The US subsidizes business through tax breaks--like the ones that Amazon extracted from Washington, D.C. Americans don't seem to realize that the Chinese don't have a comparable tax system, so they subsidize via preferential loans, for example. When will the US realize that the American Way is not universal? Not under this administration.
6
Curiously enough since the same time Trump started his trade war first accusing China about manipulating its currency then switching towards trade imbalance and now 'focusing' on the subsidy's schemas China uses to help finance its heavy industry, U.S. has strongly moved towards impressive tax cuts primarily benefitting the biggest Corporations in such a way that now the number of companies not paying taxes at all has doubled. Tell me about 'subsidies'. Tell me about the supposedly federal legal feuds against Boeing competitors such as Bombardier (Canadian) or Airbus (European).
4
The Chinese government subsidy of Chinese industry is certainly a problem. Of course, we wouldn't do anything like that here in the U.S. of A., would we?
Well, how about the questionable fortune made by our (not my) President that was fully enabled by our federal tax system and bankruptcy code? Why do some of our largest and most profitable companies pay no income tax or even get refunds at tax time? Who pays for the costs of running our military-industrial complex that Dwight Eisenhower warned about so prophetically (e.g., government contracts)? What about the $10 billion Congress approved to pay the farmers (mostly corporate) to offset their losses caused by the so-called trade war?
If there is any country that doesn't subsidize their industrial base to one extent or another, I don't know where it is. Not on this planet.
8
New York Times needs to report truthfully.
"One year ago, when he began a multibillion-dollar trade war with China that shook the global economy, President Trump demanded that Beijing end lavish government spending aimed at making the country a world power in computer chips, robotics, commercial aircraft and other industries of the future."
That is completely FALSE. The trade war is about
1) trade imbalance
2) protecting US company patents and copyrights
3) removing barriers to Chinese markets
Beyond that China can do all it wants to make great products.
3
In addition to all the Federal corporate welfare here in the U.S., there is a massive amount of corporate subsidy going on at the state and local levels of government. I am guessing that the main beneficiaries of the government largesse on both sides of the Pacific pond are the rich and powerful.
4
Chickens...coming home to roost. No if or buts about it. We rely on the military industrial terror complex for decades to keep our edge both economically and militarily. We subsidize the wasteful military, we engage in foreign wars based on neocon lies, we cut taxes to the rich and corporations, we impoverished the middle class, made education so expensive that they are the new serfs of our time. We taught the world how to mess with the environmemt and be the most myopic big consumers of resources, and we and we. Yes, the chicken are coming home to roost.
5
Elect Bernie. We subsidize our growth. Easy fix.
1
China has not winning because of tariffs. China is winning because it subsidizes important industries, while Republicans slash investment in America.
It's really that simple.
A tariff war will not change that. It was Republicans that opened up our borders to let American productive capital be exported to low wage countries, and let cheap junk made by low wage labor compete with quality American goods made by union employees.
It was the Republican base that stopped shopping at the local stores on Main Sheet to save money at Wal-Mart.
You did this to yourselves. "East Coast Liberals" tried to warn you but you called us socialists for interfering in markets. Now you cheer a president who is doing stupid interferences in markets that cost you money but won't improve the situation.
If you want the lives of workers to get better, stop attacking workers while you protect the very billionaires that rob you.
5
@McGloin
China robs patents and technology!
As for cheap products; they are purchased by you and me and not Republicans. The free market was intended to be free and fair.
3
Both China and the US subsidize key industries for all sorts of reasons. So does Germany. Folks, this is why capitalism is *political* economics. We falsify the nature of capitalism with incessant propaganda.
The losers will be farmers and consumers dependent on low cost Chinese imports - - - predominantly Trump's base.
Trade disputes destroy confidence in global markets , such as soybeans and tractors. This rupture will endure with no end in sight.
9
Now that China has aimed tariffs at Ag products Trump will take another 15 Billion in taxpayer money for farmers. Senator Grassley took the hand-out previously when Trump gave farmers 12 Billion for his farm in Iowa, now he will have his hand out for more.
3
We're going to have the nerve to forbid China subsidizing homegrown industries even as the US subsidizes its agricultural industry. as it has for decades? And what is the huge tax cut, without significantly removing business deductions and credits, but another kind of subsidy of American businesses? We artificially prop up coal and steel against foreign markets, but China can't do the same?
