Peter Goodman reported this article from Los Angeles, New York and Washington.
“Like the rest of the e-commerce world, Jacob Weiss was contending with excruciating difficulties in getting his goods — mostly furniture — across the Pacific from factories in China.
It was April 2021, and the global supply chain was rife with dysfunction because of the pandemic. At ports in China, Mr. Weiss’s usual ocean carrier, Hamburg Süd, was refusing to accept some of his shipping containers at his contracted rates, saying it had no room on its vessels.
These sorts of complaints had become commonplace, given shortages of containers and crippling traffic jams at ports. Most importers avoided conflict, fearing reprisals from the carriers. But Mr. Weiss had his lawyer fire off a menacing letter, demanding that Hamburg Süd “immediately honor” his contract while threatening to file a complaint with the Federal Maritime Commission.
Here was a minnow picking a fight with a whale. Mr. Weiss’s company, OJ Commerce, is modest in size. Hamburg Süd is a subsidiary of Maersk, a publicly traded Danish conglomerate that is the second-largest container shipping company on earth, with annual revenues exceeding $61 billion.”
David Lindsay Jr.
Hamden, CT2h ago
Great reporting, thank you Peter Goodman. Now I’d like a serious discussion or rounddtable about what can be done about this problem. It seems like many big problems return to, in part, a US Justice system that favors the rich over the poor, but then there is the fact that this was also an anomoly of the pandemic. How do we make the playing field more level. I wonder if the US government could use a part of the Justice Dept or some other agency to fast tract a decsion, and if they find the small American business has a claim, to fund its legal challenge against the giant corporation. David blogs at InconvenientNews.net.
“Tariffs on imports from China have refilled the employee parking lot at Stoughton Trailers in Evansville, Wis. The company makes chassis, the wheeled steel frames that carry cargo containers around the country. Chassis from China are now prohibitively expensive, Stoughton is hiring hundreds of workers — and the rest of us are paying for those jobs.
The tariffs have contributed to a shortage of chassis in the middle of an import boom, one reason that American ports are gridlocked. Tariffs also drive up prices. American chassis are beginning to roll off production lines, but they cost more than pretariff Chinese chassis, which raises the price of everything that travels by chassis.
In slapping tariffs on chassis and a wide range of other goods in 2018, President Donald Trump loudly insisted China was cheating by subsidizing its export industries. Tariffs, he promised, would shelter American manufacturers from unfair competition. President Biden has maintained the tariffs. The federal government is on pace to collect more money in tariffs this year than in any previous year.”
“WASHINGTON — Among the corporate titans recognized last week by President Trump during a White House signing ceremony for his China trade deal was Sanjay Mehrotra, the chief executive of Micron Technology, whose Idaho semiconductor company is at the heart of Mr. Trump’s trade war.
China’s treatment of American companies like Micron fed Mr. Trump’s decision to unleash a punishing trade war with the world’s second-largest economy, a fight he said would halt Beijing’s use of unfair practices to undermine the United States. But that two-year conflagration may wind up being more damaging to American technology companies.
The initial trade deal announced last week should make operating in China easier for companies like Micron. The deal contains provisions meant to protect American technology and trade secrets and allow companies to challenge China on accusations of theft, including older cases like Micron’s that precede the agreement.”
“The prospect of a wider trade war between the United States and China sent global financial markets whipsawing on Monday and could force Beijing to make difficult decisions if it hopes to preserve its nascent economic recovery.
President Trump upended what appeared to be steady progress toward reaching a trade pact after he threatened on Sunday to impose still more tariffs on Chinese-made goods unless Beijing moves closer to a deal. Liu He, the Chinese vice premier overseeing economic policy and Beijing’s lead trade negotiator, had been set to travel to Washington for talks scheduled for Wednesday that were widely seen as the potential last round before reaching a trade deal.
David Lindsay: Good piece. Here are two top comments I endorse.
Please, if you must quote Mr. Trump’s tweets, immediately bracket them with corrective disclaimers. Tariffs ARE NOT paid to the US Treasury. They are paid by the consumer in the form of a higher purchase price, whether buying parts for assembly in the US or the finished goods. The costs are not directly borne by China, except the demand for Chinese products drops due to the increased price. I’m sure people read the tweets and assume it’s a statement of fact.
