By Juan Fermin, NoSocialism.com
April 24, 2025
President Donald Trump’s aggressive trade policies have reshaped the U.S.-China economic battlefield, positioning America to come out on top in the ongoing trade war. Critics in the media and establishment think tanks warn that Trump’s tariffs—145% on Chinese goods, 10% globally—will cripple consumers and alienate allies. They’re wrong, just as they were in 2018 when they predicted runaway inflation from steel tariffs. Today, a manufacturing boom, curbs on China’s trade tricks, and Beijing’s economic vulnerabilities show that Trump’s strategy is delivering results. Trump recently extended a hand to China, but they're now acting like a petulant child who's toys have been taken away. While the war isn’t over, the U.S. holds the upper hand—here’s why.
Tariffs Work: A Proven Track Record
In 2018, Trump slapped a 25% tariff on steel, sparking media cries of inflation doom. Prices spiked for 30 days, then fell below pre-tariff levels by 2023, thanks to increased U.S. production and global supply adjustments (Bureau of Labor Statistics). Today’s tariffs are even more strategic. Since April 2025, a 10% global tariff (down from 10–90% threats) and a 145% levy on Chinese imports have generated $21 billion in revenue, with projections nearing $170 billion by year-end. This funds Trump’s tax cuts—no Social Security, overtime, or tip taxes—without ballooning deficits, despite the Congressional Budget Office’s (CBO) $200 billion estimate, which often misses dynamic growth (e.g., 2017 tax cut shortfalls 20% below CBO forecasts).
Critics like the Peterson Institute claim tariffs will cost households $1,700 annually. They’re off-base. Consumer electronics—73% of smartphones, 78% of laptops from China—are exempt, slashing cost estimates closer to $800 (Bloomberg, 2025) and even that may be an overestimation, considering that it's mostly on Toys and Apparel, items consumers can often forgo or cut back on to suit their budget. High-margin industries, like auto parts (where dealers charge $1,000 for $150 brakes), can absorb a 10% tariff without gouging consumers. The 145% Chinese tariff? It’s a negotiating tactic, not permanent, designed to drag Beijing to the table. In 2018, tariffs jumped from 3% to 17% with minimal inflation (1.8% CPI in 2019). History suggests markets will adjust again. China isn't the only game in town.
Reshoring: America’s Manufacturing Revival
Trump’s tariffs, paired with Biden’s CHIPS and Inflation Reduction Acts, have ignited a U.S. manufacturing renaissance, reducing reliance on China. The CHIPS Act alone has spurred over 100 projects worth $540 billion, with 50+ companies—Intel ($100 billion in Arizona, Ohio), TSMC ($65 billion in Arizona), Micron ($100 billion in New York)—building semiconductor plants across 28 states (Semiconductor Industry Association, 2025). Battery factories are booming, with 10 set to open in 2025 (e.g., LG Chem in Michigan) and 15–20 more by 2027, targeting 1,200 GWh capacity by 2030 (BloombergNEF, 2024). Steel and glass are back, too: Hyundai’s $1.5 billion Louisiana plant, Nucor’s $2.7 billion Arkansas mill, Steel Dynamics’ $1.9 billion Kentucky facility, and Dialum/Viracon’s glass factories in Florida signal a heavy industry revival.
This isn’t just about jobs—it’s about the middle class. The CHIPS Act will create 56,000 direct jobs and 300,000 indirect ones (SIA, 2021). Each manufacturing job generates 5–10 support roles so in reality it could be as high as over a half million indirect jobs (Economic Policy Institute), adding $15–25 billion in tax revenue annually by 2030 (NAM, 2024). Hyundai’s plant alone could yield $300–500 million in taxes. Unlike the globalization era, which hollowed out U.S. factories, Trump’s policies prioritize American workers over foreign economies.
