Absolutely correct.
The entire world is adjusting to the Wall Street-first mentality that maximizing the bottom line is the ONLY approach, even if it meant selling Americans down the drain. If a multi-national was growing overseas in order to sell into that market as part of their supply chain that was fine.
But when they started to import back into the U.S. that’s when it crossed the line. It’s absurd that in order to save $2 dollars off the cost of a hammer it had to be outsourced overseas; the American public is finally starting to get the idea that the $2 saved cost Americans their livelihoods. And that’s the step that MANY countries are starting to understand, and that’s going to be the partly painful transformation.
Also understnad that the VAST majority of Americans DO NOT KNOW the steps the Chinese take when we want to export to their markets. Many of us here do because we actually pay attention, but when the Trade issue takes up even more time in the Media and the truth about A) the Technology Transfer requirements and B) the enormous influence of the Chinese People’s Liberation Army on ownership of economic assets in that country to fund their military ambitions, the backlash will be far bigger than anyone can imagine.
When you have an enormous trade surplus you have by far the most to lose. Clancy’s novel The Bear and The Dragon is based on how a trade war between the US, Europe, etc., versus China plays out and it’s VERY realistic.
And if the Chinese government and it’s people think they can scare us by boycotting U.S. goods they might want to take a look at the 1980’s and Japanese car imports and how Americans publicly started to destroy those cars. I would not want to be on the Chinese side of this if it gets out of hand. We can supply all our food, they can’t.
Some nations are self-sufficient in food. Some nations can be self-sufficient in energy. Some nations have advanced industrial economies. Very few countries have all three. The United States is one of them.
China is not.
>> When you have an enormous trade surplus you have by far the most to lose <<
A trade surplus means that you have an investment deficit. Not a good thing. It’s better to have an investment surplus.
Just remember these identities:
(1) TD = (-1)*IS
(2) TS = (-1)*ID