Posted on 10/16/2021 12:15:15 PM PDT by elpadre
China’s exports rose 28% in September from the year-earlier level, more than the analyst consensus had forecast. More important is that China’s exports to the United States have risen by 31% since January 2018, when President Trump imposed tariffs on a wide range of US imports from China. At a seasonally adjusted annual rate, the US is buying $635 billion of Chinese goods, equal to a staggering 27% of US manufacturing Gross Domestic Product.
That’s the sort of import dependency economists associate with Third World countries dependent on former colonial powers. US exports to China during the past 12 months were only 30% of China’s exports to the US.
During the same period, China’s exports to South Korea rose by 50%, to Taiwan by 60%, and to Germany by 61%, but China imports almost as much from these three countries.
Demand for Chinese goods after the pandemic disruption has strained China’s production capacity, contributing to a power shortage that is now forcing cutbacks in key industries, including computer chips.
China came out of the COVID-19 epidemic faster than any other large industrial country, and suffered less disruption to its productive capacity. That explains part of the increase of Chinese exports to the US despite a 20% tariff on about half of all goods sold to America.
The poor condition of America’s supply chains is another part of the story. Orders to US manufacturers for manufacturing equipment, for example, languish at the level of 1992, at just half the 1999 peak.
The Trump corporate tax cut of 2018 reduced incentives to invest, cutting depreciation allowances for capital equipment in order to pay for a lower basic corporate tax rate. In response, US corporations in 2019 spent more money buying back their own stock than on capital expenditures, (charts at link)
(Excerpt) Read more at asiatimes.com ...
“...The Trump and Biden Administrations paid $5.8 trillion in COVID relief, equal to roughly a quarter of US GDP, and extended unemployment benefits, in effect paying large parts of the workforce to stay at home. This had the double effect of increasing demand for goods (especially the consumer electronics that the United States imports from China) while decreasing supply.
Lack of labor has worsened some critical bottlenecks, notably including transportation. The American Trucking Associations estimate that the US is short of 60,000 truckers....”
No incentive to invest, so they bought stock instead? What?
I had to go inside a Wal Mart store yesterday. What CHEAP looking merchandise on the shelves. Definitely not made in America.
“....Wong explained in a June 2021 study published on the website of the Federal Reserve Board of Governors:
The United States’ bilateral goods trade deficit with China appeared to have narrowed substantially since the escalation of the U.S.-China trade conflict in 2018, or so US trade data suggest. By contrast, the Chinese data tell a much different story: The deficit, as implied by China’s bilateral surplus, nearly reached historical highs by the end of 2020.
Historically, the discrepancy between these trade balance figures had remained fairly predictable and stable. But with the onset of the trade conflict, US-reported import values from China have fallen more sharply than the China-reported export values to the United States. Two reasons are likely responsible for this phenomenon: (1) US importers underreporting Chinese imports in order to evade US tariffs, and (2) Chinese exporters reporting higher exports due to changes in tax incentives in China.
In this note, we find that the majority of the shift in discrepancy can be explained by the first factor, with an estimated $10 billion annual loss in US tariff revenues due to underreported US imports....”
“The poor condition of America’s supply chains is another part of the story.”
And it’s caused internally by the unions.
wy69
Covid shutdowns destroyed the economy.
Whatever the criticism of Trump’s response toward the problem, he is the only national politician to even attempt to address the problem of a collapsing industrial base, and an offshoring of our industries. He was pushing to bring industries back, and the tariffs were intended to give incentives for companies to at least leave China even if they didn’t return to the US.
Any politician who doesn’t have a plan to bring industry home doesn’t understand the problem. Or is owned by the Chinese.
Nonsense!
Tax cuts are the best incentives to invest there is.
Of course the dumb ass morons who run these big firms would much rather do stock buy backs, putting even more money in their own pockets.
cutting depreciation allowances for capital equipment in order to pay for a lower basic corporate tax rate.
Who does that?
Oh wait, the same very woke Biden voting dunbasses who are running these large companies into the ground.
The trucking industry needs to get their collective heads out of their asses and figure out a way to compensate their drivers adequately. The current model for over-the-road truckers is ludicrous and outdated. These drivers are paid by the mile or the load, spend days on the road at a time, and are not paid for the time they are stuck in traffic, shut down for mandatory rest periods, or forced to wait at a customer's location to get unloaded.
The ATA tries to sell politicians and the public on this fiction of a "driver shortage" in order to maintain their stupid business model where drivers basically operate sweatshops on wheels.
“And it’s caused internally by the unions.”
It’s caused by California outlawing the majority of the trucks in the US with new Environmental Regulations.
Forget all the BS about your Constitution protecting you, The Supremacy Clause should smack down CA truck regs as an interference in Interstate commerce but like everything else, it only applies when the Deep Satanists on both coasts want to take away rights, not when a State actually destroys commerce in the other States for their own stupid fantasies.
Unions don’t have a damn thing to do with it this time. Working 24/7 to unload ships when there’s no room for the containers because there aren’t enough trucks to move them is a joke from the mental dwarf in the Whitehouse.
Don’t get too excited. Most of it is for masks and hand sanitizer, gloves and hazmat suits. They need us to keep buying because they have an overstock.
There is no such thing as a labor shortage, only a wage shortage.
Thanks, Joe Xiden
Myth.
Everything you said is correct, but unfortunately there are additional issues that have been discussed here.
California’s “special” trucking requirements have created a west coast mess.
Baby boomer retirements are another factor.
Covid requirements (vaxx and/or mask that vary widely by location) have been demoralizing for truckers, and that makes the job even worse than it otherwise would be.
AMEN! That is what I hear from a Custom’s broker. There are trucks moving, just not out of Long Beach.
All store are the same.
Unfortunately you are right. My 30 year old clothes are looking better everyday . . . now if I can just get into them. I’m trying!
The designs out there now are not only sickening but I’m afraid to wash them. Looks like there all for weirdos or teenie-boppers. I guarantee nothing out there now will last as long as they use to. Everything now is made to self destruct within year, or ‘right before that extended warranty runs out’.
Not only clothes! Don’t get me started on how many time we’ve had to replace appliances. AND they want us to buy on-line. GRRRRRRRR Many things I have bought on line had to be sent back for one reason or another. Too much hassle. I’ll just do without. My 40 year old clothes will look like from the future before long.
Hey, I have some 40 year old clothes, too and still get compliments . . . I never went for the fads. My mother taught us right!
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