Not sure why you're being downvoted here, it's absolutely true. They'd be mad not to enact their own tariffs in response. How long it can carry on before one side backs down is the real question here.
I heard a claim in a podcast the other day that I'm not able to put my hands on (it may have been EconTalk or Vox's Weeds) where someone claimed that trade is generally so beneficial to the recipient that even if your partner puts tariffs on your goods that retaliation is just shooting yourself in the foot purely for appearances.
I wish I could provide a link or more details but there does seem to be an economic case for non-retaliation.
Of all the nutty, anxiety-inducing and self-destructive things administration is doing right now, this trade war with China leaves me least concerned. In fact I'm curious to see where it leads. Change my mind?
do you realise that global tariffs was a strong factor into the build up of the Great Depression?
To me, its the most concerning aspect of all of Trump's activity as it has the capacity to strongly influence global events.
Generally speaking, you're trading economic growth and progress for "lols". Changing you mind is completely meaningless unless we know what you're actually after. If the outcome you're after is "lols", or it's politically-correct phrasing "getting tough on China", then why would anyone try to change your mind?
Everyone except you responded with something well-reasoned and interesting. Does that change your mind about your ill-considered and rude response to me here?
Isn't it ruder to assume that you think exactly as I do? And why do you take offense at someone asking about your intent?
An action is meaningless in isolation and without context. Even something as "obvious" as killing a person cannot be right or wrong without being aware of the context in which it occurred and taking into account the intent of the person.
So we're discussing an action "trade war" and you're asking, essentially, is it right or wrong. You can't get a good answer without revealing what you're actually after. Other people merely assumed your intent, whereas I asked you about it.
There's a lot of this assumed intent these days, where people can't possibly imagine someone thinking differently than them. So if work with the "economic growth and standard of living increase" intent, then Trump's trade war is idiotic, and we can then show that in many different ways.
But Trump's supporters don't share this intent, they're perfectly fine with sacrificing economic growth for other outcomes, mostly about trying to protect their dominant group status. In light of that intent, the same action makes a ton of sense.
People should keep in mind that others don't think as they do.
Op never said anything about 'lols'. I'm cautious but this is one area where I think the administration might be doing something correctly (but I don't know).
We lost a lot of manufacturing and it should have been OK because we could just move up the value chain to tech. Between the great firewall, restrictive cloud rules, partnership requirements, and IP transfers that hasn't worked out.
I don't know if the policies are best but I agree with the statement that as far as all the administrations policy proposals, this is one example of where I'm willing to take a wait-and-see approach.
It has the potential for the most dramatic long term consequences as it could dramatically speed up China's rise. China's economy is where future growth is, to get access to that growth capital will reallocate itself around these trade barriers to China's advantage if they persist.
Also, part of the reason the US dollar is the chief world trading currency and the US Treasury is considered the world's safest investment is open trade policy. This preferential place in the world financial system gives the US economy major advantages, including low interest rates.
Attacking the entire world at the same time is a really bad plan. The chance of wringing concessions from China would be much greater if the US would make common cause with the EU, Japan, etc. But the opposite is happening, the rest of the world is moving on w/o the US as we saw with TPP and the recent EU / Japan deal. Expect to see things like China start canceling deals w/ Boeing and inking new deals with Airbus.
Finally, there's a military dimension to this. China is raising tariffs on US oil at the same time it is saying it won't respect Trump's sanctions on Iran. Its unlikely anything would happen in the immediate term but if this situation persists its not far fetched to imagine things getting tense.
China's economy needs Western imports far, far more than the West needs Chinese imports, they're likely to break first. The short-term impact could be quite painful on both sides, but things will turn out fine for the US if they stay the course. And someone needs to, China has played protectionist games unchecked for far too long.
But without the US trade, it'd be much worse because much more people would've starved to death. Don't forget that behind a government, there still are people.
The estimated number of inmates keeps growing by the week. I think it's more accurate to call them re-education camps, but it's an issue that I wish more countries would push China on. I don't get why our (German) government spent so much time on negotiating the Liu Xiaobo issue instead.
Not sure why you're being downvoted, you can argue to what degree Mao was responsible, but in the end China's authoritarian government was at least partially responsible.
They estimate 20 and 43 million died, if not caused by, then exacerbated by policies implemented under Mao.
"Since June 2015, all Wikipedias redirect HTTP requests to the corresponding HTTPS addresses, thereby making encryption mandatory for all users. As a result, Chinese censors cannot see which specific pages an individual is viewing, and therefore cannot block a specific subset of pages (such as Ai Weiwei or Tiananmen Square) as they did in past years. As a result, Beijing chose to block the whole Chinese Wikipedia"
What a load of crap. Ignoring the fantastic abuses that the US commits everyday against its minority and poor folks, disenfranchising and imprisoning them and basically kicking them out of regular society... China is a sovereign nation and has every right to Govern itself the way it wants to. They may not have the same system and freedom that the West is used to, but authoritarianism has been the norm in China for centuries. The one time they tried to be a Republic: Civil War happened (with a LOT of Western intervention, no less).
I think ethically you shouldn't be making judgements about another country when you clearly know so little about it.
No. I'm merely pointing out that the Chinese Government has certain leeway in which to run their country. Concentration camps must and should be condemned and there are ways to achieve that: targeted sanctions on entities associated with those activities. That's why we have sanctions against Russian oligarchs involved in criminal activities and not against the entire Russian Federation.
What I'm arguing against is penalizing the whole country with a trade embargo. That is just bullshit coming from someone who understands very little about how international relations work.
How should we impose a sanction on the regional government of Xinjiang specifically? Do you really think the gov't in Beijing has nothing to do with these camps, and should be exempt?
I'm glad that weapon sales to all of China are banned, not just to imperialistic individuals within the PLA.
There is only so much that you can do with wealth in China; many corrupt individuals often park their illicit wealth abroad in Western nations and that is where sanctions against these individuals (or companies) really hurts them.
Sanction enough individuals and you force them to fall in line and discourage that kind of corruption.
> China is a sovereign nation and has every right to Govern itself the way it wants to
Who has granted the Chinese government this right? God? The "consent of the governed"?
> Ignoring the fantastic abuses that the US commits everyday against its minority and poor folks... I think ethically you shouldn't be making judgements about another country when you clearly know so little about it.
You can't even compare the two, the US is still dealing with systemic racism, but we are dealing with it, China is institutionalizing it. For example, Chinese citizens can be _tortured_ for political views, protesting or religious beliefs, real torture, they apparently use electrocution.
China is not allowed to do what it wants to its citizens, that is the load of crap.
That makes zero difference to me. I find them both immoral, not to mention that enemies of the US might include some Chinese people, making the two sets identical. You're saying that only the US can torture person X, but China can't.
Because torturing anyone is immoral? Do you seriously need justification? Does this moral position of "we can torture foreigners, it's fine" seem fucked up to anyone else, or is it just me?
Keep in mind that questioning whether the two are "morally equivalent" is not the same as saying "one is right and the other is wrong".
It intuitively feels, to me, "more bad" for a country to torture its own citizens than for a country to torture citizens of its enemies (although both are still bad). Thus, I'd want to hear a justification that "actually, no, both are the same degree of bad."
I think the onus falls on you to justify why torturing an enemy is "more good" than torturing a citizen. To me, torturing someone is axiomatically immoral, and the fact that they're a citizen of a specific country doesn't make any difference to that. I don't find it "less bad" to torture someone one day before they get their green card than one day after.
