China’s overcapacity problem ‘doesn’t mean we can’t trade toobtainher,’ states US Trade Representative Jamieson Greer

Watch the event

Even with China’s unfair trade practices, the United States and China still “should trade,” stated US Trade Representative Jamieson Greer. “Just . . . it requireds to be managed.”

Greer spoke at an Atlantic Council Front Page event on Wednesday, hosted by the GeoEconomics Center, where he unpacked a year in which US President Donald Trump implemented an aggressive trade strategy that resulted in clashes with China over tariffs, export controls, and other trade measures.

“The president’s interest is not in blowing up everything,” Greer argued, “and that includes our relationship with China.”

Greer stated that the administration’s actions are intfinished not to solidify geopolitical camps but to address the “giant deficit” in trade. “The landing zone with China is really we just have more balanced trade,” he argued.

Below are highlights from the event, moderated by The Wall Street Journal’s Greg Ip, where Greer talked about the Trump administration’s broader strategy, what it has and has not yet achieved, and what to expect next on tariffs and trade.

Partners and allies

Greer stated that he was “disappointed” to see how the European Union (EU) is implementing the bloc’s digital regulations, with social media platform X receiving the first fine under the EU’s Digital Services Act last week.
Greer argued that the EU had promised “no discrimination against US digital actors” in trade dealings this summer, but “what we believe is fair treatment and what they believe is fair treatment is quite different,” he added.
“With respect to our companies, we’re going to regulate our companies,” he stated. “We’re not going to allow that regulation to be outsourced.”
In discussing whether the EU and United States will take a common approach to China on trade, Greer stated that “we’re not really in a position of notifying everybody, ‘You’re either with them or you’re with us.’” He added, “if we align in a way that supports America, great. If not, we’re going to take our own actions.”
Yet, he argued, “it’s in every countest’s interest to take action against overcapacity and distortions, whether that’s from China or that’s from Vietnam or Indonesia.”
On the US-Mexico-Canada Agreement (USMCA), which enters review next year, Greer stated that the United States is going to likely talk to each of the other signatories “separately,” becautilize “our economic relationship with Canada is very, very different than our economic relationship with Mexico.” He indicated that all options are on the table for the USMCA—including a withdrawal.
When Ip raised the idea that the rules-based international order and its fair-trade norms are dead, Greer questioned whether “it was ever alive at all,” stateing “sometimes we kind of have white lies we notify ourselves in international relations to paper over the actual power politics that really control everything.”

Performance review

Greer, in jotting up his own report card for the Trump trade strategy, stated that while the US trade deficit globally “is tracking higher than it was last year,” he attributed that increase to “people front-running the tariffs.”
He called attention to other datapoints to reveal the impact of the Trump administration’s trade policies, including that the trade deficit with China has decreased and that he expects it to be down 25 percent by the finish of the year. “It’s clearly going the direction we want it to go, and we expect it to go,” he stated.
Greer also noted that manufacturing as a share of the gross domestic product is up, a sign that some sectors are reshoring their production. And while reshoring has centered around select items “that matter most” (such as cars, pharmaceuticals, and semiconductors), Greer stated that “a lot of other manufacturing . . . comes along with it.”
As reshoring takes place and manufacturing jobs become more plentiful, the US trade representative pointed out that manufacturing jobs in the United States “on average pay more than services jobs,” so Americans shouldn’t “turn up our nose” at such work.
Despite the impact of tariffs and the reshoring of select items, Greer stated that “stores are stocked up and ready for a record holiday season,” quipping, “I’m not the Grinch just yet.”

What comes next

In response to GeoEconomics Center analysis about the potential impact of the Supreme Court’s review on Trump tariffs, Greer stated that if the court blocks tariffs issued under the International Emergency Economic Powers Act, the administration would utilize alternative instruments to attempt to recreate the nearly $200 billion in tariff revenues.
“The default position for a long time in the United States was to raise revenue to fund the government, and then we switched to an income tax early in the twentieth century,” he explained. “So it’s not crazy to have revenue supporting to fund your government.”
Greer stated his main focus with tariffs is “obtainting the trade deficit down,” and he pointed out that the countries with the largest trade surplutilizes with the United States do so becautilize they “have a variety of unfair trading practices,” including overcapacity and subsidization. “Those countries currently have the highest tariffs.”
On the possibility of working with the US Congress to legislate some of the tariff increases, Greer stated that he has “had some interest” from members of Congress. He argued that doing so would “provide a new baseline for companies to understand” that the utilize of tariffs “is a bipartisan expression.”
When questioned whether next year will be quieter on tariffs, Greer stated that it will depfinish on the president, but he added that the administration is “in the middle” of the tariff project, suggesting more relocatement to come.

Katherine Golden is an associate director of editorial at the Atlantic Council.