This is the REAL reason for Trump's visit to China

Added: 2026-05-17

[00:00:00]Donald Trump visited China this May and met with China's President Cingping.

[00:00:06]This was the first trip by a US president to China since 2017.

[00:00:12]And it's important to emphasize that it was Trump who asked for this meeting. It was not China that initiated this. It was the US. So this raises the question, why did Trump want to go to China and meet with President C? The short answer is that this is mostly about the US economy. Trump launched a trade war against China back in 2018 in his first term and during his second term in 2025, he massively escalated this trade war against China. But it backfired majorly.

[00:00:47]The US economy was already facing significant problems with inflation, which has been eating away at the purchasing power of American workers.

[00:00:56]and Trump's trade war and tariffs have only made this situation even worse. So, it is now widely acknowledged in US foreign policy circles, even by the Council on Foreign Relations, that China has the upper hand in these negotiations. Again, it was the US that called for this meeting, not China, because Beijing has the upper hand, and the US is in a very delicate situation economically. And the thing about Trump is he has no subtlety. He always says the quiet part loud. And Trump boasted in a post on his Twitter copy website, Truth Social, that he was traveling to China with some of the most powerful billionaire oligarchs in the United States. He wrote a list of the CEO of major corporations who would be visiting China with him, including the CEO of Nvidia, Jensen Huang, as well as the richest billionaire oligarch on Earth, Elon Musk. And these billionaires actually traveled on Air Force One with the US president. They were on the plane with Trump. Elon Musk, who was previously a top figure in the Trump administration until he and Trump had a political fight, although it seems like they've made up once again. And Jensen Huang. Hang's company, Nvidia, is the most valuable corporation on Earth. It is the first company that has ever had a market capitalization of $5.5 trillion.

[00:02:36]And this is because Nvidia designs the most advanced chips that are used for AI for artificial intelligence research and also data centers. But these were not the only corporate executives who joined Trump on his trip to China. He was also joined by Tim Cook, the CEO of Apple, although Trump calls him Tim Apple, as well as Larry Frink, who is the CEO of BlackRock, the world's largest asset manager, along with Steven Schwarzman, who is the CEO of Blackstone, which is the world's biggest alternative asset manager. By the way, Schwarzman is the highest paid corporate executive on Wall Street and he was also a big donor to Trump's presidential campaign. Along with them, Trump boasted that he was joined by the CEOs of Boeing, Cargill, Cityroup, GE Aerospace, Goldman Sachs, Micron, and Qualcomm. So, these are some of the most powerful corporations on Wall Street and in Silicon Valley. and their CEOs were joining the US president on this trip to China. So, it's so obvious what this is all about. And just to illustrate this fact, the US media published photos of Trump when he got off the plane joined by Elon Musk and Jensen Huang. And you can see that they were welcomed by Chinese diplomats. So symbolically the US president is standing with the most powerful billionaire oligarchs from the United States. Some of the richest people on earth. These are the oligarchs who determine US government policy. The media also published a photo of Trump meeting with China's presidency. And in the photo you can see some top US government officials including the secretary of war Pete Hegth, a former Fox News host. the Treasury Secretary, Scott Bessant, who's a billionaire hedge fund manager from Wall Street. Marco Rubio, who's the national security adviser and the secretary of state, and also in the photo, you can see David Purdue. And by the way, can you guess what David Purdue did before he became the US ambassador to China? He was a senator from Georgia and he boasted of being the only former Fortune 500 CEO in Congress. He was the president of Reebok and then he was the chairman and CEO of Dollar General. So this is the guy representing the US in Beijing right now. And in that photo of them meeting with Trump and Presidenc Jensen Huang, the CEO of Nvidia and Steven Schwarzman, the CEO of Blackstone. Once again, these corporate executives are being treated as if they were US government officials. Trump is bringing them to his meetings with the leadership of the Chinese government. So again, all of this makes it as clear as day that US government policy is made by and for large corporations for these billionaire oligarchs. Trump also made this extremely clear symbolically in his inauguration when he invited Elon Musk and Mark Zuckerberg and Jeff Bezos and the CEOs of Google and Apple and other big tech corporations to sit with his cabinet officials with top administration officials. All of this makes it very very clear that US government policy is not about average workers and average people. It's about big billionaire oligarchs and large corporations. They determine US government policy. It's foreign policy.

