China Is Already Winning the Trade War America Wanted
Trump's “grand bargain” won’t happen at a time when tariffs and export controls have become combat by other means.
Hal BrandsOctober 19, 2025 at 7:00 AM CDT
At war.
Photographer: Saul Loeb/AFP/Getty Images
Historians may record these recent weeks as the moment when our new age of economic warfare got very real indeed. At the end of September, the US Department of Commerce announced a crackdown on provision of semiconductors and chipmaking equipment
to subsidiaries of blacklisted Chinese companies. Beijing then went massive in its retaliation, unveiling export licensing requirements that weaponize China’s
rare-earths dominance to an unprecedented degree.
China, wrote Dean Ball, who recently served in the Trump administration,
had asserted “the power to forbid any country on Earth from participating in the modern economy,” because it had put their access to materials that underpin a wide array of strategic industries at risk. US President Donald Trump
responded angrily, calling the restrictions a “moral disgrace” while also threatening China with new sanctions and heavy tariffs. If implemented, those measures would restore a de facto trade embargo between the two largest economies in the world.