About China and Trump
Trump’s idea, apparently, is to weaken the Chinese economy until China adopts fairer business practices or until the Chinese economy fails. He believes his tariffs will force China into a less aggressive stance on the world stage.
Despite Trump’s failures he still thinks he is a great negotiator. He also thinks he can use Patriotism as a lure to order manufacturers back to the US. Economic experts don’t like tariffs, both those on the left and those on the right. Tariffs, they say are like taxes on goods and they rebound on the nation that levied them. However, President Xi of China must not mind taxing his own people who may not even be his main consumers, because he is a dictator whose citizens know better than to complain.
Trump and his henchman Mnuchin say that a bit of suffering for the greater good is our patriotic duty and humbling China (if the China of 2019 can be humbled) will pay off for all of us in the long run. And it is true that if the American economy is strong, the people benefit. But Trump is making an awful lot of assumptions without getting any input or advice from American capitalists and farmers who will have to weather the economic storms when they are already being battered by actual atmospheric storms.
Trump’s first assumption is that a trade war will work. It will even the economic playing field between the two nations without saber rattling or threats of a real war. I don’t hear anyone who expresses comfort or confidence in this strategy except Trump and his toadies. A tiny part of each of us almost believes Trump’s hype. After all China has gotten pretty far out over their skis. However it is possible that they may have the chops to back up their bravado, while our guy doesn’t We only hear Lindsay Graham telling us to take one for our country. Take less for a while (how long?) to win big in the end. But it seems like a real long-shot gamble.
Which brings us to the second assumption. If Trump orders it, our factories will come back ‘home’ and he has, as of now, ordered it. But is this actually a viable assumption. If it is the patriotic duty of manufacturers to pay American workers rather than Chinese workers then how much are they willing to pay; minimum wage? These same manufacturers are paying Chinese workers far less. Given the popularity of the ‘free market’ stance and the greedy profiteering of modern capitalists it doesn’t seem as if even a threat of loss of citizenship will suffice to bring factories back to the US.
If anything Capitalists are trying to cool off the desires of American workers and cool down our economy so that Americans will have to accept much lower salaries before manufacturers will even consider coming back. It is doubtful that they are very afraid of Trump or will be persuaded by something as non-concrete (non-green and ‘unbankable’) as Patriotism.
China seems quite ready to just walk off and do business elsewhere. The reason for some of the fires in the Amazon basin is to clear land to grow soy beans for China that US farmers used to grow. Actions have unexpected consequences as we are all interconnected. Perhaps our president has no peripheral vision. He only sees straight ahead so he misses a lot, like a Chinese lateral move to find a new source for soy beans in South America. The American people are far more likely to cry chicken first than the Chinese are because they live in an authoritarian state. It is likely that they are used to far more hardship than we are.
Except for our millionaires and billionaires most of us are not feeling very flush and we cannot afford to be patriotic for very long if it means getting even poorer, especially when we have no faith in our ‘great negotiator’ and when we know that the outcomes he predicts are unlikely to result from his ‘Grand China Plan’. We also realize that doing these things, going down these roads, will probably deepen our isolation. We will produce and consume but it will be a small-time domestic operation. The world will move on without us. Trump has diminished our already diminished power in the world and yet he wants to act as if our bargaining position is undiminished.
Photo Credit: From a Google Image Search – The Live TradeRoom