Okay, calling them on patent violations and other kinds of criminal or unethical activity is righteous, but we'll expect only the United States to be able to have nationalistic economic policies? Either we're really going to push open and fair markets or we're just twisting arms to get the best unfair advantage - the dark side of unfettered capitalism, where businesses try to manipulate market forces instead of letting them play out naturally.
China would be foolish to take that deal, unless they got RECIPROCAL bans on US subsidies.
11
The attempt to change the Chines tigers strips to spots is ludicrous. In the long run if you want to compete with China the US will have to follow their lead. The US Government will have to make trillion dollar investments in infrastructure, education and technology. Free markets are taking off in China precisely because they are managed. Free markets in the US fall prey to periodic crisis precisely because they are not. The near term requirements to solve species extinction, water degradation, and climate change with its attendant problems of food scarcity, mass migration and catastrophic weather events will not be met by free market mechanisms. After all free markets have got us here in the first place.
13
So now the free market, anti-globalist, Trump people are advocating for the globalist W.T.O. to pull the reins in on China. Trump has always stated that he could make better deals on his own. But his deals have no teeth without global participation.
Look, we can't force China to alter its internal policies. We can't even get Georgia to provide equal voting rights. There is no way an authoritarian regime like China can be bossed around by the US or any other nation.
Facts are that the largest foreign industrial suppliers in the world employ state capitalism. Those are South Korea, Japan, Taiwan, China, and Germany. Vietnam is also coming on strong. Airbus is a heavily subsidized European endeavor. US agriculture is heavily subsidized. Millions of small Mexican farmers were put out of business when NAFTA dumped our crops, at below cost of production, onto their markets.
This trade war will further divide the world. It will push developing nations into China's orbit. African economies will be developed and controlled by China. They can set up their hog farms there. Iran will now strongly ally with China.
China will continue to expand its influence and it will use our opponents to do so. Russia is loving all of this because it destabilizes our nation.
The global and strategic implications of this trade war are huge. Trump understands none of this. He doesn't even realize that that US consumers and businesses pay the tariff tax.
19
Asymmetric warfare goes beyond terrorism, outer space and the cyber world. The tentacles of warfare extend deeply into global economics. The ongoing trade talks reflect fundamental disagreements between China and the United States over dominance via economics More importantly the disagreements are about national sovereignty and which country will dominate the world stage economically and politically.
Would you want your neighbor to come into your home and tell how to spend your money? That is just what the United States is telling China I wonder if President Trump has the will and long term strength to tell American businesses to stop doing business with China? Surely that would bring the trading deficits down and in the short run play well with the President's base, until they go shopping.
We are in a battle of ideals and the Chinese expect to outlast the United States. I suspect they may be right.
7
United States massively subsidizes industries through tax breaks, use of resources, funding of academic "research," and many other "legitimate" forms. For example, the beef industry is subsidized by the government allowing cattle grazing on federal lands for far below market value, and allowing cattle to consume massive amounts of water and leave excrement on these lands causing water pollution. All of this keeps beef "cheap" so Americans can consume it and get obesity, diabetes, hypertension, prostate cancer, colon cancer, gout and myriad other preventable diseases, which the federal government subsidizes through Medicare, Medicaid, and endless NIH funding of academic medical research which pharmaceutical industry leverages in futile, expensive attempts to "cure" these preventable diseases. US is then so non-competitive in industry because employer-based "health insurance" for our fat, lazy, unhealthy population--as exemplified by our obese "president"-- costs so much that our industries cannot compete against China.
China is a socialist-communist nation. It's a government-controlled economy. Calling their practices "unfair" is yet another strawman set up by the Blamer-in-Chief. Start with real economic policy before you go trying to tear down everybody else.
14
@JCX Subsidies for industry? Industrial espionage? We do these already. I just hope we can somehow someway learn to do these better - with better outcome - than our international competitors.
2
@JCX If they'e stealing intellectual property and the like, that's illegal AND unfair. But internal industry subsidies? Not so much. Having a problem with that is, like much of Trumpian and, frankly, current Republican talking points, the height of hypocrisy.
2
Remove "Beijing" and replace with Washington
U.S.-China Trade Talks Stumble on Washington's Spending at Home!!!!!
Subsidies to big oil, big mining (e.g. coal), big forest industries, big pharma.
You name it, it's subsidized or receives mega-tax breaks!
9
Via China’s state owned capitalist system, they’ve made enormous progress in record time. In high speed rail, electric car production, drug manufacture, improved steel, etc., etc., China’s advances have dwarfed the US.