Hold up, "less bad" is not necessarily the same as "more good". Breaking my arm and breaking my neck are both bad, but one is worse than the other. It seems difficult to justify that "breaking my arm is more good than breaking my neck".
I don't necessarily agree that the onus is on me (you were the one to initially bring it up here: https://news.ycombinator.com/item?id=17717319 and I also gave my justification, which is that it feels intuitively different), but I can throw out some ideas as to why. I said it was interesting for a reason...
1) Perhaps it's a moral foundations (Haidt) difference: a state torturing its own citizens violates a moral "loyalty" principle as well as a moral "care" (harm avoidance) principle. Thus, it feels worse IF you ascribe to loyalty as a valid moral foundation. Haidt suggests modern liberals heavily elevate the "care" and "fairness" principles over the others, suggesting we might have a deep value difference causing our different opinions.
2) A more political perspective: the US constitution contains certain rights which all citizens are granted (note that US citizenship is defined as a "right to have rights"). See the passage (emphasis mine): "we hold these truths to be self-evident... that [all men] are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness".
One could argue that for the US government to torture its citizens would be additionally unjust, on the grounds that it violates these constitutional rights, specifically (I'd argue) that of Liberty. It's a violation of a social contract as well as a violation of an ethical principle, making it a worse injustice. Note that the authority here is granted to "[the] Creator", intensifying the ethical severity of violating this social contract.
3) Could also make some lower-Kohlberg-level arguments about this, but they're less fun and interesting.
> It seems difficult to justify that "breaking my arm is more good than breaking my neck".
I disagree, I think it is very easy to justify that breaking my arm is "more good", in that it is preferable. If one is -100 and the other is -50, then it is "more good" (i.e. the difference is positive). By "more good" I don't mean that it is good, mind you, just that it is better/preferable.
> Haidt suggests modern liberals heavily elevate the "care" and "fairness" principles over the others
I think this is our difference. I wouldn't want my country torturing anyone, enemy or not. Your second argument conflates legality with morality, so I don't really consider it especially valid. Unless you mean that the government has made a promise to the citizens to not torture them, and it would be additionally breaking that promise. Still, though, I consider the "torturing people" part much, much worse than the "you broke the promise" part, so much so that the latter seems like a rounding error to me, to use a somewhat utilitarian phrase.
> breaking my arm is "more good", in that it is preferable
Neither are preferable over "don't break any of my limbs", but I understand your point. I only nitpick because "having no bad things" is not equivalent to "having good things," in my mind. This is something I dealt with on a personal level relatively recently.
> Your second argument conflates legality with morality, so I don't really consider it especially valid.
The constitution speaks in terms of "god-given rights" and not "laws". The founding fathers were speaking the language of moral imperatives and not of legal imperatives. This is intentional.
The conflation occurs when people consider the laws themselves as opposed to their motivating intentions to be moral imperatives. But my claim is that "life, liberty, and the pursuit of happiness" are (some of) the motivating moral intentions that justify the laws, thus there is no conflation in my argument.
> I consider the "torturing people" part much, much worse than the "you broke the promise" part, so much so that the latter seems like a rounding error to me, to use a somewhat utilitarian phrase.
Ironically, I argue a utilitarian would disagree: it is likely that a government breaking their promises is harmful and perhaps terrifying to a much larger group of individuals than those who are directly harmed via torture. I figure there's a strong utilitarian argument that (a small harm * 150 million people) > (a large harm * 200 people), but then again, this is part of the horror embodied by stories like "The Ones Who Walk Away from Omelas".
I am no utilitarian myself, but I am also no orthodox Humanist either...
> It intuitively feels, to me, "more bad" for a country to torture its own citizens than for a country to torture citizens of its enemies (although both are still bad).
I agree with you. The citizen scenario includes extra immoral elements like in-group betrayal and abuse of friends in addition to whatever immoral elements come from the torture itself. The enemy scenario feels like the immoral elements may even be a bit muted by that fact that you're probably already willing to kill the enemy, which feels like a more extreme action.
> already willing to kill the enemy, which feels like a more extreme action.
Tell me, would you rather be tortured in Gitmo for a decade and live with the scars for the rest of your life or just take a bullet to your head and be done with it?
Torture is immoral, full stop. No human being should ever be tortured.
> You can't even compare the two, the US is still dealing with systemic racism, but we are dealing with it, China is institutionalizing it.
At the moment, so is the US. There is some measure of hope in some corners that this is an aberration that will be brief at least at the federal level, and that the reversal of it at the federal level will eventually negate any adverse trends at other levels, but that's hope, not established fact.
China may have up to 1 million muslims in concentration camps, what has the US done in the last 50 years that is even comparable? I'm reading so many people defending China, I have to think it's because they haven't done any research, and assume China's not that bad.
> China may have up to 1 million muslims in concentration camps, what has the US done in the last 50 years that is even comparable?
I didn't say that the US did anything comparable to that, I said that the argument that the big-picture difference between the two was that China was institutionalizing systemic racism while the US was addressing it was, whatever the past or hoped-for future of the US might be, currently inaccurate on the US side.
> I'm reading so many people defending China, I have to think it's because they haven't done any research, and assume China's not that bad.
Maybe somewhere, but the post you are responding to said not one word about China (other than a quote for context from the post it was responding to), either in defense or otherwise.
> How does the US institutionalize racism? If anything we implement tons of policies with the opposite goal.
Redlining, racial-profiling, school-prison pipeline, pay discrimination, voter id laws that discriminate against minorities... I can go on and on.
> I'm not saying the US is perfect, but compared to China right now the US is
No its not. They are not comparable and shouldn't be. You think the US is great because I'm assuming you belong to socio-economic classes that have granted you a great quality of life and freedoms which are theoretically promised to all US citizens. But in practise, they are not and the situation is much more nuanced.
No, I want specific laws or policies from government. I'm not denying that there is racism in the US, but the government does not encourage or implement racism to my knowledge. Most of what you describe is illegal in the US.
> No its not. They are not comparable and shouldn't be.
Why can you not compare two countries' human rights?
> But in practise, they are not and the situation is much more nuanced.
It is more nuanced as you suggest, the difference is that the government of China is busy locking up muslims, and the US is busy passing anti discrimination laws.
> No, I want specific laws or policies from government. I'm not denying that there is racism in the US, but the government does not encourage or implement racism to my knowledge. Most of what you describe is illegal in the US.
It doesn't matter and I frankly don't care what you want. Slavery was technically illegal after the Civil War and yet you still had Jim Crow; similarly racism is technically illegal but there continues to be systemic racism in the US, whether or not promoted by Government policy. To the millions of African-Americans incarcerated for possession of Marijuana, it doesn't matter whether there are protections for minorities, because the laws are not enforced. The War on Drugs was a euphemism for a war on minority communities.
> It is more nuanced as you suggest, the difference is that the government of China is busy locking up muslims, and the US is busy passing anti discrimination laws.
No, its not that simple either. The US is busy locking up immigrants... what do you say to that? Or about locking up minorities for minor infractions, while whites go scot-free?
What about that?
Its not simple, which is why it must not be compared. You are allowed to criticize China for its human rights record, but they are equally free to criticize you for yours. What is not OK is to spread the lie that the US is some sort of utopia of human rights when its clearly not, and has not been ever since its inception.
