WASHINGTON — President Donald Trump floated cutting tariffs on China from 145% to 80% on Friday ahead of a weekend meeting among top U.S. and Chinese trade officials as he looks to deescalate the trade war between the world's two largest economies.
Top U.S. officials are scheduled to meet with a high-level Chinese delegation in Switzerland in the first major talks between the nations since Trump sparked a trade war with stiff tariffs on imports.
"80% Tariff on China seems right! Up to Scott B," Trump wrote on social media Friday morning, referring to Scott Bessent, his Treasury chief, who has been a point person on trade. The Republican president also called on China to open its markets to the U.S., writing: "WOULD BE SO GOOD FOR THEM!!! CLOSED MARKETS DON’T WORK ANYMORE!!!"
President Donald Trump speaks Thursday at an event in the East Room of the White House in Washington.
Bessent and U.S. Trade Representative Jamieson Greer will meet Chinese Vice Premier He Lifeng in Geneva in the most-senior known conversations between the two countries in months, according to announcements this week by the Trump administration and the Chinese commerce ministry. It comes amid growing U.S. market worry over the impact of the tariffs on the prices and supply of consumer goods.
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So far, the Chinese have refused to fold under the pressure of Trump’s massive tariffs. Instead, they have retaliated with triple-digit tariffs of their own.
"All bullies are just paper tigers," the Chinese Foreign Ministry declared in a video last week. "Kneeling only invites more bullying."
The stakes are high between the world's two biggest economies, whose trade topped $660 billion last year.
While businesses and investors welcome any easing of tensions, the prospects for a quick and significant breakthrough appear dim.
"These are talks about talks, and China may be coming to assess what's on the table — or even just to buy time," said Craig Singleton, senior China fellow at the Washington-based think tank Foundation for Defense of Democracies. "There's no shared roadmap or clear pathway to de-escalation."
Treasury Secretary Scott Bessent testifies Tuesday before a House committee on Capitol Hill in Washington.
But if the two countries eventually agree to scale back the massive tariffs they slapped on each other's goods, it would relieve world financial markets and companies on both sides of the Pacific Ocean that depend on U.S.-China trade.
"The companies involved in this trade on both sides just cannot afford waiting anymore," said economist John Gong of the University of International Business and Economics in Beijing.
In a worst-case scenario, China could walk away from the negotiations if it feels the U.S. side isn't treating China as an equal or isn't willing to take the first step to deescalate, Gong said.
"I think if (Bessent) doesn't go into this negotiation with this kind of mindset, this could be very difficult," he said.
For now, the two countries can't even agree on who requested the talks.
"The meeting is being held at the request of the U.S. side," Chinese Foreign Ministry spokesperson Lin Jian said Wednesday. Trump disagreed. "They ought to go back and study their files," he said.
Shipping containers are ready for transport April 17 at the Guangzhou Port in the Nansha district in southern China's Guangdong province.
Tariffs meet economic reality
What seems clear is that Trump's favorite economic weapon — import taxes, or tariffs — has not proved as mighty as he hoped.
"For Trump, what's happened here is that the rhetoric of his campaign has finally had to face economic reality," said Jeff Moon, a trade official in the Obama administration who now runs the China Moon Strategies consultancy. "The idea that he was going to bring China to its knees in terms of tariffs was never going to work."
Trump views tariffs an all-purpose economic tool that can raise money for the U.S. Treasury, protect American industries, lure factories to the United States and pressure other countries to bend to his will, even on issues such as immigration and drug trafficking.
He used tariffs in his first term and is even more aggressive and unpredictable about imposing them in his second. He slapped a 10% tariff on almost every country in the world, blowing up the rules that governed global trade for decades.
But it's his trade war with China that has really put markets and businesses on edge. It started in February when he announced a 10% levy on Chinese imports. By April, Trump ratcheted up the taxes on China to a staggering 145%. Beijing upped its tariff on American products to 125%.
Trump's escalation sent financial markets tumbling and left U.S. retailers warning that they might run out of goods as U.S.-China trade implodes. U.S. consumers, worried about the prospect of empty shelves and higher prices, are losing confidence in the economy.
"This was not very well planned," said Zongyuan Zoe Liu, senior fellow in China studies at the Council on Foreign Relations. "I don't think he intended to have the tariffs escalate into this chaos."
Chinese President Xi Jinping gestures Friday as he walks in Red square after the Victory Day military parade in Moscow.
China was ready
When Trump hit Chinese imports with tariffs during his first term, he claimed Beijing used unfair tactics, including cybertheft, to give its technology firms an edge.
The two countries reached a truce — the so-called Phase One agreement — in January 2020; China agreed to buy more U.S. products, and Trump held off on even higher tariffs. But they didn't resolve the big issues dividing them, including China's subsidies of homegrown tech firms.