China’s ambitious global infrastructure program known as Belt and Road has picked up speed since the launch of Trump’s tariff war. Former allies and US working partners see America as erratic and unreliable and acted in their own best interest by partnering with China.
This is a winning strategy and China is never going to change their model. To oppose Trump’s tariffs and batter the US farmer, China built Brazil’s roads so their soy can be easily shipped to China.
Trump refuses to listen to people who disagree with him, refuses to research, and perpetuates his failed approach. Short of war, there is no way to stop China’s progress.
America could compete with China but that would take leadership & cooperation. Instead, Trump’s focus is personal gain, impressing his base with chest thumping exhortations of manliness, and staying in power so he avoids prosecution.
Every day Trump remains in office inflicts permanent damage to our country.
11
@Manfred J Yes; we are all tired of Trump, dragging our country through the mud!!
This whole debate, to me, reeks of American hypocrisy.
1) Re: Call for China to be more “Free Market’
A) Independent China is only 70 years old, after a century of Western colonization, including cultivation of opium. US is more than three times its age
B) The US economy was built on UNFREE LABOR — you know, the pesky little matter of enslavement of black bodies —— without which the property of the both the plantation South and the shipping and textile industries of the North were dependent.
2) Re: Theft of Intellectual Property —— the American textile industry was built on theft of intellectual property. Its “innovators” stole the designs of essential machinery, like the Spnning Jenny, then had the audacity of Alexander Hamilton’s constitutional protection of “our patents”, to attempt to limit others. (Contrast: Benjamin Franklin refused to patent his inventions, asserting that they belong to the world)
3) Re: Government “Bad China” subsidizes its companies —- oh, our military budget (greater than that of the newt 8 or so countries combined) which built our aerospace and computer and internet industries is not Government Subsidy. . Our bailout of Citibank and other financial lepers, through almost free money from the Federal Reserve, which they can then lend out to ‘Private Enterprise” is also not Government Subsidy.
9
People (politicians, businesses, etc.) need to get real about China. Yes, America subsidizes some private industry, but it's *nothing* on the scale of what the Chinese do. The Chinese have a deeply authoritarian single-party political system and a heavily-state-managed economy. The two go together. This is not likely to change in the foreseeable future. And neither will China's refusal to play by anyone else's rules. To pretend otherwise is foolish.
3
@Buck Thorn
You look very impressed by the sheer scale of things in China. Just do the basic calculations: China is 4 times the size of the U.S. where cities with 20 - 30 million population are not exceptional. The number of engineers graduating every year from Universities overclass the number in U.S. 10 times... the number of Scientific publications in university grade journals also overclass U.S.'s.
This is really the struggle. China's commitment to devote an excessive percentage of its GDP to production, rather than households, which might destabilize the current regime's hold on power, vs the US's habits of budget deficits, which draw Chinese capital and, in turn, Chinese goods, and skimpy infrastructure investment.
Any agreement will not matter. The proof of success in rebalancing current and capital accounts with China will be--when current and capital accounts become balanced. As long as they don't balance, we need to reserve the right to manage trade with China, exactly how China has managed trade with us, by tariffs and shutdowns, not by running to the WTO and litigating for yrs.
China has long pursued its national interests in trade. It's about time that we finally seize control of trade policy--free trade--from the Rs, Ds, and their donors--largely Wall St--and pursue our national interests in the form of managed trade where all of us participate. If we make clear that we intend to do that, China will understand, wondering only what took us so long to figure it out.
1
What about American government subsidies? Are they ok just because they are American?
11
A lot of economists and other political pundits are criticizing Trump's trade war with the Chinese. All, yes all, of the same lot of economists also admit that China is doing so many unfair trade practices that include stealing technologies; forcing foreign companies to hand over technology to Chinese companies, which are bound to help Chinese state intelligence agencies & the Govt; manipulating currency market, benefiting from WTO rules when it suits them but refuse to comply with it when it think that's in its the best interest; and many more. Yet, none of these western economists and political pundits, mainly associated with left wing politics, are offering any solution on how to deal with China. No previous administration could force China to change its economic behavior and we all see the consequences of it in terms of more belligerent China with its worst form of spread of communist imperialism in the world.
4
Good morning, bonku,
The premise of your argument is simply not true...(none of these western economists and political pundits, mainly associated with left wing politics, are offering any solution on how to deal with China.”
