Three Categories of US Desires Necessary Exaggerated Crazy
Necessary Intellectual Property Forced Intellectual Property
Transfer from US Companies to Chinese Companies Competition
Requirements requires of US companies but not Chinese state owned
Companies Exaggerated: China's 5% tariffs on US auto imports
is not a serious problem. General Motors profits from China sales
saved stopped GM bankruptcy. Buicks are everywhere. Japan and South
Korea buy few US car
Trade Deficit with China Because China is assembling parts
from all over Asia, she receives the total US dollars then distributes
it. We could move the assembly to other Asian countries to make it
look better. Editor's Notes: Product profit ends up at Apple or some Taiwanese
manufacturer. Years ago Japan and others moved mfgt to US w which
provided good but not 1950's wages.
China's Attitude toward U.S. Trade
War Chinese Elite
love pressure on Xi Jinping Chinese
Average citizen,
because of nationalistic indoctrination,
dislike US policy. United States Average citizen,
because of nationalistic indoctrination,
dislike US policy. United States Elite love
pressure on Trump
Affect of Trade War on Chinese
Trade Policy China will continue to
liberalize trade and intellectual property and services policies
Major Structural changes will not happen Larger problem: China
fears a new Cold War which will take a long time to alleviate.
China Adjusts, will not over
react to Trump's trade policy
K. Rudd
Possible Adjustments
1. She will lower trade balance. 2 . Her relatively
low tariffs of about 9% will be lowered. 3. China
could propose zero
Five Reasons China Isn't Backing Down
K. Rudd
1.
Trump’s trade war confirms that Barack Obama’s “pivot to
Asia,” was an expansion into China’s sphere of influence.
2.
Recent actions means trade talks must be delayed at least
until after US midterm elections.
3.
Xi Jinping ability to consolidated more power is partially
based on fulfilling a “China Dream.” He can’t back down.
4.
China’s economy will suffer little, much less than 0.5
percent of GDP.
5.
China believes she has
less near-term political vulnerability
but greater long-term economic vulnerability as China’s
authoritarian state-dominated capitalism better absorbs economic
shocks.
The bottom line: Trump and Xi believe near-term fallout can be managed so this
trade war will probably last longer and inflict damage.
tariffs in both countries and could make sam
Kevin thinks
keeping
Chinese students in America is very important to long-term political
security. Australia has relatively many more Chinese students.
Editor's Note: Historically, not listening to our allies has not worked
out well. Think Vietnam and Iraq/Afghanistan/Syrian wars.
C.
Relations With Russia
Bremmer video
See
21st Century Free Trade Analysis
Updates
e offer to others.
1.
Trump's
90-day Tariff Deal 12/18\
2. Three small numbers are making big waves in
China. The digits 9-9-6, a shorthand for 9am to 9pm, six days a week,
have
become a rallying cry for tech workers frustrated with their
bruising work schedules 4/17/19
Source
3. From
Bloomberg's New Economy Forum 4/19/19
China has no desire to scale back its winner-take-all industrial
ambitions or to make fundamental changes to its authoritarian
capitalism.
A mix that includes subsidies for state industrial
champions and economic policy
favoring local over foreign players, has
succeeded.
Any final agreement will have Chinese pledges to buy
more U.S. products but few promises to restructure
the economy.
A trade deal won’t end China-U.S. frictions. In
fact, the conflict has only just begun.
A 2018
report from Freedom House, a democracy watchdog, noted that 18
countries (so far) now use Chinese-made intelligent monitoring systems
and 36 have received training in topics like "public opinion guidance,"
a euphemism for censorship. The list of countries includes the UAE,
Zimbabwe, Uzbekistan, Pakistan, Kenya, and Germany.
The worldwide infrastructure-building
project "has pushed China’s huge construction, telecommunications and
shipping companies to go global at a time when a cooling domestic
economy means less business at home." Editor's
Note: A common problem in centrally planned economies. Where
is the data on the cost of China's overbuilding housing at home. Japan
rushed into HDTV while US, very profit dependent, waited for digital
technology.

