White House economic adviser Larry Kudlow admits he has turned increasingly cynical about the likelihood of a trade deal between the U.S. and China.
“China is a problem,” the veteran financial guru and former Ronald Reagan adviser told Fox Business Network’s Stuart Varney.
The United States and China are locked in a spiraling trade war that has seen them level increasingly severe rounds of tariffs on each other’s imports.
The Trump administration’s “America First” policies, which have left the United States embroiled in a bitter trade war with China and tit-for-tat tariffs with other trade partners, have raised the cost of some raw materials for American businesses and strained their bottom line, Reuters explained.
President Donald Trump has imposed tariffs on Chinese goods worth $250 billion and has applied tariffs on steel and on foreign aluminum, which raised import and domestic costs. He has threatened tariffs on another $276 billion in Chinese products, which would touch nearly every imported good.
The president previously has threatened to hit virtually all Chinese imports with duties, Bloomberg reported.
“They have not responded to our asks, and it’s not just the trade deficit, per se. It’s the theft of [intellectual property],” said Kudlow, who served as the Trump campaign's senior economic adviser.
Kudlow, the head of the National Economic Council that advises Trump, also criticized a new regulation in China setting wide-ranging police powers to inspect internet service providers and users, as the government tightens its grip on the country’s heavily restricted cyberspace.
“Under the new rule, effective from November 1, central and local public security authorities can enter the premises of all companies and entities that provide internet services and look up and copy information considered relevant to cybersecurity,” The South China Morning Post reported.
“The regulation was issued by the Ministry of Public Security last month and released on its website on Sunday. It comes more than a year after a controversial cybersecurity law was introduced that has caused widespread concern among foreign companies operating in China. Despite its broad scope, the legislation gives few details about implementation, making it all the more difficult for companies trying to avoid its repercussions,” the Post explained.
“That’s outrageous,” Kudlow said. “They have been unsatisfactory. Me, I want to see a trade deal. I have become very cynical, because we’ve given our ‘asks’ and China does not respond. I worry that they’re moving in the wrong direction, with a more closed economy and less liberal economy,” said Kudlow, who worked as Reagan’s budget deputy between 1981 and 1985.
Kudlow warned that China shouldn’t count on victories by Democrats in the midterms to change anything.
He said Democrats want to crack down on Chinese trade practices as much as Republicans. “China will miscalculate if they think there’s going to be some type of change in November, regardless of who wins,” Kudlow said.
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