You are free to criticize the US, as is China. But this is a thread about China, it seems you're not making an argument that the US is equally as bad as China.
I suppose you could say there are more minorities in jail, but minorities tend to be more on the poverty line which is an easy explanation, I would be interested in a study on the treatment of only those in poverty.
Illegal immigrants should be deported, legal immigrants should not be.
The US is not a utopia, but my point was china is looking more and more like Big Brother in 1984.
If you see anything that the US is doing that is equivalent what China is doing in Xinjiang, I'm pretty sure that the problem is with your moral compass. The two situations are not equivalent.
> If you see anything that the US is doing that is equivalent what China is doing in Xinjiang, I'm pretty sure that the problem is with your moral compass. The two situations are not equivalent.
Pretty generous considering the US actually separated thousands of kids from their parents at the border, some of whose parents have still not been found. If you didn't factor that into your moral compass, you probably should.
Absolutely, hundreds of orphans is bad enough. (Except they aren't exactly orphans - we didn't kill the parents. They're long-term separated from their parents, though, which is pretty close.)
Hundreds of thousands is a thousand times worse. So, yeah. Not equivalent.
Ignoring how ethically insane it is to justify human rights abuses under the guise of national sovereignty, this same sovereignty would allow the US to cease trade relations.
No the question was whether or not national sovereignty justifies criminal behavior. You made the ludicrous point that China's national sovereignty gives them the right to commit human rights abuses, and I merely pointed out that your same logic would justify whatever unethical trade arrangement we decide on.
> No the question was whether or not national sovereignty justifies criminal behavior.
No you are wrong again. The question was whether its OK to cease all trade with a country solely because of its questionable human rights record. I pointed out that its not. That Sovereign countries have the legal right to do certain things and must be dealt with in an appropriate way.
It is the same argument made, by the way, when the US wants to justify buying oil from the Middle East, none of whose countries have a stellar record regarding human rights.
Simply read what you wrote. No serious person defends a position like this:
'China is a sovereign nation and has every right to Govern itself the way it wants to.'
Rather than taking the human rights abuses seriously, you continually obfuscate obvious facts by pointing to the United States' history of human rights abuses (of which there are plenty), and simply double down on your own indefensible position.
You could also do the most elementary research into your own position, which would immediately reveal that currency manipulation, censorship, restrictions on freedom of movement and associated crimes violate UN human rights laws and countless international trade agreements. Any honest definition of 'legal' would account for this.
There's an honest conversation to be had about how sanctions impact the poorest segments of a country. That conversation cant proceed if you don't acknowledge reality.
I don’t think I ever refused to acknowledge that the Chinese Government commits human rights violations (among other offenses). My point all along has been that these offenses cannot be used as justification for a complete trade embargo, based solely on those violations.
They tried at least twice, and both kind of succeeded, or at least didn't totally fail. (Both the ROC and PRC are republics. The PRC especially obviously isn't a western-style liberal-democratic republic, but it is a republic.)
> They may not have the same system and freedom that the West is used to, but authoritarianism has been the norm in China for centuries.
Antisemitism had been pretty "normal" for 2 millenia in Europe. Would you go to a holocaust museum and roll your eyes at them, too? Mayne tell them the death camps in annexed territories were bad, but that all the stuff from 1933 to 1939 should be removed, because it was just internal politics and making a judgement about that just shows how little one knows.
Can you even imagine how many of those were put up in response to mere internal politics? You should clear up how none of that was bad, would save a lot of money on maintaining exhibits, and archiving survivor testomies and all that.
> More than half the people we met along the way during our journey spoke of family members or acquaintances who were "sent to school." One driver in Hotan talked about his 72-year-old grandfather. A person in Urumqi told the story of his daughter's professor. An airplane passenger spoke of his best friend.
I guess they forgot to mention that authoritarianism has been the norm in China for centuries, so being tortured or a loved one being disappeared and killed doesn't really bother them. They have a "different system and freedom", after all. As does anyone who moves there, anyone the secret police gets their paws on, even internationally. When they get locked up and murdered, they don't really feel it the same way you or I do. When they have families and friendships, it's not like they're actually sad when that ends. They don't suppress showing pain they feel, they simply don't feel it in the first place.
It's all good, nothing to see here. Just the normal day to day business of being a monster.
I don't disagree, and I would add that the US has some very dubious incarnation practices. Getting locked up for minor crimes, and running prisons for profit is unethical in my mind. Your point is very valid though.
But the negotiations left out the most important sector, which is automobiles. The US is still pursuing a "national security" review on the automobile industry under Section 232.
Well, on one hand we have the EU and Canada with an actual free-trade deal, the TPP is happening and China is spending hundreds of billions in trade-related infrastructure throughout the world.
On the other hand we Trumps incredible negotiating skills. Same ones he used to bring Kim Jong Un to heel and denuclearize North Korea.
Well of course they don't, they still enjoy the benefits of developing nation status in the WTO despite moving from a poverty stricken 3rd world country 20 odd years ago to the 2nd largest economy in the world, as well as a leader in some hi-tech fields and ready to challenge in many more.
In my estimation they seem a hell of a lot smarter than most other countries as well, I don't think they need or deserve help from third parties any longer.
That's clearly not true; China engages in a number of unfair trade practices, including requiring foreign companies to surrender their technology to Chinese ones.
There is no western trade alliance because Trump is challenging the multi-lateral trade institutions such as the WTO which the US created. Given that the Tariffs that Trump is imposing will likely be illegal under WTO rules, Europe and Canada will not simply work with the US when their products are also at risk from Trump's tariffs.
You may think that the west has a collective interest, but does Trump think so when he gets mad every time he sees a Mercedes car running down Fifth avenue?
> There is no western trade alliance because Trump is challenging the multi-lateral trade institutions such as the WTO which the US created.
The WTO is ineffective and broken. Based on prior precedent, if the US raised objections to the "China 2025" policy, the adjudication of the dispute will probably be finish sometime around 2030. In the past, the Chinese government has typically ignored adverse WTO rulings or dragged its feet until they were moot. IIRC, after all off that, only then will the WTO sanction tariffs. It's basically the definition of too little, too late.
China's economy needs Western imports far, far more than the West needs Chinese imports, they're likely to break first.
I don't think so. China has a huge amount of power over the US economy[1].
What Happens If China Called in Its Debt Holdings
China would not call in its debt all at once. If it did, the demand for the dollar would plummet. This dollar collapse would disrupt international markets even more than the 2008 financial crisis. China's economy would suffer along with everyone else's.
China could crash the American economy any time they want. It'd hurt them, but it'd hurt America a lot more. Especially because oil exporters would immediately switch to doing oil trade in Euros, which would make it exceptionally hard for the dollar to recover.
Well, they can sell their holdings of US bonds on the market. That's a matter of indifference to the US government, because it doesn't affect the repayment schedule at all.
It might affect the price of the next sale of Treasuries, but that's the limit of its impact.
> China could crash the American economy any time they want. It'd hurt them, but it'd hurt America a lot more. Especially because oil exporters would immediately switch to doing oil trade in Euros, which would make it exceptionally hard for the dollar to recover.
But their likely action, according to the article you linked, might actually help the US economy by making its exports more competitive:
> China would not call in its debt all at once. If it did, the demand for the dollar would plummet. This dollar collapse would disrupt international markets even more than the 2008 financial crisis. China's economy would suffer along with everyone else's.
