Archive for Trade and Trade Policy

Opinion | Trump and Xi Sittin’ in a Tree – By Thomas L. Friedman – The New York Times | InconvenientNews.Net

Thomas L. Friedman

By 

Opinion Columnist

CreditCreditDoug Mills/The New York Times

“I was glad to see the stock market get a boost from the news that Chinese and U.S. trade negotiators were talking again and that President Trump blinked a bit and pulled some of his planned tariffs.

But don’t be fooled. Trump and President Xi Jinping of China are still locked in a cage match over who is the true big dog in today’s global economy. Both are desperate not only to “win,” but to be seen to win, and not be subjected to the scorn of their rivals or critics on social media.

Precisely because neither leader feels he can afford that fate, both have overplayed their hands. Xi basically believes that nothing has to change — and all can be made to stay the same by the force of his will. Trump basically believes that everything has to change — and all can be made to change by the force of his will.

The rest of us are just along for the ride.

Let’s look at both men’s calculations and miscalculations. Trump was right in arguing that America should not continue to tolerate systemic abusive Chinese trade practices — intellectual property theft, forced technology transfers, huge government subsidies and nonreciprocal treatment of U.S. companies in China — now that China is virtually America’s technology equal and a rising middle-income country.”

Source: Opinion | Trump and Xi Sittin’ in a Tree – By Thomas L. Friedman – The New York Times | InconvenientNews.Net

Posted in: China, Trade and Trade Policy

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Trump’s Trade War Threat Poses Problems for China and Investors – The New York Times

“The prospect of a wider trade war between the United States and China sent global financial markets whipsawing on Monday and could force Beijing to make difficult decisions if it hopes to preserve its nascent economic recovery.

President Trump upended what appeared to be steady progress toward reaching a trade pact after he threatened on Sunday to impose still more tariffs on Chinese-made goods unless Beijing moves closer to a deal. Liu He, the Chinese vice premier overseeing economic policy and Beijing’s lead trade negotiator, had been set to travel to Washington for talks scheduled for Wednesday that were widely seen as the potential last round before reaching a trade deal.

Source: Trump’s Trade War Threat Poses Problems for China and Investors – The New York Times

David Lindsay:  Good piece. Here are two top comments I endorse.

Baltimore 16
Adrian MI

Please, if you must quote Mr. Trump’s tweets, immediately bracket them with corrective disclaimers. Tariffs ARE NOT paid to the US Treasury. They are paid by the consumer in the form of a higher purchase price, whether buying parts for assembly in the US or the finished goods. The costs are not directly borne by China, except the demand for Chinese products drops due to the increased price. I’m sure people read the tweets and assume it’s a statement of fact.

Concerned citizen commented 6 hours ago

Concerned citizen
Lake Frederick VA

As Trump manipulates the stock market with his comments, now is the time to investigate whether he or his friends are profiting from advance knowledge of his tweets

McGloin commented 6 hours ago

McGloin
Brooklyn
Times Pick

Trump does not understand how the Chinese think and does not understand how they keep winning. The main concern of the Chinese leadership is to avoid public embarrassment (“save face”). Trump thinks that publicly embarrassing them (“making them lose face”) is going to make them do what he wants them to do. It’s not going to work. The Chinese are telling him in negotiations (according to this article) that they will do what he wants, but it can’t be done through the legislature because it will be too embarrassing, so he publicly demands that it be done through the legislature. The Chinese don’t have a trade surplus because of tariffs. The Chinese have a trade surplus because they pick winners and they back them with public money, investing in new technologies, often stolen from America. If America invested in the technologies that we invented, like solar power, we would dominate the fields that we invented. But for decades, Republicans (and the centrist Democrats that compromise with them) have refused to “pick winners and losers,” letting the Chinese government pick winners, them, and losers, us. Notice none of this involves embarrassing public attacks on public officials. It is all done subtly. While the USA is spending trillions attacking countries around the world, the Chinese are quietly going around the world investing in third world countries, while the Party of Trump insists that investing in foreign countries is a waste of money. Learn from the Chinese

Posted in: China, Trade and Trade Policy, Trade and Trade Policy

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Opinion | America the Cowardly Bully – By Paul Krugman – The New York Times

Paul Krugman

By Paul Krugman

Opinion Columnist

Image.  President Trump’s trade belligerence has done lasting damage to America’s reputation.CreditCreditPete Marovich for The New York Times

“This is the way the trade war ends. Not with a bang but with empty bombast.