Closing China’s Trade Loopholes
China claims it cut its U.S. export reliance from 19.8% to 12.8% (2018–2023). Don’t buy it. Much of this “reduction” is transshipment—Chinese goods relabeled in Vietnam, Malaysia, Thailand, or Cambodia to dodge tariffs. A Harvard study (2024) estimates 16% of Vietnam’s U.S. exports are transshipped Chinese products and that's JUST Vietnam! Trump’s response? High tariffs (46% on Vietnam, 49% on Cambodia) followed by a 90-day pause and 10% rate for compliant nations. The threat of high tariffs on Vietnam's manufacturing base moved them to now enforce strict factory inspections and “Made in Vietnam” label checks. Cambodia pledged tariff cuts (35% to 5%) and export oversight. Malaysia, Thailand, and Singapore are tightening controls, too. All wins for Trump's strategy of isolating China.
These deals raise costs for Chinese goods, forcing them through U.S. tariffs—145% unless exempted. While enforcement isn’t perfect (China’s supply chain ties run deep), Trump’s pressure is dismantling Beijing’s workaround, ensuring fairer trade. Again, however Trumps target rate is probably closer to 25%. High enough to make "Made in America" more viable, but not so high as to completely shut down all trade.
China’s Economic Achilles’ Heel
China’s economy is faltering, amplifying U.S. leverage. Its real estate crisis ($300 billion Evergrande debt, 65 million vacant units), 15% youth unemployment, and loss-making EV sector (99/100 firms unprofitable) strain growth (4.6% GDP, 2024). Subsidies ($100 billion for steel, autos) prop up exports but drain resources. China needs U.S. dollars—its $295.4 billion U.S. trade surplus is critical for $3.2 trillion reserves and debt servicing.
Beijing’s diversification to ASEAN ($560 billion) and the EU ($525 billion) faces limits. ASEAN’s growth is strong, but the EU and Japan, with populations shrinking 6% and 0.5% yearly (Eurostat, OECD, 2024), won’t sustain China’s export machine. Food imports (50% of needs, including 100 million tons of soybeans) are another weak point. China’s 125% tariff on U.S. soybeans shifts demand to Brazil, but Brazil’s 150 million-ton limit leaves global gaps (400 million tons traded yearly). The U.S. can sell to the EU or India, maintaining leverage.
Strategic Gains Beyond Economics
China’s military buildup—400+ fighter jets, 20 warships, doubled missiles, 50% more satellites (Pentagon, 2024)—threatens Taiwan by 2027, justifying Trump’s hard line. Its South China Sea aggression alienates Vietnam (27 F-16 orders) and Japan ($7 billion naval buildup), creating U.S. openings. The Belt and Road’s debt traps (e.g., Sri Lanka’s port) spark regional backlash, amplifying Trump’s tariff-driven isolation of Beijing.
Could iPhones be made here? Yes, at a modest cost. Assembly labor in China ($24/unit) would rise to $240 in the U.S., but lower transport and tariffs cut the net increase to $165. Apple’s 44% margins can absorb a 10–15% price hike without losing share to Samsung AND still maintain the most profitable manufacturing operation on earth. Rare earths? The U.S. (Mountain Pass mine) and Australia (Lynas) can supply all needs, despite higher costs (USGS, 2024). China’s 80% share is a choice, not a necessity.
The Road Ahead
Trump hasn’t won the trade war outright—China’s $2.8 trillion reserves and ASEAN trade provide resilience. Inflation risks and supply chain dependencies linger. Initial high tariffs strained allies, but it was a move to get them to police China's transshipment abuses, AND IT WORKED! Hopefully the 10% rate restored goodwill. But Trump’s gains are undeniable: $170 billion in tariff revenue, a manufacturing boom, transshipment curbs, and pressure on China’s economy. Beijing may resist, but its dollar needs and global food constraints limit options. The U.S., with exports at 8% of GDP, can outlast China and in the end, hopefully we can cut a deal that STOPS China from supplying our enemies.
The media’s doom-and-gloom narrative—echoed by Krugman and Peterson—misses the mark, just as it did in 2018. Trump’s tariffs are rewriting the rules, bringing jobs home, and forcing China to rethink its game. The trade war’s endgame is unclear, but one thing’s certain: America’s back in the driver’s seat.
