Saturday, November 19, 2016

Death by Tariff? No.

Tonelson has been studying economics for longer than many "economists" have been alive.  Here he dismantles the "China will kill the US" fabrications pumped by the Establishment/Chamber-of-Commerce twits.

He begins with the fabulism propagated by state-run media (ChiCom in this instance):

“A batch of Boeing orders will be replaced by Airbus. U.S. auto and iPhone sales in China will suffer a setback, and U.S. soybean and maize imports will be halted. China can also limit the number of Chinese students studying in the U.S.”


....if the Chinese newspaper writers really are reflecting their political leaders’ views, then their grip on reality is totally gone. For example, will the United States really be the only country that suffers if iPhone sales in the PRC are limited? Last I checked, nearly all these devices were assembled in China, where Apple and especially subcontractors are mass employers. Further, the Chinese content of manufactured goods across-the-board keeps rising, so Chinese workers across long domestic supply chains would be hit as well....

He mentions the "Chinese students" threat, too.  Since a large number of Chinese 'students' are actually spies, perhaps that's a feature, not a bug.


...More important, let’s not forget the broader economic context. Although it’s down some since 2015, China is still on course to run a nearly $350 billion trade surplus with the United States this year. And not only is trade more crucial to China’s growth than it is to America’s (and more important than official figures indicate), but that growth in turn is vital to China’s stability – and to the personal fortunes of its dictators and oligarchs. So could we please stop with the claims that these same Chinese leaders are going to launch a commercial attack on its top customer on net by far?...

Not if you are the WSJ, NYT, or any of the other state-run media (US versions.)

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