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Not much help: Despite his use of
tariffs to help skew the playing field in favour of US firms, the very
industries Trump has tried to help have become the weakest links in the
otherwise solid economy.
WASHINGTON: At rallies and whistle-stop campaign tours, President Donald Trump proclaims a renaissance in US factories rebuilding the nation with “American steel”, “American heart” and “American hands”.
But in reality, despite his relentless use of punitive tariffs to help skew the playing field in favour of US companies, the very industries he has tried to help have become the weakest links in the otherwise solid economy.
With just over a year to go before he faces re-election, Trump takes credit for the most vigorous economy in the industrialised world, with the expansion entering its 11th year and historically low unemployment.
But while services and office jobs dominate the US economy, Trump continues to promote the factory and mining jobs that were the lifeblood of the economy in the last century.
“American steel mills are roaring back to life,” he declared last month in Florida – the same day US Steel announced it would idle plants in Michigan and Indiana until “market conditions improve”.
And to West Virginians he said, “The coal industry is back.”
But in fact each of the sectors Trump has championed – coal mining, steel, aluminium and auto manufacturing – have been buffeted by a combination of market forces and changing technologies – factors beyond his control – or damaged by the very things he did to protect them, economists and analysts say.
Last month, a national survey of manufacturing activity hit its lowest level in nearly three years – narrowly avoiding slipping into contraction – while regional surveys have also seen record declines.
In March, the number of workers in US manufacturing shrank for the first time in nearly two years and it is now growing more slowly than the rest of the American workforce.
Trump has imposed tariffs on hundreds of billions in imports, renegotiated trade agreements and dangled the threat of worse over China and Europe and Mexico – all while publicly browbeating companies that close US factories or move production offshore.
But weak foreign demand, a strong US dollar and a decades-long evolution away from domestic manufacturing have progressively shrunk America’s industrial sector, said Gregory Daco, chief US economist at Oxford Economics.
Trump’s world trade war has not helped either.
“The policies that have been implemented in terms of protectionism have hurt the very sectors they were meant to protect. There’s no escaping that,” Daco said. - AFP/The Star
The US is deploying a double standard by calling China's
proposed sanctions on US companies for arms sales to Taiwan a "foolish
action," Chinese mainland analysts said on Sunday, pointing out that the
sanctions could not only cut base material supply to these companies
including rare earths but also block their non-military products from
entering Chinese markets.
US President-elect Donald Trump appointed Peter Navarro, a strident critic of China, as head of the new National Trade Council on Wednesday. Most of the Trump's views in his accusation against China during and after the election are influenced by Navarro. Moreover, Trump's special adviser Carl Icahn and Secretary of Commerce Wilbur Ross also take a hard line on the trade with China. The possibility of a potential trade war between China and the US after Trump takes office has come under heated discussion.
Trump’s Top China Expert Isn’t a China Expert
Peter Navarro doesn't speak Chinese, and has scant in-country experience. Should that matter?
University of California at Irvine Economics Professor Peter
Navarro, head of White House National Trade Council nominee for
president-elect Donald Trump, arrives in the lobby of Trump Tower in New
York, U.S., on Thursday, Jan. 5, 2017. A top congressional ally to
Trump said Thursday that Republicans will repeal Obamacare, including
some funding provisions, quickly while a replacement plan is due in "six
to eight months." Photographer: Albin Lohr-Jones/Pool via https://foreignpolicy.com/2017/03/13/peter-navarro-profile-national-trade-council-donald-trump-china-expert/
The issue needs to be considered in the backdrop of a major adjustment of the US policies toward China. At present, there is a glaring contrast between the economic prosperity and political stability in China and the economic downturn and political division in the US, which stings the US policy elites who are steadfast defenders of the US hegemony and its role as the world leader. Those elites tend to believe that the increasingly powerful China has not made the changes approved by the US and is trying to upend the international order shaped by the US.
Thus, it has now gradually become an expectation for the incoming US government to discard the long-standing engagement policy and adopt tougher or more confrontational policies toward China instead.
Against this backdrop, the trade topics closely associated with employment and welfare have become more sensitive but quite effective tools for the China hawks to create an unfriendly public opinion against China. The China-US trade disputes are no longer simply economic topics, but have strong political and strategic implications.
The manufacturing industry is not only the foundation for the US economic recovery, but also the key to solving the unemployment problem and guaranteeing social stability. The imbalance of China-US economic and trade relationship is considered by economists represented by Navarro as the critical reason for the weakening US manufacturing industry. They believe that the current close trade ties have boosted China's rapid development, whereas the hundreds of billions of dollars of US trade deficit with China has led to the current economic woes in the US. They also blame the US manufacturing companies that moved their factories to China for the high domestic unemployment rate.
