Is There Any Benefit To A Trade War?
President Trump is engaged in a
dangerous “game” with other countries on trade.
Yes, China and others have taken advantage of our trade practices to
exploit them to a large imbalance between each other. We import a lot more from China than we
export. Technology that we use in China
is then re-engineered so that the US companies can be sent away. A lot of Chinese
technology is intellectual property that they did not honor.
Japan for decades has fought free
trade with the US. They want full and
open access to our markets but block or severely restrict access to
theirs. European countries have done the
same.
I can understand the frustration the
President has with this issue. He has
been very vocal about this for 30 years.
It should come as no surprise that he is taking the actions he is doing. However,
is it the smart way to go about it? No,
there is not a good reason for a trade war.
I am not sure you can site a trade war in the past that ended with both
sides “winning.” Trump looks at things
from a binary perspective. He has to win
and the other side has to lose. This is
strength to him. Trade is not like a
military war were there is a winner and loser.
Trade has to be win-win.
Tariffs are most corrosive aspect of
trade. They are set up to protect a nation’s
capability to produce something at an inefficient rate in order to save
jobs. That is all it is about. Some
other country can do it better, but political leaders bend to the local
populace.
Trump putting tariffs on a lot of
products from China and other countries leads to nothing but bigger challenges. Trump wants a “fair” trade deal. If that were true, he would negotiate with
the countries. However, he wants trade
in his favor. That is not going happen. Until he understands that, we will continue
to have the trade wars. Nobody is
winning and everybody is losing.
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