I have a better idea. Declare a moratorium on the trade deficit with China. Announce that it will shrink by 25% each year over the next 4 years, and once it exceeds the yearly threshold, stop it altogether.
China has been waging guerilla trade war against us or decades and we haven't had an effective response. It's time to fight back and insist not on individual deals, but on a well-defined outcome.
"Trade war"? An interesting word for an attempt at reciprocity and parity. The problem with China is that is has been able to get away with a lot by pressing on US importers and outsourcers which in turn controlled the trade policy of Obama and GWB admins alike.
Trump is doing precisely what he said he would - ask for equal terms. Let us not forget that China is by far the greatest polluter of the planet - slapping tariffs to offset pollution (and species extinction due to Chinese superstitions) would only be logical and fair. So, kudos to Trump. If we have to pay slightly more to compensate for products that Chinese dump on Western markets, so be it.
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It was incredibly funny watching all the propaganda American media outlets were spewing out against China re: steel and solar panels, while the real biggest importers of those goods to the US were keeping meek and quiet and not speaking up at all to correct the situation. Now that the US has imposed blanket tariffs, all of a sudden, Americans discover that their media and newspapers have been dishonest with them, and those countries that did not speak out to correct the facts, are now getting huffy and jumpy at getting their trade affected.
Such a pleasure to watch this kind of drama. The Chinese are laughing at the Americans and their "allies". I am laughing at the Americans, their media and their "allies" too.
P.S. I can't wait to see how the Chinese retaliate against the Americans in trade. There is this categorical assumption from America that China would lose decisively in a trade war with America. Time for some 340 million folks to be waken up from their media cast illusions, LOL!
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Hmmm.... this may remind some people why selling an American high-tech company (Qualcomm) to a Chinese-controlled Singaporean (or Malaysian) company would have been a bad idea.
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You can remind however and whoever you want. Just remember, the US wants access to foreign and global markets too. The game can be played both ways, and if the US starts erecting walls against its own allies (Singapore is an American ally who took sides against China in several geopolitical issues and had thus, received political fire from China), then Singapore will have nowhere else to turn to but China or other countries not very amenable to the US.
I am waiting for the time when Asia erects roadblocks and ring-fences against American service and finance companies trying to operate and profit in their (Asia) jurisdiction. After all, it is probably a bad idea to allow American companies to profit or even dominate in the local markets - who knows what may happen if the Americans suddenly decide that they do not like the local government or people, or even want to initiate regime change!
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Hey TE - regime change in Malaysia would not be such a bad idea. Especially if you are Chinese. But Singaporeans and Malaysians have it good - once they are behind the Great Firewall, no more NYT and onwards behind the Great Leader.
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I have a crazy idea. Rather than seeking to punish, why don't we focus on making our own industries more competitive or expanding industries where we actually have an edge? We have to accept the painful reality that many of our blue-collared industries are simply not competitive. It doesn't have to stay this way, it's not too late for us to take back leadership in renewable energy. Agriculture is another sector where we're easily No. 1 in many respects.
Protecting uncompetitive industries is a sure way to seal America's economic decline.
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The emotional dynamics of this: "We can't hit China, so we hit Canada" remind me of what Calvin Trillin wrote about the emotional driver for the Iraq war:
https://www.thenation.com/article/everything-george-bush-needs-know-he-l...
We can't hit our boss, so we beat up the poor dog at home, until the dog bites back.
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China has always had a trade war with US and always wins with 0 Chinese casualties. No US company can enter China without a Chinese partner who steals all the technology and business and then the Chinese government ousts the Americans. The tariff on Americans is perfection, at least from the Chinese view. There have been millions and millions of Chinese-Americans but 0 American-Chinese. But the Chinese anchor babies keep coming. Every other Saturday morning buses of Chinese women deboard at Garfield Medical Center east of Los Angeles to deliver the anchor baby that will chain-link to everyone else in China who might claim to be related to the anchor baby. 9am in the GMC cafeteria. See for yourself.
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TPP, for its many faults, was a concerted response to China's unfair trade practices. It created a free trade sphere that excluded China, and where US was the biggest player. There were common standards for labor practices and enforcement clauses. The Obama administration and Congress must bear some responsibility for the shadowy way negotiations were handled, but TPP was killed with no effort to fix its problems amidst the tide of "trade is evil" knee-jerk reactions.
But what have we accomplished instead? The US is locked in a stand-off with allies over threats of mutual retaliation over tariffs. China keeps doing what it has been doing, barely bothering to respond. Steel execs are delighted, but industries that employ far more Americans like auto, construction, and aerospace, are concerned about rising prices. Trump's approach trade has always been that of an amateur trying to fix a watch with a sledgehammer, and we're seeing the result.
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Hi. Haven't even read the article yet, but when you say the "The U.S. Wants to Take On China With Trade. The Rest of the World
Will Be Caught in the Middle."
U.S. Wants to Take ...," I'm a US citizen (regardless of circumstance; born here) and I want _NOTHING_ to do with creating this barrier among my (read: our) friends. If you mean the current administration (koff koff) or the enlightened institution of the U.S. Constitution, please say so. I volunteered to serve my country too. And, no, I'm not part of your gross generalization. Oh, and the small bit about Vietnam circa 1963. So, I guess (time allowing) I'll read your article.
So, If I have this straight the President of the United States worked himself up into a fit of pique and decided he wanted to impose tariffs on steel and aluminum. Notwithstanding his unilateral action violates NAFTA and WTO rules his willing supplicants cheer him on. Wilbur Ross makes the rounds of business shows with his can of Campbell's soup and Peter Navarro declares there will be no retaliation.
Canada is the number one supplier of steel to the US and is also the largest market for US steel. China is not even in the top 5.
This lunacy has been going on for months with apparently no one thinking Trump is in dire need of adult supervision. Trump is destroying alliances which took years to build up and the US has little if no respect left in the world.
When this carnage is over I hope the Republicans still think their tax-cuts and plunder were worth the cost because after the Trump debacle no one will view the United States the same.
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Looks like Trump's trade war will not work. It's always better to win trade wars the old fashioned way - by competitive advantage. If that does not work with steel, then you're in the wrong business and need to redeploy assets.
The key success factors in business are the same as for life - adaptation, learning, and strategy. If you need lobbyists to insure government assistance, your assets are not in their highest and best use.
The market should pull capital from every business that can't make it on its own. Instead of rewarding government handouts as a competitive advantage, capital should see this as unsustainable and a sure sign of weakness. Government protection just makes companies and countries weaker - they never learn to compete.
Another example as a result of "idiocracy" that Socrates warned in the Plato's "Politics" that idiotic citizens choose an idiotic leader. The U.S. has been showing herself to the rest of the world as a model case of "idiocracy".
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How many of the Canadian 'imports' of steel into the US are simply transfers within corporations that work both sides of the border? NAFTA led to a lot of dispersal of industries among the three partners and integration of economies. If the US were to block imports of steel from Canada and imports to the US would drop. But I suspect the US exports far more steel and autos to Canada and in the long term Canada would stop importing steel and autos from the US and the US would lose exports. I'm not even talking about contervailing tarrifs here, simply the breakdown of economic integration.
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