[00:06:17]It's domestic policy. And ultimately, that is what Trump's visit to China is about. Because these large US corporations are desperate to get access to the Chinese market. China has 1.4 billion people. It is the second most populous country on Earth after India.

[00:06:37]China also has the world's largest middle class in overall numbers. It has more than 800 million people in the middle class who together have the spending power of 7.4 trillion. That is significantly larger than the middle class in the United States or in India or any other country. And the trade war that the US government has been waging against China, not only under Trump but also under Joe Biden, this has been bipartisan. That trade war has hurt many US corporations. Nvidia is a great example. Jensen Hang has repeatedly visited China multiple times in the past few years and he is desperate to get access to the Chinese market. Why is that? It's because Nvidia used to control 95% of the Chinese market for advanced chips, but that has fallen to 0%.

[00:07:32]So from a 95% market share just a few years ago to 0%.

[00:07:38]This is why Jensen Hang was with Trump.

[00:07:41]This is why he has repeatedly visited China. And this is because the US government under Trump in his first term and under Biden put significant restrictions on China, restricting the export of advanced chips to try to prevent China from developing AI to prevent China from catching up to the US AI sector. However, China did not just quietly sit on its hands and allow the US to try to sabotage its high-tech sector. Instead, the Chinese government invested billions of dollars in cheap loans and subsidies and other support to try to develop a domestic chip industry.

[00:08:21]And China has made a lot of progress in just a few years. China is still not at the exact same level as the US as Nvidia. But China is now dominating the global market for what are known as legacy chips, which are slightly larger chips, not the most advanced tiny chips, which are like 3 nmters or 5 nanometers in size. China has made a lot of progress and it's likely that in the upcoming years, China will not only catch up to the US, but will surpass the US. So the argument of US corporate executives like Jensen Huang is that this trade war and tech war against China has backfired. It's actually hurt them in the medium to the long term. And maybe it helped them in the short term just in a few years, but in the medium to the long term, it's actually hurting them. And this is why they're working with Trump to try to formulate a new strategy. And what all of this reflects is the massive shift in the global economy. In the past few decades, China has become the single most important manufacturing power on earth. It is the only manufacturing superpower. China alone represents about onethird of all global manufacturing output more than the US and Japan and Germany and South Korea and other countries combined. And as the US economy was financialized and de-industrialized in the past few decades, many major corporations moved their production overseas, especially to China. And China is now the center of global supply chains for advanced manufacturing. And many US corporations like Apple have tried to diversify and to move their production out of China.

[00:10:08]The US government under Democrats and Republicans under Obama, Trump and Biden, Washington has pressured these companies to withdraw their investments from China and to move to countries like India. But they have not been able to because China has such a sophisticated supply chain. It has so many domestic companies that provide all of the small parts, all of the tools, all of the minerals, which I'll talk about in a moment here. And China has very skilled workers and it's been impossible for many of these large US corporations to derisk and move out of China despite the US government's insistence that they do so. Tesla is a perfect example of this.

[00:10:52]The CEO of Tesla is of course the world's richest billionaire oligarch Elon Musk who was the biggest funer of Trump in his 2024 presidential campaign.

[00:11:01]And more than half of Tesla's electric vehicles are made in China at the so-called Gigafactory in Shanghai. And this is quite ironic because while Musk is making half of his Tesla EVs in China, he has also been begging the US government to implement protectionist measures in order to shield Tesla from Chinese competition in the US. In 2024, when Biden was president, Elon Musk begged for trade barriers to protect Tesla. And then just a few weeks later, Biden announced 100% tariffs on Chinese EVs. It's almost impossible to get a Chinese EV in the US, which means that Tesla still dominates the US market, while Chinese EV manufacturers like BYD have dominated the global market. BYD has overtaken Tesla as the top sellers of electric vehicles around the world.

[00:11:57]And this is why the CEO of Ford has been warning that China can put all US car companies out of business. And by the way, the CEO of Ford drives a Chinese EV that was made by Xiaomi. So he understands how good Chinese EVs are.

