More Pain Than Gain

Abstract

Abstract The ultimate results of the phase one trade deal between China and the United States—and the trade war that preceded it—have significantly hurt the American economy without solving the underlying economic concerns that the trade war was meant to resolve, writes Ryan Hass and Abraham Denmark. The consequences that have followed in the wake of the economic clash have served to exacerbate bilateral relations. As a candidate in 2016, Donald Trump built his argument for the presidency around his claimed acumen as a dealmaker. As the 2020 election draws nearer, President Trump and his surrogates are doubling down on that assertion, including by calling attention to what he has deemed ‘the biggest deal ever seen’: the ‘phase one’ trade deal with China. The agreement reportedly includes a Chinese commitment to purchase an additional $200 billion in American goods above 2017 levels by the end of 2021. Six months after the deal was inked, the costs and benefits of this agreement are coming into clearer focus. Despite Trump’s claim that ‘trade wars are good, and easy to win’, the ultimate results of the phase one trade deal between China and the United States—and the trade war that preceded it—have significantly hurt the American economy without solving the underlying economic concerns that the trade war was meant to resolve. The effects of the trade war go beyond economics, though. Trump’s prioritization on the trade deal and de-prioritization of all other dimensions of the relationship produced a more permissive environment for China to advance its interests abroad and oppress its own people at home, secure in the knowledge that American responses would be muted by a president who was reluctant to risk losing the deal.