Trade

Trump’s China deal, USMCA relieve Iowa farmers rocked by trade war

Iowa’s farmers were among the biggest casualties of the U.S.-China trade war, but President Trump’s historic trade agreement has them confident of a comeback. The phase one deal comes on top of trade pacts his administration has negotiated with Canada, Mexico and Japan. Those four countries are the biggest buyers of U.S. agriculture, purchasing more than $62 billion of products in 2018. “You’re going to have to get bigger tractors and a hell of a lot more land,” Trump said at a rally in Des Moines, Iowa, on Thursday, just days before the state’s caucuses to choose a Democratic candidate for president. A battleground state, Iowa gave its six electoral votes to Trump in 2016, and the state is important to his re-election bid this year. Its economy had been humming along before the outbreak of the trade war, growing at 5.4 percent and 4.2 percent in the first two quarters of 2018, before Trump imposed his first set of tariffs on Chinese goods on July 6. China responded by putting its own levies on U.S. goods, including soybeans. The nation had bought $12.5 billion of U.S. soybeans the year before, and Iowa was the largest producer, growing 562 million bushels, or about 22 percent of nation’s output. The state’s economy decelerated sharply as the tit-for-tat trade war escalated, growing just 1 percent in the third quarter before contracting 2 percent in the final three months of the year. It returned to growth in 2019, expanding at 2 percent, 1.1 percent and 1.3 percent in the first three quarters of the year. Trump responded to the trade war’s toll with two aid packages, totaling $28 billion, to help cushion the blow to U.S. farmers, whom he publicly praised. “What President Trump has done had to be done,” Roy Bardole, president of the Iowa Soybean Association, said…

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Trump signs USMCA, paving way for job market boom

President Trump signed the historic United States-Mexico-Canada Agreement, replacing the Clinton-era North American Free Trade Agreement that he called a “disaster.” The USMCA, which is the biggest trade deal of all-time, covers more than $1.3 trillion of commerce, and is the second major trade deal secured by the Trump administration this year. The agreement has already been ratified by Mexico, but not yet by Canada. “You’re going to see more jobs all across the economy, in the automobile sector, in the agricultural sector and of course in the energy sector as well,” Energy Secretary Dan Brouillette told FOX Business’ Maria Bartiromo on Wednesday. The USMCA requires 75 percent of automobile components be manufactured in the United States, Canada or Mexico in order to avoid tariffs. By 2023, some 40 to 45 percent of automobile parts must be made by workers who earn at least $16 an hour. The agreement is expected to create 80,000 new jobs tied to the auto industry and bring in up to $30 billion of new investment in the sector. The pact will also open new markets for American wheat, poultry and eggs, among other things. “This is a colossal victory for our farmers and ranchers,” Trump said at the signing ceremony. “Everybody said this was a deal that could not be done,” he added, “but we got it done.” Once fully implemented, the USMCA is expected to lift U.S. gross domestic product by as many as 1.2 percentage points and create up to 589,000 jobs, according to the International Trade Commission. After the trade deal was approved by the Senate on Jan. 16, by a vote of 89 to 10, Sen. Charles Grassley, R-Iowa, hailed it as a “major achievement for President Trump and a very big win for the American people.” The signing of the USMCA comes nearly two weeks after Trump inked an initial trade deal with China. Combined, the two agreements encompass more than $2 trillion worth of trade and could add as much as 1.7 percentage points to U.S. economic growth. The U.S. economy expanded at a 2.1 percent pace in the three months through September. “We’re restoring America’s industrial might like never before,” Trump declared at a campaign rally in Wildwood, N.J., on Tuesday evening. “They’re all coming back. They want to be where the action is.”

This is a HUGE win for Trump, and was entirely bi-partisan.  Not surprisingly, Bernie said he’d get rid of it, should he (God-forbid) become President.

