President Donald Trump claimed a great victory last Wednesday when he convinced some 75 countries to negotiate on trade and tariffs, leaving China out of the cold. In doing so, Hey also avoided a bond market disaster. But we are not yet out of the forest.
Thousands of American companies, and potentially millions of employees, are still in the first line of the commercial war with China, a war that took many by surprise.
The risks of that confrontation threaten the entire American economy.
That is not minimizing what the Trump administration achieved this week, after President Tok in all newcomers in a global commercial confrontation, such as Bruce Lee in a Kung Fu movie.
In doing so, Trump prompted China to take a hard line that interrupted it, not only from US markets but, enhanced, of an entire American commercial block. Whether Trump had rejected each exact movement, or simply found a route when applying a constant pressure, it worked.
China has been a disruptive player in global markets since he was admitted in the World Trade Organization 25 years ago, without having reformed his internal policy since the horrors of Tiananmen Square.
But the United States and others believed that trade would cause China’s political system to be more democratic, since it made China’s economy freer. And American companies wanted access to the Chinese market on an empty stomach and China’s workforce.
At first, trade between China and the rest of the world was mutually beneficial. Many US companies established production facilities in China, while Hollywood found a large audience for their culture. Products. American consumers benefited from the lowest prices, and China’s middle class asked to flourish.
But then China began to overcome its commercial midwives. Throughout the world, for example, textile factories were closing, unable to match the low Chinese labor costs.
China also stole intellectual property or Western companies. He insisted that they share their knowledge as a condition of doing business in the country, then established Chinese companies that surpassed foreigners.
China also kept artificial low labor costs, in some industries, through the use of exploitation work practices, or, in the case of Uigures Muslims, slave work. Some US companies bullen out of China; Others did not see a real alternative to operate there.
Meanwhile, China maintained a growing amount of American public debt, which gave him influence on the United States instead of China resembled the United States, the United States looked more like China.
Film studies shape their content to avoid offending the Chinese public. The social media companies Begen helped the government censor their critics. And Puerta de la Pandemia del Coronavirus, which begged in China, the US authorities closed the economy; Some close their own basic rghs.
He Wall Street JournalWilliam Gallston, the only columnist in the center of the center, observed that much of the anxiety for globalization was not a function of trade, but of the unique challenge that China raised. Conventional economic rules did not seem to apply to a commercial partner who had the power to distort markets alone.
Admitted to a “free trade” system, China has tried to manipulate the rules to master trade by its own enrichment and power.
Trump is the first president to perceive that China is both a partner and a rival, maybe just an enemy. He launched and won a commercial war with China in his first term, and it was a process of “decoupling” of China, especially after the coronavirus.
That process could have continued, Trump had not lost to Joe Biden in 2020, a president with corrupt commercial ties with China, through his son, Hunter, a story that the media worked hard to suppress when it arose.
Trump has returned, four years and billions of dollars in the American public debt, later, and has adopted a more aggressive strategy to counteract China.
That includes controlling key points in world trade routes: Greenland, the Panama Canal, Gaza (near the Suez Canal), the Cabo de Buena Esperanza, and the launch of the current commercial war, which has led China to retaliate, also as a mind for the Sooughr negotiation partners.
We have to wait for history books and internal accounts to know how long of the last week was an intelligent calculation and how much was the mistake and luck. But Trump’s final objective seems likely to be, consciously, divide the world into commercial blocks and ask the commercial partners to make a decision: the authoritarian and communist regime of China; or the democratic free market system of the United States, thought flaed and disorderly it could be.
That strategy is on its way. But he has also left thousands of American businessmen and millions of workers, in the Facaña.
Giant companies such as Apple can transfer China’s production to India. For anything smaller, rates are absolutely devastating, whether they are small mothers and pop stores that sell imported products, small manufacturers that use Chinese components in American factories or brave inventors that look beyond their garages.
I talked to an old friend of my Chicago days, Rick Woldenberg, this week. Your toy company, Learning Resources, manufactures educational products that you can recognize from your childhood or your children’s schools.
When China’s tariffs and counter-tarifas arrived this week, it was forced to stop production and shipping through its entire operation between the United States and China. Its tax bill increased 50 times, five zero from $ 2.3 million to $ 100.2 million during the night.
With a 20%tariff, says Rick, American companies such as his message: move China’s production. With a 145%rate, says Rick, the message is: “Die.”
Rick’s company is a family business that has a leg for a century. Use 500 people, many in the west. So far he had been in a solid financial form.
Now, Rick told me that the hefaces went to the business. And he warned that if he faces that risk, then thousands of other companies that do business in China, which can have less flexibility than their own, could be making similar decisions. A “infection effect” can be imminent: a waterfall of layoffs and closures.
With more than a touch of bitters, Heys who was fine before President Trump decided to “fix” things. Understand the largest economic and strategic problems at stake, but its first responsibility is with its clients, its 500 employees and their family legacy, a manufacturing legacy, most in the United States.
Rick has a suggestion: whenever we are stopping the implementation of tariffs in all others for 90 days, why not stop tariffs for China too? At least during enough time for your company to change production, enough time to produce Christmas orders and put them in the water for July.
Christmas, he points out, could be very cold if the products in which they depend on retailers do not reach US ports. And we could not do them at the national level yet.
Perhaps all this is part of the plan: the anticipated cost of the commercial war that, in fact, can have an inevitable leg, if Trump decided to take a position at this time or go to another. But if there is any way to mitigate that cost, you could provide Trump with the political coverage you will need to combat this war with victory.
A “Christmas truce”, extending the 90 -day break to tariffs on China, to fill Christmas orders, could be a timely and essential respite.
Joel B. Pollak is a senior editor in general in Breitbart News and the host of Breitbart News Sunday In Sirius XM Patriot on Sundays at night from 7 pm to 10 pm et (4 pm at 7 pm pt). Hey is the author of The agenda: What Trump should do in its first 100 daysAvailable for pre-pedd at Amazon. He is also the author of Trump’s virtues: the lessons and legacy of the presidency of Donald TrumpNow available in audible. He is a winner of the student community of journalism Robert Novak 2018. Follow it on Twitter in @joelpollak.
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