Posted on 08/05/2019 12:35:20 PM PDT by con-surf-ative
What is Trump’s end game in the China trade stand-off? I admit China has been ripping off US intellectual property for years and has been gaming the free enterprise system by exporting products manufactured with cheap, coerced labor and apparently have prevented US exports from competing fairly with their own domestically produced goods. The results have been loss of manufacturing and other blue collar work to outsourced labor in foreign markets. The Chinese have also been able to reverse engineer/steal/purchase technology that has a direct impact on US national security. This has to stop.
However, so many inefficiencies have been built into American industry, including union pay scales, environmental regulations requiring more costly processes, government mandated employee benefits, OSHA standards, and on and on. It seems to me that placing tariffs on Chinese imports to the US basically subsidizes all these inefficiencies by driving up the cost of imported alternatives to more expensive US manufacturing. It subsidizes and empowers unions and ties the hands of those who are seeking the most economically efficient means to maximize production and reduce costs.
There is no question that US industry has been come dangerously intertwined with and manipulated by the Chinese communists who basically determine the political conditions for accessing China’s labor and consumer markets. Apple and Nike and a host of others I can’t name have moved significant segments of their manufacturing to China and have voluntarily surrendered intellectual property to the Chi-comms. Nonetheless, there has to be a way to protect national security and incentivize these companies to extricate themselves from the Chinese entanglement short of shocking the markets with these seemingly random tariff tweets.
The entire situation is totally opaque to those of us outside the Washington insider circles, or who do not pay or trade favors for access to the real story. As a recent retiree trying to plan for the next thirty plus years of living off of my investment portfolio (I am not fortunate enough to have a taxpayer funded or corporate pension), it is indescribably frustrating to watch my assets plummet in value overnight in response to this nonsense.
So what is Trump’s end game? He is too smart for me to believe that all this is merely random. What is the method to the madness? Why is he throwing markets into chaos with the out of the blue threats and demands? The only plausible theory I can come up with is the classic create a crisis and then come riding in to the rescue. It could well be that Trump is allowing/encouraging this economic chaos to get so bad that voters become so overwhelmed by it that they begin to lose hope and fear impending economic calamity. Then at the perfect time in the lead up to the 2020 election, he will announce that we have miraculously reached a comprehensive trade deal with China. The markets will skyrocket and the economy will begin to roar. All just in time for the election. I hope I am wrong.
What is Trump’s end game in the China trade stand-off?
Winning...................
I suspect the goal is degradation of the Chinese economy to a point that China cannot support its military to the extent that it has intended.
Also, this is causing some companies to move outside of China so we aren’t so reliant on Chinese crap.
He is moving toward the impasse of permanent tariffs on Chinese goods/products.
That’s the end game.
25-30% across the board...floating with the Chinese currency.
Think Reagan Soviet Union.
The Chinese are very well known to be virtually intractable and to measure things in decades while Americans generally want near instant gratification.
If Trump thinks he can out sumo-wrestle the Chinese on this, I fear he is sadly mistaken. China will simply wait, let both economies go through whatever “short-term” (to them, ages to us) chaos that may ensue, and hope/work to ensure he does not win re-election.
I’m all for fixing the big imbalance with China, but do not think POTUS is going about this the right way - and in the meantime, the economy (the one thing that’s Trump’s biggest Ace) is at huge risk. Not the smartest approach, IMHO..
They have more to lose economy-wise than we do.
Their military is dependent upon it..........
That would be a legitimate goal, just as Reagan did with the Soviets during the 80’s oil price crash. But just like that time, there will be a lot of collateral damage.
The end game is to stop China’s drive toward world domination, that we have bankrolled.
Yes, there are issues with our system, but had we not sold out to them at the hands of our globalists, they would still be a third world nation rather than being a severe threat to our future.
Their communism is a hybrid mix of mercantilism and communism. We are the source of their money, as all communist systems require outside money to survive. Their mercantilism is rewarded through their gaming of the WTO agreement.
You would rather feed the PLA and their political owners over our unions in the US? Whose side are you on again? If you haven’t noticed, our unions are starting to stand behind our president.
This is the strategy of a man who walked into a very bad situation. At this point, he has a weak hand and is playing this like a woman would, think the Virgin Queen against the Spanish. This is about one day at a time guerilla warfare in an attempt to erode the ill-gotten gains of the Chinese and their enablers, and to put us into a better strategic position.
The crisis has been ongoing since the Bush 41 administration, at least, and includes more than the Chinese.
During the rise of American manufacturing in the 19th century protective tariffs were the rule rather than the exception.
Makes sense. But there has to be a more orderly and less arbitrary way to go about it. Investors are getting decimated (at least I am).
My understanding was that the goal was for all or most of these companies in China would relocate here, employing American workers at decent wages.
We would then begin to consume what we produce, thereby supporting a thriving middle class.
Nobody seems to talk about that anymore, so I don’t know if that was never really the goal or what.
You have to be brain dead to think Trump is going to show his hand now.
Fine points. But when the economy is doing well, that’s the time to make a bold move and use your stick, Otherwise you are at their mercy. China has a coming crisis with aging, so time isn’t completely on their side.
I agree totally. The folks who compare this to Reagan and the arms race that destroyed the SU are mistaken if they apply that policy here. The arms race in no way harmed the US economy. In some ways it benefitted it. China has taken the Trade War to the next level and I agree that we in no way have the patience to suffer an economic downturn.
25-30% across the board...floating with the Chinese currency.
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It will be above 50% and may go to 100% or more?
Why? because the chinese want to keep their huge import imbalance and they want to keep all the theft.
So the president will keep raising tarriffs.
The costs of the tarriffs simply don’t outweigh the benefits of the current regime to the red chinese. tarriffs will have to be much higher for them to bite in any meaningful way.
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