Thread by @anders_aslund

A broad consensus reckons that Trump has done every fault in the book in his key trade aggression on China.
1. He should have joined hands with the EU & Japan. Instead he imposed unjustified tariffs on them & went alone.

2. The best tool Trump had against China was the already agreed Trans-Pacific Partnership, TPP. He threw it out & aggravated US trading conditions, leaving it to China to take the regional lead with its Regional Comprehensive Economic Partnership.

3. Trump should have focused on a few key issues, probably subsidies to state-owned enterprises, theft of intellectual property & bad conditions for foreign investors, but he has no focus & certainly not these.

4. Instead, Trump has brought up nonsensical issues, such as the bilateral current account deficit, which is caused by internal US fiscal & monetary policy, and demands Chinese state-led import of US agricultural products, which is socialist & anti-market.

5. Each Trump action comes as a reflection of Trump's stream of consciousness rather than as a thought-out policy. His unpredictable tariff impositions should be stopped if the Congress were responsible. Now they might cause global recession.

6. By having the US Treasury declaring China a currency manipulator, when it is not according to Treasury & IMF criteria, Trump just ridicules the US & its institutions, which obviously benefits China.

7. At present, Trump seems to have lost control. He is so obviously driven by the US stock market, which plummets if he or China escalates. Trump has ended up in a situation: Tails he loses; heads he loses.

8 Trump is in a lose-lose situation. The only sensible thing he can do is to give up. As in other trade fights, he can give up & declare victory. Any other option would be extremely damaging to the US & the world. But is he able to understand that? Does he care?