United States President Donald Trump has announced in recent weeks that his administration will impose tariffs on steel and aluminum coming from China and some other countries. In addition to these tariffs, President Trump announced that he may add tariffs to another $50 billion dollars in goods. On top of that, the president two days ago said the as much as $100 billion in Chinese goods may be hit with tariffs.
The Chinese government was quick to respond. Tariffs on United States products were quickly announced. The Chinese government stated that they did not want to get into a trade war with the United States. However, the government stated that they would fight and win a trade war if that is what was necessary.
The question that many economists are asking is if China could win a trade war with the United States. Most economists clearly believe that there are no real winners in a trade war. They also believe that China is positioned to withstand a trade dispute better than the United States.
China has a government-controlled economy. It has the ability to control prices so that the general public would never see any price increases due to tariffs.
China also has one important weapon in its trade war arsenal. China is one of the largest importers of US agricultural products. It is possible that China could decide to place large tariffs on soybeans from the United States. This would harm farmers in the Midwest who are critical for President Trump’s reelection.