US, China sign historic phase one trade deal

President Trump signed a landmark trade agreement with China, heralding a period of detente in a trade war between the world’s two largest economies fueled by decades of complaints that Beijing was manipulating its currency and stealing trade secrets from American firms. The pact, detailed in a 94-page document, is only the initial phase of a broader deal that Trump has said may come in as many as three sections. “Together, we are righting the wrongs of the past,” Trump said in a pomp-filled signing ceremony. “It doesn’t get any bigger than this.” The agreement will help grow the U.S. economy in 2020 and 2021 by “at least a half a point of additional GDP” and “probably translate into another million jobs on top of what we’ve already done,” Larry Kudlow, director of the National Economic Council, told FOX News’ “America’s Newsroom” on Wednesday. During two years of negotiation, there were occasional setbacks because “on some issues, we don’t see eye to eye,” noted Liu He, the Chinese vice premier who represented President Xi Jinping at the signing, but “our economic teams didn’t give up.” The agreement, which was first reported on Dec. 12, includes commitments from Beijing to halt intellectual property theft, refrain from currency manipulation, cooperate in financial services and purchase more than $200 billion of U.S. products over the next two years. The purchases will include up to $50 billion of U.S. agriculture, according to Trump and Treasury Secretary Steven Mnuchin, $40 billion of which has been confirmed by Chinese sources. China will also buy $40 billion in services, $50 billion in energy and $75 billion to $80 billion worth of manufacturing, the sources said. Lighthizer says the deal is “fully enforceable” if Beijing fails to live up to its end of the agreement, and the pact includes mechanisms for handling violations of intellectual property rights. Its dispute-resolution process will allow either side to appeal if it believes the other is “not acting in accordance” with the agreement. The document specifies that both China and the U.S. “shall ensure fair and equitable market access” for businesses that depend on the safety of trade secrets. Specific measures that will protect pharmaceutical firms’ intellectual property, govern patents, block counterfeiting on e-commerce platforms and prevent exports of brand-name knockoffs are detailed. In return, the U.S. will reduce tariffs on some products made in China, but keep duties the White House has imposed on $375 billion worth of merchandise. Following the phase-one signing, $250 billion of Chinese imports will still be subject to a 25 percent tariff and $125 billion of Chinese goods will be under a 7.5 percent levy. “These tariffs will stay in place until there is a phase two,” Treasury Secretary Steven Mnuchin told FOX Business’ Lou Dobbs. “If the president gets a phase two quickly, he’ll consider releasing tariffs as part of phase two. If not, there won’t be any tariff relief. It has nothing to do with the election or anything else. There’s no secret agreement.” Trump says phase two negotiations will begin “immediately.” though he pointed out Wednesday that China is “doing many more things in phase one than anyone thought possible.”

This is GREAT news!!!  I watched this live on tv, and the room at the White House was filled with a whose who of CEOs from American businesses like Ford, Visa, etc.  And, of course members of the House, Senate, and all the trade folks in the administration were in attendance.  It was truly historic, and certainly a feather in the President’s cap.  Here he was getting stuff done for We the People, while the Dems in the House were voting to send ridiculous, extremely partisan (not a single Republican voted for it, and in fact 1 Dem voted “nay”!) articles of impeachment to a Senate that won’t vote to convict.  The optics couldn’t have been more stark.  The House Dems looked pathetic, political, and inept.  The President, by contrast, looked…well..presidential, and working for us…as the Stock Market hit historic new highs with the Dow over that 29,000 mark again.  Clearly the market couldn’t care about the petty politics of House Dems and was far more interested in the progress with Chin and this trade deal.  It was a great day for America, and a bad day for Nancy Pelosi and her “impeachment managers.”     🙂

