The administration’s approach might quickly reduce the headline level of the trade deficit, but it largely ignores the frustrations of American sectors that are the most promising sources for creating future good export-related jobs.
American companies that make automobiles, semiconductors and other complex products bemoan Chinese government requirements that force American firms to form joint ventures with Chinese companies, sharing their technology. They accuse those partners of widespread theft of intellectual property as they try to catch up in advanced technologies. Many American firms face Chinese competition that receives heavy state subsidies.
These are some of the most stubborn, longstanding issues in American-Chinese economic relations. But they aren’t likely to be fixed overnight, and even if the United States wins concessions, it won’t necessarily affect the trade deficit — especially in the next couple of years.
This helps explain why some prominent advocates of a tougher stance toward China — who applauded President Trump’s tariff threats — are critical of the turn the negotiations have taken.
The tariffs the president threatened “are designed to address China’s technology theft and their plans to dominate advanced and high technology manufacturing,” said Dan DiMicco, chairman of the Coalition for a Prosperous America, which advocates for a hard-line stance, in a statement. By contrast, “an agreement to sell agricultural and energy commodities is the result of bad negotiating and bad economic strategy.”
Exports of agriculture were directly or indirectly responsible for 524,000 jobs in 2014, according to analysis by the International Trade Administration; petroleum and coal products were responsible for an additional 255,000. But combined that is less than 7 percent of the jobs tied to exports that year.
Sectors like computers and electronic products and machinery were responsible for substantially more export-related jobs.
Speak Your Mind
You must be logged in to post a comment.