Former Obama administration Defense Secretary Chuck Hagel said on Thursday that economic warfare is one of his biggest worries as the global economy becomes more interconnected.
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“Economic warfare is right at the top of challenges,” he told FOX Business’ Neil Cavuto during an interview on “Cavuto: Coast-to-Coast.”
“When you start down the path of tariffs and trade wars, there will be consequences, definitely, but there’ll also be unintended consequences that will have a devastating effect on our economy, on the economies of the world,” he said.
With trade negotiations at a standstill, the Trump administration is threatening to slap another set of tariffs on $300 billion worth of Chinese goods. The trade standoff intensified last month when Trump increased tariffs on $200 billion worth of Chinese imports to 25 percent from 10 percent.
Trump is leveraging the use of tariffs to engage China into a reciprocal trade agreement with the U.S.
Hagel said China had been taking advantage of the U.S. on trade for many years, but he questions the use of tariffs as a means to influence China into an agreement.
“I do think that China has taken advantage of their membership in the WTO [World Trade Organization] ... I do think they've been deceitful. I do think they've shut our companies out a lot,” he said. “I think that's real. But it's a matter of how you deal with it and how you manage it, how you approach it. I don't think the way to do that is unilaterally arbitrarily saying 'well, we're just going to tariff the hell out of you.'”