[00:12:16]And US corporations are terrified of competition from China. All of this explains why the Council on Foreign Relations, the most powerful foreign policy organization in the US, said very clearly that at the Trump CS summit, China has the upper hand. The Council on Foreign Relations official publication is Foreign Affairs magazine and it published an article by a former US government official who worked at the State Department and the National Security Council and she wrote very clearly that America has lost its leverage over China and Beijing clearly has advantages. So let's briefly review what exactly those advantages are. So, if we go back to April 2025, Trump came out on what he called Liberation Day and he announced tariffs on countries all around the world. But the main target of Trump's trade war was China. At one point, the tariffs that Trump had temporarily imposed on China were 145%.

[00:13:24]Which is basically just a trade embargo at that point. However, ultimately Trump was forced to take a step back and in October 2025, he met with China's presidenc and they agreed to a one-year truce in the trade war. And why exactly was that? It's because the US clearly lost the trade war against China. A trade war that Trump started back in his first term. It was continued by Biden and then Trump massively expanded it in his second term and at the end after nearly 10 years the US obviously lost the trade war. China won. Many mainstream US media outlets acknowledged that the US trade war against China backfired spectacularly.

[00:14:13]And why was that? It's because US policy makers were very arrogant and they underestimated China. They believed that they had so much leverage. And the billionaire hedge fund manager from Wall Street, Scott Bessant, who is Trump's Treasury Secretary, went on TV in April 2025 when they started this new phase of the trade war. And he claimed that the US had all of the cards and China was playing with a losing hand. But that was the exact opposite of reality. It was China that had significantly more leverage. And that's because for the past decade, China was diversifying its economy and its trade. So the US assumed that China's economy could not survive without access to the US market. Because it's true that if you go back to the 1990s, one quarter of China's trade was with the US. China was extremely dependent on exporting to the US market. However, since 2016, China has been diversifying away from the US economy, and the US is no longer the most important market for Chinese exports. In fact, China now trades more with ASEAN, the Association of Southeast Asian Nations, than it does with the US or with all of the European Union. Southeast Asia and the global south in general have become more important trading partners. So Trump assumed he could simply cut off China's access to the US market in the form of sky-high tariffs and it would force Beijing to give in to all of his demands. This is what Trump did to many other countries. China was one of the very few countries that actually fought back and responded to the unilateral US tariffs with actual reciprocal tariffs, proportional reciprocal tariffs in self-defense. And then China took a step further and Beijing announced the restriction on the export of rare earth elements to the US. This was a huge shock because the US military-industrial complex and US big tech corporations are extremely dependent on critical minerals and rare earth elements that come from China. And this has been a massive piece of leverage that China has over the US.

[00:16:39]And this has been something that has been discussed in the previous meeting between Trump and President C in October 2025. And it's certainly a major issue of discussion during the meetings this May 2026 because many advanced technologies simply cannot be manufactured without rare earth magnets. And China utterly dominates the global supply chain for rare earths. And it's not just that. If you look at the countries that produce critical minerals, you can see that China plays an outsiz role in the production of copper, nickel, aluminum, lithium, and cobalt. China plays a very significant role. and in the production of rare earths, manganese and graphite, China absolutely dominates and there is no alternative. So when China announced these export restrictions in response to the aggressive US trade war, it was a massive blow to US big tech corporations. And we have already established how those corporations determine US government policy. And it was also a huge blow to the US military industrial complex because the US military needs these critical minerals and especially rare earths that are largely mined and processed by China. So without access to these Chinese minerals, the US military would not be able to function. This is why foreign policy magazine said that China's rare earth card looms over the Trump sea summit. This is also why in the past few years the US government has been obsessed with trying to create a new supply chain for critical minerals. This started in Trump's first term. It accelerated in Biden's term and has continued in Trump's second term. In fact, this February, Trump's Secretary of State Marco Rubio invited representatives of dozens of countries to Washington to meet for the so-called critical minerals ministerial. And this conference was organized so the US could work together with other countries to try to create a new supply chain for critical minerals that cuts out China.

