Simple Math Shows That China Lacks Leverage in This Trade War – The American Spectator | USA News and PoliticsThe American Spectator

The last month that the U.S. enjoyed a trade surplus with China, “Rock Me Amadeus” topped the Billboard Hot 100, Geraldo Rivera found some empty bottles in Al Capone’s vault, and Halley’s Comet passed by the planet.

Yes, a ledger showing a trade surplus with China appears almost as rarely as does Halley’s Comet.

So, when its commerce ministry vowed this week that “China will fight to the end,” the question arises: Fight with what?

People who do not buy American stuff promise not to buy American stuff.

This does not seem as scary as when Donald Sutherland let out a bird-like screech at the end of Invasion of the Body Snatchers.

China hiked its tariff on American goods to 84 percent on Wednesday, shortly before the Trump administration announced a 90-day pause on reciprocal tariffs with one glaring exception: China.

“China will be raised to 125 due to their insistence on escalation,” Treasury Secretary Scott Bessent explained, calling the nation a “bad actor.” On Thursday, the Trump administration noted that the tariff actually reaches 145 percent.

“China is the most imbalanced economy in the history of the modern world,” Bessent noted. “They are the biggest source of the U.S. trade problems. Indeed, they are a problem for the rest of the world.”

Kevin O’Leary, Shark Tank’s “Mr. Wonderful,” believes President Trump let the Chinese off easy. Noting that the Chinese government routinely steals technology from Western companies, O’Leary argued for a 400 percent tariff to the astonishment of a CNN host.

China’s exports account for about a fifth of its GDP. America’s exports to China account for about a tenth of its GDP. China relies, to a greater degree than other nations, on people in other nations buying its stuff. Its economy depends heavily on exports, much like America’s did over a century ago.

When one examines Chinese exports and imports specifically involving the United States, it becomes clear that China has more to lose than the U.S. does in a trade war. China’s exports to the U.S. amount to about three percent of its GDP. American sales to the Chinese market constitute about half a percent of U.S. GDP. (RELATED: America’s Tariffs: Clear Losers, but Decoupling From China)

In 2024, the Chinese bought $143.5 billion worth of U.S. products, which fell by about three percent from the previous year. The U.S., on the other hand, purchased $438.9 billion worth of products from the Chinese. This rose by about three percent from 2023. Put another way, for every three dollars we put into their pockets, they put about one into ours. (RELATED: Trumping China)

What do we buy from them?

The list unsurprisingly includes toys, lighted signs, electronics, and footwear. But it also includes nuclear reactors, medical apparatuses, and pharmaceuticals.

So, the tariffs will harm American consumers. And not everything they sell us is junk. But the tariffs may jar China into ending its trade war, waged unilaterally until fairly recently, by closing off one of the world’s best markets. The blow to their economy shows, or does not, that they need us more than we need them.

The advantage for China in trade becomes a disadvantage in a trade war. The country lacks leverage, and Donald Trump knows that.

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