Trade negotiations between Washington and Beijing during President Trump’s first term often felt like an existential clash of economic models. Recent talks are more like the management of a fragile status quo.
Back then, forcing China to abandon its state-driven economic practices was the very spark that ignited the trade war. When U.S. negotiators flew to Beijing in the spring of 2018, they delivered a “surrender-or-die” list of demands–insisting on the elimination of state subsidies and a total opening of Chinese markets–that effectively would have required Beijing to turn its economic model on its head.
That era was defined by the original Section 301 investigation, which served as a serious indictment of China’s structural flaws–specifically its systemic use of forced technology transfer and intellectual property theft–backed by mountains of factual evidence.
Fast forward to 2026, and the atmosphere heading into Trump’s first expected state visit to Beijing during his second term feels fundamentally different. The era of aggressive structural engineering has given way to what looks like a period of truce management.
In the latest twist in the diplomatic dance, Trump said Monday the U.S. had asked China to delay his summit with Chinese leader Xi Jinping that had been expected to begin later this month. “Because of the war, I want to be here. I have to be here. So we’ve requested that we delay it a month or so,” Trump told reporters.
Both sides seem to have reached a weary resignation: China’s state-led engine won’t be dismantled by U.S. pressure, so the goal has shifted from transformation to mere transactional containment.
The Trump administration recently initiated broad Section 301 investigations into global manufacturing overcapacity and the failure more than a dozen nations, including China, to curb forced labor in their supply chains.
Few people feel the difference more than Daniel Bahar, a former assistant U.S. Trade Representative who was at the table during those first-term negotiations. In a recent conversation, Bahar told me the current Section 301 investigations seem less like a hammer for structural reform and more like a legal “vehicle to just put tariffs back up to where they were.”
In other words, the primary goal now is to rebuild the old rates that a recent Supreme Court ruling dismantled. These new 301 probes essentially provide the administration with the necessary legal authority to restore tariff levels to what China had already grown accustomed to during the truce.
As Bahar put it, “I don’t view this as itself a signal that we are escalating against China.” The intent, he said, is to restore the status quo without “blowing up the truce.”
Analysis from Washington-based Beacon Policy Advisors echoes this, suggesting the coming summit will prioritize stability over breakthroughs. Instead of a deal targeting the roots of the Chinese economy, the U.S. is looking at an extension of the truce struck late last year, which involves both sides holding fire on further tech export controls and critical mineral restrictions.
This shift signals a mutual desire to maintain a stable state of relations rather than seeking a transformative deal.
Big number commitment
Indeed, many have said Trump’s China agenda these days focuses on wins that prioritize optics: increased Chinese purchases of Boeing planes, American soybeans, and oil and gas. The administration even hopes to convince China to buy American energy over Russian or Iranian sources, despite the higher price tag.
In 2026, it appears a “big number” has officially replaced “structural change” as the ultimate metric of success.
Perhaps the most striking departure from the first trade war is a renewed openness to bilateral investment. While previous policies suggested a tightening, some American companies are pushing for more joint ventures.
Some China skeptics warn that a massive Chinese investment deal—perhaps something even bigger than the $550 billion investment commitment Trump struck with Japan last year—could blow up the national security protocols used to vet Chinese investment. If Beijing offers a trillion-dollar commitment, those skeptics worry, the U.S. might be tempted to trade its regulatory guardrails for the optics of a historic win.
The stakes for China are clear as well. Beyond tariff relief and access to high-end semiconductors, Beijing is expected to push for a more proactive U.S. stance against Taiwanese independence. For Beijing, the Taiwan issue is the ultimate prize, as it seeks to undermine confidence in the island’s security to eventually force a political reunification on Chinese terms.
To many in Washington and elsewhere, it is a sobering thought: the structural reforms that once defined the U.S.-China economic war might be traded away for purchase orders and investment checks—while the geopolitical landscape shifts beneath our feet.
As the U.S. and China move from a battle over economic principles to managing the status quo, who is winning? Write to me at lingling.wei@wsj.com. Include your full name and location, and I might publish your response in an upcoming issue (if you’re reading this in your inbox, you can just hit reply).
This is an edition of the WSJ China newsletter, a weekly dispatch of exclusive insights on the contest between the U.S. and China, brought to you by the WSJ’s top China correspondent. If you’re not subscribed, sign up here.
China in a Few Headlines
China has spent years preparing for the Iran oil crisis.Xi is enforcing his demand for ethnic unity across the country.China’s economy is off to a steady start in 2026 amid lowered expectations.The country has resumed military flights around Taiwan after a sudden 10-day hiatus.An OpenClaw craze in China has buoyed tech stocks and fueled an AI pivot.
A Closer Look
ByteDance is arranging access to 36,000 Nvidia Blackwell chips, worth over $2.5 billion, through a company in Malaysia, part of an effort to navigate around U.S. export controls.
Reader Responses
Last week, we asked whether China is still an engine of global growth with the “Iron Rooster” now running the books. Some shared their thoughts:
“By cutting the 2026 growth target, Beijing merely acknowledged that accelerating export growth won’t offset decelerating domestic demand growth. Anti-involution is the only relief producers in other countries can expect from Beijing.” — Tim Condon, Costa Rica
“China will continue to be a major supplier to the global economy. However, finding overseas demand would become challenging over time as many western countries are seeking to build China-proof supply chains—not only for critical minerals, but a broad range of major products—especially after the recent rare-earth embargo.” — Hiroshi Utsumi, Japan
“Due to geopolitics, supply-chain security concerns, and cost restructuring, parts of the industrial chain that were once heavily concentrated in China are gradually shifting to other developing countries. Future global growth is likely to be driven by a broader set of emerging economies, with China still remaining one of the most important among them.” — Li Mengzhang, China
“We will look back five years from now and say that this was the high point of China’s rise. China, with an economy half of the U.S.’s size, has almost as much debt and the debt is going to drag them down over time.” — Jim Hunter, North Carolina
“Breaking through the psychological wall of consumer resistance will take time, so China would seem to be looking at some rough sledding ahead. Failure to address this issue will only extend the lag period needed to regain the consumer’s confidence in government.” — Eugene P. Grace, Pennsylvania
(Responses have been condensed and edited.)
About Us
WSJ China is a weekly newsletter with exclusive insights on the contest between the U.S. and China, brought to you by WSJ Chief China Correspondent Lingling Wei, with help from Zhao Yueling. Reach Lingling at lingling.wei@wsj.com or at @Lingling_Wei on X. Sign up to get an alert every time she publishes an article. Got a tip for us? Here’s how to submit.