Economic War with China is a Losing Proposition

By Eve Ottenberg / CounterPunch

It is always better to do business with people than to fight with them. But this common sense seems to have slipped the brains – if they have any – of America’s congressional and White House leaders. During his presidency, Donald “The Tariff Man” Trump slapped tariffs on washing machines, aluminum, steel, solar panels and other goods, worth $380 billion in trade from China. , the third largest trading partner in the US. That equated to an 80 billion dollar tax increase. Not to miss out on the stupid sweepstakes, Joe “Copycat” Biden increased his bids. They affected batteries, steel, aluminum, semiconductors, solar cells, electric vehicles, precious minerals and more.

When the election campaigns began, candidates went toe-to-toe over who would be the hardest hit on China’s economy. Let’s hope that Kamala “Black Rock” Harris will avoid these crazy sounds. They do nothing but annoy Beijing. And you don’t want to upset Beijing. It is America’s second largest creditor, and while the rulers in Washington are making noise, Sinophobic noise, Beijing is dumping US Treasuries. Other countries do the same. This, while Treasury Secretary Janet Yellen already has her hands full, trying to uncover buyers for American debt. He doesn’t need, China, Saudi Arabia and who knows who else providing USTs of billions of dollars.

And that’s just finance and taxes. Just as bad, maybe even worse, are all the economic restrictions that the last two governments have imposed on business. Biden has no plans to go to China. Well, that escalated quickly. China has boosted its domestic chip industry and had great success: Huawei’s Mate 60 smartphone has a seven-nanometer chipset. The manufacturer, SMIC, “reached seven nanometers in two years from the standard fourteen nanometers without acquiring foreign technology,” reported the Foreign Policy Research Institute June 28. So China is on its way to self-sufficiency in semi-conductors, which “change the supply of chips worldwide and raise environmental security concerns…” There is nothing like sanctions and tariffs to do America Third Class Again.

And they succeed in many ways. Also, take Biden’s semiconductor sanctions against China. Back in July 2023, Beijing returned: it announced export controls on two rare earth minerals, gallium and germanium, which are essential for US satellites, semiconductors and solar cells. Given that China has 60 percent of the world’s supply of rare earth minerals, with the other 40 percent in accessible areas, Beijing’s move has alarmed companies in American technology, which they feared would provide more to come.

In fact, Nvidia and Intel honchos asked Biden’s bumblers to ease semiconductor sanctions against China. But it was too late, according to Shaun Rein, founder of China Market Research Group. These crazy sanctions have already cost American companies billions. “Chinese semiconductor companies have emerged. China will no longer trust US politics, so it will buy domestically. Biden shot the US in the foot.” Recently, Beijing announced “limits on antimony exports and related components due to national security concerns,” Sirius Report tweeted August 15. “Antimony is used in military applications such as guns, infrared missiles, nuclear weapons and photovoltaic devices etc. ” Washington beats Beijing and is punished as such. A good working country, the US, is totally dependent on imports of parts, minerals and anything else you can think of.

Given the interdependence of the Chinese and American economies, this long-term effort by the white house to manipulate them is like a surgeon using a chain instead of a scalpel: it’s dangerous. Take soy. The US is the world’s largest producer of soybeans and China is the largest consumer of soybeans. But the US has lost the Chinese market because of the stupid American trade war, which has helped turn China into buying soybeans from Latin America. On the commercial end, consider the US ban on Chinese software for autonomous vehicles. Developing these vehicles is based on global cooperation, Sputnik reported on August 6, “since the sector has a relatively large environment and high research and development costs.” But Biden’s team intends to introduce legislation that would ban “Chinese software in US vehicles with Level 3 and above and effectively prevent testing on US roads of autonomous vehicles produced by Chinese companies.” .” And that’s not all.

Cars with “Chinese-enhanced telecommunications” would be banned from US highways, and their manufacturers were forced to prove that “none of their cars are connected or advanced autonomous vehicle software developed by a “concerned foreign party,” such as China. This proposed ban is all part of Biden’s trade regulations. Indeed, in less than a month three years ago, the mega-minds of the white house decided to increase tariffs on EVs in China.

So these Beltway experts insist on their dangerous tariffs (which cost Americans a lot of money), sanctions and other restrictions, which get us nowhere. Remember that “ruble will be a wasteland”? Well, it wasn’t. It is doing well, and so is the Russian economy, which is now the fourth richest in the world. Penalties and theft of foreign financial assets do not apply. All they do is convince foreign money managers to flee US banks – and the dollar, which ends up hurting Americans. But hey, since when did Washington sachems ever cause pain to Americans in their numbers? Never forget the financial policies of Barack “Evict the Homeowners” Obama.

Unfortunately, there is no end in sight to this inner-Beltway malice toward China. Trump’s former national security adviser Robert O’Brien said back in June that if re-elected, Trump should cut all economic ties with China. For good measure, O’Brien added, in a June 18 Foreign Affairs article, that Trump should start testing nuclear weapons and consider moving ALL ships to Asia. “When China seeks to undermine America’s economic and military power, Washington should return the favor … in fact, it may seek to decouple its economy from China’s,” O’Brien wrote. According to the Taipei Times June 19, O’Brien said he “meets regularly” with Trump and “O’Brien provided a copy. [of the Foreign Affairs article] to Trump campaign consultant Susan Wiles. ” It is reported that he showed Trump, but this was denied by his campaign. This was a smart move: raising military and economic hostility with another country, that is, China, is not a platform of the winning campaign.

In particular, O’Brien suggested “that the 60 percent tariffs on China that Trump has floated should be only the first step, followed by stronger foreign controls” on any technology that could used in China…'” Because that has gone well lately. Those foreign controls, the sanctions, have captured China’s new technologies, thrown Beijing and Moscow into the economic, political and military embrace. American industries,’ including the reliance of arms manufacturers on global supply chains.

Not that I’m complaining: if Lockheed Martin can’t get the necessary parts or software from China because of the Einsteins in Washington, it’s less bombs and guns in the world and less corpses in places like Eastern Europe, the Middle East. , Far East and Africa. But these moronic policies do not only affect the production of weapons. They destroy all kinds of industries that ordinary people depend on. Like it or not, the world is economically interconnected, and it is utter folly to burn these global bridges without a scintilla of strategy to start local industries. And there is no plan, because such industries do not happen, for the simple reason that it does not interest our oligarchs.

American corporate executives favor low wages in Bangladesh, Myanmar, Vietnam, Mexico and, yes, China. They have no intention of spending money to plant new industries in the US, whose workers may unionize, or are already unionized and thus threaten the wealth in which their royal right rests. Until political bigwigs start talking about how we’re going to re-industrialize here in America, all these insults directed at Beijing are worse than hot air: it’s economic suicide.

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