China finally acknowledges the reality that wise watchers in the United States already know. They've been talking with the White House via back channels for a while. Trump's tariffs have gotten their attention, and it's now crunch time. The time to deal is now.

CNBC reports that the Chinese exact line was they were "evaluating U.S. overtures to initiate trade negotiations, potentially paving the way for the world's two largest economies to start talks to resolve a trade war that has rumbled financial markets and cast a pall on global economic activity."

Additionally, "Senior U.S. officials have reached out recently 'through relevant parties multiple times,' hoping to start negotiations with China on tariffs."

Contrary to the press's portrayal that no one is talking between these countries, the opposite is true. Like all things related to diplomacy, the back channels work first, and when they find a thaw, the named parties step into the ring. This story reflects a certain thaw that has reached China.

This admission from the Chinese comes from hints from the Trump administration that it was already true. "U.S. officials, including Treasury Secretary Scott Bessent, have indicated that there could be an easing in tensions with China. Bessent ... said in a Fox Business Network interview Thursday that U.S.-China tariffs at their current levels are 'not sustainable on the Chinese side' and a 'big deal' could be made between the two economies."

Trump's tariff schemes are about that - building leverage against other countries to pull off deals that will benefit the United States. All the talk about building a tariff-centric economy ignores that everything is negotiable for Trump: he wants a deal. He did in his first term, and nothing has changed.

The truth is that China is feeling the impacts of tariffs now. Everything up until now has been an appetizer. For instance, tech giant Apple reported a surge in iPhone sales as customers rushed to buy phones ahead of tariffs. That behavior rippled throughout the economy.

That's why the first preliminary look at U.S. GDP showed negative growth in the first quarter of 2025. U.S. imports increased by 41.3% in that quarter alone, as businesses and customers rushed to get products ahead of the tariffs. The way the U.S. measures GDP, imports count as a negative in growth. That fact alone slashed nearly five points off top-line growth.

Liberation Day, when Trump announced broad tariffs everywhere, was April 2. Everything in the GDP report pre-dates that massive spike in tariffs. However, suppliers expected something along those lines, so they were panic-buying ahead of time.

What's next? China is getting crushed. Chinese manufacturing has entered a contraction period. What makes this worse is that the Chinese economy was already in a deflationary crisis because of issues. These tariffs present an outright haymaker right when they're at their weakest.

American media focuses on the reality that U.S. customers face higher prices. However, the reality for China is starker: they face an existential crisis. A centrally planned economy that communists have used to steal and copy American ideas to build a new society faces real uncertainty.

Chinese factories are laying off employees. "Around 10 million to 20 million workers in China are involved with U.S.-bound export businesses, according to Goldman Sachs estimates. The official number of workers in China's cities last year was 473.45 million."

So here we are, a month from the start of "Liberation Day," and the Chinese are willing to talk publicly and acknowledge backchannel negotiations. China is watching as Trump's tariffs cripple its manufacturing sector, and businesses are fleeing to find alternative hubs.

China's position as the 800-pound gorilla dictating the world's manufacturing plans is over. Trump has leveled the Chinese and pumped up India, Mexico, Vietnam, and other places to overtake the Chinese advantage. The end result is supply chains that are no longer dependent on Chinese communists and are more spread out.

The libertarian insistence that the Chinese monopoly on global is good because it pumps out "cheap goods" ignores how we got here. Chinese central planners specifically set out to undercut any other seller, using government funds to support themselves while they destroyed everyone else economically.

That advantage is gone. Wrecking China will finally allow a free market to appear globally, with true trade. And in the case of China, dropping a wrecking ball on the primary funding source of a communist regime bent on destroying the American order is a good thing.

If China were a free society that wanted to cooperate with everyone else, this might be a different situation. But it's not. China fired the first shots in the trade war by trying to wreck global competitors. They never anticipated someone might swing back at them, even when they were claiming to invade Taiwan.

They're talking now because they have to. The entire existence of the Chinese Communist System is at stake. This is the second half of the Cold War. Russia lost the first half. China scored a lot of points in the second half, but now it's battered and broken.

What emerges from these trade deals will determine how long the Trump White House lets the CCP continue to exist. The deal that is brokered here is no different from an arms control agreement between the Americans and Soviets. That's the level we're on with this contest.

A U.S. victory is also one for the rest of the world, whether they want to admit that or not.