The previous administration worked for years with other nations to manage and address China’s rise by maintaining the open door in Asia with ‘every element of American power’—from trade to defence policy. It became a focal point of Obama’s foreign policy. The main economic pillar of this approach was the Trans-Pacific Partnership—an arrangement intended less to engage than to exclude China, seeking to make other countries in the region follow America’s ‘rules of the road’ and thus prevent the rise of a more Sinocentric economic area. Beefing up its naval presence in the Pacific and strengthening military ties with both old and new allies, the Obama administration also continued the line of backing up economic openness with military hard power.
But our current President tore up the TTP and replaced it with...tariffs. It’s a setback from which this country may never recover.
6
@Peter. Good Morning Peter.
This article also mentioned-//“To be fair the Obama administration got nowhere, the Bush administration got nowhere,” Derek Scissors, a resident scholar at the American Enterprise Institute//
Of course, Trump policies at home and abroad are very naive, to put it more politely, in terms of protecting American interest. IN fact, many, if not most of Trump policies are counterproductive for the US in particular and the world in general. I surely do support Obama's policies in terms of promoting democracy and rule of law abroad. But Obama admin failed miserably when trying to deal with deceptive and rogue actors in the world. There are many policy failures that had very serious consequences (e.g. rise of ISIS). I tend to believe that Obama and his administration failed to understand the mentality of criminals and rogue people in power, probably because as a person Obama was very educated and wise, hardly mix up with such rogue elements in the society on a regular basis. That's not the case for Trump. he seems to be more comfortable with criminals and dictators and hows how to deal with them (more from the perspective of a businessman than a leader.)
Farm subsidies may aid exporters, but the real purpose is to protect farmers. Farming can be a risky business with crop failures from varying conditions year to year and unpredictable commodity prices. Most countries try to protect their farm economies. Add to this that with global warming there is energy savings in consuming locally produced farm products.
Steps to counter global warming in switching the transportation and the electricity grid to renewables should be the urgent policy. A carbon tax in the U.S. with all the funds invested in buyer incentives by individuals and utilities would make this happen. As a domestic tax for this purpose the U.S. could stipulate that purchased components be high percentage U.S. made, say 80%, with other countries allowed to do the same. The exception should be solar panels. The importance of installing these fast cannot be overstated and lowest prices should prevail, no matter where produced.
Technical innovations covered by patents would still apply, and transparently enforcing this should be the core for all products covered in these negotiations. A pattern of past blatant violations as well as blocking imports of American manufactured and service products by China should not be allowed to continue. Changing laws is an acknowledgment of this.
The extent that China backs the proliferation of nuclear weapons to N. Korea should be a part of this. Both countries need to ban coal and the export of coal and coal plants.
1
@loveman0 "Farming can be a risky business..."
And so? Capitalism is about market forces. Once the government starts meddling to shield businesses from market forces, you no longer have a pure capitalism; you've edged into socialism.
So, our problem with China is that we want them to NOT be what they are, a communist society that tries to control market forces, especially internally, while we continue to fake being nothing like what they are - fake being a country that plays by pure market forces.
There is nothing in the definition of capitalism that says a capitalist country's government can't take tax revenue and use it to provide citizens with police protection, firefighting, and, yes, healthcare. Subsidizing businesses to protect them from market forces is not true capitalism...but it might be necessary if competing countries are also not practicing true capitalism. Btw, only criminal enterprises practice true, unfettered capitalism; pure market forces, no government control of the business.
@Barry WilliamsSo true! Indeed, only criminal enterprises practice true capitalism, as capitalism is an inherently criminal enterprise, with those with capital who don't work for a living make profit off the labors of those who didn't have rich daddies and who do. Who nowadays aren't actually slaves anymore, just wage slaves who have to do what they're told to avoid being homeless and hungry. The question is not how the USA should deal with China, that's simple. If the Chinese make good stuff American consumers should be allowed to buy it without Trump's interference. The question is how China should deal with the warmonger in the White House. Alas, the corrupt bureaucrats in Beijing are probably not up to the job.
China has three times the population of the US, which has been hostile to China since day one of its Independence. No wonder the Chinese seek to quickly make its hundreds of millions of poor peasants more prosperous, and protect itself from US military attacks, such as occurred during the Korean War.
American corporations which want access to the China market, just seek to do so for their own profit, after moving millions of American jobs to China through subcontractors in order to undercut American labor
I would like to see a real discussion of how to build peace and prosperity for both the US and China.
Probably won’t happen in this newspaper or the rest of the mainstream US press.
14
I don't see the difference between a government providing subsidies and one providing tax cuts. At least the subsides have strings attached. Tax cuts - a give away.
