Red China accepts 30% tariff

Nevertheless, our media declares President Trump capitulated

BBC reported, “Following months of back-and-forth tariff escalation, U.S. and Chinese officials announced this morning that they would reduce levies on each other’s goods for 90 days and start a new round of trade negotiations.

“Both sides are set to slash tariffs by 115% starting from Wednesday—with U.S. tariffs on Chinese products falling to 30% and [Red] China’ reciprocal tariffs on the U.S. falling to 10%.”

Invariably, news reports conveniently failed to mention that these huge tariffs were imposed only a month ago.

BBC also said, “The president described relations between the two countries as "very good" and said he did not expect U.S. tariffs on Chinese imports to return to 145% after pause.

“In Beijing, though, the mood is more somber with Chinese businesses telling the BBC they expect more tariffs in the future.”

A 30% tariff is a big deal. Suddenly a $125 American Girl doll (they are made in Red China) gets slapped with a $37.50 tax. Who will eat that tax?

You guessed it, the communists in Red China because BBC reported, “Beijing will help struggling exporters cope with the implication of U.S. tariffs, Chinese Commerce Minister Wang Wentao has told a roundtable of company executives.”

Quick pop quiz. No. 2 pencils out and books under your chair: Which is bigger, 30% or 10%?

If you said 30%, you flunk as an American business reporter. That’s a compliment because all the bozos on that bus convinced themselves that Trump got the worst part of the deal.

Think of reporters as sheep. They have bleated for some time that nobody wins a trade war. That’s untrue. Lincoln’s protective tariffs helped lay the groundwork for the Gilded Age 30 years after his assassination.

Trump knows the power of the American consumer and his threat of tariffs against India and Pakistan got the two nuclear powers to lay down their weapons and work for peace.

He told reporters on Monday, “I said [to India/Pakistan] let’s stop it. If you stop it, we’ll do trade. If you don’t stop it, we’re not gonna do any trade and all of a sudden, they said, ‘I think we’re gonna stop.’ And they have. We’re gonna do a lot of trade with Pakistan, with India. We stopped a nuclear conflict.”

Some people look at Pakistan and ask why? Trump looks at Pakistan and sees a trillion dollars in rare earth elements.

Of course, the American media will never admit that Trump used tariffs to rein in Red China or to stop a nuclear war.

Rupert Murdoch’s MarketWatch served up the Democrat talking points, saying, “Trade policy is just the latest climbdown by the Trump White House.”

Without bothering to fact-check him, Rupert’s online rag quoted George Saravelos, head of FX research at Deutsche Bank, who said, “Other notable developments include the departure of Elon Musk [fact-check, Musk was on a 130-day contract], explicit statements from President Trump he will not seek Powell's removal [fact-check, Trump cannot fire him] and a more conciliatory stance towards Ukraine following the bilateral Zelensky-Trump meeting in the Vatican [fact-check it is called negotiation].”

President Trump is negotiating. This is not nuclear science. He asks for the stars and settles for the moon.

But the media says Trump capitulated while Xi—who will pay triple the tariffs Americans will pay—won.

Axios surprised me by reporting, “Small packages from China are still subject to tariffs of 120%, a White House official confirmed Monday—a major blow for U.S. consumers seeking cheap goods from e-commerce retailers like Shein and Temu.

“Why it matters: Trump previously ended a loophole that allowed low-value goods into the country tariff-free—and while high retaliatory tariffs on most other Chinese imports were eased, these levies appear to be the new normal.”

But notice that Axios spun it as consumers will pay, not Shein and Temu.

Consumers can go to Amazon, can they not? Trump is protecting American retailers. Good. I don’t care what Jeff Bezos calls me or MAGA in his newspaper. What matters is American jobs for Americans.

TDS sufferer Paul Krugman actually gave a fair appraisal of the deal: “A 30% tariff is still really, really high, especially combined with the 10% tariff we’re imposing on everyone else. The back of my envelope says that the average U.S. tariff rate will now be around 13%, up from around 3% when Trump began his trade war. Before all this drama that would have been seen as wildly protectionist.”

Trump moved the center. That’s excellent negotiation. Had he asked Red China for a 30% tariff, he would have gotten 10%.

After a good start, Krugman proceeded to write some nonsense such as, “This wasn’t a case of both sides backing down. [Red] China only imposed its tariffs as a response to Trump’s gambit, and has reduced them only because he retreated.”

Red China has accepted a 30% tariff but in Krugmanistan land, Trump was the one who retreated. I may be biased but I don’t see a 10% tariff on U.S. products as a big deal. If Red China is dumb enough to impose a 10% tariff on ethane from the USA (its main supplier) then go ahead and let the commies shoot themselves in the foot. Ethane is used to make plastic—you know, the thing Red China uses to make American Girl dolls.

AP’s take was this was a lesson learned by both sides.

Taisu Zhang, a law professor who studies comparative legal and economic history at Yale University, said the chaos from last month probably was not for nothing. Both countries were testing their strengths, with Trump stressing the importance that foreign companies placed on accessing U.S. consumers and China emphasizing its resilience to an external shock.

“As recently as February, both sides probably harbored unrealistic assumptions about each other’s economic or political weaknesses or intents,” Zhang said. “The Americans had an exaggerated sense of their own bargaining power to begin with, and the Chinese may have had an exaggerated sense of their security from American economic pressure.”

“The best thing to come out of this agreement, therefore, seems to be a stronger sense of reality on both sides,” Zhang said. In that, Zhang said, it looks like the goals of the two countries align, with China consuming more and the U.S. manufacturing more.

Who wins when Red China buys more and America makes more?

Wall Street reacted to Red China agreeing to a 30% tariff with all the grace of a water buffalo in heat.

Yahoo Finance reported, “The S&P 500 soared nearly 3.3% to its highest level since March 3. The Dow Jones Industrial Average gained 2.8%, or more than 1,100 points. The tech-heavy Nasdaq Composite led gains, rocketing up 4.3%.”

It was not a good day to buy stocks. Two days after Trump imposed the 145% tariffs on Red China and stocks fell was a good day to buy stocks because it showed he was negotiating from a position of strength and he would not settle for a measly 10% tariff with the Big Red Machine.

Monday was a good day to sell and turn your paper profits into cash, but what do I know? I am just a poor hillbilly in Poca, West Virginia, trying to get by.

But I do know that 30% is larger than 10%.

Meanwhile, not all the media’s coverage of Trump’s success with tariffs was negative.

CNBC reported, “Receipts from U.S. tariffs hit a record level in April as revenue from President Donald Trump’s trade war started kicking in.

“Customs duties totaled $16.3 billion for the month, some 86% above the $8.75 billion collected during March and more than double the $7.1 billion a year ago, the Treasury Department reported Monday.”

That’s not enough to close the deficit, but the money is welcome as are the American jobs the tariffs protect and even create. Trump’s winning, which means America is winning—and that is what really roils the media.