According to multiple news organizations, the U.S. and China are close to a deal that would effectively end trade hostilities. Under the reported deal, America would remove most of the tariffs it imposed last year. China, for its part, would end its retaliatory tariffs, make some changes to its investment and competition policies and direct state enterprises to buy specified amounts of U.S. agricultural and energy products.

The Trump administration will, of course, trumpet the deal as a triumph. In reality, however, it’s much ado about nothing much.

As described, the deal would do little to address real complaints about Chinese policy, which mainly involve China’s systematic expropriation of intellectual property. Nor would it do much to address Donald Trump’s pet although misguided peeve, the imbalance in U.S.-China trade. Basically, Trump will have backed down.

If this is the story, it will repeat what we saw on the North American Free Trade Agreement, which Trump denounced as the “worst trade deal ever made.” In the end, what Trump negotiated — the U.S. Mexico Canada Agreement, or U.S.M.C.A. — was very similar to the previous status quo. Trade experts I know, when not referring to it as the Village People agreement, call it “Nafta 0.8”: fundamentally the same as Nafta, but a bit worse.”

Source: Opinion | America the Cowardly Bully – The New York Times

Posted in: Trade and Trade Policy, Trade and Trade Policy

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Trump Undermines Top Trade Adviser as He Pushes for China Deal – By Ana Swanson – The New York Times

WASHINGTON — President Trump has signaled that he is moving toward peace with China in a trade standoff that has rattled markets and businesses globally. But as he backs off his threat to impose higher tariffs, the president’s relationship with his own trade negotiator is now showing signs of strain.

The situation has left Mr. Trump’s trade representative, Robert Lighthizer, who is both an ardent supporter of the president and a longtime China critic, in an uncomfortable bind. While broad tariffs on Chinese imports brought Beijing to the negotiating table, Mr. Trump has grown impatient with the talks, and a consensus is growing in Washington that Mr. Trump will ultimately accept a weak deal.

And despite the lack of a transformative arrangement he once promised, the president has begun dangling the idea of a “signing summit” with President Xi Jinping of China at Mar-a-Lago, Mr. Trump’s Florida resort. As a result, the president is undermining Mr. Lighthizer as he tries to pressure China to make big concessions.

“Trump is certainly doing his negotiating team no favors by undercutting them in public,” said Eswar Prasad, a trade expert and the former head of the China division of the International Monetary Fund. The president’s actions, he said, “weakens rather than fortifies Lighthizer’s leverage.””

Source: Trump Undermines Top Trade Adviser as He Pushes for China Deal – The New York Times

David Lindsay Jr.
Hamden, CT | Pending Approval

Posted in: China, David Lindsay, Trade and Trade Policy, Trade and Trade Policy

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Opinion | China’s Online Censorship Stifles Trade- Too – By Tim Wu – The New York Times

Tim Wu

By Tim Wu

Mr. Wu is a law professor who specializes in technology.

“As China and the United States engage in high-level negotiations over a possible trade deal, it’s puzzling to see what’s been left off the table: the Chinese internet market. China blocks or hinders nearly every important foreign competitor online, including Google, Facebook, Wikipedia in Chinese, Pinterest, Line (the major Japanese messaging company), Reddit and The New York Times. Even Peppa Pig, a British cartoon character and internet video sensation, has been censored on and off; an editorial in the Communist Party’s official People’s Daily newspaper once warned that she could “destroy children’s youth.”

