It is not discussed openly, but there’s no little sensitivity in Washington these days as to whether the tariff war will be the straw that breaks the camel’s back, driving Western countries to choose the stability of China over the debt-laden dollar. Yesterday, Spain’s Prime Minister Pedro Sánchez, on a diplomatic trip to Asia, voiced the simple idea that the EU could benefit from closer cooperation with China, given Washington’s tariff war and the instabilities. That seemed to touch a nerve.
Treasury Secretary Scott Bessent, speaking to the American Bankers Association yesterday, brought up Sánchez’s comments (though he pretended not to know Sánchez’s office): “I’m not sure if the prime minister or the economic minister in Spain, made some comments this morning, ‘Oh, well, maybe we should align ourselves more with China’—that would be cutting your own throat.... These Chinese exports that the U.S. tariff wall is going to keep out … the Chinese business model … it never stops. They just keep producing and producing and dumping and dumping, and it’s going somewhere.”
Bessent left open the door for the tariff war to escalate further. Asked by Fox Business Network’s Maria Bartiromo whether Chinese stocks might be delisted from U.S. exchanges, he replied: “I think everything’s on the table.” He added the options of export controls on both goods and capital to China, and then said that he’s “confident this will be resolved at the highest levels,” because Presidents Trump and Xi Jinping have such a good personal relationship.
Chinese Foreign Ministry spokeswoman Mao Ning shared a meme mocking Donald Trump’s latest tariff hikes. The image features the signature “Make America Great Again” hat, but with a “Made in China” label and a jacked-up price tag. Her meme, based upon a mere 54% tariff, was out-of-date within hours.