> It's more likely that China would slowly begin selling off its Treasury holdings. Even when it just warns that it plans to do so, dollar demand starts to drop. That hurts China's competitiveness. As it raises its export prices, U.S. consumers would buy American products instead. China could only start this process if it further expands its exports to other Asian countries and increases domestic demand.
China only amassed so much US debt because it sells RMB to buy dollars to keep the RMB down and fuel exports. Reversing that policy would make Chinese exports less competitive on the world market. Ultimately, that could thwart the CCP's ambitions to create "national champions" by limiting them to their domestic market.
China can't just "call in" debt from treasury bonds, that's not how they work at all. And what happens after they sell a bunch of treasury bonds? Everyone knows that the yuan is propped up by the Chinese government and ain't worth a spit internationally, and US treasury bonds are still considered a good investment at present.
Right. Wouldn't they have to find a buyer for the bonds? That'd likely increase the yield quite a bit, which would descrese the value of China's holding a lot, right?
China's #1 customer is the US, by a large margin. Around half of their exports come here. China has far more to lose in a commercial war.
It'd hurt them, but it'd hurt America a lot more.
Nope. The only way they can hurt the US is by economic suicide (dumping all debt). And I mean total annihilation: they'd be shooting themselves. And the USD would suffer, true. But it would recover, US economy has far more autarky.
"oil exporters would immediately switch to doing oil trade in Euros"
How does this affect the US any more than whether they measure oil volume in metric or not? It's not something that changes the real economy, it's just a matter of which ruler you're using. If the oil company has European employees, it still has to pay them in Euros. If the oil company has American employees, it still has to pay them in dollars. Likewise for customers. You have currency coming in, and if it's not what you need, you trade it for what you need.
Yeah once China runs out of nvidia GPU's the whole economy will crash.
Meanwhile everything in the US is "made in china" and our entire manufacturing infrastructure and knowledge has deteriorated while China was slowly taking over...
But everyone knows GPU's are the key to economic dominance.
Well their AI progress will stall until they come up with an alternative to CUDA which, if you talk to futurists here, is almost just as bad. And this is just one example. Many industries are reliant on some special American component that they haven't figured out yet.
I think people get a distorted picture of that as an artifact of labeling rules. The US exports a lot of industrial equipment, for instance. Most of the economy does not involve the final step of constructing consumer products that leads to the label "made in..." on the shelf of Wal-Mart.
China's economy is where a large part of the world's future growth will occur, in the longer term capital will reallocate itself around trade barriers to get access to it.
In the short term, the US could potentially get some concessions that it wants. However, things have already gotten further than most predicted, lots of people expected China to give Trump a few crumbs that didn't really matter but allow him to declare victory. Trump seems to not want that, so it might be too late to avoid damage.
This is a good point. Personally, I think the inverted pyramid means that China won't achieve parity with US in per capita wealth. However, there's still a ton of growing that it can do. Think of all the millions of cars, washing machines, air conditioners, not to mention increased consumption of pharmaceuticals, personal care, apparel, meat, etc.
> You mean China's current aging population with a reverse pyramid demography due to one child policy is where global growth is at?
Given we're talking about the CCP, I suppose they could right their reverse pyramid using the same brutal means they used to create it. Say, by heavily pushing euthanasia options onto retired folks who can't care for themselves, with financial sanctions for their families if they refuse to comply.
This may be the case as of this exact moment, but I see two things here that work in China's favor:
1) Given the current balance of trade between the US and China, each $1 of retaliatory Chinese tariffs has a larger impact as a percentage of trade flow than each $1 of US tariffs.
2) The Chinese economy is much more nimble and diverse than the US, and – especially with government intervention – may have an easier time developing domestic alternatives to US goods.
On an unrelated note, it's interesting that they're implementing a tariff on recyclables. That could be a devastating blow to the already struggling US recycling market.
>1) Given the current balance of trade between the US and China, each $1 of retaliatory Chinese tariffs has a larger impact as a percentage of trade flow than each $1 of US tariffs.
That doesn't benefit China. What you are saying is that China has less total trade that they can tariff than the US.
>2) The Chinese economy is much more nimble and diverse than the US, and – especially with government intervention – may have an easier time developing domestic alternatives to US goods.
Source? It's common knowledge that the US has the most largest and most diverse economy in the world.
On (1), I mean that $16B worth of goods is 12% of US->China exports, whereas it is only 3% of China->US exports, meaning that if this continues to escalate in this manner it will disproportionately affect US->China exporters.
I will concede (2) was not well expressed. I just find it much much easier to imagine – due to differences in labor forces, natural resources, environmental regulations, etc. – a suddenly growing Chinese motorcycle industry than, say, a resurgent US steel industry.
Are you joking? It's the other way around. Most of our manufacturing infrastructure and knowledge has deteriorated while China's knowledge has only risen.
Manufacturing goods is the root of an economy. China is the root, the US is a leaf.
I don't think it's a joke. At least in the US, the free market values services a lot more than manufacturing. Services make up 79.6 of the U.S economy [1].
Granted, I don't have the stat for the entire world, so it might be bigger. Considering the US and EU are half of global GDP, I doubt it.
Trust me, a modern technological economy exists because human labor is augmented by physical machines. You take away the machines you'd have a service economy similar to services provided during a time when modern machinery was nonexistent (the stone age).
Windows is pirated by everyone in China so a tarrif is useless. iPhones and apple computers are manufactured in China so YES they can put a tarriff on every freaking part of a mobile device/computer except for the GPUs and CPUs.
Once upon a time, agriculture was the root of an economy, but these things change. Manufacturing became the root. But it's not any more - now technology is.
More countries can manufacture it than can develop it. The manufacturing gets driven down to low margins. Developing is therefore the root of the economy, rather than manufacturing.
Make no mistake. Manufacturing something is just as complex if not more complex than design. When you know how to manufacture a car, you probably know how to design one as well.
You can literally be taught how to design a car in CAD. It can be done on your computer with a mouse. But to fabricate a car takes a life time of knowledge from multitudes of disciplines.
The proof is in the pudding. China is well known for replicating and ripping off patented designs in seconds because design is trivial once you know how to fabricate something.
The only reason why China can't produce an nvidia GPU is because they don't have the knowledge to fabricate it.
Honest question: If some Chinese goods become "too expensive" because of the tariff, wouldn't some other country's goods become the new more affordable one?
If so, does anyone here know who's next in line after China?
ps: i'm already looking for a potential alternative to AliExpress to buy integrated circuits :)
China has been sinking serious finances and engineering personnel into Africa for about 20 years. The Koreas have been trying too. Basically as soon as the Chinese middle class pushes up wages past the point where manufacturing is viable, they'll need a cheaper workforce.
Thanks to these long-view investments, they'll likely maintain control over manufacture for another few decades, at least.
India is already cooked. Despite their wage inequality, they're practically already post-manufacture. They've missed the boat.
The global economy is very complicated, there will be different suppliers in different countries with various qualities of the different goods they are selling therefore I don't think there is an easy answer to that question.
If a country is already producing something they can probably produce a little more: just work some overtime. To do anything more than a little though requires new manufacturing plants. Building them isn't hard, but it takes time: you risk that your expensive new plant opens the day this all resolves. If that happens you go bankrupt.