China has long defended its censorship as a political matter, a legitimate attempt to protect citizens from what the government regards as “harmful information,” including material that “spreads unhealthy lifestyles and pop culture.” But you don’t need to be a trade theorist to realize that the censorship is also an extremely effective barrier to international trade. The global internet economy is worth at least $8 trillion and growing, yet the Trump administration has focused chiefly on manufacturing, technology transfers and agriculture, and does not seem to have pressed for concessions on this issue.

Sheltered from American, Japanese and European competition, Chinese internet businesses have grown enormously over the past decade. Nine of the world’s 20 largest internet firms, by market value, are now Chinese. Some of this growth reflects the skill and innovation of Chinese engineers, a vibrant start-up culture and the success of Chinese business in catering to local tastes. But it’s hard to believe that this has been unaided by censorship.

And the barriers to foreign competition have more than just economic effects. Without any better options, Chinese users are forced to put up with companies like Tencent, which owns the private messaging app WeChat, and the online payment company Ant Financial, whose privacy violations are, amazingly, even more troubling than those of Facebook and Cambridge Analytica. By tolerating Chinese censorship, the United States encourages other countries to do the same.”

Source: Opinion | China’s Online Censorship Stifles Trade, Too – The New York Times

Posted in: China, Trade and Trade Policy, Trade and Trade Policy

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Opinion | The Dangerous Naïveté of Trump and Xi – The New York Times

Nicholas Kristof

By Nicholas Kristof

Opinion Columnist    Nov. 17, 2018,      280 comments

 

President Trump and President Xi Jinping of China in Beijing last November.CreditDoug Mills/The New York Times

 

Image
President Trump and President Xi Jinping of China in Beijing last November.CreditCreditDoug Mills/The New York Times

“Presidents Donald Trump and Xi Jinping are a bit alike, and that presents a danger to the global order.

The American and Chinese leaders are both impetuous, authoritarian and overconfident nationalists, and each appears to underestimate the other side’s capacity to inflict pain. This dangerous symmetry leaves the two sides hurtling toward each other.

The 10 percent tariffs already imposed in the trade war are scheduled to rise to 25 percent in January, but there’s also a broader confrontation emerging.

Trump and Xi may well be able to reach a cease-fire in their trade war when they meet for the Group of 20 in two weeks. Even if a deal is reached, though, it may be only a temporary respite that doesn’t alter the dynamic of two great nations increasingly on a collision course.”

Source: Opinion | The Dangerous Naïveté of Trump and Xi – The New York Times

David Lindsay: Thank you Nicholas Kristof. Yes, and here are the top comments, which I endorsed:

ShenBowen
New York
Times Pick

I agree with many things in this article, but I’m not certain that Xi has shown himself to be ‘impetuous’. On the contrary, I believe that most of his actions are deliberate and carefully considered. I have been impressed with Xi’s constraint in his responses to Trump’s Twitter rants. If Xi was ‘impetuous’ he might have pulled the trigger and put an end to the Chinese buying of US Treasury Bonds. Also, I suppose that you could make the argument that the two men are ‘a bit’ alike, but there is one very big difference, Xi is a very intelligent man and Trump is not.

Aaron commented November 18

Aaron
Tokyo  
Times Pick

And those of us in Japan and Korea are caught in the middle. The contest will likely be decided by which side has the most friends. Indeed, the TPP would have been a very strong economic platform favoring the US. Trump chose to scuttle it and he has also chosen to starve the state department, effectively crippling the two biggest, peaceful levers America had to work with: trade incentives and diplomacy. Hopefully the next US President will revive these programs, but for now, we haven’t much choice but to hunker down.

 

Posted in: China, Nicholas Kristof, Trade and Trade Policy

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Opinion | The U.S. and China Are Finally Having It Out – by Thomas Friedman – NYT

“With the arrival in Beijing this week of America’s top trade negotiators, you might think that the U.S. and China are about to enter high-level talks to avoid a trade war and that this is a story for the business pages. Think again. This is one for the history books.

