Who’s Winning the War?

As the midterm elections in the United States draw closer, which will result in an entirely new House of Representatives and a replacement of a third of the Senate, the issue of the trade war with China is gaining relevance in domestic politics and, according to some academics, this will end up costing Donald Trump’s administration more votes than it will gain.*

These people also maintain that the trade war which the occupant of the White House has unleashed is more damaging to the U.S. economy than to its Asian rival. In the eyes of the experts, the revenue that the United States will receive through the imposition of greater tariffs is of little significance and contributes barely a fraction of the total revenue of the world’s leading power. Therefore, Trump stands to gain nothing this way. And the reality is that China has chosen the critical sectors through which it hopes to strike at Trump in the electoral arena with care: gas, aeronautics, agriculture and chemicals, to mention a few.

It is possible to measure the trade that has taken place between the two countries since the beginning of the hostilities and work out who is selling more and who is buying less. But this is not where the greatest impact on the two parties lies. The big difference between the two sides of the equation in this conflict is China’s refusal to submit to any regulations. Chinese theft of American technology is beyond measure and affects the very essence of the economy of the country in the north, which is rooted in its capacity to generate and sell innovative technology.

As far as the matter of protecting its rights is concerned, the United States has not made the slightest bit of progress. Washington has demanded that China guarantee its companies a technological niche as well as ownership of intellectual rights. Trump has also gone as far as to threaten to withdraw from the World Trade Organization if the other big players of the organization do not give in to his requests to isolate China. But keeping China in check is nothing short of impossible and international organizations can do very little to pressure the titan of Asia, aside from continuously reiterating the need to put a stop to the transgression of international agreements regarding the protection of intellectual rights, which China breaches with the greatest flippancy.

What is certain is that this test of strength between giants triggered by the U.S. president has caused friction between him and all sides in the international arena, since ways and means are just as important as the matter itself, where the United States unquestionably has the advantage of being in the right. The decibels of the battle sounds between the two titans are reaching increasingly high levels, while with each step, the theory that the problem will only be resolved by a contest between all the world’s major trading players is gaining ground in the international community.

Therefore, all things considered, from both a domestic and international point of view, it is the United States that so far stands to lose the most in this war, even though trade figures show that it has succeeded in punishing China.

As for his country’s elections, Trump will have few successes to flaunt with regard to this test of strength with China, while Xi Jinping has no one around him or in his country to hold him accountable for his mistakes or for his violation of regulations.

*Editor’s note: The 2018 midterm elections take place in November. All 435 seats in the U.S. House of Representatives and 35 of the 100 seats in the U.S. Senate will be contested.