Sunday, June 09, 2019

Such concern for the US brings tears to our eyes.

Last month trade talks between the US and China broke down with US President Donald Trump increasing tariffs on $200 billion worth of Chinese imports from 10% to 25%, and promising tariffs on another $300 billion of Chinese imports if necessary. China has responded with tariffs on $60 billion worth of US goods. "The immediate reason for the disruption was China's insistence on a substantially rewritten draft agreement, which, according to US President Donald Trump's administration, reneges on previously agreed terms," wrote Zhang Jun, dean of School of Economics at Fudan University. "But the root cause of China's changes to the draft -- the reason behind its reluctance to meet US demands -- lies in a fundamental miscalculation by Trump." How so? If China went back on its word, it is guilty of bad faith. "There's no question where we are now, that this is a result of them backtracking on significant commitments," said US Treasury Secretary Steven Mnuchin. "All countries should conduct exchanges beyond borders of state, time and civilization, and work together to protect the peaceful time we have, which is more precious than gold," Chinese President Xi Jinping. Others disagree. "There's not a magnanimous bone in the Chinese body politic. It's all about China," said Jim McGregor. "Name a country that's a true friend of China." "That many of the charges the US has levelled against China aren't based on solid facts indicates there is lack of sufficient information about China and its aims and interest," wrote Lu Ying. "As the multilateral perspective makes clear, the US current account deficit can be reduced only through structural reforms to address the imbalance between domestic and investments," wrote Min and Yanliang. "The reality, of course, is that whatever the costs the US incurs from trade with China are vastly outweighed by the benefits," wrote Yu Yongding. "True, the trade deficit with China has cost the US jobs. But these losses have been in low-wage positions, and have been offset by new employment in other areas." No they haven't. Some 6 million jobs were lost in the US from 1999 to 2010, not because of automation, but because of China, which took advantage of open US markets while creating non-tariff barriers, forcible transfer of intellectual properties and lack of transparent rules, wrote J Bartash. "We shouldn't underestimate China's capacity to handle both longstanding and new challenges, including the trade war that Trump has initiated," wrote Jun. Great. It is touching to see how Jun, Jinping, Ying, Min, Yangliang, and Yongding are so worried about the US. That is true brotherhood indeed.

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