Five days of meetings in Beijing with Chinese, U.S. and European government officials and business leaders made it crystal clear to me that what’s going on right now is nothing less than a struggle to redefine the rules governing the economic and power relations of the world’s oldest and newest superpowers — America and China. This is not a trade tiff.

“This is a defining moment for U.S.-China relations,” said Ruan Zongze, executive vice president of the Chinese Foreign Ministry’s research institute. “This is about a lot more than trade and tariffs. This is about the future.”

In one corner stand President Trump and his team of China trade hard-liners, whose instinct is basically right: This is a fight worth having now, before it is too late, before China gets too big.”

Source: Opinion | The U.S. and China Are Finally Having It Out – The New York Times

 

Yes, Sir. I agree.

Here are two comments  I recommended:

allan slipher
port townsend washington
Times Pick

“..there is a trade imbalance today because we’ve been investing in our future and you Americans have been eating yours.”

Spot on. Wake up call, America.

Our choice is self indulgent consumerism, cheap political theatrics, empty celebrity worship, and self absorbed rants, or redirecting ourselves and doubling down on basic research, education, infrastructure, well paid work, investment in the well being of our children and grandchildren and upholding the rule of law.

Bruce Rozenblit commented May 1

Bruce Rozenblit
Kansas City, MO

China employs state run capitalism. The US employs market capitalism. China views government as an asset. The US views government as an enemy. China pays to have its brightest students educated in the worlds greatest universities. In the US, we question why we even have universities, let alone want to pay for them. China follows decade long economic plans. The US is ruled by quarterly profits. China cheats. We don’t tax the billionaire class. In China, civil rights are forfeit. In the US, money has more rights than people. China is destroying the environment for quick growth. In the US, we want to destroy the environment for feeble growth. China pursues multi-national trade and investment policies. In the US, we used to and now want to pursue only unilateral policies.

So who wins? China will win. Trump did have the right idea about China getting away with murder. Many of our largest corporations made a fortune off of cheap Chinese goods, so we went along with it for years.

Until and unless we straighten out our twisted and self defeating ways, we cannot out compete China. The first step is to stop demonizing the government and allow government to participate in business. The ExIm bank is a good example. Big business in the rest of the industrialized world has government involvement. It’s about time we joined the club. We call it redistribution. They call it public investment.

Posted in: China, Globalization and Trade, Trade and Trade Policy

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Trump Hits China With Trade Measures as White House Exempts Allies From Tariffs – The New York Times

“President Trump said he would impose about $60 billion worth of annual tariffs on Chinese imports on Thursday as the White House moved to punish China for what it says is a pattern of co-opting American technology and trade secrets and robbing companies of jobs and billions of dollars in revenue.

The measures come as the White House grants a long list of exemptions to American allies from steel and aluminum tariffs that go into effect on Friday, including the European Union, which has lobbied aggressively and publicly for relief from the trade action.

“The word that I want to use is reciprocal,” Mr. Trump said in announcing the tariffs in the Diplomatic Room of the White House. “If they charge us, we charge them the same thing.”

The China tariffs are his strongest trade action yet against a country he has branded an “economic enemy.” They fulfill one of his core campaign pledges, to demand more reciprocal deals with trading partners around the world.

But coupled with the administration’s decision to exempt the European Union, South Korea, Brazil, Canada, and Mexico from the tariffs on cheap metals, the action demonstrates how much Mr. Trump’s nationalist trade agenda is really targeted at a single country: China.”

Source: Trump Hits China With Trade Measures as White House Exempts Allies From Tariffs – The New York Times

David Lindsay Jr.

Hamden, CT 

“The tariffs, which the United States trade representative will publish within 15 days, will target 1,300 lines of Chinese goods — everything from shoes and clothing to electronics, administration officials said.” I understood the the argument for steel and aluminum, but what is the argument for these other 1,298 products? All the mainstream economists that I learn from, say that tariffs are toxic. The Chinese are famous for their intelligence, work ethic and pride. If they feel insulted, and have lost face, they will be forced to retaliate. Can Boeing stay on top without one of their biggest customers? Or did their stock price just drop almost 4% for no reason?

