US-China: What If There’s No Deal?

US-China: What If There’s No Deal?

As the trade war between the world's two largest economies continues, stock markets around the world have gone queasy, and both sides are hunkering down for a longer fight. Some people still hope that a compromise will emerge at a possible Trump-Xi meeting during the G20 summit in Osaka in June.

But the optimists shouldn't get their hopes up.


Trump and his negotiators are demanding a fundamental change to the way China grows its economy. Among other things, they want the Chinese government to:

  • provide better access for US firms to the Chinese marketplace
  • stop providing Chinese companies with big subsidies that give them a competitive edge against foreigners
  • stop stealing foreign intellectual property
  • end the practice of forcing US companies to share new technologies as the price of entry into China
  • write these changes into Chinese law
  • and create a verification system that gives the US government confidence that China is actually doing all these things

In other words, Trump wants Xi to formally renounce the tools that China's leaders have used to transform what was once one of the poorest economies into what is now the world's second largest. What's more, Trump wants Beijing to make all these changes with a knife at its throat.

Compromise won't come easy on either side. Both Xi and Trump attach outsized importance to the need to save face. Both are under intense domestic political pressure to prove that the gains they hope to make are worth the pain they're forcing their people to endure.

Many of us assume that US and China will eventually get to yes. But what if it takes much longer than anyone thinks?

If they can't make sustainable progress toward a deal by their meeting next month, this conflict will drag on – potentially until after the 2020 US presidential election. Why make tough concessions to a man who might not be president much longer?

The 2020 election is still 18 months from now – if the trade war persists until then, how much collateral damage will China, the US, and the world economy suffer in that interim?

Jon Lieber, Managing Director of the United States for Eurasia Group, shares updates on recent COVID-19 policy developments:

The Biden administration extended an eviction moratorium even after the Supreme Court said they couldn't, what's next?

Well, the CDC imposed a nationwide eviction moratorium in light of increased risk from evicted people because of the coronavirus pandemic. The Supreme Court in June ruled that they (CDC) overextended their authority in doing so and mandated that the moratorium expire on schedule in July. A group of progressive activists weren't happy about this and raised a huge stink in Congress, but Congress recessed for their August vacation before they could solve the problem, putting big pressure on President Biden to extend the moratorium even though he said he didn't think that it would pass constitutional muster. The CDC did it anyway, extending the moratorium until October 3rd, which is a time that's short enough to probably avoid it being overturned by lawsuits, but long enough that Congress has time to figure out how to either extend it on a bipartisan basis or put more money into a rental assistance fund that few people have taken advantage of so far. This whole incident shows the power of progressive activists in the Biden administration who were able to elevate the profile of this issue and potentially prevent millions of people from losing their homes this summer.

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This week, the market value of Tencent, China's biggest video game company, nosedived after a state media outlet suggested that online gaming was as addictive and destructive as opium. Tencent immediately pledged to cap the number of hours people can play, and to keep minors off its platforms.

It's the latest example of a months-long crackdown on major Chinese technology firms that until recently were viewed as some of the world's most powerful and successful companies, as well as a source of national pride. Beijing's about-face on its own tech titans could have big implications for China, and beyond.

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Iran was involved in two naval incidents in the Gulf of Oman in recent days. The US, UK, and Israel have blamed Iran for a drone attack that killed two European nationals. Iran has rejected the accusations. Iran is also suspected in the "potential hijack" of a tanker off the coast of the United Arab Emirates.

These provocations are happening just as Iran inaugurates a new president, Ebrahim Raisi, and as talks continue over the possible US re-entry into the 2015 Iran nuclear deal. What's the connection between these events? We asked Henry Rome, Eurasia Group's deputy head of research and a director covering global macro politics and the Middle East.

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Whenever Burkina Faso is in the news, it's often about how the crisis-ridden country has got caught up in the crosshairs of horrific jihadist violence plaguing the Sahel.

But this week, the nation of 20 million was celebrating because Hugues Fabrice Zango won its first-ever Olympic medal after finishing third in the men's triple jump in Tokyo.

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Should people get COVID vaccine booster shots? Not yet, says the World Health Organization, which is pushing for rich nations or those with access to jabs to hold off until at least the end of September so all countries get to fully vaccinate at least 10 percent of their populations before some jump ahead with boosters. But the WHO's call has fallen on deaf ears in nations like Israel, France, Germany and Russia, which are already planning to offer boosters, in part to better protect people against the more contagious delta variant. What's more, mRNA vaccine makers Pfizer and Moderna are recommending supplemental doses for the same reason. The problem is that, beyond the obvious moral imperative for equal access to vaccines, if the rich continue hoarding jabs while vaccination rates stay low elsewhere, the virus will continue to thrive — and mutate into new, potentially even more infectious variants that sooner or later will reach every corner of the planet.

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80: If polar ice caps continue to melt at their current pace due to climate change, 80 percent of all emperor penguins will be wiped out by the end of the century because they need the ice for breeding and keeping their offspring safe. American authorities want to list emperor penguins, which only live in Antarctica, as an endangered species so that US fishing vessels will be required to protect them when operating in their habitat.

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On GZERO World, Ian Bremmer takes a look at the yin and the yang of alcohol's role in high-level diplomacy and society at large. Alcohol can bring people together just as easily as it can tear them apart. From a 1995 Clinton/Yeltsin Summit where a drunk Yeltsin almost derailed Bosnian peace talks, to Obama's Beer Summit and the recent G7 Summit, booze plays a part in how world leaders interact. Globally, alcohol consumption has been steadily increasing, by over 70 percent between 1990 and 2017, according to one report. . Low and middle-income nations like Vietnam, India, and China are a driving force behind that trend, with drinking in Southeast Asia rising by over 34 percent between 2010 and 2017. And yet, amidst this global booze boom, the world has only grown more and more divided.

Watch the episode: The (political) power of alcohol

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