11
I agree with Chairman Lou. China's subsidies aren't unfair to America; they are unfair to China. All evidence suggests that China's state-owned enterprises do not make money sufficient to cover the cost of capital. In other words, the money spent on these enterprises is wasted, and severely handicaps China's private sector. Amazingly, despite being the world's second largest economy, China has produced only 2 out of the world's 100 most valuable corporations (Alibaba and Tencent), and both of those are mostly owned by non-Chinese investors. There is no globally recognized Chinese corporation like Apple, Google, Coca-Cola, McDonald's, etc. A huge chunk of "China's" exports are controlled by American corporations that get most of the profits, because Chinese companies cannot compete. If the subsidies stopped and the state-owned enterprises were privatized, more money would flow to China's private sector and those private companies would be stronger. There might be a Chinese Toyota, Samsung, etc.
Unfortunately, the trade war is terrible for Chinese reformers. If I were a Chinese reformer, I absolutely would not want my agenda associated with an arm-twisting foreign power.
3
It's clear that Trump wants to look strong by making impossible demands than enter a realistic agreement which would make him look weak. It's all about 2020.
3
I believe we should separate completely from China. There is no hope of them being fair competitors in a free market economy. They are socialists and control oriented. Different than we are. We should work to move all our imports and exports to other less developed countries of which there are many.
1
Rather ironic that Trump proposes $15 billion in new subsidies to support U.S. farmers comes on the heels of the negotiation impasse over Chinese subsidies to their own strategic industries.
That Trump's potentially $50 Billion tariff/tax on U.S. consumers is being used to provide possibly $27 Billion in total subsidies to farmers leaves him $23 Billion to give to his own companies, other rich supporters and perhaps to build his namesake wall.
3
@Charlie
Come on, subsidies from American government is not real subsidies. It is aid. Another world for the same action.
3
“Chad Bown, a senior fellow at the Peterson Institute for International Economics, said that tariffs imposed bilaterally were a poor tool to address a global problem like overcapacity. Even if the United States successfully kept part of the tariffs in place, they would protect only American business at home. Subsidized Chinese business could still compete at home, in Europe and almost everywhere else around the globe, hurting prospects for American exporters.”
Overcapacity is synonymous with overproduction. Neither tariffs or any other type of commercial maneuvering will impact positively on this area. Overproduction manifests only as a problem of circulation when it is already too late. Crashes take care of it, unfortunately. These maneuvers only reveal how the big guys fight over the rest of the booty.
2
In other words, China isn’t supposed to do what the US routinely does: subsidize corporations.
13
With its 1% tax code, America has been a giant corporate and 1% welfare state for decades.
Donald Trump, his father Fred and the Trump family are/were among the country's biggest welfare queens thanks to federal subsidies.
Perhaps America's problems could be solved if we stopped painting the toenails of the rich in gold instead of blaming the Chinese for our own coddling of the obscenely wealthy.
66
It sounds to me that Trump and friends don’t like the idea that socialist policies to subsidize and focus on certain fields could curb the US monopoly on advanced industries. I suppose China is supposed to go back to an agrarian economy and leave technology alone?
It’s funny how government funds can have that much of an impact. Maybe if we diverted some military funds to help citizens or subsidize green energy industries they could be as impactful as our agriculture and oil subsidies are.
17
Is the Trump so-called tax cut not a multi-billion dollar government spending on US industry and endless welfare for the ultra-rich? How are Chinese spending and US spending of debt borrowed money any different? The US deficit grew by a trillion dollars in last year, virtually all of it for industry and increase in massive wealth.
8
"WTO rules ban governments from helping export companies will cash, free land ..." Really? Guess they must not care if the governments are state and local governments in the US providing this corporate welfare to exporting companies.
6
This has less to do with subsidies because every country does so in some fashion, but more to do with China becoming a global superpower on the theft of our intellectual property and the dumping in manufacturing and resources. We need to face facts. China is an adversary. They may not be as blatant as Russia but an adversary it is by any other name. It did claim the south China seas. Then said they would not build anything on them. Lies. And they send their children to our top schools to learn our ways. Then use that information to their own benefit. They claim they do not steal or copy yet look around china and you see it everywhere.
7
So many articles in the Times and elsewhere present a distorted view of the world that whitewashes our faults and crimes while pointing the finger at others.
