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Xi and Trump are now in a zero-sum contest for global supremacy.

As Donald Trump gave much of the world on Wednesday a 90-day reprieve from his global trade war, he singled out China for a knuckle sandwich. While he dropped “reciprocal” tariffs on dozens of trading partners, he hiked tariffs on Chinese imports to a sky-high 125 percent, “effective immediately.”

“At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other countries, is no longer sustainable or acceptable,” Trump declared on Truth Social.

Welcome to the Great Divorce: a messy breakup between the world’s two largest economies—with the rest of the world up for grabs as part of the settlement. What began mainly as a trade beef for Trump is, for Xi Jinping—Chinese president and general secretary of the Chinese Communist Party—nothing less than a contest for mastery of the 21st century.

Xi is right. This is about much more than trade. And like it or not, the competition is pretty much zero-sum. While Trump has seized the upper hand in the trade war, Xi is gaining ground in areas that may be even more consequential: artificial intelligence, advanced manufacturing, and the military might required to seize the most important piece of real estate in the world—Taiwan.

The moment when China would be singled out from the rest of the world as the primary target of Trump’s ire was a long time coming—but it was always coming.

For much of his first term, Trump believed he could negotiate down China’s trade surplus with the United States, which today accounts for roughly one-third of America’s nearly $1 trillion overall trade deficit. We witnessed this firsthand as officials working on China policy in Trump’s White House. Things changed in 2020. With the global economy and his electoral prospects badly hurt by the pandemic, Trump told a small group of advisers that even “a hundred” trade deals with China wouldn’t make up for the losses the United States suffered from the Covid shock—which Trump rightly blamed on Beijing’s malfeasance.

“I’m not sure we can do business” with China anymore, he said in the Oval Office. One of us (Pottinger) was sitting on the sofa. “It may be time to decouple,” Trump said.

That thought has clearly stuck with him ever since. Here’s what he said Tuesday night: “Look, I get along with President Xi. I have over the years. But, you know. You just—when Covid came, that was the end. That was it. That was called the bridge too far.”

Might Trump’s dealmaking instinct reassert itself and overtake his decoupling instinct? Might he offer a temporary reprieve to China, or partial tariff relief in exchange for Xi’s blessing to sell Americans a larger stake in TikTok? It wouldn’t surprise us. But a comprehensive “grand bargain” that sets aside the U.S.-China archrivalry has never been more distant.

Why? Because there simply exists no deal that could plausibly fix the fundamental problem: Beijing’s economic model is designed as a means to political—not just economic—dominance around the globe.

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