China was ready for a rematch when Trump returned to the White House. It worked to reduce its dependence on America's massive market, cutting the U.S. share of its exports to 15% last year from more than 19% in 2018, according to Dexter Roberts of the Atlantic Council.
Beijing is confident that the Chinese people are more willing than Americans to endure the fallout from a trade war, including falling exports and shuttered factories.
"For China, it's painful, but it's also imperative to withstand it, and it's prepared to cope with it," said Sun Yun, director of the China program at the Stimson Center.
Here's how the global economy impacts your car insurance rate
Here's how the global economy impacts your car insurance rate
As of December 2024, car insurance rates had jumped 11.3% over the year prior, and tracking the reasons behind the spike in premiums isn't easy. Car insurance rates are affected by a global ripple—things like changes in U.S. trade relations or rising costs at local auto body shops may impact the cost of insurance. That may leave consumers wondering how these changes impact their bottom line.
 used data from the and the to explore the domestic and international factors that can directly affect car insurance rates.
Generally, American car insurers base rates on factors including driver's age, gender, driving history, location, type of vehicle, credit score, and even marital status. But supply chain issues, labor shortages and costs, and a spike in the prices of new cars all contribute to high premiums.
Insurance companies are raising rates partly because vehicle technology has made it more difficult to repair cars, sport utility vehicles, vans, and trucks. As the demand for repairs increases, so does the cost, which had already climbed after parts shortages and other global issues precipitated by the COVID-19 pandemic. For example, a global shortage of chips all but halted new vehicle production in early 2021—and made it harder for insurance companies to offer replacement vehicles after cars were totaled.
Increased vehicle prices are also partly to blame for higher premiums. Higher sticker prices tend to push consumers to fix cars they already own rather than buy new ones, reported. According to , heavier, more powerful vehicles that require more complex and expensive repairs, coupled with increased rates of speeding and crashes, could be pushing repair prices higher as well.
A mechanic shortage is also a factor. Many skilled technicians are retiring, while younger people are less inclined to make up the shortfall. And during the pandemic, fewer drivers on the road led to decreased maintenance needs. Now that people are back behind the wheel, cars need repairing, and mechanics are in short supply. A suggested the U.S. shortfall for technicians could reach 471,000 from 2024 to 2028.
Even problems at critical supply chain choke points around the world are raising the cost of doing business. So, insurers are trying to compensate—and all that puts a dent in consumers' pocketbooks.
Cost of insurance and maintenance are increasing
BLS data shows that although steadily since the 1960s, they've skyrocketed over the last few years. This is the "main reason" for , The New York Times reported.
Other factors complicating the cost of repairs are more luxury models on the road and more severe crashes, which means insurers have to cover higher costs. When newer, safer vehicles and their cameras, radars, sensors, and other features are damaged, the repair work can quickly get complicated and, of course, more expensive.
In other words, as liabilities rise, so do premiums.
How global changes influence domestic auto insurance
There are some bright spots on the horizon for auto owners. Global shifts in manufacturing could help reduce car insurance rates in the United States, which are so high they're near a breaking point, the Times reported.
Since consumers absorb production costs, a shift from globalization to regionalization may bring down costs. With supply chain risks and bottlenecks still hindering the movement of goods through the Red Sea, Suez Canal, and Panama Canal, U.S. manufacturers who move production closer to home may decrease their overhead. Some prices—and yes, that may include rates—should go down.
What's more, with new levels of transparency around fair pay, regulatory compliance, labor rights, and social and environmental issues, many companies are moving production closer to home, where regulation is less expensive. For example, car and car parts manufacturers that have long been in China and other Asian countries are investing heavily in Mexico, in part to reduce expenses associated with regulatory compliance, as reported in early 2024. Political considerations, with caution about what information the U.S. discloses to China, also played a role.
This change, known as "nearshoring," in which companies get closer to their preferred markets, has an outsized impact on the automotive industry.
From 2019 to 2023, industrial park space in Mexico more than doubled, from 21.5 to 46 million square feet—and most of the $13 billion in industrial funding the country has secured over the last couple of years is to back auto or auto parts manufacturers, which have nearly a century of history in Mexico. The nation now far outpaces other U.S. trade partners for parts, in part due to increased supply and a more convenient, tighter supply chain.
But there is a fine line between reasonable increases and extra padding for profit margins. Between production shifts, frustrated consumers, and a 2024 win by Consumer Watchdog that challenged requests for inflated insurance rate increases among major providers, auto owners might want to monitor their rates closely. There are many things drivers can control, but geopolitics isn't one of them.
Story editing by Alizah Salario and Carren Jao. Additional editing by Kelly Glass and Elisa Huang. Copy editing by Kristen Wegrzyn.
originally appeared on and was produced and distributed in partnership with Stacker Studio.