WE provide government subsidies to key domestic industries. WE meddle in the internal political affairs of other countries. WE engage in creepy digital surveillance of citizens at home and state sponsored hacking and planting of destructive malware abroad. WE engage in torture and detention without trial. WE fail to address levels of poverty at home that the UN highlights as alarming. WE have a corrupt political system that serves a monied elite, and a political leadership class that enriches itself.
Physician, Heal Thyself.
20
Imagine that, a grotesque American President who violates his oath of office every day is telling the Chinese to re-write and follow its laws. Funny!
17
Years ago, the NY Times pointed out how nobody in China is allowed a burial plot (except one small village). If China can control burial plots, why not software, music and designer piracy? Because it is all about them.
The underlying tone is these negotiations should be, "“Things have to change, things are going to change.” and we should hold firm.
The strong always impose their Will on smaller and weaker countries. We’ve been doing that almost from the beginning of our country. That’s just natural. Organizations like the W.T.O. are a great buffer, but it’s not perfect. Like any law, there are individuals, corporations and countries who will always find unscrupulous ways to divert them.
Our problem right now is with the Trump administration and it’s leader. Trusting someone like Donald Trump is a real challenge. Trusting and believing ANYONE he appoints is even more of a challenge.
One thing is certain with the present condition: We the people are going to lose!
6
How are you supposed to engage in free trade with a nation that refuses to allow free trade for goods sold for use within its borders? Its like trying to have a fair fight with someone who insists on putting eye irritant on his boxing gloves.
Its a big world out there, with billions of people with insufficient opportunities for economic advancement. There are many alternatives for affordable, trainable labor, and we have the opportunity to improve life for those people now living in Third World conditions. China has grown up, economically, but still wants its infant formula. Time for us, as a nation, to move on.
6
@RM
Sorry to shatter your fabricated narrative, but we have actually been trading with China for decades. Americans businesses have gone to China of their own free well. So obviously they have made great profits there. And they continue to do so. Neither Trump nor you will be able to stop it.
12
@Frank
So Frank, it is your understanding that all those firms now trading there are thrilled to be compelled to share technology to get into the market?
And other companies, that may not even be in the Chinese market, have no problem with their trademarks or patents being purloined?
@RM
Do you like paying money when you buy a car? Wouldn't you much rather get it for free?
I bet you would. Well, guess what? Deals aren't all about you. The other guy gets to make demands too. If you agree to the terms, then you sign the contract and you pay your due.
Sorry to disappoint, but the Chinese won't just let American business raid their labor and resources without contributing something towards modernizing their society.
Don't like it? Tough. You can sit there and keep yelling at the screen, like your idol.
2
Its ridicules that we feel we have the right to tell any country what laws to pass, especially China, and then try to punish them when they don't obey. How would trump and congress react if another country demanded we change our laws? Trump will never win this so it seems China has a better system than us so maybe we should copy then for a change.
10
@Thomas Renner
Implicit in any treaty is the obligation to pass laws that conform to the treaty's provisions. For example, if we sign a treaty that we will not hunt migrating birds flying over the country during migration season, it is implicit that we must then pass a domestic law prohibiting such hunting.
If there is a treaty or international agreement that provides that intellectual property rights must be respected, then there must be a domestic law that enforces the treaty provision on the Chinese people and business firms. Otherwise, the trade agreement is meaningless.
2
Would Trump consider ending the corn subsidy, and the sugar subsidy? I really don't think so (and there are many other subsidies to corporations in our economy, too many to mention).
It's time we recognize Trump doesn't want an agreement with China. His goal is to separate our economy from the Chinese economy. He believes we do China a favor by buying their products. He could not be more wrong.
16
So what does the Donald expect. It's two different economic systems. Market Capitalism vs Market Socialism. Don't blame the Donald for feeling the pressure from what is slowly proving to be a superior system. It'll get worse I'm afraid.
3
This article tries so hard to frame the narrative the only the US has the right to make demands. What about China's demands? What concessions will we give them?
Will Congress pass a law giving Huawei open access to the American market? Will we abolish the "national security" committees that have been barring mergers and acquisitions by Chinese companies? Will we pay reparations to the Chinese-American citizens who have been falsely accused of spying, and lift this racial profiling?
I doubt it. And China's answer to unilateral demands will be that they do not practice appeasement.
9
As if the USA didn't subsidize its Industries. Remember the new tax law?
6
Beijing has no need of a Troll Factory in St. Petersburg. It already enjoys the support of self-loathing Americans. They never have compassion for their 5 million fellow Americans who list their jobs to Chinese workers after the Clinton-backed entry of China into the WTO.
