Under the impact of the so-called “reciprocal tariff” policy of the United States, the American people have been hoarding storable goods to resist the cost of living pressure brought by rising prices; consumers in countries such as Canada and Denmark have expressed their strong dissatisfaction with the policy by boycotting American products.
“Instead of ‘making America great again’, the (US) president has made Washington an ‘international outcast’… The shadow of economic recession is gradually approaching the United States.” The British “Guardian” wrote. Adam Posen, director of the Peterson Institute for International Economics, a US think tank, published an article in “Trade Wars Can Fail Easily” in the magazine “Foreign Affairs” emphasizing that “the United States is betting all its bets on a losing hand.”
Recently, Chen Zheng, a lecturer at the Institute of Regional and Global Governance of Beijing Foreign Studies University and a researcher at Taihe Think Tank, said in an interview with China Youth Daily and China Youth Network that the Trump administration’s move not only failed to solve the domestic economic problems of the United States, but also intensified the problem of political polarization in the United States and seriously disrupted the world economic order. At the same time, China has always been an advocate of economic globalization and trade liberalization, a staunch defender and supporter of the World Trade Organization, and has contributed Chinese wisdom and strength to the stability and development of the global economy.
On April 13, at the Shanghai Haitong International Automobile Terminal, a large number of domestically produced new energy vehicles were waiting to be shipped for export. Image source: Visual China
Imposing tariffs is a move to “cut off the supply chain”
According to the US financial media CNBC, on April 14, the Organization of Petroleum Exporting Countries (OPEC) lowered its forecast for global oil demand growth in 2025 for the first time since December 2024. The reason is that a series of tariff policies announced by the United States have brought risks to the global economy.
Since taking office in January, Trump has wielded the “tariff stick”. He regards tariffs as “the most beautiful word in the dictionary” and an important tool for achieving the “industrial return and manufacturing recovery” in the United States. But when he was immersed in the fantasy of “prying the global industrial chain towards the United States” with tariffs, reality gave him a heavy blow.
“Trump is implementing a typical ‘shock therapy’. Not only will this measure fail to achieve its goals, it will also accelerate the bleeding of the US economy and trigger a domestic crisis,” Chen Zheng analyzed.
Specifically, on the one hand, US inflation will intensify, and a large number of US companies that rely on imports may go bankrupt, leading to an unemployment crisis; on the other hand, the US high-end manufacturing industry will be the first to be hit. Take industries such as semiconductors, aerospace, and new energy vehicles (such as Tesla) as examples. They rely heavily on the global supply chain. However, the US labor cost is high, and it lacks a complete industrial ecosystem like China, so it is extremely difficult to rebuild the upstream and downstream supply chain of the industry. “The policy of imposing tariffs is undoubtedly to cut off the supply chain.”
The US “Dialogue” News Network emphasized that even if tariffs force some manufacturing industries to move to the United States, it is very likely to backfire. For example, more domestic steel production in the United States can indeed create jobs for American workers, but high costs will inevitably lead to rising product prices, and the competitiveness of American products and consumers will be harmed.
Chen Zheng said that compared with the US tariff policy in the past, the characteristics of the current Trump administration’s tariff policy are: the amount of tariffs is huge and the radiation is wider, covering almost all countries with a trade surplus with the United States. Moreover, the current debt pressure faced by the United States is even greater, so Trump is eager to take action, through the means of trade war, trying to force countries to buy U.S. debt to help the United States alleviate its debt problem.
“Trump ignores the United States’ dominant position in the field of service trade.” Chen Zheng observed that the United States is a country with a surplus in service trade. Software provided by high-tech companies such as Microsoft and Google, financial services of financial companies, and virtual economic services provided by AI computing companies have all generated considerable revenue for the United States. In 2024 alone, the U.S. service trade surplus reached US$295 billion, far higher than the US$77 billion in 2000.
“Once you have bad intentions, it’s hard to sell things.” David Weinstein, professor of economics at Columbia University, expressed his concerns to the Wall Street Journal that tariff policies would undermine the United States’ ability to do business in other countries.
Filippo Taddei, managing director of global investment research at Goldman Sachs, revealed that the EU may target the service import sector of the United States and take countermeasures. The Wall Street Journal reported that the EU has proposed sanctions on large American technology companies. In addition, Trump’s approach has also aroused “anti-American sentiment” among foreign consumers, who tend to avoid American banks, asset management companies and other companies.
“In the long run, the policies implemented by the United States will eventually undermine its national soft power, dampen its advantage in attracting outstanding global talents, and cause heavy damage to its service industry.” Chen Zheng emphasized.
Weakened trust in the American system
“The chaotic tariff policy has weakened people’s confidence in the American system.” The New York Times wrote. But Trump did not stop.
Talking about the reasons why the Trump administration is so stubborn, Chen Zheng analyzed that from an ideological perspective, the “MAGA” group represented by Trump is a combination of populism and the extreme right. At present, the strength of the United States is relatively declining. Economic structural problems have led to an increase in the polarization between the rich and the poor. The people’s sense of deprivation has become stronger, and the trend of turning to the right is obvious. After Trump came to power, in order to give back to his “basic base”, he took advantage of the situation to launch populist propositions and respond to the demands of the grassroots people.
From a political perspective, the polarization of American society and politics is becoming increasingly obvious. Some working-class groups feel that they have been betrayed by the Democratic Party, the establishment and Wall Street elites. They blame many social problems on immigrants and foreign competitors, and Trump took advantage of their psychology.