Opinion/Analysis: Speaker Nancy Pelosi’s stall tactics hurt America’s economy

Wouldn’t it be wonderful if for one brief shining moment in Washington, Congress put good policy over politics — and passed a bill that would benefit American workers, investors and businesses? We haven’t had a true bipartisan victory in Washington for seemingly ages, but we are tantalizingly close to getting there. This would be the passage of the U.S. Mexico Canada Trade Agreement (USMCA). Both parties want this modernized version of NAFTA to pass. It is the legacy of Ronald Reagan and Bill Clinton. But this latest modernized trilateral trade deal for North America hasn’t happened yet because of an endless parade of stall tactics by House Speaker Nancy Pelosi. She is blockading a vote of the 435 members of the House of Representatives. The odds are very favorable that Democrats and Republicans would provide enough yays to pass it and move it on to the Senate where the trade deal would be approved by a wide margin. The whispering campaign on Capitol Hill is that Mrs. Pelosi is worried about giving Mr. Trump a “win,” so she’s inventing flimsy excuses for endlessly delaying a vote. Her strategy might have some credibility if she had credible objections to this modernized trade deal, which was carefully crafted by Donald Trump with trade negotiators from our neighbors Canada and Mexico. First, Mrs. Pelosi said she wanted more worker protections in the trade deal — but this bill actually has stronger job and wage protections for American workers (some of which I think go too far) than the old North America Free Trade Agreement. Mr. Trump insisted on those broader labor protections for the auto and other blue-collar workers in many of those Midwestern states that have seen middle class job losses. She continues to broach the idea of attaching a pension bailout bill to the trade deal. That pension bill has nothing to do with trade. It would also potentially cost taxpayers tens of billions of dollars of costs to bailout mismanaged labor union pension funds. This is Mrs. Pelosi’s way of throwing a wet kiss to the union bosses as payback for their support in helping her become Speaker. An even wilder idea is a scheme by Democrats to force Mr. Trump to allow the United States back into the Paris Climate Accord — a $100 billion tax on Americans — as the ransom for passing USMCA. These are obvious poison pills and the speaker knows it. Mr. Trump would never allow the U.S. into the climate treaty and many fiscally-conscientious Republicans would withdraw their support for the USMCA if they were forced to endorse these new giant taxpayer liabilities for obese pensions. Then there is Mrs. Pelosi’s ploy to reopen the trade deal to repeal the hard-won patent protections for American pharmaceutical companies. Mrs. Pelosi is acting as if this were a giant “giveaway” to the U.S. drug companies that will raise prices for American consumers. She has it all wrong. This provision of the trade deal actually protects America patent rights for 10 years when made-in-America drugs and “biologics” are sold in foreign countries. The USMCA — expertly negotiated by Mr. Trump’s lead trade negotiator, Robert Lighthizer — actually forces Mexican and Canadian citizens to honor our patents and pay more for American drugs. This could in the end mean lower prices for these drugs here in the United States because our two neighbors would pay their fair share to cover the billions of dollars of research costs to bring to market new life-saving drugs. Mr. Trump should be applauded for getting Mexico and Canada to agree to live by the same patent protections that we require here in America. Why would Mrs. Pelosi object to a provision that effectively curtails foreign freeloading off the medical R&D investments of American firms? Why should foreigners get special discount deals on our patented drugs that are not similarly available to American patients? Mrs. Pelosi’s cynical strategy to change the USMCA would bust the trade deal wide open and kill it. Trying to renegotiate a trade deal that has been years in the making is like putting toothpaste back in the tube. Opening up one section of the law makes every section negotiable and brings us back to square one. The victims here would be American farmers, ranchers and hard-hat manufacturing workers. The economic benefits of the USMCA have been estimated by the U.S. International Trade Commission to be almost $60 billion in higher exports each year and some 175,000 new jobs. Passage of this law would put added pressure on China to pass its own trade deal with the Trump administration. Mrs. Pelosi should put America first by putting the political games aside and bringing USCMA to a vote urgently. Democrats won back the House in the 2018 elections by promising Americans that they could govern the country. Obstruction is not governing and blocking free trade deals is no way to keep the Trump economic boom going. I hate to think that may be the point of her political tactics.

No kidding!!  Thanks to economist Stephen Moore for calling out Speaker Nancy Pelosi (D-CA) on her shameless, and shameful, politics that are just hurting everyday Americans. Stephen Moore is an economic consultant with Freedom Works and served as a senior economic adviser to Donald Trump. His latest co-authored book is “Trumponomics: Inside the America First Plan to Revive Our Economy.”

Japan and U.S. Sign Trade Agreement

The U.S. on Monday signed two trade deals with Japan that are intended to alleviate the hardships American farmers have encountered since President Trump imposed tariffs on U.S. agricultural exports to certain countries. The first and third largest economies in the world signed the U.S.-Japan Trade Agreement and U.S.-Japan Digital Trade Agreement, just days before U.S. trade negotiators are set to meet with senior officials from the globe’s second largest economy, China, in Washington on Thursday. The two somewhat restrained trade deals cut $7.2 billion worth of tariffs on U.S. agricultural exports. U.S. Trade Representative Robert Lighthizer and Japanese Ambassador to the U.S. Shinsuke J. Sugiyama signed the agreements at a ceremony at the White House. “This is a huge victory for America’s farmers, ranchers and growers. And that’s very important to me,” Trump said in remarks at the signing ceremony. “From day one my administration has worked tirelessly to achieve a level playing field for the American worker.” American farmers bore the brunt of Trump’s decision to pull out of the Trans-Pacific Partnership trade agreement in 2017. One of the new deals does away with $4.3 billion in tariffs on American food products including wine, cheese, nuts, berries, and grains as well as $2.9 billion in tariffs on beef and pork products. The other agreement commits Japan and the U.S. to $40 billion worth of digital trade. Republican Senator from Iowa Chuck Grassley called the agreement great news for Iowa farmers and said the new deal “strengthens” the administration’s negotiating position with China, which has battled with the U.S. on trade since Trump took office. Nevertheless, the agreements keep U.S. tariffs on Japanese automobiles at 2.5 percent, in line with what Japanese Prime Minister Shinzo Abe said Trump promised him, that tariffs on Japan-made cars would not be hiked up. The trade deficit between the U.S. and Japan was $58 billion last year, long a point of contention for Trump.

Analysis: Trump’s tough trade tariffs on China have raked in $30 billion for U.S.