Good on China. I'm glad China is reacting to the ridiculous actions of the US. Is everyone in these comments shortsighted in thinking that this is good for the long term? The US does not benefit from these huge trade tariffs on China. Protectionism is not a good idea. It'll only slow job growth in the US.
Oh yes, because the US (not we, I'm European, thank you very much) has a trade deficit with China it's inherently bad for the US?
Where are you going to get a good price for steel (and not only steel) when you add a 25% tariff on it when it comes from China? It'll lead to American products also being more expensive and it'll lead to a lower purchasing power in the US.
Other countries can also higher their prices for the US because why wouldn't they? The US isn't gonna get it cheaper from China... This leads to an endless price war that is not good for anyone.
Don't mix short term and long term. Short term we have 25% tariffs. What about long term? Trump has stated some goals that would end the tariffs. If he succeeds that changes things and it is worth the short term trade.
Of course who knows if he will succeed. Ask me in 20 years what the real result was.
> If we correct our trade deficit with China(it's 5:1 right now) how is that against our interests?
Why is a trade deficit bad? Is there some reason the capital account surplus needs to flow out instead of in? What negative effect do you perceive the trade deficit as having in the economy?
Trade deficits are basically neutral. They fund the foreign investment in the US and purchases of US bonds by foreign governments.
The biggest worry over a trade deficit that I'd have are National Security implications due to the dependance on trade with that county. To explain why that would matter, consider the following:
- Because of the much lower wages and regulatory costs, manufacturing here in the U.S. seems to have been strangled in the last few decades and mostly moved over to China.
- This has caused a shift in the way the U.S. economy works, with cheap parts / goods from China being considered a given and a transition to businesses that depend on those cheap imports.
- Once our economy wholly depends on that overseas manufacturing in China, that gives China large leverage over us because we don't have the factories here in the U.S. anymore to pick up the slack if China stopped trading with us and instead found another buyer for their goods.
- MUCH more importantly though, is the affect this dependance on a foreign nation would have on us if China decided to do things that we find reprehensible in the world. Think about what Russia did with Crimea. Now imagine China doing something similar. With Russia we were able to slap strong economic sanctions on them... but if our economy is strongly intertwined that makes taking any strong stance against that nation extremely difficult. I don't think anyone wants their future and safety dependent on strangers from a different society that have different cultural values.
> Is everyone in these comments shortsighted in thinking that this is good for the long term?
How deeply have you thought about the issue? I mean really, really thought about it. Trying to poke holes in your own deeply held beliefs, that kind of thinking.
“He who knows only his own side of the case knows little of that. His reasons may be good, and no one may have been able to refute them. But if he is equally unable to refute the reasons on the opposite side, if he does not so much as know what they are, he has no ground for preferring either opinion... Nor is it enough that he should hear the opinions of adversaries from his own teachers, presented as they state them, and accompanied by what they offer as refutations. He must be able to hear them from persons who actually believe them...he must know them in their most plausible and persuasive form.”
― John Stuart Mill, On Liberty
I can think of several ways things could play out in this trade war that would end in terrible results for the US, China, the whole world, and every different combination you can think of.
Can you think of even one scenario where the current status quo might produce bad results for even one nation? Or, do you truly believe that our current model (which objectively is still very much protectionist, in a variety of very complicated ways) happens to be designed absolutely perfectly to produce the optimum outcome for everyone under all scenarios that our infinitely complex and unpredictable world throws at us?
Personally, I believe a better approach is for everyone to get out of their ideological mental straight jackets and practice critical thinking, conversation, honesty, and cooperation skills. And if we can pull that off, then maybe then we can hold our respective political leaders to some sort of a similar standard.
One consequence is the reduction of trust and perceived-value in the global economy, which reduces our capacity for investment and growth*
As far as I can tell, as long as the economy runs super well and everybody trusts that it'll continue to do so, we are all able to collectively defer debt among ourselves to invest in augmenting our production capacity right now. In practice this means people trust that the work (or product) that they are doing (or delivering) now can be payed later, so they can wait to be paid. Meanwhile that work (or product) can be put to use _right now_ to increase production as a whole.
I'm certain someone with a more formal grasp of macroeconomics can explain this better.(Maybe even yourself, if that was a rhetorical question)
* many caps apply, and IMO foremost the accelerated consumption of natural resources is the most critical one. Eternally growing economies mean eternally accelerating change of the natural environment.
150 comments
[ 2.7 ms ] story [ 216 ms ] threadAn action is meaningless in isolation and without context. Even something as "obvious" as killing a person cannot be right or wrong without being aware of the context in which it occurred and taking into account the intent of the person.
So we're discussing an action "trade war" and you're asking, essentially, is it right or wrong. You can't get a good answer without revealing what you're actually after. Other people merely assumed your intent, whereas I asked you about it.
There's a lot of this assumed intent these days, where people can't possibly imagine someone thinking differently than them. So if work with the "economic growth and standard of living increase" intent, then Trump's trade war is idiotic, and we can then show that in many different ways.
But Trump's supporters don't share this intent, they're perfectly fine with sacrificing economic growth for other outcomes, mostly about trying to protect their dominant group status. In light of that intent, the same action makes a ton of sense.
People should keep in mind that others don't think as they do.
We lost a lot of manufacturing and it should have been OK because we could just move up the value chain to tech. Between the great firewall, restrictive cloud rules, partnership requirements, and IP transfers that hasn't worked out.
I don't know if the policies are best but I agree with the statement that as far as all the administrations policy proposals, this is one example of where I'm willing to take a wait-and-see approach.
Also, part of the reason the US dollar is the chief world trading currency and the US Treasury is considered the world's safest investment is open trade policy. This preferential place in the world financial system gives the US economy major advantages, including low interest rates.
Attacking the entire world at the same time is a really bad plan. The chance of wringing concessions from China would be much greater if the US would make common cause with the EU, Japan, etc. But the opposite is happening, the rest of the world is moving on w/o the US as we saw with TPP and the recent EU / Japan deal. Expect to see things like China start canceling deals w/ Boeing and inking new deals with Airbus.
Finally, there's a military dimension to this. China is raising tariffs on US oil at the same time it is saying it won't respect Trump's sanctions on Iran. Its unlikely anything would happen in the immediate term but if this situation persists its not far fetched to imagine things getting tense.
https://www.independent.co.uk/news/world/asia/china-re-educa...
The estimated number of inmates keeps growing by the week. I think it's more accurate to call them re-education camps, but it's an issue that I wish more countries would push China on. I don't get why our (German) government spent so much time on negotiating the Liu Xiaobo issue instead.
They estimate 20 and 43 million died, if not caused by, then exacerbated by policies implemented under Mao.
https://en.wikipedia.org/wiki/Great_Chinese_Famine
https://en.wikipedia.org/wiki/Four_Pests_Campaign
"Since June 2015, all Wikipedias redirect HTTP requests to the corresponding HTTPS addresses, thereby making encryption mandatory for all users. As a result, Chinese censors cannot see which specific pages an individual is viewing, and therefore cannot block a specific subset of pages (such as Ai Weiwei or Tiananmen Square) as they did in past years. As a result, Beijing chose to block the whole Chinese Wikipedia"
I think ethically you shouldn't be making judgements about another country when you clearly know so little about it.
Exactly like North Korea does, but that's not a valid reason to approve whatever they do.
Is this how you justify concentration camps?
What I'm arguing against is penalizing the whole country with a trade embargo. That is just bullshit coming from someone who understands very little about how international relations work.
