Much of what MR Roach says is true, a full up trade war would hurt the USA as well as China.



However in such a battle, would you not rather be in the position of having twice the economy of your "adversary", and selling about 1/3 as much as they sell to you? Or having as a large part of your "sales product" be agricultural products that are largely fungible and therefore since the US is typically the lowest cost supplier due to our ag efficiency, simply can be rerouted as exports to other countries since if China bought food from other exporters, the deficit of those now purchased agriculture would require American exports to fill (at a lower price to be sure since we currently sell to the highest bidder--but how much lower?) Compare that to China's electronics and other finished manufacturing goods where other potential suppliers like India, Phillipines, Vietnam, etc etc would dearly love to take over Chinese manufacturing markets.



As to Chinese Treasury purchases. That was certainly true in the past, but for a long time the Chinese have actually been net selling US treasuries, not buying so this isn't really a factor, even assuming their government could stop individuals and companies from buying Treasuries.

The major players that WILL be hurt are the US multinationals that would have to scramble to find new supply chains (some in the US hopefully) Boeing (who still would have an enormous Chinese aircraft base requiring spare parts and maintenance) and the global financiers like Morgan Stanley, or Goldman Sachs who frankly few of us care that much about, all things considered.



In Contrast, China would suffer an immediate and precipitous drop in industrial output, difficult to replace in the short term.



So do I advocate needlessly starting a trade war....hardly. Both countries would suffer, and there is always the risk that the Chinese leaders would try to rally their population against the US and its allies in some military provocation....However, the current state of the balance of trade with China is not sustainable long run. The Chinese either have to be cajoled to buy more from the USA or alternatively find another huge market to flood with their output or further develop their own internal market so they no longer need to so aggressively export (not really as likely at least in the short and intermediate term).



So while I deplore Trump needlessly picking fights over Taiwan, the established "One China" policy or acting too aggressively in the South China Sea, the trade issue HAS to be adjusted, and far more from the Chinese side given the continuing imbalance in trade