President Trump’s decision to impose tariffs on Chinese products over the Asian superpower’s “unfair” trade practices has brought in tens of billions of dollars, prompting Republican lawmakers to propose ways to pass along the windfall to American taxpayers. U.S. Customs and Border Protection says special levies on China, known as Section 301 duties, have brought in more than $30 billion since they were imposed in July 2018 to combat Beijing’s “harmful industrial policies.” Special levies on steel, aluminum, solar panels and washing machines have reaped roughly $10 billion more from countries, including China, since early 2018, according to CBP data. Mr. Trump frequently points to those numbers to boast that his pressure tactics are paying dividends while White House and Chinese negotiators reach for an elusive trade deal. “We’re taking in billions and billions of dollars in tariffs. We’re taking in tremendous numbers in tariffs,” Mr. Trump said during a press conference last week at the United Nations in New York. Analysts say the sheer amount of revenue isn’t unprecedented but is an unusual turn of events in the post-World War II era. “We used to get most of our revenue from tariffs. But it’s very unusual because for the last 80 years tariffs have been a declining source of revenue, so this is the first time [in recent history] it’s been a rising source of revenue,” said Marc Goldwein, senior vice president at the Committee for a Responsible Federal Budget. Tariffs are taxes on imports, largely designed to promote domestic producers by making outside goods less attractive. Mr. Trump said China is “eating” the cost of his levies, but it’s complicated. Some Chinese companies may be forced to offer discounts to U.S. importers, though American-based businesses often pay the cost of the tariffs and pass it along to consumers in the form of higher prices. The price is set to rise this fall when Mr. Trump imposes a 10% tariff on $300 billion worth of additional Chinese goods. It took partial effect on Sept. 1 but won’t be fully implemented by mid-December to avoid ripples during the Christmas shopping season. Analysts at JPMorgan Chase estimated that the average American family could face up to $1,000 more in annual costs once the levies are in place because the tariffs are starting to hit popular consumer goods. China, meanwhile, has retaliated with trade moves and tariffs of its own, hurting farmers in particular. While Mr. Trump is using some of the incoming duties to bail out the agricultural sector, some Senate Republicans say all Americans should get relief. Sen. Rick Scott, Florida Republican, has been meeting with the White House on a proposal that would pass along tariff revenue in the form of tax cuts. “Sen. Scott supports the president’s efforts to get tough on China, but any revenue brought into the federal government should be returned to the taxpayers,” Scott spokeswoman Sarah Schwirian said. Sen. Tom Cotton, Arkansas Republican, filed legislation last week that would gather tariff revenue and give it to working-class taxpayers in the form of a rebate check that arrives several months after tax-filing season. “Tariffs are an effective way to apply pressure to China and other nations in trade negotiations, but there’s no reason that tariff revenue can’t help working Americans in the process,” Mr. Cotton said. U.S. adults who are citizens or legal residents, file federal taxes and earn less than $84,200 as individual filers or $168,400 as joint filers would be eligible for rebate checks. The plan starts with a special rebate check for calendar years 2017 and 2018 — mailed within 90 days of enactment — and would establish a recurring annual rebate for eligible filers as long as money is pouring in from what are known as Section 201, 232 and 301 duties. According to Mr. Cotton’s office, the rebates would be a good way to shore up political support for the U.S. crackdown on China while protecting Americans against any price increases resulting from tariffs. The White House hasn’t weighed in yet — the bill was just released — though Mr. Trump’s chief economic adviser, Larry Kudlow, has voiced support for Mr. Scott’s push to offer tax cuts equal to the amount the U.S. collects in tariffs. Mr. Scott’s spokeswoman said the senator plans to put forward a formal proposal in the coming weeks.

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Trump: U.S., China to resume trade talks ‘where we left off’

The U.S. will not impose new tariffs on China as the mega-powers restart trade talks that fell apart in May, President Trump said Saturday, signaling a freeze in an economic war that’s rattled investors, farmers and consumers alike. Mr. Trump said Chinese President Xi Jinping agreed to resume talks “where we left off,” with guardrails in place. “We’re holding on tariffs and they’re going to buy farm products. They would like to make a deal, I can tell you that,” Mr. Trump said in a lengthy press conference at the end of the G-20 summit in Osaka, Japan. Tariffs that Mr. Trump already slapped on China will remain in place for now. What to do about Huawei, a Chinese tech company effectively blacklisted by the U.S., will wait until the end of talks, though Mr. Trump said they agreed to let American companies sell components to the controversial firm. “Huawei is a very complicated situation,” Mr. Trump said. “We agreed to leave that.” It’s unclear if American and Chinese negotiators will be able to strike an accord, given complex hurdles, though both sides agreed not to heighten tensions. “China and the United States both benefit from cooperation, and lose in a confrontation,” Mr. Xi said. “Cooperation and dialogue are better than friction and confrontation.” Mr. Trump discussed the way forward after a two-day summit that focused on trade, climate change and women’s empowerment in the economy. Mr. Trump took questions from reporters for over an hour at a closing press conference. He then hopped on Air Force One for Osan Air Force Base in South Korea..

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