I'm glad that weapon sales to all of China are banned, not just to imperialistic individuals within the PLA.
Sanction enough individuals and you force them to fall in line and discourage that kind of corruption.
Who has granted the Chinese government this right? God? The "consent of the governed"?
> Ignoring the fantastic abuses that the US commits everyday against its minority and poor folks... I think ethically you shouldn't be making judgements about another country when you clearly know so little about it.
Is this... a hard cultural relativist stance?
China is not allowed to do what it wants to its citizens, that is the load of crap.
Read the wikipedia article and then tell me how ignorant I am: https://en.wikipedia.org/wiki/Human_rights_in_China
Or this one if you need more: https://www.bbc.com/news/magazine-34592336
As opposed to "enhanced interrogation techniques"?
One thing the West certainly does better than the East is marketing.
Why might a government torturing its own citizens be morally equivalent to a government torturing the citizens of other countries?
It intuitively feels, to me, "more bad" for a country to torture its own citizens than for a country to torture citizens of its enemies (although both are still bad). Thus, I'd want to hear a justification that "actually, no, both are the same degree of bad."
I don't necessarily agree that the onus is on me (you were the one to initially bring it up here: https://news.ycombinator.com/item?id=17717319 and I also gave my justification, which is that it feels intuitively different), but I can throw out some ideas as to why. I said it was interesting for a reason...
1) Perhaps it's a moral foundations (Haidt) difference: a state torturing its own citizens violates a moral "loyalty" principle as well as a moral "care" (harm avoidance) principle. Thus, it feels worse IF you ascribe to loyalty as a valid moral foundation. Haidt suggests modern liberals heavily elevate the "care" and "fairness" principles over the others, suggesting we might have a deep value difference causing our different opinions.
2) A more political perspective: the US constitution contains certain rights which all citizens are granted (note that US citizenship is defined as a "right to have rights"). See the passage (emphasis mine): "we hold these truths to be self-evident... that [all men] are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness".
One could argue that for the US government to torture its citizens would be additionally unjust, on the grounds that it violates these constitutional rights, specifically (I'd argue) that of Liberty. It's a violation of a social contract as well as a violation of an ethical principle, making it a worse injustice. Note that the authority here is granted to "[the] Creator", intensifying the ethical severity of violating this social contract.
3) Could also make some lower-Kohlberg-level arguments about this, but they're less fun and interesting.
I disagree, I think it is very easy to justify that breaking my arm is "more good", in that it is preferable. If one is -100 and the other is -50, then it is "more good" (i.e. the difference is positive). By "more good" I don't mean that it is good, mind you, just that it is better/preferable.
> Haidt suggests modern liberals heavily elevate the "care" and "fairness" principles over the others
I think this is our difference. I wouldn't want my country torturing anyone, enemy or not. Your second argument conflates legality with morality, so I don't really consider it especially valid. Unless you mean that the government has made a promise to the citizens to not torture them, and it would be additionally breaking that promise. Still, though, I consider the "torturing people" part much, much worse than the "you broke the promise" part, so much so that the latter seems like a rounding error to me, to use a somewhat utilitarian phrase.
Neither are preferable over "don't break any of my limbs", but I understand your point. I only nitpick because "having no bad things" is not equivalent to "having good things," in my mind. This is something I dealt with on a personal level relatively recently.
> Your second argument conflates legality with morality, so I don't really consider it especially valid.
The constitution speaks in terms of "god-given rights" and not "laws". The founding fathers were speaking the language of moral imperatives and not of legal imperatives. This is intentional.
The conflation occurs when people consider the laws themselves as opposed to their motivating intentions to be moral imperatives. But my claim is that "life, liberty, and the pursuit of happiness" are (some of) the motivating moral intentions that justify the laws, thus there is no conflation in my argument.
> I consider the "torturing people" part much, much worse than the "you broke the promise" part, so much so that the latter seems like a rounding error to me, to use a somewhat utilitarian phrase.
Ironically, I argue a utilitarian would disagree: it is likely that a government breaking their promises is harmful and perhaps terrifying to a much larger group of individuals than those who are directly harmed via torture. I figure there's a strong utilitarian argument that (a small harm * 150 million people) > (a large harm * 200 people), but then again, this is part of the horror embodied by stories like "The Ones Who Walk Away from Omelas".
I am no utilitarian myself, but I am also no orthodox Humanist either...
I agree with you. The citizen scenario includes extra immoral elements like in-group betrayal and abuse of friends in addition to whatever immoral elements come from the torture itself. The enemy scenario feels like the immoral elements may even be a bit muted by that fact that you're probably already willing to kill the enemy, which feels like a more extreme action.
Tell me, would you rather be tortured in Gitmo for a decade and live with the scars for the rest of your life or just take a bullet to your head and be done with it?
Torture is immoral, full stop. No human being should ever be tortured.
At the moment, so is the US. There is some measure of hope in some corners that this is an aberration that will be brief at least at the federal level, and that the reversal of it at the federal level will eventually negate any adverse trends at other levels, but that's hope, not established fact.
I didn't say that the US did anything comparable to that, I said that the argument that the big-picture difference between the two was that China was institutionalizing systemic racism while the US was addressing it was, whatever the past or hoped-for future of the US might be, currently inaccurate on the US side.
> I'm reading so many people defending China, I have to think it's because they haven't done any research, and assume China's not that bad.
Maybe somewhere, but the post you are responding to said not one word about China (other than a quote for context from the post it was responding to), either in defense or otherwise.
The article is about tariffs on China, this is thread is all about China, you responded to a post about human rights violations in China.
I'm not saying the US is perfect, but compared to China right now the US is .
Redlining, racial-profiling, school-prison pipeline, pay discrimination, voter id laws that discriminate against minorities... I can go on and on.
> I'm not saying the US is perfect, but compared to China right now the US is
No its not. They are not comparable and shouldn't be. You think the US is great because I'm assuming you belong to socio-economic classes that have granted you a great quality of life and freedoms which are theoretically promised to all US citizens. But in practise, they are not and the situation is much more nuanced.
> No its not. They are not comparable and shouldn't be.
Why can you not compare two countries' human rights?
> But in practise, they are not and the situation is much more nuanced.
It is more nuanced as you suggest, the difference is that the government of China is busy locking up muslims, and the US is busy passing anti discrimination laws.
It doesn't matter and I frankly don't care what you want. Slavery was technically illegal after the Civil War and yet you still had Jim Crow; similarly racism is technically illegal but there continues to be systemic racism in the US, whether or not promoted by Government policy. To the millions of African-Americans incarcerated for possession of Marijuana, it doesn't matter whether there are protections for minorities, because the laws are not enforced. The War on Drugs was a euphemism for a war on minority communities.
> It is more nuanced as you suggest, the difference is that the government of China is busy locking up muslims, and the US is busy passing anti discrimination laws.
No, its not that simple either. The US is busy locking up immigrants... what do you say to that? Or about locking up minorities for minor infractions, while whites go scot-free? What about that?
Its not simple, which is why it must not be compared. You are allowed to criticize China for its human rights record, but they are equally free to criticize you for yours. What is not OK is to spread the lie that the US is some sort of utopia of human rights when its clearly not, and has not been ever since its inception.
I suppose you could say there are more minorities in jail, but minorities tend to be more on the poverty line which is an easy explanation, I would be interested in a study on the treatment of only those in poverty.
