High interest rates could balloon the national debt

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Amy Scott (1:02)

We got some pandas. They got a bald eagle statue. We'll look at what else came out of this week's US-China Summit. From American Public Media, this is Marketplace.

In Denver, I'm Amy Scott, and for Kai Ryssdal, it's Friday, September 25th. Good to have you with us. Chinese President Xi Jinping wrapped up his three-day visit to Washington today, his first state visit in 11 years. But aside from plenty of pageantry and the exchange of animals, what was actually a big accomplishment between the world's largest economic powers? We're going to get to it in our weekly wrap with Anna Swanson at the New York Times and Greg Ip at the Wall Street Journal. Hi, you two. Hello.

Anna, you're our resident trade reporter. So was there any actual progress on that front in this state visit?

Anna Swanson (2:06)

So there's still not a lot of specificity and it does look pretty limited. The two sides did agree to extend their trade truce for two months, kind of a minimal time period. The US got a couple more pandas, which personally always very exciting.

SPEAKER_2 (2:25)

President Trump said that the farmer-

Anna Swanson (2:27)

Right. President Trump said the farmers would be happy, but we don't have a lot of evidence to that effect yet. So essentially, there was a lot of pomp and circumstance, a state dinner that featured some tech titans, but not a lot of substance to the visit.

And I think really the takeaway is, it's hard to do a business and trade summit with a country when you're skeptical of doing business and trade with them. And that's really where the US is with China now. A lot of advisors don't particularly want to lower tariffs or welcome auto investment into the United States from China. So the question is just, what are they negotiating over? And it's really become just this kind of minimal truce that just keeps basic relations going.

Amy Scott (3:17)

Yeah. And Greg, can you remind us what this truce covers and what's at stake? It's mostly about rare earth minerals, right?

Greg Ip (3:25)

Yeah. Well, if you cast your mind back a little over a year when the trade war began, the United States put very high tariffs up to 100 percent or more on China. China responded by restricting exports of certain critical things like rare earths. The truce that was arrived at in Busan, South Korea basically said, we'll pull back some of our tariffs, they'll start releasing those exports again, and that's where we stand. That has now been extended for another couple of months. So I guess you could say that, assuming that that then gets extended again, we're in kind of like an uneasy equilibrium, right? And it's not getting worse, but it's not getting better. And honestly, given that, I think the United States is on a long-term path to decouple its economy from that of China, that's about all you can expect. It's not getting worse at a faster rate, but there's no great desire on the side of the United States, or I think of China, to really get much closer.

Amy Scott (4:21)

Hmm.

Well, another issue that was at least supposed to be on the agenda was AI. And, Anna, as you said, there were some big US tech titans who attended a state dinner at the White House last night. But as you reported, there weren't any Chinese tech executives there. What, if anything, do you make of that?

Anna Swanson (4:40)

Yeah, I thought that was really remarkable to have a state visit with a lot of prominent American business people. You know, tech people certainly were seated at the head table, but also, you know, other companies like Pfizer or GE Aerospace, but no Chinese companies at all.