The president’s comments, in posts on Twitter and remarks to the press, came just as his top negotiators were sitting down to dinner with their counterparts at the Fairmont Peace Hotel in Shanghai. While both sides are trying to get trade talks back on track, Mr. Trump’s angry words underscored the diminishing prospects for a transformative trade deal anytime soon and the extent to which the bilateral relationship has not unfolded in the way that Mr. Trump expected.
“I think the biggest problem to a trade deal is China would love to wait and just hope,” the president said. “They hope — it’s not going to happen, I hope, but they would just love if I got defeated so they could deal with somebody like Elizabeth Warren or Sleepy Joe Biden or any of these people, because then they’d be allowed and able to continue to rip off our country like they’ve been doing for the last 30 years.”
Mr. Trump’s anger was fueled, in part, by the fact that China has not begun buying large amounts of American farm products, which the president promised farmers would happen after a June meeting with Chinese President Xi Jinping. Mr. Trump emerged from that meeting in Osaka, Japan, saying he had agreed to postpone tariffs on an additional $300 billion of Chinese products and allow American firms to resume sales of nonsensitive goods to the Chinese telecom firm Huawei. In return, Mr. Trump said China would immediately start buying American agricultural goods, touting it as a big win for farmers.
But no such purchases have happened, and, in the weeks since, Chinese officials disputed that they had agreed to buy more farm products as a condition of the talks. On Sunday, Chinese state media reported that “millions of tons” of American soybeans had been shipped to China. But Mr. Trump on Tuesday said no such purchases had materialized.
China “was supposed to start buying our agricultural product now — no signs that they are doing so,” Mr. Trump tweeted. “That is the problem with China, they just don’t come through.”
China is doing very badly, worst year in 27 – was supposed to start buying our agricultural product now – no signs that they are doing so. That is the problem with China, they just don’t come through. Our Economy has become MUCH larger than the Chinese Economy is last 3 years….
His comments on Tuesday appeared to be an effort to give his negotiators more leverage and to pressure China into making concessions in talks this week. Mr. Trump took credit for China’s weakening economy, saying the tariffs he’s placed on $250 billion worth of Chinese goods have put enormous pressure on the country, costing it jobs and prompting companies to leave.
But he seemed to veer between goading China to quickly accede to America’s demands and suggesting the country could get a better deal if it waits and a Democrat wins the 2020 presidential election.
“China is dying to make a deal with me. But whether or not I’ll do it — it’s up to me, it’s not up to them,” Mr. Trump said. “I think China is willing to give up a lot, but that doesn’t mean I’m willing to accept it.”
Stocks dipped on Tuesday, partly as investors grew nervous about a prolonged trade war between the world’s two largest economies. The S&P 500 was down 0.3 percent.
The president’s remarks have been matched by strident rhetoric on the Chinese side. At a news conference on Monday, Hua Chunying, a spokeswoman for the Ministry of Foreign Affairs, called the United States “capricious, arrogant and selfish” after the Trump administration challenged China’s claim to a special status for developing countries at the World Trade Organization.
“There is a catchphrase that got popular just recently in China: ‘Don’t do things like the U.S. does.’ I hope some people of the U.S. side can deeply reflect on it,” she said.
Negotiators from both countries will try to bridge their divisions as talks begin in earnest in Shanghai on Wednesday. But the deep divisions between the countries suggest another protracted round of talks may be needed before any agreement can be reached.
The text that the two countries have been negotiating is highly secret. But American and Chinese negotiators appear to still have significant differences of opinion over how China should enshrine changes, including new protections for American intellectual property in its laws and regulations, how many American products China would agree to buy as a result of the deal, and how many of Mr. Trump’s tariffs on $250 billion in Chinese goods would remain in place after an agreement is struck.
The president continues to insist that he faces no immediate deadline to reach an agreement. On Tuesday, he repeated his claim that the United States economy is benefiting from the billions of dollars his tariffs are generating and that all the pain of the trade war was being felt on the Chinese side. That view is not supported by businesses and economists, who say Mr. Trump’s trade war is starting to take a toll on the United States economy. Chinese leaders have also insisted that the country can withstand the pressure of the trade war as it waits for a better deal from the Trump administration, or another president.
In reality, both economies are presenting more of a mixed picture, with the effects of the trade war clearly being felt, but not so intensely that their leaders can’t ignore it.
The Chinese economy is decelerating gradually, but further increases in the country’s already massive infrastructure spending have cushioned the shock. Chinese exports to the United States have fallen 8.5 percent in the first half of this year compared with the same period last year, while exports to the rest of the world have been up slightly.
Sales of cars and other big-ticket purchases in China had tumbled sharply last autumn when Mr. Trump broadened his tariffs to $250 billion a year of goods from $50 billion. But Chinese consumer confidence now seems to have leveled off at a level best described as still very glum, but not rapidly deteriorating further.
In the United States, gross domestic product, a broad measure of the strength of the American economy, came in at an annualized 2.1 percent in the second quarter, a decent pace but slower than the 3.1 percent rate posted in the first three months of the year.
On Tuesday, Mr. Trump again blamed the Federal Reserve for taking some steam out of the economy, saying that both the stock market and economic growth would have been stronger if the Fed had not raised interest rates last year. Mr. Trump called on the Fed to implement a large rate cut, just a day before the central bank is widely expected to lower rates, albeit slightly, for the first time since 2008.
Stocks “would have been 10,000 points higher, and I think we would have been in the 4’s for GDP” if the Fed hadn’t raised rates, Mr. Trump said, noting that former President Barack Obama had a near-zero interest rate while the Fed has since normalized interest rates.
“I’m very disappointed in the Fed. I think they acted too quickly, by far, and I think I’ve been proven right,” Mr. Trump said.
The Dow Jones industrial average closed about 27,000 on Monday, and has risen nearly 4,000 points since the start of the year.
The central bank lifted interest rates nine times between late 2015 and the end of 2018, though it has paused such increases this year as risks from Mr. Trump’s ongoing trade wars and slowing global growth loom. It has also been shrinking its balance sheet, swollen by bond purchases meant to reignite growth in the wake of the recession, and that process is set to end in September. Policymakers are widely expected to cut rates by a quarter percentage point at the Fed’s meeting on Wednesday.
“The Fed moved, in my opinion, far too early and far too severely,” Mr. Trump told reporters Tuesday. “Fortunately, I made the economy so strong that nothing is going to stop us. But the Fed could have made it a lot easier. I would like to see a large cut, and I would like to see immediately the quantitative tightening stop.”