January 12, 2020

Which...could potentially stop trade wars before they start.

The White House and Beijing have agreed to hold semiannual discussions over economic issues, reports the WSJ. Once resisted by the Trump administration, the talks will implement a similar structure to those put in place by Presidents George W. Bush and Barack Obama.

What do negotiators hope to accomplish? Let’s check in with former Treasury Secretary Hank Paulson, who initiated the economic talks during the Bush administration.

Paulson wrote that his Strategic Economic Dialogue (SED) led to contracts for U.S. companies.

He also argued that as a result of the SED, the U.S. persuaded China not to sell its stockpile of U.S. government bonds during the financial crisis in 2009.

Big picture: Though certain sectors—auto parts, furniture, and machinery—were dinged by tariffs, “most of the U.S. economy sailed through two turbulent years of trade war with China with barely a scratch,” a WSJ analysis of economic indicators concludes.

This week, the U.S. and China are expected to sign a “phase one” trade deal that puts future tariffs on hold.