Someday a Democrat will be President again. Maybe even when the USA surrenders to China.
3
Wow. China actually devotes national resources to nurturing their own science and technology development? How criminal!
Clearly, the solution is not to learn from their example and maybe use some of that $$$$ for aircraft carriers and drones to advance science. We should instead demand that China dismantle its successes and return to an agrarian society we can exploit for labor.
I'm sure if China demanded that Congress pass a law giving Huawei unfettered, unregulated access to the American market, the US would quickly accept.
Idiocy is such an American trademark.
28
@Frank
What a great idea....to use some of the $750 billion plus per year we throw at the "military industrial complex" (for aircraft carriers, drones, bombs, outmoded tanks, etc.) and use it for such useful purposes as rebuilding our infrastructure or housing our poor who are living on the streets.
4
Subsidies and government investing give unfair advantage to industries.? Oh how about we do more of that and in our country as long as it doesn’t violate the WTO agreement. No let’s just shrink government and complain about how it’s the devil. #sarcasm
1
If, indeed, the US government - conveniently ignoring the immense subsidies given the country's industries and agriculture by both federal, state, and local authorities, believes China to be in violation of WTO regulations, the obvious course would be to strengthen that institution. Instead, the US seems to be determined to dismantle it - among other things, by since August 2017 blocking the appointment of all new nominees to the organisation' s appelate body....
Tactics of this sort are best described by the Latin phrase «in mala fide»....
Henri
7
How is the U.S. cutting taxes on corporations any different from China's subsidies?
20
All of this should be done through the WTO. It is not reasonable for us to try to stifle Chinese economic advancement, period; China's economic growth is both unrelenting and beneficial to a vast number of people in China. T wants to win and is willing to cheat, not be fair. We have a great economy, and China will be larger than ours pretty soon. Somehow we need to become economic allies not economic enemies, 19th century stuff. Any economic change is disruptive and the policy of managing disruption will be more beneficial than winning a trade war. China cheats, and so do we to some degree (more now with a cheater as president).
7
China is not nor should it stop paying subsidies to its industry. As pointed out by many who have commented here, we heavily subsidize many parts of our economy.
This effort will fail. China is advancing in the world and the United States is falling behind. Capitalism is failing and we will all suffer except of course for the wealthy.
9
Does anyone believe that through its military orders and provision of airfields that the US government does not, and has not always, subsidized our aircraft and weapons industries? Do we not subsidize the farmers who export our farm produce? Let us be honest with ourselves before maligning others for following our lead.
27
Folks need to remember that these are the folks that brought their citizens Cultural Revolution #1 and #2.
Think Americans are ready for that level of personal sacrifice for the "benefit of the many"?
That's the competition.
3
Expecting China to eliminate subsidies to its local manufacturing businesses is as unrealistic as expecting the United States to eliminate farm subsidies. Get real.
45
We have anti dumping laws on our books to deal with Governments that subsidize imports into the USA. Commerce can levy countervailing duties on any products that are proven to be subsidized by Gov't programs. Intellectual property and technology theft need to be dealt with in the courts. A hold/ban on imports of any products from these categories are in order.
The Donald's approach is typical of his personality - simple and meant to make a big splash.
1
All of these comments show a true misunderstanding of the facts which is why the left thrives on misinformation. As a nation we invest in our defense and provide support for strategic initiatives as do all countries. Where it crosses the line is when you start to pick winners and losers and support areas that cannot compete in the market with; money to stem losses, stolen technology, and restrict competition. We don’t do any of those things. In fact both sides of the aisle want us to do more for some areas like solar panels but are resistant because of our market system.
I know you are obviously rooting against the US but please educate yourself. China will fail in the next 10 years overburdened by debt. Then you can find someone else to root for from the safety of the US.
6
Are you saying the US doesn't provide "money to stem losses"? Then what are farm subsidies? And what specifically are the moneys currently being paid to farmers affected by this trade war? I consider myself a political moderate and I don't hate the US but I do hate hypocrisy.
12
@Paul
According to your 'truth' America HAS "crossed the line is when you start to pick winners and losers and support areas that cannot compete in the market".
What are the massive farm subsidies that Trump lavishes on our farming communities? That is federal money to stem losses. Trump's policies at home pick winners for votes - see coal.
These are just 2 examples where Trump's policies have attempted to manipulate our 'free market' economy.
So let's be clear, there is NO misunderstanding of these actions.
