China Turns Tables on US Over 'Rip-Off' Economy
Beijing on Monday pushed back against Trump administration criticism of its trade deficit with the U.S., suggesting the White House misunderstands basic economic fundamentals.
Newsweek reached out to the Chinese Foreign Ministry and the White House with emailed requests for comment.
Why It Matters
U.S. Treasury Secretary Scott Bessent has repeatedly criticized China’s reliance on exports, calling it the “most unbalanced economy in the world.” His remarks come as the Trump administration targets China’s trade practices, arguing the country benefits unfairly from its yawning trade surplus with the U.S.
While President Donald Trump cited fentanyl as the reason for doubling tariffs on Chinese goods to 20 percent last week, he has long railed against China’s trade imbalance with the U.S.. His belief China is “ripping America off” prompted him to launch the trade war against the world’s second-largest economy during his first term.
What To Know
Beijing has never sought trade surplus, Chinese Foreign Ministry spokesperson Mao Ning told reporters Monday.
“The China-U.S. trade, as it is now, is the result of market forces with multiple factors at play, including the two countries’ economic structures and trade policies as well as the position of the U.S. dollar,” she added.
A truck loaded with vehicles moves to lines of vehicles for export at a port in Yantai in eastern China’s Shandong province on January 2.
Associated Press
She added that these ties benefit both countries, adding that U.S. firms operating out of China have also profited from the trade surplus.
“To call the economic ties a ‘rip-off’ and pursue absolute reciprocity in trade goes against the most basic economic common sense, and those who do so are underestimating the judgement of American companies and consumers,” Mao went on.
She noted the U.S.’s yearslong trade duties—which were maintained by the Biden administration—did not stop the U.S. from importing over $900 billion more goods than it exported last year.
A tariff is essentially a tax on foreign goods paid by the importer and typically borne by consumers in the form of higher prices.
What People Are Saying
Vance Ginn, senior economic fellow at Pelican Institute for Public Policy, wrote earlier this month:
“In reality, Trump’s tariffs are one of the most significant tax increases in modern history […] And for what? The justification that trade deficits hurt the U.S. economy is fundamentally flawed.
“A trade deficit is not a sign of economic weakness — it reflects strong capital inflows and consumer purchasing power. Trying to “fix” it with tariffs only distorts markets and raises costs.”
Rep. Andy Harris, a Republican Congressman for Maryland, told Fox News:
“The president through tariff policy will bring back many industries back to the United States that are long overdue; and he will use it as bargaining chips.
“A lot of companies are going to look to site their manufacturing facilities in the United States because of the tariffs, and in the long run that’s very good for America.”
What’s Next?
The Washington, D.C.-based Tax Foundation has estimated Trump’s tariffs will shave 0.1 percent off China’s GDP this year and 0.3 percent off Canada and Mexico’s. They will also result in a hidden tax increase of $1,072 per American household, the think tank forecast.