Trump does not understand how the Chinese think and does not understand how they keep winning. The main concern of the Chinese leadership is to avoid public embarrassment (“save face”). Trump thinks that publicly embarrassing them (“making them lose face”) is going to make them do what he wants them to do. It’s not going to work. The Chinese are telling him in negotiations (according to this article) that they will do what he wants, but it can’t be done through the legislature because it will be too embarrassing, so he publicly demands that it be done through the legislature. The Chinese don’t have a trade surplus because of tariffs. The Chinese have a trade surplus because they pick winners and they back them with public money, investing in new technologies, often stolen from America. If America invested in the technologies that we invented, like solar power, we would dominate the fields that we invented. But for decades, Republicans (and the centrist Democrats that compromise with them) have refused to “pick winners and losers,” letting the Chinese government pick winners, them, and losers, us. Notice none of this involves embarrassing public attacks on public officials. It is all done subtly. While the USA is spending trillions attacking countries around the world, the Chinese are quietly going around the world investing in third world countries, while the Party of Trump insists that investing in foreign countries is a waste of money. Learn from the Chinese
Image. President Trump’s trade belligerence has done lasting damage to America’s reputation.CreditCreditPete Marovich for The New York Times
“This is the way the trade war ends. Not with a bang but with empty bombast.
According to multiplenewsorganizations, the U.S. and China are close to a deal that would effectively end trade hostilities. Under the reported deal, America would remove most of the tariffs it imposed last year. China, for its part, would end its retaliatory tariffs, make some changes to its investment and competition policies and direct state enterprises to buy specified amounts of U.S. agricultural and energy products.
The Trump administration will, of course, trumpet the deal as a triumph. In reality, however, it’s much ado about nothing much.
As described, the deal would do little to address real complaints about Chinese policy, which mainly involve China’s systematic expropriation of intellectual property. Nor would it do much to address Donald Trump’s pet although misguided peeve, the imbalance in U.S.-China trade. Basically, Trump will have backed down.
If this is the story, it will repeat what we saw on the North American Free Trade Agreement, which Trump denounced as the “worst trade deal ever made.” In the end, what Trump negotiated — the U.S. Mexico Canada Agreement, or U.S.M.C.A. — was very similar to the previous status quo. Trade experts I know, when not referring to it as the Village People agreement, call it “Nafta 0.8”: fundamentally the same as Nafta, but a bit worse.”
WASHINGTON — President Trump has signaled that he is moving toward peace with China in a trade standoff that has rattled markets and businesses globally. But as he backs off his threat to impose higher tariffs, the president’s relationship with his own trade negotiator is now showing signs of strain.
The situation has left Mr. Trump’s trade representative, Robert Lighthizer, who is both an ardent supporter of the president and a longtime China critic, in an uncomfortable bind. While broad tariffs on Chinese imports brought Beijing to the negotiating table, Mr. Trump has grown impatient with the talks, and a consensus is growing in Washington that Mr. Trump will ultimately accept a weak deal.
And despite the lack of a transformative arrangement he once promised, the president has begun dangling the idea of a “signing summit” with President Xi Jinping of China at Mar-a-Lago, Mr. Trump’s Florida resort. As a result, the president is undermining Mr. Lighthizer as he tries to pressure China to make big concessions.
“Trump is certainly doing his negotiating team no favors by undercutting them in public,” said Eswar Prasad, a trade expert and the former head of the China division of the International Monetary Fund. The president’s actions, he said, “weakens rather than fortifies Lighthizer’s leverage.””
Excellent article, thank you. Please keep going. It would be useful to see an analysis of the TPP, the Trans Pacific Partnership, and the positions of Lighthizer vs a soft deal by Trump. Am I correct in thinking when Trump threw out the TPP, he threw out the baby with the bathwater? Could Lighthizser be expected to do as well as what was expected from the TPP, or better. This is an odd story, since Trump is usually the bad guy, but so many experts were against his tariff war, that now, is his relenting better than the posssiblility of a more severe set of tariffs? x David Lindsay Jr. is the author of “The Tay Son Rebellion, Historical Fiction of Eighteenth-century Vietnam,” and blogs at TheTaySonRebellion.com and InconvenientNews.wordpress.com
Mr. Wu is a law professor who specializes in technology.
“As China and the United States engage in high-level negotiations over a possible trade deal, it’s puzzling to see what’s been left off the table: the Chinese internet market. China blocks or hinders nearly every important foreign competitor online, including Google, Facebook, Wikipedia in Chinese, Pinterest, Line (the major Japanese messaging company), Reddit and The New York Times. Even Peppa Pig, a British cartoon character and internet video sensation, has been censored on and off; an editorial in the Communist Party’s official People’s Daily newspaper once warned that she could “destroy children’s youth.”
