When the U.S. voted to bring isolated and economically poor China into the World Trade Organization (WTO), the hope was, China would become a thriving and interdependent member of the family of nations, thus fostering world peace and prosperity.
Instead of playing by the rules, the Chinese have sought to take advantage. WTO rules are designed to enable each nation to create products for which each is uniquely suited. By so specializing, each nation thrives to a greater degree than each would on its own. They seek to dominate commercially via non-reciprocal trade practices which make it impossible to operate on a level playing field. Their tariffs on average on U.S. products are three times our tariffs on theirs. Further, they steal and copy our technology or force our companies to hand ours over to them as a prerequisite for doing business in their country.
If this weren’t bad enough, they are now using the trade surplus to build an enormous military machine, which their own defense by no means requires.
China is an immense and now powerful nation with no comparable regional military rivals. Yet year after year they continue to add to their strength. Would it be prudent for America to sit still and leave this unchecked? It is seldom wise to do nothing and hope for the best — we only have to refer to recent history to prove it. Germany insisted that their intentions were peaceful while they were building up an ever vaster military force in the 1930s. If we had checked Germany back earlier, we probably could have prevented a devastating war.
What if we were wrong about China and, despite all evidence to the contrary, they have no intention toward domination of others? We still must confront them because their trade practices undermine the American workers and American industry and American security. Fair trade practices would bring about something more near parity in the trade between our nations. Over the last 12 months, we exported to China only $136 billion of our products, while importing $528 billion, creating a $392 billion deficit. With the huge disparity which exists, Americans are denied the employment which those extra hundreds of billions of dollars should be bringing into our economy; our companies are denied the business opportunity, and our nation is denied the taxes that are going to China instead of to the U.S.
Let me note here that the Sept.18, 2018 Bloomberg Opinion challenged the actual magnitude of the deficit while acknowledging it to be enormous. It states, “…the U.S. should be pressing China to open up its own markets wider, to allow greater investment access and a level playing field to U.S. firms vis-à-vis local players.” Regardless of the ultimate solution to this challenge to our national security and economic well-being, what we are engaging in is crucially important. They are taking massive advantage of us, and sitting around the table chatting and sipping tea will never cause them to change their practices.
So where do we go from here? We have no choice but to continue to increase the pressure. And yes, we must pay the price to do that, and a growing price over time, but it is a cheaper price than we will pay if we wait.
Nobody said life would be easy and guess what? It is not.
