The Detrimental Effects of the US-China Trade War

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Proposal Argument: U.S.-China Trade War
As the world becomes more and more globalized, countries are increasing depending on each other for many things. One of these things is trade. Since 1990, trade wars between nations have intensified as states look to maintain robust domestic production bases (Zeng 1). The United States (U.S.) has been engaging in a series of trade conflicts for many years. In the mid to late twentieth century, the country was often in battle with Japanese and European competitors (Zeng 1). Recently, the government has been embroiled in another bitter trade war, this time with China. There have been numerous discussions about the impact that this trade war will have on the country. Previously, the U.S. had to adopt an aggressive trade policy to keep up with its competitors. Today, economists, diplomats, and lawmakers are still contemplating the steps to mitigate the U.S.-China trade war. This paper discusses the problem presented by the U.S.-China trade war. Also, it offers solutions that can be used to alleviate this problem.
During his campaign for the most powerful office in the world, Donald Trump promised to increase trade tariffs with China as part of his plan to improve America's global trade position (Winter 1). According to the sitting President, this would force China to renegotiate its trade agreements with America. However, many did not expect that the action would culminate in a trade war that America would most certainly lose. Immediately after he took office, President Trump abandoned the Trans-Pacific Partnership (TPP). In his view, he did not understand the policy of "One China." But what he did not know is that this would accelerate America's displacement as the leading economic power (Winter 1).
Despite continuous advice from economic experts and elected members, President Trump said "trade wars are good and easy to win" (Hass and Denmark 1). But, as seen in the first fallout of the trade war, America’s economy was hurting. Still, it is essential to note that both countries were losing as trade flows were diverted away from each state. A contributor at the Washington Post pointed out that the growth of the American economy slowed. There was no interest from investors, and companies were beginning to lay off workers. In rural areas, farmers could not sell their produce. The freight transportation and manufacturing sectors were also hit hard by the trade war. Besides this, American citizens had to endure the most massive tax increase in decades (Hass and Denmark 1).
A study by Moody's Analytics found that 300,000 jobs were lost in the U.S (Hass and Denmark 1) due to the trade war. The country's real GDP also dropped by an estimated 0.3%. According to a Bloomberg report, $316 billion will be lost in 2020 due to the trade war. Recent research also shows that American companies have lost more than $1.7 trillion in stock prices since 2017. Additional studies have revealed that American companies have paid tariffs amounting to at least $46 billion. These tariffs have forced American companies to cut wages, jobs and accept lower margins in their profits. To increase profits, these companies have been forced to raise prices affecting Americans' daily liveli...