china us trade war
China-US Trade War
Vocabulary
| censor | go after | trading blows |
| tariff | issue (2) | release (2) |
| goods | implement | representative |
| impose | statement | responsible |
| fair (3) | response | announcement |
| seal (2) | klystron | centrifuge |
| tube | consumer | measure (2) |
| supplier | standard | at the expense of |
| achieve | dominate | aerospace |
| hack | Wal-Mart | in large measure |
| set up | strategic | steal/stole/stolen |
| tolerate | hand over | intellectual property |
| hope | advantage | joint venture |
| episode | instigate | trigger (3) |
| GDP | innocent | multilateral |
| rhetoric | state-run | motivation (2) |
| levy | scale (3) | destructive |
| conflict | resolutely | go into effect |
| affect | tit-for-tat | make out (2) |
| effect | derail (2) | deregulation |
| threat | outweigh | supply chain |
| fake | match (3) | for the better |
| regime | chain (2) | practitioner |
| editorial | soybeans | take advantage of |
| media | pitch (3) | pressure (2) |
| benefit | delicious | authoritarian |
| dessert | fodder (2) | should the blame |
| blame | reluctant | human rights |
| ethical | push (2) | put it this way |
| election | bridge (2) | World Trade Organization |
| willing | potential | look the other way |
| access | fever pitch | throw/threw/thrown |
| collapse | influence | in exchange for |
| greed | withstand | in the long run |
| theft | liberal (2) | get their just dessert |
| exploit | tackle (2) | came out (2) |
| stuff (2) |
Video
Transcript
On this episode of China Uncensored: pre-trade trash talk is over. Now China and the US are in the ring, and all they’re going to be trading is blows.
Hi. Welcome to China Uncensored, I’m your host, Chris Chappell.
We told you so; as far back as January of 2017.
25 January 2017, Chris Chappell: “How likely is it that Trump is going to impose tariffs on China?”
Expert: “Oh, he’s definitely going to do it.”
Chris Chappell: “Really?”
Expert: “One-hundred percent.”
And last Friday, Trump did it.
In a White House statement, Trump said that the US would implement a 25% tariff on $50 billion of goods from China that contain industrially significant technologies.
On the same day, the Office of the United States Trade Representative, the agency responsible for implementing the tariffs, issued a news release. It was helpfully titled: “USTR Issues Tariffs on Chinese Products in Response to Unfair Trade Practices.”
With the announcement, the US Trade Representative published a long list of 1,102 products that will be hit with tariffs starting July 6. That list includes can-sealing machines, centrifuges and Klystron tubes?
The tariffs don’t include consumer goods like mobile phones and TVs. Well, that’s great news. It looks like American consumers will still be able to enjoy Wal-Mart’s everyday low prices — and Wal-Mart’s everyday low standards for Chinese suppliers.
But just because the new tariffs don’t cover consumer goods doesn’t mean they’re not a big deal for both countries.
Most of the goods on the tariff list are related to China’s 2025 strategic plan to dominate hi-tech industries like robotics, aerospace and industrial machinery.
The Made in China 2025 plan is designed to drive future economic growth for China, in large measure, at the expense of the US. And a lot of these products were made after China stole American technology.
In some cases, the Chinese military simply hacked in, stole it, and gave it to local Chinese firms.
In other cases, it was because of a Chinese law that US companies doing business in China were required to set up joint-ventures with Chinese firms, and then hand over their intellectual property.
That’s why, when announcing the tariffs, Trump said “The US can no longer tolerate losing our technology and intellectual property through unfair economic practices.”
One thing Trump hopes to achieve with the tariffs is to force China to change parts of its state-led economic system that put foreign companies at a disadvantage.
But with Friday’s publication of the tariff list, Chinese state media got seriously triggered.
An editorial in the Communist Party’s official People’s Daily said the US was instigating a trade war, and that it would be “extremely destructive to global trade, economic globalization, multilateral trade systems, and global production supply chains.”
State-run Xinhua News said, “The wise man builds bridges; the fool builds walls.”
State-run CCTV announced that China would fight back.
Newscaster: “China has no choice but to fight back strongly to resolutely protect its national interests and the people’s interests and to resolutely defend globalization and the multilateral trading system.
We will immediately publish levies of the same scale and same strength.”
And they did.