1.
China is pursuing “debt trap diplomacy"
But
the idea that China deliberately forces debt
onto poor countries, then grabs physical
assets when they can’t repay the loans,
isn’t supported by the facts,
writes Deborah Brautigam. Hambantota
Port in Sri Lanka, is
an exception. But, Simon
Rabinovitch in The Economist, tfrrls Chinese
loans can be “ruinously expensive” with
little regard for risk. Rabinovitch
among others thinks Chinese lending
merely clumsy not malevolent.
Editor's Note: Economic Success of projects
will determine success of program.
2: It’s another Marshall Plan
The
U.S. Marshall Plan didn’t rebuild Western
Europe after World War II. Infrastructure
had been largely fixed by the time U.S.
loans and grants kicked in, according to the
economist Barry Eichengreen. The Marshall
Plan’s introduced free market ideas,
and habits of cooperation that underpinned
democracy in postwar Europe. To the extent
the Belt and Road promotes state capitalism
and authoritarian governance, the initiative
is the exact opposite of the Marshall Plan.
3: The project
is Xi Jinping’s “Grand Strategy"
Sweeping global
vision, in contrast to Donald Trump’s narrow
“America First” view of the world. But it
evokes one of Communist China's raucous
“mass mobilization” campaigns. Multiple
Chinese local governments, state enterprises
and banks are swept up in a state-funded
investment free-for-all, one that enriches
these groups but often neglects the
interests of poor countries desperate for
infrastructure. "The Belt and Road
isn’t a master
plan: It needs one," writes Yuen Yuen
Ang, of University of Michigan writes in
a Bloomberg Opinion.
4: The astronomical price-tag
It’s hard to put
a realistic dollar figure on a project that
is so spectacularly ill-defined: China has
never publishe puts the total at roughly
$340 billion
during the
period 2014–2017 The cumulative spending
will be less than what the U.S. squandered
on futile wars in the Middle East and Asia
in recent decades. The U.S. hasn’t been able
to come up with a real counter because
Washington doesn’t have the money.
5: It will promote “yuan
internationalization"
The
majority of Belt and Road projects are
financed in dollars because yuan held
outside China remain relatively scarce. The
Belt and Road will dwindle over time
Bloomberg 5/1/19
By and large, China’s Belt & Road Initiative gets a bad press in the
U.S., much of Europe, Japan and India.
But it’s a “debt trap," for instance, or China’s bid for empire —
is way overblown.
At 2nd Belt & Road gathering in Beijing, President Xi Jinping went out
of his way to
address international concerns.
Whether this represents a reset, a course correction, or simply a
rhetorical gesture remains to be seen.
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as
its trade surpluses inevitably disappear.
Printing yuan to finance projects, capacity
would be virtually limitless.
Download the Bloomberg app: It's
available for
iOS and Android.
The
Impact of Chinese Trade on U.S. Employment:
The Good, The Bad, and The Apocryphal
by
Chinese competition on
US manufacturing had a striking regional variation from
2000-2015.
In high-human capital
areas like West Coast or New England, manufacturing
job losses saw industry switching to services. Companies
changed to research, design, management or wholesale. Hence,
redistributed of jobs went from manufacturing in lower
income areas to services in higher income areas.
In the low
human-capital areas like the South and mid-West,
manufacturing plants closed without much increased service
employment.
Offshoring appears to
drive these manufacturing job losses.
This employment
impacts was strongest between from 2000 to 2007
Ling
Chen: New Insights on the 'Made in China' Model
1. Began with Top Down Trade
which succeeded using cheap labor
2. Success cause companies to move to other Asian companies
3. Bottom up home grown Gorilla Investors will contribute to
Made in China_2025
4. Ling Chen's analysis supports the Bajing Model. See
Washington Consensus vs Beijing Consensus/
|