CNBC's Jim Cramer on Thursday laid out his case for holding a hard-line position in the U.S.-China trade war.

The "Mad Money" host said he's cynical about free trade as opposed to most Wall Street professionals, highlighting that China's practices of subsidizing domestic companies has negatively impacted America's manufacturing economy, including electronics, toys and even gift wrapping, which once was a moneymaker for his father, "Pops."

"With each of these items, I see a group of towns that's been decimated by permanent, normal trade relations with China, just like the towns that made gift wrap for my dad's" business, he said.

Cramer is in favor of the U.S. tariffs in place on billions of dollars' worth of imports from China as a means to force the country to change its unfair trading practices. For more than a year, the two countries have been engaged in a trade dispute that has escalated over time through a series of tit-for-tat duties.

The Trump administration on Thursday signaled that American and Chinese trade negotiators are nearing a "phase one" trade deal, which would be the first sign of concrete progress in the trade war. Without it, the U.S. plans to impose a new round of tariffs on more products.

"The economists will tell you that tariffs raise the cost of living. They're not wrong — a tariff is a sales tax — but a lot of their predictions seem overblown," he said. "A lot of companies can do a lot to mitigate the damage."