China announced essentially tit-for-tat tariffs — also worth $50 billion, some of which are also going into effect starting July 6.
China’s tariff list on US goods includes soybeans, beef and whiskey.
But is a trade war really going to be as destructive as China is making it out to be?
Well, probably not for the US. Experts say economic growth in the US won’t be affect all that much. Rich Sega, global chief investment strategist at Conning, says Chinese tariffs won’t be “enough to derail strong growth in the US because lower taxes and deregulation outweigh trade.”
As for China, this could be a big hit to their Made in China 2025 plan.
And that doesn’t even include the additional $100 billion in tariffs that Trump has threatened. He has even announced a possible additional $200 in tariffs.
It’s a good thing China can always just fake its GDP data.
What’s interesting about the $200 billion number is that China doesn’t import that much from the US.
So while China can match a $50 billion tariff, they can’t match a $200 billion one.
What they could do instead is go after US companies in China, and make it harder for them to continue manufacturing and doing business there.
But, if the American companies all leave China, who would the Communist Party steal technology from?
The Chinese regime’s rhetoric against US tariffs is hitting a fever pitch because if we do ever reach an all out trade war, China is at a disadvantage.
Typically in a trade conflict, the side that exports the most stuff, has the most to lose.
However, some analysts think that China could withstand a trade war better than most exporters since they don’t have to worry about things like elections, or public pressure, and they control their own media.
I guess there are some benefits to being an authoritarian state.
But regardless of what happens, there is one clear winner: ME!
Nothing gives the media more delicious fodder than international conflict.
Before you go, it’s time for me to answer another question.
Ivan A. asks, “Do you think all Western liberal democracies shoulder much of the blame for China’s continual terrible human rights record, by their reluctance to apply ‘ethical foreign policies’ over the last twenty years?”
I’ll put it this way: “Back in the 90s, US President Bill Clinton, and a lot of other countries’ leaders pushed to allow China to get into the World Trade Organization. The idea, they told us, was that “Sure, there are bad things in China, but if China opens up its markets, then democracy and human rights will follow.”
Doesn’t that sound wonderful?
But, if that was really their main motivation to open up trade with China, then why weren’t those same politicians also pitching open up trade with Cuba and North Korea?
Oh, wait. Those countries don’t have a billion potential consumers.
So basically rich companies and powerful politicians were willing to look the other way when it came to the Communist Party throwing Falun Gong practitioners into labor camps in exchange for access to that sweet, sweet China market.
Bill Clinton, US President: “I don’t believe that we will have more influence on China by giving them the back of our hand.”
Yeah, and how did that work out?
So are Western liberal democracies to blame?
Yeah, for sure.
But the Chinese Communist Party is even more to blame: they’re the ones that are actually throwing innocent people in labor camps. They took advantage of foreigners’ greed to grow China’s economy.
Without foreign investment, the Party would have collapsed a long time ago.
But with all the intellectual property theft, the Western liberal democracies got their just desserts for exploiting unfairly cheap, Chinese labor.
The Party came out on top.
Of course, now there’s trade tariffs designed to tackle unfair trade practices. And those could hurt both the Chinese Communist Party and greedy foreign companies.
But if the tariffs work the way the White House believes they will, that may change things for the better in the long run.
Questions
1. Tariffs and trade wars came as a complete surprise to the host. True or false? Why has the US imposed tariffs on certain Chinese goods?
2. Do the tariffs target consumer electronics like smartphones and laptops? What do they target? Why are these targeted?
3. What is Made in China 2025? According to Trump, how has China progressed over the years?
4. The Chinese government agreed with Trump’s decision. Is this correct or incorrect? How did they respond?
5. According to the host, would a trade war affect both China and the US equally? Who would it affect more? Why?
6. Would both governments come under equal (public) pressure?
7. Why did the US under President Bill Clinton, open up trade with China? Did things work out as intended? Were the results what he had intended?
8. According to the host, will the US “suffer” and “lose” the trade war?
A. Does your country trade extensively with the US and China? How would you describe it?
B. Is the current trade system “perfect” or should there be changes?
C. What kind of countries do you trade with? Are they democracies, authoritarian states, both, in the middle? Are politics involved?
D. What do you think will happen in the future (short, medium and long-term)?
E. Do you agree with Trump’s policy regarding trade with China? What should both sides do?
