Former White House chief strategist Steve Bannon says that President Trump's new China tariff threat is a clear message that Beijing can no longer 'game the system.'
In a Friday discussion with CNBC, Bannon said "It’s pretty remarkable how the Chinese have tried to ... game the system," adding "They’re used to American leaders buckling under this false concept of engagement."
On Thursday, President Trump announced that the US would impose a 10% tariff on an additional $300 billion of Chinese imports - days after negotiators from both countries met for trade talks. Later in the day Trump told White House reporters that he's mulling a 25% tariff or more.
"It can be lifted in stages so we're starting at 10% and it can be lifted up to well beyond 25%," said Trump, adding "But we're not looking to do that, necessarily."
Bannon said that if the new tariffs hit on September 1, that it would "cross a psychological barrier in China," and would be a "new day" for Chinese imports.
That said, Trump is apparently willing to shelve the tariffs if China takes positive action, according to CNBC's Kayla Tausche.
As I just reported on @SquawkCNBC:— Kayla Tausche (@kaylatausche) August 2, 2019
- USTR planning notice in Federal Register w/ tariff details “soon”
- Sr admin official tells me expectation is tariff will apply to goods that arrive in US on Sept 1
- SAO says POTUS willing to shelve if China takes positive action
In June, Trump and Chinese President Xi Jinping agreed that China would purchase more US agricultural goods in exchange for a pause on additional tariffs - however the US has accused China of failing to hold up their end of the bargain. On Tuesday, Trump tweeted that China is "doing very badly," and that they "just don't come through."
..My team is negotiating with them now, but they always change the deal in the end to their benefit. They should probably wait out our Election to see if we get one of the Democrat stiffs like Sleepy Joe. Then they could make a GREAT deal, like in past 30 years, and continue— Donald J. Trump (@realDonaldTrump) July 30, 2019
According to Bannon, Trump has "given the communist party enough time" to express their concerns over US policy and come to an agreement.
Washington and Beijing have been engaged in a trade war for the past year, with each side upping punitive measures on one another.
In May, Trump increased the tariff rate on $200 billion worth of Chinese goods to 25% from 10%. In retaliation, China at the time announced plans to raise tariffs, some to as high as 25%, on $60 billion in U.S. goods.
However this plays out will be "the defining event of our time," according to Bannon, who added that none of the 2020 Democratic candidates would be able to handle the China situation like Trump.