China has long defended its censorship as a political matter, a legitimate attempt to protect citizens from what the government regards as “harmful information,” including material that “spreads unhealthy lifestyles and pop culture.” But you don’t need to be a trade theorist to realize that the censorship is also an extremely effective barrier to international trade. The global internet economy is worth at least $8 trillion and growing, yet the Trump administration has focused chiefly on manufacturing, technology transfers and agriculture, and does not seem to have pressed for concessions on this issue.
Sheltered from American, Japanese and European competition, Chinese internet businesses have grown enormously over the past decade. Nine of the world’s 20 largest internet firms, by market value, are now Chinese. Some of this growth reflects the skill and innovation of Chinese engineers, a vibrant start-up culture and the success of Chinese business in catering to local tastes. But it’s hard to believe that this has been unaided by censorship.
And the barriers to foreign competition have more than just economic effects. Without any better options, Chinese users are forced to put up with companies like Tencent, which owns the private messaging app WeChat, and the online payment company Ant Financial, whose privacy violations are, amazingly, even more troubling than those of Facebook and Cambridge Analytica. By tolerating Chinese censorship, the United States encourages other countries to do the same.”
President Trump and President Xi Jinping of China in Beijing last November.CreditDoug Mills/The New York Times
“Presidents Donald Trump and Xi Jinping are a bit alike, and that presents a danger to the global order.
The American and Chinese leaders are both impetuous, authoritarian and overconfident nationalists, and each appears to underestimate the other side’s capacity to inflict pain. This dangerous symmetry leaves the two sides hurtling toward each other.
The 10 percent tariffs already imposed in the trade war are scheduled to rise to 25 percent in January, but there’s also a broader confrontation emerging.
Trump and Xi may well be able to reach a cease-fire in their trade war when they meet for the Group of 20 in two weeks. Even if a deal is reached, though, it may be only a temporary respite that doesn’t alter the dynamic of two great nations increasingly on a collision course.”
“With the arrival in Beijing this week of America’s top trade negotiators, you might think that the U.S. and China are about to enter high-level talks to avoid a trade war and that this is a story for the business pages. Think again. This is one for the history books.
Five days of meetings in Beijing with Chinese, U.S. and European government officials and business leaders made it crystal clear to me that what’s going on right now is nothing less than a struggle to redefine the rules governing the economic and power relations of the world’s oldest and newest superpowers — America and China. This is not a trade tiff.
“This is a defining moment for U.S.-China relations,” said Ruan Zongze, executive vice president of the Chinese Foreign Ministry’s research institute. “This is about a lot more than trade and tariffs. This is about the future.”
In one corner stand President Trump and his team of China trade hard-liners, whose instinct is basically right: This is a fight worth having now, before it is too late, before China gets too big.”
“President Trump said he would impose about $60 billion worth of annual tariffs on Chinese imports on Thursday as the White House moved to punish China for what it says is a pattern of co-opting American technology and trade secrets and robbing companies of jobs and billions of dollars in revenue.
“The word that I want to use is reciprocal,” Mr. Trump said in announcing the tariffs in the Diplomatic Room of the White House. “If they charge us, we charge them the same thing.”
The China tariffs are his strongest trade action yet against a country he has branded an “economic enemy.” They fulfill one of his core campaign pledges, to demand more reciprocal deals with trading partners around the world.
But coupled with the administration’s decision to exempt the European Union, South Korea, Brazil, Canada, and Mexico from the tariffs on cheap metals, the action demonstrates how much Mr. Trump’s nationalist trade agenda is really targeted at a single country: China.”
“The tariffs, which the United States trade representative will publish within 15 days, will target 1,300 lines of Chinese goods — everything from shoes and clothing to electronics, administration officials said.” I understood the the argument for steel and aluminum, but what is the argument for these other 1,298 products? All the mainstream economists that I learn from, say that tariffs are toxic. The Chinese are famous for their intelligence, work ethic and pride. If they feel insulted, and have lost face, they will be forced to retaliate. Can Boeing stay on top without one of their biggest customers? Or did their stock price just drop almost 4% for no reason?
A five or ten percent tariff on just Chinese steel and aluminum might have been a more prudent test of the waters. Rejoining the TPP asap, would probably do more for the US economy and economic defense, than the steel tariff. The Chinese play like a people at war with the West, and they probably are, since they still have a score to settle over the bombardment and destruction of the Spring Palace, and its mulitude of treasure buildings and libraries, in the 1840’s, during the ugly opium war. The civilization that invented, paper, writing, gunpowder, history and literature, should be courted with carots as well as with sticks.
David Lindsay Jr. is the author of “The Tay Son Rebellion, Historical Fiction of Eighteenth-century Vietnam,” and blogs at here and InconvenientNewsWorldwide.wordpress.com