This is a big subject to talk about in my microblog. But I’ll do what I can to give you my two-cents.
What is tariff? Guanshui (关税) in Chinese. According to the Oxford Dictionary, it means a tax that is paid on goods coming into or going out of a country. As of the writing of this article, China will impose retaliation tariffs against about $75 billion worth of US goods, putting an extra 10% on top of existing rates in the US-China trade dispute. Motivated by hawkish advisors, US President Trump now demands—note, he demands, not requests, or simply suggests—US companies stop doing business with China.
Does that mean the Trump children will stop doing business with China to set a good example?
China is no longer the biggest creditor to the US. Japan has surpassed China since the past June after it increased its holdings of US bonds, bills and notes to US$1.12 trillion. So what it means is the US cannot blame China only for bad economical signs in the US. Trade itself is built on a bilateral relationships. If A disagrees to do business with B, B cannot strike a deal. It takes two to tango. Now Trump is DEMANDING that US companies stop doing business with China. This only pushes China to aggressively invest in other geopolitical regions, including in its homemade space project and Arctic expeditions.
When the world’s two giant economies are at one another’s throat, it only brings misery to the rest of the world. Because different political ideologies of the US and China will make their supporters take sides, the world will be split between an authoritarian camp and a so-called Western democratic camp. Even neutral like Singapore and Switzerland are, Chinese leadership see them too liberal to look up to.
China, of course, has its own domestic economic problems. With the increase of an ageing population and the decline of the labor force in China, there’s a greater demand for health care and social welfare. But for those who have never learned about the history of the Chinese Communist Party (CPC), China is a country of self-reliance. The stronger the objections China receives from the outside world, the more resolute China, or precisely speaking, the Chinese one-party leadership, will become. They believe the country can find its own way to overcome adversities. The monumental leap of Chinese space program in recent years is proof after Chinese astronauts were snubbed by the International Space Station.
A step further back in history—more than half a century ago when relations between the Soviet Union and China ruptured over the future of communism, China tightened central government control, and launched a series of new programs to revive domestic economy without its big ally’s help. According to Britannica.com, under Mao’s leadership, in 1965 China regained the level of output of 1957—the year before the Great Leap Forward campaign—in almost all sectors.
So when China is aggressively strengthening its image and influence in Africa, the South Pacific, and even in the backyard of the US—the Latin American countries, the US needs to understand that cooperation with China is the only way to maintain peace in all global regions politically, and economically. China won’t collapse because of the US’s retaliation in trade, which it naively thinks will stop China’s antagonistic behavior. Instead, China’s belligerent attitude will flourish. In the CPC lexicon, let’s boycott US goods and all people will stand up stronger against the bully.
You’ll all agree that Trump is the “gold standard” of a bully, right?
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