Illegal immigrants should be deported, legal immigrants should not be.
The US is not a utopia, but my point was china is looking more and more like Big Brother in 1984.
Pretty generous considering the US actually separated thousands of kids from their parents at the border, some of whose parents have still not been found. If you didn't factor that into your moral compass, you probably should.
Any system has injustices; we cannot prevent that. But willfully enacting forcible family separation was not an accident.
Hundreds of orphans is bad enough.
Hundreds of thousands is a thousand times worse. So, yeah. Not equivalent.
The question was never if it can, but whether it should.
No you are wrong again. The question was whether its OK to cease all trade with a country solely because of its questionable human rights record. I pointed out that its not. That Sovereign countries have the legal right to do certain things and must be dealt with in an appropriate way.
It is the same argument made, by the way, when the US wants to justify buying oil from the Middle East, none of whose countries have a stellar record regarding human rights.
'China is a sovereign nation and has every right to Govern itself the way it wants to.'
Rather than taking the human rights abuses seriously, you continually obfuscate obvious facts by pointing to the United States' history of human rights abuses (of which there are plenty), and simply double down on your own indefensible position.
You could also do the most elementary research into your own position, which would immediately reveal that currency manipulation, censorship, restrictions on freedom of movement and associated crimes violate UN human rights laws and countless international trade agreements. Any honest definition of 'legal' would account for this.
There's an honest conversation to be had about how sanctions impact the poorest segments of a country. That conversation cant proceed if you don't acknowledge reality.
They tried at least twice, and both kind of succeeded, or at least didn't totally fail. (Both the ROC and PRC are republics. The PRC especially obviously isn't a western-style liberal-democratic republic, but it is a republic.)
Yeah, or "the US government respected Germany’s right to govern its own citizens" as it says here: https://exhibitions.ushmm.org/americans-and-the-holocaust/ma...
> They may not have the same system and freedom that the West is used to, but authoritarianism has been the norm in China for centuries.
Antisemitism had been pretty "normal" for 2 millenia in Europe. Would you go to a holocaust museum and roll your eyes at them, too? Mayne tell them the death camps in annexed territories were bad, but that all the stuff from 1933 to 1939 should be removed, because it was just internal politics and making a judgement about that just shows how little one knows.
https://en.wikipedia.org/wiki/Stolperstein
Can you even imagine how many of those were put up in response to mere internal politics? You should clear up how none of that was bad, would save a lot of money on maintaining exhibits, and archiving survivor testomies and all that.
http://www.spiegel.de/international/world/china-s-xinjiang-p...
> More than half the people we met along the way during our journey spoke of family members or acquaintances who were "sent to school." One driver in Hotan talked about his 72-year-old grandfather. A person in Urumqi told the story of his daughter's professor. An airplane passenger spoke of his best friend.
I guess they forgot to mention that authoritarianism has been the norm in China for centuries, so being tortured or a loved one being disappeared and killed doesn't really bother them. They have a "different system and freedom", after all. As does anyone who moves there, anyone the secret police gets their paws on, even internationally. When they get locked up and murdered, they don't really feel it the same way you or I do. When they have families and friendships, it's not like they're actually sad when that ends. They don't suppress showing pain they feel, they simply don't feel it in the first place.
It's all good, nothing to see here. Just the normal day to day business of being a monster.
https://www.cnbc.com/2018/07/04/eu-could-agree-a-us-autos-ta...
On the other hand we Trumps incredible negotiating skills. Same ones he used to bring Kim Jong Un to heel and denuclearize North Korea.
In my estimation they seem a hell of a lot smarter than most other countries as well, I don't think they need or deserve help from third parties any longer.
You may think that the west has a collective interest, but does Trump think so when he gets mad every time he sees a Mercedes car running down Fifth avenue?
http://fortune.com/2018/05/31/trump-mercedes-benz-german-car...
Also Canada is balking at how the US is abandoning NAFTA just so that it could use its larger size in trade negotiations.
The WTO is ineffective and broken. Based on prior precedent, if the US raised objections to the "China 2025" policy, the adjudication of the dispute will probably be finish sometime around 2030. In the past, the Chinese government has typically ignored adverse WTO rulings or dragged its feet until they were moot. IIRC, after all off that, only then will the WTO sanction tariffs. It's basically the definition of too little, too late.
https://news.ycombinator.com/item?id=17403673#17408876
I don't think so. China has a huge amount of power over the US economy[1].
What Happens If China Called in Its Debt Holdings
China would not call in its debt all at once. If it did, the demand for the dollar would plummet. This dollar collapse would disrupt international markets even more than the 2008 financial crisis. China's economy would suffer along with everyone else's.
China could crash the American economy any time they want. It'd hurt them, but it'd hurt America a lot more. Especially because oil exporters would immediately switch to doing oil trade in Euros, which would make it exceptionally hard for the dollar to recover.
[1] https://www.thebalance.com/u-s-debt-to-china-how-much-does-i...
China would be hurt gravely.
It might affect the price of the next sale of Treasuries, but that's the limit of its impact.
But their likely action, according to the article you linked, might actually help the US economy by making its exports more competitive:
> China would not call in its debt all at once. If it did, the demand for the dollar would plummet. This dollar collapse would disrupt international markets even more than the 2008 financial crisis. China's economy would suffer along with everyone else's.
> It's more likely that China would slowly begin selling off its Treasury holdings. Even when it just warns that it plans to do so, dollar demand starts to drop. That hurts China's competitiveness. As it raises its export prices, U.S. consumers would buy American products instead. China could only start this process if it further expands its exports to other Asian countries and increases domestic demand.
China only amassed so much US debt because it sells RMB to buy dollars to keep the RMB down and fuel exports. Reversing that policy would make Chinese exports less competitive on the world market. Ultimately, that could thwart the CCP's ambitions to create "national champions" by limiting them to their domestic market.
If you owe the bank a billion dollars, you own the bank.
https://mises.org/wire/why-not-repudiate-national-debt
China economy would suffer more.
https://voxeu.org/article/china-s-wto-entry-benefits-us-cons...
https://www.thebalancesmb.com/top-countries-exporting-to-the...
China's #1 customer is the US, by a large margin. Around half of their exports come here. China has far more to lose in a commercial war.
It'd hurt them, but it'd hurt America a lot more.
Nope. The only way they can hurt the US is by economic suicide (dumping all debt). And I mean total annihilation: they'd be shooting themselves. And the USD would suffer, true. But it would recover, US economy has far more autarky.
How does this affect the US any more than whether they measure oil volume in metric or not? It's not something that changes the real economy, it's just a matter of which ruler you're using. If the oil company has European employees, it still has to pay them in Euros. If the oil company has American employees, it still has to pay them in dollars. Likewise for customers. You have currency coming in, and if it's not what you need, you trade it for what you need.
Meanwhile everything in the US is "made in china" and our entire manufacturing infrastructure and knowledge has deteriorated while China was slowly taking over...
But everyone knows GPU's are the key to economic dominance.
I think people get a distorted picture of that as an artifact of labeling rules. The US exports a lot of industrial equipment, for instance. Most of the economy does not involve the final step of constructing consumer products that leads to the label "made in..." on the shelf of Wal-Mart.
In the short term, the US could potentially get some concessions that it wants. However, things have already gotten further than most predicted, lots of people expected China to give Trump a few crumbs that didn't really matter but allow him to declare victory. Trump seems to not want that, so it might be too late to avoid damage.
edit: source for those who don't believe me: https://www.kaieteurnewsonline.com/2013/01/17/population-gro...
