Long trade war; Calibrated nationalist propaganda; Conference on Dialogue of Asian Civilizations

The Chinese side is signaling its position in the trade war with the US through a series of calibrated statements and propaganda pieces. President Trump is on his second day of tweet storms about the relationship.

The PRC propaganda has definitely shifted towards a more nationalist tone but it is still relatively restrained and leaving the door open for a resolution.

But, given the PRC’s stated bottom lines, and how they appear to conflict with the US bottom lines, it is hard to see how either side could compromise, at least until there is much more pain, without a domestic backlash. The Chinese prefer to keep the terms of any trade deal with the US secret, and even if the US side were to agree good luck stopping it from leaking in DC, so again it is hard to see a mutually face-saving compromise in the near-term.

One thing that seems certain is that the damage to the US-China relationship is significant and probably permanent, even if there is a miraculous deal around the June G20. Thi…