US. Treasury Secretary: China tariff escalation, a big mistake

China’s tariff escalation has been described as a big mistake by U.S. Treasury Secretary Scott Bessent who made this comment on Tuesday, April 8, 2025.

U.S. tariff negotiations are the result of calls from other countries not sliding financial markets.

Bessent said in an interview with CNBC,

“I think it was a big mistake, this Chinese escalation.”

“We are the deficit country. So what do we lose by the Chinese raising tariffs on us?

We export one fifth to them of what they export to us. So that is a losing hand for them.”

When asked whether the European Union needed to lower non-tariff barriers including value-added taxes, Bessent said, “Everything is on the table.”

He added that the United States will see what its trading partners offer.

Bessent cited an energy deal in Alaska that Japan and South Korea have expressed interest in financing.

“So that could be an alternative for them to come forward with that, because not only would that provide a lot of American jobs, but it would narrow the trade deficit,” Bessent said.

Treasury Secretary Scott Bessent said Tuesday the U.S. holds a substantial advantage over China as the two nations exchange threats in a growing trade war.

“I think it was a big mistake, this Chinese escalation, because they’re playing with a pair of twos,” Bessent said during an interview with CNBC.

“What do we lose by the Chinese raising tariffs on us?

“We export one-fifth to them of what they export to us, so that is a losing hand for them.”

The comments come a day ahead of the U.S. raising its duties on China and dozens of reciprocal tariffs from other nations.

According to Bessent, their purpose is to bring trading partners to the negotiating table and jobs back to the U.S.

So far, he said Japan has been at the forefront of countries eager to negotiate, and the White House expects a multitude of others.

Bessent added, “I think you are going to see some very large countries with large trade deficits come forward very quickly.

“If they come to the table with solid proposals, I think we can end up with some good deals.”

Ultimately, the hope would be to generate both jobs and revenue from the tariffs, he added.

Bessent continued, “If we put up a tariff wall, the ultimate goal would be to bring jobs back to the U.S. But in the meantime, we will be collecting substantial tariffs.

“If we’re successful, tariffs would be a melting ice cube, in a way, because you’re taking in the revenues as the manufacturing facilities are built in the U.S., and there should be some level of symmetry between the taxes we begin taking in with the new industry from the payroll taxes as the tariffs decline.”

While he said some 70 countries have reached out to the White House to begin talks, China has vowed it will “fight to the end” and has imposed 34% tariffs on U.S. products.

In return, President Donald Trump said he will slap another 50% charge on Chinese imports if the tariff is not withdrawn.

The U.S. in 2024 ran a nearly $300 billion trade deficit with China, or about one-third of the entire imbalance.

With the tariffs, Trump is hoping to open up more markets for American products and reshore manufacturing operations to the U.S.

However, the administration is not simply focusing on absolute tariff levels from other nations.

It is rather focusing on nontariff barriers such as:

• currency manipulation,
• Europe’s value-added tax and other methods the White House says undermine fair trade.

“Everything is on the table,” Bessent said.

“The academic literature shows that it’s actually the nontariff barriers which are harder, both harder to quantify and … they’re more insidious because they’re hidden, they’re obfuscated.”

Stock market futures, which already had been indicating a strong open on Wall Street, added to gains after Bessent spoke.

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