[00:18:59]The Trump administration also created a new initiative called Pox Silica in which the US and several allied countries are working together to try to create this new supply chain with an emphasis on chips and high-tech manufacturing. The US also successfully pressured India to join the so-called pox silica. And the US government has been promising India that it's going to try to force US corporations to move their factories and their supply chain out of China and instead to reshore it or Frenchshore it in India. However, this is a process that's going to take years. It's not going to happen in a few weeks or few months. So in the short term, the US has no alternative but to continue to work with China. And this again explains Trump's visit to China.

[00:19:52]And it explains why Trump and Marco Rubio, who have been China hawks for years, extremely anti-China. It explains why they have softened their anti-China rhetoric. I mean, when Rubio was a senator, he was so extreme and so anti-China and so much of a neoonservative wararmonger that he was actually sanctioned by the Chinese government in retaliation after the US government sanctioned Chinese officials.

[00:20:19]But now that Rubio is both the national security adviser and the secretary of state, he has had to soften his anti-China rhetoric because he understands that China has significant leverage over the US and it's going to take many years for the US to weaken that leverage and create alternatives.

[00:20:40]But that's not all. There's still one other major factor here that I haven't discussed which again shows how China has significant leverage over the US and that is the issue of Iran. We here at Geopolitical Economy Report have been covering the war nonstop. But this is another area where US intelligence reports have acknowledged that China has more leverage over the US. And this is because it's now widely acknowledged that the US has been losing this war of aggression that Trump launched against Iran on the 28th of February. Trump thought he could simply overthrow the Iranian government by eliminating all of the Iranian leadership and then he would put in power a loyal puppet. In fact, it seems that Trump's plan for war in Iran was part of a larger plan to try to isolate China. It seems that this was Trump's plan. In January, he invaded Venezuela and he kidnapped Venezuela's president, Nikolas Maluro. And he threatened to cut off Venezuela's oil exports to China. China bought the vast majority of Venezuela's oil. Then a few weeks later, Trump thought he could easily go in, bomb Iran, decapitate the leadership, and put in power loyal puppets who would also cut off exports of oil to China. China is the world's largest importer of oil. It's very dependent on foreign oil and China is the largest trading partner of Iran and China buys 80% of Iranian oil. So it seems that Trump thought he could attack Venezuela, attack Iran and then use Venezuela's and Iran's oil exports to China as leverage. In this meeting with President C. He thought he could tell China, "If you do not give into our demands, we are going to cut off your oil supply." But what happened is the war in Iran did not go as Trump thought.

[00:22:43]The Iranian government is stronger than ever and Trump was forced to delay his initial meeting with China's president.

[00:22:52]So, this is why in the leadup to Trump's visit to Beijing this May, just a few days before, the US government announced several rounds of new sanctions targeting Chinese companies because China has been importing and refining Iranian crude oil. And this is again part of the US pressure strategy. Trump wanted to tell China, "If you don't give in to our demands, if you don't make economic concessions and trade concessions to us, we're going to impose more sanctions on Chinese companies, including very important companies in China's oil sector and prochemical industry. However, once again, this is an example of how the US underestimated China in all of its arrogance. The US thought that by putting more sanctions on important Chinese companies that Beijing would simply give in to Trump's demands. But the exact opposite happened. For the first time, China invoked its blocking rules, its anti-sanctions law, and the Chinese government ordered all domestic companies to ignore and defy US sanctions. So, China is no longer just criticizing US sanctions. It is creating an entire parallel system in which US sanctions are irrelevant.

[00:24:14]So that strategy of the Trump administration to try to pressure China also backfired. Meanwhile, there's a significant problem happening at home in the US, which is inflation is picking back up. Inflation has reached almost 4%. By the way, the inflation target set by the US central bank, the Federal Reserve, is 2%. Inflation is 3.8% nearly double. And that's probably a conservative estimate. And a big reason for that inflation, of course, is Trump's war against Iran, which has caused the largest oil crisis in history. The price of crude oil has doubled, and the price of gasoline in the US has skyrocketed. And the US is a country that has very bad public transportation and all of the infrastructure is built around cars.