A five or ten percent tariff on just Chinese steel and aluminum might have been a more prudent test of the waters. Rejoining the TPP asap, would probably do more for the US economy and economic defense, than the steel tariff. The Chinese play like a people at war with the West, and they probably are, since they still have a score to settle over the bombardment and destruction of the Spring Palace, and its mulitude of treasure buildings and libraries, in the 1840’s, during the ugly opium war. The civilization that invented, paper, writing, gunpowder, history and literature, should be courted with carots as well as with sticks.

x

David Lindsay Jr. is the author of “The Tay Son Rebellion, Historical Fiction of Eighteenth-century Vietnam,” and blogs at here and InconvenientNewsWorldwide.wordpress.com

Posted in: China, David Lindsay, Globalization and Trade, Trade and Trade Policy

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Some Things Are True Even if Trump Believes Them – by Thomas Friedman – NYT

Thomas Friedman is great in this column. He writes that China is a big problem, but the Trump steel tariff hurts our allies and not China. Then:

“So what would a smart American president do? First, he’d sign the Trans-Pacific Partnership trade accord. TPP eliminated as many as 18,000 tariffs on U.S. exports with the most dynamic economies in the Pacific and created a 12-nation trading bloc headed by the U.S. and focused on protecting what we do best — high-value-added manufacturing and intellectual property. Alas, Trump tore it up without reading it — one of the stupidest foreign policy acts ever. We Brexited Asia! China was not in TPP. It was a coalition built, in part, to pressure Beijing into fairer market access, by our rules. Trump just gave it up for free.

Once a smart president restored participation in TPP, he’d start secret trade talks with the Chinese — no need for anyone to lose face — and tell Beijing: “Since you like your trade rules so much, we’re going to copy them for your companies operating in America: 25 percent tariffs on your cars, and your tech companies that open here have to joint venture and share intellectual property with a U.S. partner — and store all their data on U.S. servers.” “

Source: Some Things Are True Even if Trump Believes Them – The New York Times

Posted in: China, Thomas Friedman, Trade and Trade Policy

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U.S. Allies Sign Sweeping Trade Deal in Challenge to Trump – The New York Times

SANTIAGO, Chile — A trade pact originally conceived by the United States to counter China’s growing economic might in Asia now has a new target: President Trump’s embrace of protectionism.

A group of 11 nations — including major United States allies like Japan, Canada and Australia — signed a broad trade deal on Thursday that challenges Mr. Trump’s view of trade as a zero-sum game filled with winners and losers.

Covering 500 million people on either side of the Pacific Ocean, the pact represents a new vision for global trade as the United States threatens to impose steel and aluminum tariffs on even its closest friends and neighbors.

Mr. Trump withdrew the United States from an earlier version of the agreement, then known as the Trans-Pacific Partnership, a year ago as one of his first acts in office. It will undeniably be weaker without the participation of the world’s biggest economy, but the resuscitated deal serves as a powerful sign of how countries that have previously counted on American leadership are now forging ahead without it.

“Only free trade will contribute to inclusive growth of the world economy,” Taro Kono, Japan’s foreign minister, told a group of ministers from Southeast Asian countries in Tokyo on Thursday. “Protectionism isn’t a solution.”

Source: U.S. Allies Sign Sweeping Trade Deal in Challenge to Trump – The New York Times

Here is a comment I endorsed at the NYT.

Rich G

New York 4 hours ago

“While American beef farmers will have to pay 38.5 percent tariffs in Japan, for example, members like Australia, New Zealand and Canada will not.”

I’m sure that most in the beef industry voted for Trump. Well guess what, More expensive steel is going to mean your costs are going up and the tariffs mean your income is going down. America First? Much more of this and it will be America Last.

Posted in: Globalization and Trade, Japan, Trade and Trade Policy

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