Capital is not going to pass this growth up.
Given we're talking about the CCP, I suppose they could right their reverse pyramid using the same brutal means they used to create it. Say, by heavily pushing euthanasia options onto retired folks who can't care for themselves, with financial sanctions for their families if they refuse to comply.
1) Given the current balance of trade between the US and China, each $1 of retaliatory Chinese tariffs has a larger impact as a percentage of trade flow than each $1 of US tariffs.
2) The Chinese economy is much more nimble and diverse than the US, and – especially with government intervention – may have an easier time developing domestic alternatives to US goods.
On an unrelated note, it's interesting that they're implementing a tariff on recyclables. That could be a devastating blow to the already struggling US recycling market.
That doesn't benefit China. What you are saying is that China has less total trade that they can tariff than the US.
>2) The Chinese economy is much more nimble and diverse than the US, and – especially with government intervention – may have an easier time developing domestic alternatives to US goods.
Source? It's common knowledge that the US has the most largest and most diverse economy in the world.
https://atlas.media.mit.edu/en/profile/country/usa/
https://atlas.media.mit.edu/en/profile/country/chn/
I will concede (2) was not well expressed. I just find it much much easier to imagine – due to differences in labor forces, natural resources, environmental regulations, etc. – a suddenly growing Chinese motorcycle industry than, say, a resurgent US steel industry.
Manufacturing goods is the root of an economy. China is the root, the US is a leaf.
Granted, I don't have the stat for the entire world, so it might be bigger. Considering the US and EU are half of global GDP, I doubt it.
1) https://2016.trade.gov/publications/ita-newsletter/1010/serv...
Let's put your statement to the test then
Can China put tariffs on iPhones, Windows operating systems, Apple computers, Intel/AMD cpus, Nvidia GPUs?
Not any longer.
Once upon a time, agriculture was the root of an economy, but these things change. Manufacturing became the root. But it's not any more - now technology is.
You can literally be taught how to design a car in CAD. It can be done on your computer with a mouse. But to fabricate a car takes a life time of knowledge from multitudes of disciplines.
The proof is in the pudding. China is well known for replicating and ripping off patented designs in seconds because design is trivial once you know how to fabricate something.
The only reason why China can't produce an nvidia GPU is because they don't have the knowledge to fabricate it.
EDIT : Hey look, I found a dollar on the floor, good thing I just made that _great_ comment here.
Yeah, China doesn't have to worry about elections.
If so, does anyone here know who's next in line after China?
ps: i'm already looking for a potential alternative to AliExpress to buy integrated circuits :)
China has been sinking serious finances and engineering personnel into Africa for about 20 years. The Koreas have been trying too. Basically as soon as the Chinese middle class pushes up wages past the point where manufacturing is viable, they'll need a cheaper workforce.
Thanks to these long-view investments, they'll likely maintain control over manufacture for another few decades, at least.
India is already cooked. Despite their wage inequality, they're practically already post-manufacture. They've missed the boat.
My company is seriously hurting, where last year we have our best profits in decades, this last quarter was survival.
I hate money in politics, but I'm starting to think that big companies will be supporting politicians that will end these tariffs.
If a country is already producing something they can probably produce a little more: just work some overtime. To do anything more than a little though requires new manufacturing plants. Building them isn't hard, but it takes time: you risk that your expensive new plant opens the day this all resolves. If that happens you go bankrupt.
China has been playing by their own set of rules from the rest of the world and it's time to end it.
https://www.bloomberg.com/news/articles/2018-06-12/the-1-4-t...
Where are you going to get a good price for steel (and not only steel) when you add a 25% tariff on it when it comes from China? It'll lead to American products also being more expensive and it'll lead to a lower purchasing power in the US.
Other countries can also higher their prices for the US because why wouldn't they? The US isn't gonna get it cheaper from China... This leads to an endless price war that is not good for anyone.
Edit: also see thinkcontext's comment: https://news.ycombinator.com/item?id=17716933
Of course who knows if he will succeed. Ask me in 20 years what the real result was.
Why is a trade deficit bad? Is there some reason the capital account surplus needs to flow out instead of in? What negative effect do you perceive the trade deficit as having in the economy?
Trade deficits are basically neutral. They fund the foreign investment in the US and purchases of US bonds by foreign governments.
The biggest worry over a trade deficit that I'd have are National Security implications due to the dependance on trade with that county. To explain why that would matter, consider the following:
- Because of the much lower wages and regulatory costs, manufacturing here in the U.S. seems to have been strangled in the last few decades and mostly moved over to China.
- This has caused a shift in the way the U.S. economy works, with cheap parts / goods from China being considered a given and a transition to businesses that depend on those cheap imports.
- Once our economy wholly depends on that overseas manufacturing in China, that gives China large leverage over us because we don't have the factories here in the U.S. anymore to pick up the slack if China stopped trading with us and instead found another buyer for their goods.
- MUCH more importantly though, is the affect this dependance on a foreign nation would have on us if China decided to do things that we find reprehensible in the world. Think about what Russia did with Crimea. Now imagine China doing something similar. With Russia we were able to slap strong economic sanctions on them... but if our economy is strongly intertwined that makes taking any strong stance against that nation extremely difficult. I don't think anyone wants their future and safety dependent on strangers from a different society that have different cultural values.
How deeply have you thought about the issue? I mean really, really thought about it. Trying to poke holes in your own deeply held beliefs, that kind of thinking.
“He who knows only his own side of the case knows little of that. His reasons may be good, and no one may have been able to refute them. But if he is equally unable to refute the reasons on the opposite side, if he does not so much as know what they are, he has no ground for preferring either opinion... Nor is it enough that he should hear the opinions of adversaries from his own teachers, presented as they state them, and accompanied by what they offer as refutations. He must be able to hear them from persons who actually believe them...he must know them in their most plausible and persuasive form.”
― John Stuart Mill, On Liberty
I can think of several ways things could play out in this trade war that would end in terrible results for the US, China, the whole world, and every different combination you can think of.
Can you think of even one scenario where the current status quo might produce bad results for even one nation? Or, do you truly believe that our current model (which objectively is still very much protectionist, in a variety of very complicated ways) happens to be designed absolutely perfectly to produce the optimum outcome for everyone under all scenarios that our infinitely complex and unpredictable world throws at us?
Personally, I believe a better approach is for everyone to get out of their ideological mental straight jackets and practice critical thinking, conversation, honesty, and cooperation skills. And if we can pull that off, then maybe then we can hold our respective political leaders to some sort of a similar standard.
I'm not squeamish about putting some pain on China, but who's to say they won't resume the same tactics later on?
As far as I can tell, as long as the economy runs super well and everybody trusts that it'll continue to do so, we are all able to collectively defer debt among ourselves to invest in augmenting our production capacity right now. In practice this means people trust that the work (or product) that they are doing (or delivering) now can be payed later, so they can wait to be paid. Meanwhile that work (or product) can be put to use _right now_ to increase production as a whole.
I'm certain someone with a more formal grasp of macroeconomics can explain this better.(Maybe even yourself, if that was a rhetorical question)
* many caps apply, and IMO foremost the accelerated consumption of natural resources is the most critical one. Eternally growing economies mean eternally accelerating change of the natural environment.