Truth hurts when exposing hypocrisy.
@Paul How do you explain a certain individual who shall not be named allegedly becoming filthy rich by losing one billion dollars? Is he a winner or a loser?
1
“President Trump demanded that Beijing end lavish government spending aimed at making the country a world power in computer chips, robotics, commercial aircraft and other industries of the future.” And what, pray tell, would The President call his massive 2017 tax cut to American Corporations?
59
A gift to his friends?
12
@Charles Squires
The tax cuts don't only go to American corporations. They go to any business doing business here, including the Chinese.
Generalized tax cuts are not the same as specific investments. in specific industries.
China has magnetic levitation trains that go as fast as an airplane with far less energy, because the government built them.
Meanwhile Republicans attack Amtrak.
Tax cuts do not create U.S. investment. The companies that get tax cuts are more likely to invest in low wage countries like China. Demand creates investment. Demand is created by workers being paid more money, but we do not demand that tax cuts create actual jobs. I guarantee that when China invests in a Chinese company they make sure that jobs come out of it.
@Charles Squires Good point! Do you think he is also opposed to their lavish spending at the Trump hotels and resorts when they send delegations to the U.S.?
1
Our government has a history of directly and indirectly supporting segments of economic interests/industries with investment in farm supports, tax abatement and relief, military research, space exploration, road and rail construction, etc. It has and will continue these policies to further the goals and growth of our society. Partially as a result, we have grown to be the strongest nation on earth. It is Ingenuous to suggest that these policies are no less applicable and appropriate for other nations. The dilemma has arisen because China has become a legitimate world class economic competitor. We should concentrate on the maintenance and protection of our copyright and patent needs to retain the lead in our most important asset- intellectual property.
39
Trade agreements are "contracts". They are not meant to change the laws of other nations nor to superimpose our standards on other sovereign nations. In contract negotiations we hold, in most part, the upper hand because of our economic strength. We should be able to negotiate terms favorable to us including specific products, times, conditions, monitoring and penalties. Including a political and social element in negotiations weakens our advantage and reduces the chance for progress.
1
@Carey
The problem is that we stopped subsidizing new critical industries, preferring to prop up old industries.
Solar is the future, while fossil fuels are going to be depleted. But Republicans have blocked subsidies for solar while demanding subsidies for oil.
It's not enough to lay soon subsidize industries. We have to subsidize the right industries for the right reasons at the right times.
3
The US provides massive subsidies to many industries. Indeed, the US "industrial policy" is its enormous military spending - the Pentagon is basically a $700 billion/year subsidy to the technology, military and numerous other sectors in the US economy. But, beyond this obvious hypocrisy, the idea that one state can tell another how to spend within its own economy is preposterous. The US has sabotaged the economies of other states before, notably its insistence on the revaluation of Japan's currency, in order to address the US-Japan trade deficit. The effect, ultimately, was to send Japan into a 25 year recession. Hopefully, the Chinese are too smart to let the US sabotage their economy -not without reciprocal cuts in US subsidies for agriculture, the fossil fuel industry, the military, technology sectors, etc. etc.
49
@Shaun Narine. If China doesn't like the rules, then they should leave the WTO or be kicked out.
@Shaun Narine
Unfortunately there is very little multiplier effect from military spending. Building a school or a high speed train increases the productivity of those that use it. Building a bomb does not.
Technology does come from the military, but they are very secretive, so it takes decades.
China protects its interests without projecting military force around he world. Maybe we should try that
1
So the massive subsidies of the fossil fuel industry and massive farm subsidies and price support schemes in the US, not to mention that massive US-based corporations with record profits pay no taxes, is not subsidizing American business by the US government? And what of QE I and II? Or the extortion of tax and development “incentives” demanded of state and local governments by American businesses? Yeah, we don’t “subsidize” our businesses but the evil Chinese do.
106
@Joe B.Yes! Curious why more attention to US "corporate welfare" isn't part of the reporting that obsesses on Chinese support of their corporations.
17
China has every right to expand however they want and we and other nations can respond however we want. Is capitalism afraid that it isn't the best system? And, of course, we never had pure capitalism. We are just upset that China's interventions work better than ours.
13
@Michael Munk
To the NYT: I think an article about the many ways the US subsidizes its industries is needed, with a comparative analysis with what China does. Reporting on this has been remiss, and makes it difficult to understand the objections to what China is doing. Are the objections rational, or is it that America can not stand to see its "exceptionalism" challenged?
21