Advertisement
  1. Nation & World

Trump acknowledges China policies may mean U.S. economic pain

President Donald Trump speaks during a meeting with Romanian President Klaus Iohannis in the Oval Office of the White House, Tuesday, Aug. 20, 2019, in Washington. (Associated Press)
President Donald Trump speaks during a meeting with Romanian President Klaus Iohannis in the Oval Office of the White House, Tuesday, Aug. 20, 2019, in Washington. (Associated Press)
Published Aug. 21, 2019

WASHINGTON — President Donald Trump acknowledged his aggressive China trade policies may mean economic pain for Americans but insisted they're needed for more important long-term benefits. He contended he does not fear a recession but is nonetheless considering new tax cuts to promote growth.

Asked if his trade war with China could tip the country into recession, he brushed off the idea as "irrelevant" and said it was imperative to "take China on."

"It's about time, whether it's good for our country or bad for our country short term," Trump said on Tuesday.

Paraphrasing a reporter's question, Trump said, "Your statement about, 'Oh, will we fall into a recession for two months?' OK? The fact is somebody had to take China on."

The Republican president indicated that he had no choice but to impose the tariffs that have been a drag on U.S. manufacturers, financial markets and, by some measures, American consumers.

China, though, said trade with the U.S. has been "mutually beneficial" and appealed to Washington to "get along with us." A foreign ministry spokesman, Geng Shuang, on Wednesday expressed hope Washington can "meet China halfway" in settling disagreements.

RELATED: China's Xi Jinping gets tougher on Trump after new tariff threat

Trump was clear that he didn't think the U.S. is at risk of a recession and that a boom was possible if the Federal Reserve would slash its benchmark interest rate.

"We're very far from a recession," Trump said. "In fact, if the Fed would do its job, I think we'd have a tremendous spurt of growth, a tremendous spurt."

Yet he also said he is considering a temporary payroll tax cut and indexing to inflation the federal taxes on profits made on investments, moves designed to stimulate faster growth. He downplayed any idea that these thoughts indicate a weakening economy and said, "I'm looking at that all the time anyway."

Asked about his remarks, White House spokesman Judd Deere said, "The president does not believe we are headed for a recession. The economy is strong because of his policies."

Trump faces something of an inflection point on a U.S. economy that appears to be showing vulnerabilities after more than 10 years of growth. Factory output has fallen and consumer confidence has waned as he has ramped up his trade war with China. In private, Trump and his advisers have shown concern that a broader slowdown, if not an outright recession, could arrive just as he is seeking reelection based on his economic record.

Trump rattled the stock and bond markets this month when he announced plans to put a 10% tax on $300 billion worth of Chinese imports. The market reaction suggested a recession might be on the horizon and led Trump to delay some of the tariffs that were slated to begin in September, though 25% tariffs are already in place for $250 million in other Chinese goods.

The president has long maintained that the burden of the tariffs is falling solely on China, yet that message was undermined by his statements to reporters Tuesday prior to a meeting in the Oval Office with the president of Romania.

"My life would be a lot easier if I didn't take China on," Trump said. "But I like doing it because I have to do it."

The world economy has been slowing in recent months, and recent stock market swings have added to concerns that the U.S. economy is not immune. A new survey Monday showed a big majority of economists expect a downturn to hit by 2021.

Addressing that possibility, Trump focused anew on pressuring the Federal Reserve to cut interest rates. Presidents have generally avoided criticizing the Federal Reserve publicly, but Trump has shown no inclination to follow that lead. Rather, he's positioning Fed Chairman Jerome Powell to take the fall if the economy swoons.

"I think that we actually are set for a tremendous surge of growth, if the Fed would do its job," Trump said. "That's a big if."

Trump recommended a minimum cut of a full percentage point in the coming months.

YOU MIGHT ALSO LIKE

  1. This June 19, 2015, file photo, shows the Federal Communications Commission building in Washington. The Federal Communications Commission on Friday, is proposing about $200 million in fines combined for the four major U.S. phone companies for improperly disclosing customers' real-time location. Location data makes it possible to identify the whereabouts of nearly any phone in the U.S.  (AP Photo/Andrew Harnik, File) [ANDREW HARNIK  |  AP]
  2. This Aug. 2, 2018, file photo shows the U.S. Food and Drug Administration building behind FDA logos at a bus stop on the agency's campus in Silver Spring, Md. Health officials reported the first U.S. drug shortage tied to the viral outbreak that is disrupting production in China, but they declined to identify the manufacturer or the product. The Food and Drug Administration said late Thursday, that the drug's maker contacted health officials recently about the shortage, which it blamed on a manufacturing issue with the medicine's key ingredient.  (AP Photo/Jacquelyn Martin, File) [JACQUELYN MARTIN  |  AP]
  3. According to two recent studies, a startlingly high percentage of Americans believe the coronavirus is somehow related to Corona beer. [Florida Aquarium]
  4. Experts recommend employers outline policies about teleworking, travel and sick leave; monitor recommendations from the CDC and local health officials; and stock up on needed office supplies and other products that might be affected by a global manufacturing slowdown. [Times (2001)]
  5. In this photo made available by the Florida Highway patrol shows confiscated drugs following the arrest of two men Tuesday, Feb. 4, 2020, Santa Rosa County, Fla. Authorities confiscated methamphetamine, cocaine and fentanyl. (Florida Highway Patrol via AP) [AP]
  6. Trader Peter Mazza works on the floor of the New York Stock Exchange Thursday, Feb. 27, 2020. (AP Photo/Craig Ruttle) [CRAIG RUTTLE  |  AP]
  7. Brian Baumgartner, who played Kevin on "the Office," partnered with Bush's Beans to bring the chili his character was famous for spilling to life. [Bush's Beans]
  8. Rep. Bobby Rush, D-Ill., speaks during a news conference about the "Emmett Till Antilynching Act" which would designate lynching as a hate crime under federal law, on Capitol Hill in Washington, Wednesday. Emmett Till, pictured at right, was a 14-year-old African-American who was lynched in Mississippi in 1955, after being accused of offending a white woman in her family's grocery store. (AP Photo/J. Scott Applewhite) [J. SCOTT APPLEWHITE  |  AP]
  9. Japan's Prime Minister Shinzo Abe, center, speaks during a meeting of a task force on the new coronavirus at his official residence in Tokyo Thursday. Abe was asking all elementary, middle and high schools to remain shut until spring holidays begin in late March. (Kyodo News via AP) [菅原善孝  |  AP]
  10. One or more people have been using fake cash to buy Girl Scout cookies, leaving troops in the Bradenton area out hundreds of dollars, according to news reports. [JUAN CARLOS CHAVEZ  |  CENTRO Tampa]
  11. Guests walk down Main Street with Cinderella's Castle in the background at Magic Kingdom in Orlando in this 2019 file photo. Walt Disney World told some cast members to stay home because of their recent trip to Italy and the possibility of coronavirus infection.
  12. President Donald Trump, with members of the president's coronavirus task force, speaks during a news conference in the Brady Press Briefing Room of the White House, Wednesday in Washington. (AP Photo/Evan Vucci) [EVAN VUCCI  |  AP]
Advertisement
Advertisement
Advertisement