Why It Matters
A tariff truce between the U.S. and China is set to expire in November 2026, and both sides have paused, not resolved, their core disputes. The Congressional Research Service (CRS) updated its China Primer: U.S.-China Relations report on Sept. 22, days before Chinese President Xi Jinping's state visit to Washington, D.C.
The Trump administration allowed Nvidia to export its H200 chip to China and collect 25 percent of the proceeds for the U.S. government, a move former U.S. officials criticized as "negotiating national security decisions in exchange for trade concessions," saying such actions contradict past U.S. practice. The administration also rescinded the 2025 Artificial Intelligence Diffusion Rule, ending proposed restrictions on People's Republic of China (PRC) firms' use of advanced computing in third countries.
During his Beijing visit in May, President Trump described a $14 billion arms sales package for Taiwan as "in abeyance," calling it a "very good negotiating chip" with China, alarming some members of Congress.
The Big Picture
The second Trump administration has reframed U.S. strategy toward China around achieving a "balance of power" and a "stable peace," departing from the "strategic competition" language used by both the first Trump administration and the Biden administration. At a May 2026 Beijing summit, Trump and Xi committed to "build a constructive relationship of strategic stability," though a White House fact sheet added the phrase "on the basis of fairness and reciprocity," which was absent from PRC readouts.
The administration's two major strategic documents, the December 2025 National Security Strategy and the January 2026 National Defense Strategy (NDS), send mixed signals, with language about China that is conciliatory in some passages and combative in others. The NDS explicitly states that U.S. defense strategy toward the PRC "does not require regime change" and makes no mention of Taiwan.
On trade, the PRC has shifted most of its retaliation toward nontariff actions, including export controls on rare earths and cancellations of U.S. goods orders, because China has largely exhausted items it can effectively tariff given the trade imbalance. The CRS report notes that senior-level U.S.-PRC trade talks appear to have created a dynamic where U.S. officials seek to delay PRC measures in exchange for concurrent delays in U.S. actions, potentially distracting from efforts to address systemic issues.
On Iran, despite President Trump stating Xi "promised" not to send weapons to Iran, Reuters reported in July 2026 that Iran expected delivery of 300 to 400 PRC-manufactured man-portable air-defense systems within weeks.
The 119th Congress has reauthorized the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party through H.Res. 5, and the Consolidated Appropriations Act, 2026 (P.L. 119-75) appropriates not less than $400 million for the Countering PRC Influence Fund, administered by the State Department.
The Bottom Line
With the tariff truce expiring in November, Congress will have an opportunity to assess whether the Trump administration can convert summit diplomacy into verifiable, durable agreements, particularly given what the Congressional Research Service (CRS) report describes as uneven PRC follow-through on past commitments. Pending congressional legislation targeting advanced chip and semiconductor equipment sales to China signals that lawmakers are not waiting to find out.
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