“But the US government made decisions too hastily. It neither left itself time to adjust the supply chain nor was it really prepared to lose China.” Chen Zheng said. Adam Posen, director of the Peterson Institute for International Economics, further explained that China occupies a dominant position in the trade war launched by the United States. The important goods that the United States obtains from China cannot be replaced in the short term, nor can they be manufactured at low cost domestically.
In fact, the US financial market is suffering from turmoil, and the gap between the rich and the poor in society is further widening. The Guardian reported that the US stock market volatility and the increase in government debt costs have shaken the foundation of financial market stability, frustrated investor confidence, and may also damage the credit of the US dollar.
When talking with European scholars, Chen Zheng observed that the US dollar is equivalent to “US oil”. However, the foundation of the US dollar is US debt. If US debt is hit, the US dollar will lose its credit. At present, the US financial derivatives market is huge, and once problems arise, it will trigger systemic risks.
US President Trump and his staff have tried their best to convince the American people and the international community that the turmoil caused by his tariff increase is a deliberate “pain” rather than a reckless act. However, many governments and media pointed out that the huge uncertainty brought about by the US tariff policy not only disrupted global trade, but also backfired on the United States itself.
Today, the American people are shrouded in the negative haze caused by the tariff policy. According to the US Foreign Policy magazine, within 10 weeks after Trump took office, voters in Florida and Wisconsin saw a sharp drop in support for the Republican government, and they asked Republican leaders to adjust their strategies as soon as possible.
In fact, neither the Republicans nor the Democrats are in power to solve the structural problems in the US economy. Chen Zheng explained that there is a drawback in the US electoral system: politicians lack long-term strategic planning, and the public’s trust in the government is severely depleted, which leads to the US political ecology falling into a state of vacillation. On this basis, the tariff policy has intensified the contradictions between different political forces, aggravated social polarization, and provided greater development space for the extreme right.
In addition to the impact on the domestic political ecology of the United States, the trade frictions between the United States and its traditional allies continue to escalate, which is seriously endangering the stability of its alliance system.
The Financial Times analyzed that due to common interests and similar values, the United States has established long-term alliances with Japan, Germany, Australia, Canada and the United Kingdom. But Trump’s vigorously promoted “America First” policy has hit hard on traditional allies and close economic cooperation partners.
Chen Zheng analyzed that the trust mechanism of the transatlantic relationship between the United States and Europe will be shaken, and its economic and trade relations may be affected; cracks will appear in the alliance between the United States, Japan and South Korea; if the United States insists on imposing high tariffs on ASEAN countries, the ties that the United States has established with these countries in the past will also break.
“While Trump’s erratic policies hurt other countries, they also caused many troubles for the United States’ own economy, politics and diplomacy,” said Chen Zheng.
In response to Trump’s abuse of tariffs, Chinese Ambassador to Cuba Hua Xin posted a picture on a social platform: the price of the “MAGA” Little Red Hat produced in China has risen from $50 to $122.5. Image source: Social Platform X
The world should “seek win-win cooperation”
Former British Prime Minister Gordon Brown said, “No country is an island that can stand on its own.” In the context of globalization, international cooperation is the way out to deal with various challenges. Germany’s Der Spiegel published a commentary saying, “Trump launched a trade war against other parts of the world, redistributing the roles of (countries on) the global economic stage. China has become a reliable new partner.”
Chen Zheng said that the United States has ignored international economic and trade rules and vigorously promoted unilateralism. The “rules first” multilateral order led by the United States after World War II is under attack, and the World Trade Organization and the International Monetary Fund have been marginalized. If things go on like this, the United States will become a destroyer of the international economic order and be widely questioned by the international community.
“Americans expect China to greatly relax restrictions on U.S. investment and imports of U.S. goods…but Trump may have the opposite effect.” Der Spiegel wrote, “His trade war may make most of the world China’s allies.”
Singapore’s Lianhe Zaobao quoted experts as saying that as regional organizations strengthen economic and trade ties and countries other than China and the United States increase economic and trade exchanges, the future may form a process of “trade globalization with the United States taking a back seat” or “semi-globalization without the United States.” Stephen Roach, an economist at Yale University in the United States, believes that under the impact of Trump on the world, China has improved its image; the United States has become “the problem, not the solution.”
Facing the tariff threat created by the United States, Chen Zheng believes that China should continue to deepen the existing economic and trade cooperation mechanism and work with other countries to inject stability and certainty into the development of the world economy.
For example, as an active advocate and promoter of BRICS cooperation, China should continue to strengthen cooperation with BRICS countries. Second, the joint construction of the Belt and Road Initiative has entered a new stage of high-quality development. China can strengthen economic and trade cooperation with the co-construction countries to properly deal with the impact of protectionism and unilateralism. At the same time, China can strengthen dialogue with Europe, Japan, South Korea and ASEAN countries, strengthen coordination and cooperation in relevant mechanisms, and enhance connectivity and economic and trade exchanges.
Chen Zheng said that maintaining the multilateral trading system, maintaining the stability of the global industrial chain and supply chain, and maintaining an open and cooperative international environment are crucial to the development of the world economy. Today, China’s important concept of building a community with a shared future for mankind, as well as global development initiatives, global security initiatives, and global civilization initiatives, have made important contributions to the stability and development of the global economy and guided the direction for solving the common challenges faced by all countries.
“In a world of turmoil, countries should work together to strengthen the resilience of regional production and supply chain integration, promote the improvement of the global economic governance system, and seek win-win results through cooperation.” Chen Zheng emphasized.
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