[00:25:07]Everyone has to drive everywhere. And as gasoline prices go up, that means that average working people have to pay more and more just to go to work, just to go to school. And it also feeds into inflation in other sectors because trucks use a lot of gasoline to transport goods including food to grocery stores and supermarkets. So as the price of gasoline has basically doubled due to this war that was totally unnecessary. This means that there's going to be significant inflation in all other sectors of the economy. And this comes just a few months before midterm elections in November. And Trump's approval rating has plummeted. Trump is extremely unpopular. He only has an approval rating of 36%.

[00:25:56]And this is because Trump has failed to improve the economic situation for workingclass Americans. The only reason he won the election is because of the inflation crisis which was largely because of the pandemic and also the proxy war in Ukraine. And the Biden administration failed to manage the inflation crisis and Biden's vice president Kla Harris was extremely unpopular. Trump promised falsely, cynically that he would bring down inflation and make average goods and services more affordable for workingclass Americans who have been suffering through a cost of living crisis. More and more the US economy is divided. You have an economy for the rich, for a small handful of rich elites, and then you have the economy for everyone else, for the majority of the population. This has been referred to as the K-shaped economy. The stock market has been booming and Trump is constantly boasting about how the stock market is breaking new records and making billionaires like him even richer. Meanwhile, average workingclass people are suffering. The richest 10% of the US population makes up around half of all spending. And this is a consumption-driven economy. And yet 90% of the population only represents 50% of consumption. So the rich get richer and richer and they make up more and more of the economy while the vast majority of the population has been left behind. Now of course it should be emphasized that this extreme inequality in the US economy is nothing new. We should keep in mind that for decades since the 1970s real wages that is inflationadjusted wages for workingclass Americans have been stagnant. Most Americans saw no wage growth while the richest Americans got richer and richer and their wages significantly increased. And that's only considering wages. When you look at wealth inequality, it's even more extreme. The rich in the US have gotten richer and richer and richer while so many people are struggling to make ends meet. However, one of the reasons why in the past few decades, working-class Americans did not necessarily feel that they were getting much poorer is because the cost of consumer goods fell significantly, especially electronics.

[00:28:22]If you look at the change in prices of goods and services in the US, you can see that everything made in China got way cheaper, including TVs, toys, software, clothing, and furniture. All of that stuff that was made by China got way more affordable at a time when US workers real wages were stagnant. So, they did not necessarily feel poorer. In other words, China was exporting deflation to the US economy. China was helping to keep inflation relatively low. But at the same time, everything made in the US, all of the services provided in the US were bought up by the rich and turned into speculative assets, and they got extremely expensive.

[00:29:09]Housing became extremely expensive.

[00:29:11]Child care, health care, college, tuition, and fees, and textbooks, hospital services. China can't produce those services domestically and then export them to the US like it can with consumer goods. So, China was responsible for helping to keep inflation relatively low in the US in the past few decades. But now that the US government has been waging a trade war against China and a tech war and the US has been imposing tariffs on China, this has also contributed to the rise of inflation in the US and this has hurt the purchasing power of American workers. And Trump's tax cuts on the rich have only made the situation even worse. Because while Trump is cutting taxes on the richest Americans, he's in fact moving the tax burden off of the rich onto poor and working-class Americans in the form of tariffs.

[00:30:04]Because tariffs are simply a tax on imported goods. That is to say, tariffs are a tax on consumption. And this is a regressive tax that hurts poor and working-class Americans much more because they have lower disposable income and they spend much more of their paycheck on these basic goods compared to rich people. So all of these factors that I have analyzed today explain how the US is actually in a quite weak position economically and geopolitically. And this is why I agree with the analysis of the Council on Foreign Relations for once which said that at the Trump sea summit, China has the upper hand, not the US. The reality is that so many of the policies that the US government has carried out to try to weaken China have actually ended up backfiring and only accelerating China's rise and China's attempt to become more self-sufficient and more independent.

[00:31:07]And with that said, I'm going to conclude. I am Ben Norton. I am the editor-inchief of Geopolitical Economy Report. I want to thank everyone for joining me today. Please like and subscribe. Please share this. I will see you all next time.