Where American consumers will feel a real hit, Hufbauer says, are in job losses.
Libertarians know that's far from the truth, of course, but it's a cliche because it does reveal something about the way policymakers tend to view their pet projects.
Last week, Washington announced a 25 percent punitive tariff on thousands of Chinese products, unveiling plans to increase levies on an additional $300 billion worth of imports from the world's second-largest economy.
President Trump on Tuesday said that a deal with China will happen "when the time is right", and only after the U.S.is allowed to "make up" ground he says was lost after the formation of the World Trade Organization. And the increased interest in economic protectionism has created an opportunity for farm lobbyists to potentially score a somewhat unrelated victory by pushing for higher tariffs on Mexican produce.
Beijing's response comes after the White House increased tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent.
The two governments have given themselves a few more days to make peace before their latest tariff hikes hit.
Propaganda directives handed out past year instructed media to play down the trade war's effect on the stock market, refrain from whipping up public opinion, and halt mentions of Made in China 2025, an industrial policy that drew global criticism, according to China Digital Times, which publishes propaganda directives. "A small portion will go to our farmers, they'll be very happy, our industries will be very happy", Trump said.
Those bailouts are a poor substitute for letting farmers have access to foreign markets. Compared with a year ago, however, prices of imports from non-China Asia are down 0.6 percent. Rand and other legislators have warned that a damaging trade war is in prospect.
In series of early-morning tweets, Trump kept up his "America First" agenda in support of hefty tariffs and called on USA companies to back him by shifting their businesses away from China. "Losing a valuable market, losing stable pricing, losing an opportunity to support our families and our communities".
Beijing is the biggest holder of U.S. debt, and Bloomberg estimated previous year that China held around $1.2 trillion.
However, the onshore yuan weakened 0.1% to its lowest level since December 27, 2018, trading at 6.8874 per dollar, after the foreign ministry said it hoped the United States would not underestimate China's determination to defend its interests.
Trump warned China not to intensify the trade dispute and urged its leaders, including President Xi Jinping, to continue to work to reach a deal.
"If the administration follows through on this threat", David French, a senior vice president at the National Retail Federation, told the paper, "American consumers will face higher prices and United States jobs will be lost".
They point to two things. The duties imposed on a wide array of imports cost American businesses three billion us dollars a month in additional tax costs, the paper calculated.
Early Tuesday morning, the president tweeted, "Our great Patriot Farmers will be one of the biggest beneficiaries of what is happening now", adding that the funding for the new subsidies would be paid for by the "massive Tariffs" currently leveled against China and others.
Undeniably, China will also suffer.