In other words, the field of trade, which has long been regarded as mutually beneficial, is now considered by advisers of the incoming US government to be detrimental to their country's interests. The US maintains that a major trade policy adjustment needs to be urgently pushed forward to give China a head-on blow.
Although bilateral trade generally works by following WTO rules, the US policy elites, represented by Navarro, maintain that their country's serious inherent economic problems are caused by both China, which fails to address bilateral trade problems impartially, and the US government, which neglects the American public's demands. They keep overstating China's negative role to the American public, and thus have made full preparation for a big policy change toward China in the coming years.
Given the current policymaking atmosphere in the US as well as Trump's picks of advisers, the US has a strong desire to make a major confrontational policy adjustment in its trade with China in the future. However, it still remains uncertain if the adjustment will directly lead to a trade war.
The high interdependence of bilateral trade indicates that any form of trade war provoked by the US will ultimately hurt itself. It is probably difficult for the Trump team to figure out how much self-damage their country is able to withstand.
During the election campaign, Trump denounced the greediness of Wall Street magnates and promised to create new jobs, but, ironically, the officials he appointed after winning the election mostly came from the Wall Street.
China's economic power is no longer as it was before, and its defining power over bilateral relations in trade and all the other aspects is stronger than ever. It is impossible for China to sit back and let the US destroy the mutually beneficial situation in trade. Instead, China will firmly push forward the future bilateral ties under the concept of building a new type of major power relationship.
In contrast to the uncertain US trade policies toward China, China's policies toward the US are clear and concise: get rid of any barriers and push forward bilateral relations in a stable and mutually beneficial direction. The evolution of China-US relationship has always been a process of moving forward and addressing various conflicts along the way. It is hoped "the China-US trade war" will only be a verbal clash, instead of a clash in real action.
By Li Haidong Source:Global Times Published: 2016/12/25 13:43:39
The author is a professor with the Institute of International Relations at China Foreign Affairs University. opinion@globaltimes.com.cn
Right after the G20 summit in Japan, US Senator Marco Rubio made the headlines again by calling for legislation to continue the ban on Huawei, even after US President Donald Trump said he would lift some of the restrictions on US companies doing business with the Chinese tech giant.
Senator Rubio Prepares To Blast China ...
forbes.com
Rubio is a salient representative of the US political extreme. Some US politicians appear to take advantage of the split in US society and are using their extreme political views to gain more voters as well as please different political groups. This actually reflects the increasingly prominent malfunction of US politics.
It is an important reason why China is concerned that the US-launched trade war against China will not end in the short term.
We believe there are rational people who know China well at the US government's decision-making level. Even so, lawmakers like Rubio have gone too far. They are not messing with China but rather wearing down the credibility of US politics.
The US political system is becoming increasingly flawed. Many politicians deliberately act up to firmly oppose anything that would benefit China for the sake of being anti-China. That the political landscape is becoming extreme in the US is providing these politicians with the opportunity to play to their base if they show an open anti-China stance.
Rubio is one such politician. He paints himself as being hostile to China to draw attention. Despite the fact that the trade war and the Huawei ban are harming the interests of the US, Rubio insists on this excessively tough stance toward China because that could spark controversies which could end up favoring him.
This is what Rubio, an unsuccessful candidate for the Republican presidential nomination in 2016, needs to fulfill his political ambitions. Such narrow-minded thinking has de facto escalated the US-launched trade war against China.
Rubio doesn't understand China and probably barely knows China's history. But taking advantage of being anti-China, he can create hot debates and make headlines, and thus gain more assets for his political career.
Even though people who don't know much about the world's second-largest economy can be a senator in the US, it is a joke that someone like Rubio can pretend to be a China hand and comment on China's policies. This is one of the key reasons for the ratcheted-up tensions between China and the US.
The fundamental split in the US political system provides openings for hawkish politicians who have long been hostile toward China. The US is now in the throes of the 2020 presidential campaign, when candidates vie with each other to make outrageous remarks to appeal to their supporters.
This marked increase in radicals in US politics makes it much more difficult for the US government to function normally and for Republicans and Democrats to reach compromises, especially on major issues.
Even though there are signs of China-US trade frictions turning around, as the US political system will not fundamentally change in the short term, China must remain vigilant and prepare for a long-term trade war, in case the hawks gain the upper hand.
By Xu Hailin Source:Global Times Published: 2019/6/30 19:53:39
China can effectively sanction US companies who sell weapons to Taiwan: experts
