Balance of Power Trump, Xi Strike Truce on Tariffs, Rare Earths
Oct 30, 2025
Mary Lovely, a Senior Fellow at the Peterson Institute for International Economics, discusses the implications of the recent tariff truce between Trump and Xi, including rare earths and soybean purchases. U.S. Representative Jake Auchincloss shares insights on the government shutdown and its effects on the FAA, stressing the importance of airport staffing. The conversation also touches on energy policy, highlighting the need for a diverse clean energy mix to support growth while managing security risks around AI chip exports.
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Tariff Truce Eases Immediate Tensions
- Trump and Xi agreed a one-year tariff truce and rollback of some export controls, easing immediate tensions between the US and China.
- The deal included China pausing rare-earth magnet controls and US halving fentanyl-related tariffs, but many strategic issues remain unresolved.
Treat The Truce As A Breather, Not A Solution
- Avoid treating the summit as a comprehensive settlement; treat it as a pause and plan for deeper structural work.
- Use the truce to craft bipartisan industrial policy and strengthen domestic supply chains for critical minerals and tech.
Soybean Purchases Are Strategic Leverage
- China committed to buy 12 million tons of soybeans this year and 25 million tons annually through 2028, which aligns with US farm export expectations.
- These purchases offer short-term relief for farmers but function as a lever China can toggle based on US actions.