worth an estimated $7.6 billion because of the trade war. That figure doesn't include the higher costs that were passed onto American consumers. The combination of higher costs for producers and consumers has put significant downward pressure on the US economy.

In contrast, China performed well over the same two-year period, growing by more than 6 percent a year. The importance of China’s trading relationship with the US fell significantly, as ASEAN replaced it as China's second-largest trading partner, and the share of China's exports to the US as a proportion of its total exports dropped by two percentage points.

Washington's blunt and uncompromising approach to trade, namely tariffs on goods from China, has failed to address the trade imbalance that President Trump set out to reduce by starting the trade war. So why push forward with a strategy that has failed to achieve the stated goal?

Washington is targeting China not because of alleged unfair trade practices or supposed theft of intellectual property. Rather, it's because the American administration views China as a political rival that threatens its hegemony over international affairs. This was evident in Lighthizer's remarks this week, when he raised the issues of the border tensions between India and China and the introduction of the national security law in Hong Kong. By doing so, he was highlighting Washington's habit of interfering in the affairs of other countries. Claiming not to know "the end goal" of the trade war reveals Washington's real intentions.

It's clear that the US used the phase-one trade deal as a tool to contain the development of China, which Washington views as an "aggressive force." Lighthizer has more or less acknowledged that this strategy failed, which is why Washington has resorted to restrictions on China's high-tech firms, most notably Huawei. But the pursuit of exclusionary policies that seek to pit the world's two largest economies against each other does nothing but harm.

The Chinese people have the patience and willingness to work peacefully with the United States and the rest of the world. But it remains to be seen if Washington is capable of overcoming its own anxieties about its place in the world and acting in the same spirit of goodwill.

Note: Zhao Yang is a journalist with China Plus and a former London correspondent of CRI. The article reflects the author's own views.