High stakes meeting at White House on China tariffs today

According to three sources familiar with the matter at hand, U.S. President Donald Trump is scheduled to meet with top trade advisers on Thursday in order to discuss U.S. tariffs which are scheduled to kick-in on December 15 on $160 billion in Chinese goods.

Ahead of the meeting, officials circulated talking points and downplayed the implications of the potential tariffs hike on the U.S. economy.

Senior trade advisers, which include Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin, and White House advisers Larry Kudlow and Peter Navarro, are expected to present a wholesome view during the meeting; Trump however will have the final say, said sources.

“I’m expecting them to raise the tariffs on Sunday,” said a source while adding, “The administration is preparing its talking points about how that’s the right thing to do. The message is that it will not be painful.”

According to a source, in recent days emails had been circulated among a select group of senior officials which argued that previous tariffs had a muted impact on the U.S. economy.

Navarro, had circulated a separate memo in favor of continued tariffs, arguing that China had increased its purchases of U.S. pork and soybeans only because of domestic pressures – the outbreak of swine fever; and that tariffs had minimal negative effect on U.S. growth or the stock market.

“The message is that it will not be painful,” said a source familiar with the administration’s thinking. “People have been proclaiming for a year and half that the sky is falling, and the sky isn’t falling yet.”

“When they get in the room, Peter’s going to say: ‘Hit ‘em.’ Larry [Kudlow] and Mnuchin are going to say: ‘Don’t do it.’ And I think Bob [Lighthizer] … is hoping he has enough to go on to justify not doing it,” said a source.

According to Derek Scissors, a China scholar at the American Enterprise Institute who consults with White House officials, he believes the White House is likely to delay the implementation of tariffs by up to 90 days.

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