U.S. to collect 25% tariffs on Chinese woodworking equipment starting July 6

[Rich Enders]

Curt,

I am just learning as the situation develops, but certainly under the WTO (which most of the worlds countries are members of including the US, and China) there is no possibility of a 2%/20% trade tariff situation. Please note Item 1 of the WTO principals:

1. Non-discrimination. There are two major components: The most favoured nation (MFN) rule, and the national treatment policy. Both are embedded in the mainWTO rules on goods, services, and intellectual property, but their precise scope andnature differ across these areas. The MFN rule requires that a WTO member mustapply the same conditions on all trade with other WTO members, i.e. a WTOmember has to grant the most favourable conditions under which it allows trade in acertain product type to all other WTO members.[49] "Grant someone a special favourand you have to do the same for all other WTO members."[30] National treatmentmeans that imported goods should be treated no less favourably than domesticallyproduced goods (at least after the foreign goods have entered the market) and wasintroduced to tackle non-tariff barriers to trade (e.g. technical standards, securitystandards et al. discriminating against imported goods).[49]






Rich

[Steve Demuth]

The thing is this: at this stage, China needs the US more than the US needs China to accomplish it's long term goals.

I rather doubt that. Two decades ago when I first travelled to China, maybe. Today, exports to the US are about 3.5% of China's GDP, and their consumer economy is growing rapid enough to absorb the consequences of a significant reduction in that pretty rapidly. Clipping their economy by 1% in a trade war with the US will be at most a short-term set back.

China has some pretty serious economic challenges in the years ahead (they have a huge internal debt fueling their growth, a rapidly aging population, and rampant pollution and resource degradation), but US exports are a small piece and f their puzzle.

[Steve Demuth]

That's what I don't get. They aren't stealing anything; if companies don't want to share their IP, then they don't have to. If the practice is illegal, the US should do something about it appropriate to the offense. If it is legal, then starting a trade war is absurd.

There is both quasi-theft and outright theft of IP rampant in China.

The quasi-theft is the requirement that companies that operate in China do so through a Chinese partner. This is at least of questionable illegality in the WTO rules, and while not a uniquely Chinese practice, it is much more thorough there. This forces transfer of IP to Chinese companies in order to access their labor market.

Outright theft is also not uncommon. I saw it in action often in an earlier job - Chinese engineers would come to work for us for a few years right out of school or a Chinese company, and after 3 years move over to a Chinese company that would in short order put a competitive product to ours in the market. Since the products I worked on were software, it wasn't terribly difficult to prove that this involved outright theft of code, as well as transfer of protected IP if we could get access to the competitor's software (which on occasion, we did).

I am not saying other countries don't do this, but it is a far more common and institutionalized in China than anywhere else I've ever worked.

[Peter Kelly]

China has some pretty serious economic challenges in the years ahead (they have a huge internal debt fueling their growth, a rapidly aging population, and rampant pollution and resource degradation).

The environmental degradation in China is horrifying. If you're from the west and not used to breathing the toxic soup that usually hangs over the large cities (Beijing), your lungs will start to hurt after being there for a day or two. Food security is up at the top of that list of challenges as well. How to feed the largest population with precious little clean water and non-contaminated arable land is going to be incredibly difficult.

"Cheap" items from there will have come at a terrible cost.

[Rich Enders]

The following relates to your quasi-theft I believe. "There are signs that China is sensitive to U.S.pressure, with senior official visits to Washingtonand a vague statement<http://www.scmp.com/news/china/diplomacy-defence/article/2138087/china-vows-end-forced-tech-transfers-manufacturing> earlier this week by Chinese premier LiKeqiang that China would no longer forcetechnology transfers to Chinese companies".

Rich

[Joe Jensen]

That's what I don't get. They aren't stealing anything; if companies don't want to share their IP, then they don't have to. If the practice is illegal, the US should do something about it appropriate to the offense. If it is legal, then starting a trade war is absurd.

What they did to ZTE was block their shipments into the US. ZTE just recently paid a $950M fine to open shipments up again. That said the tech they stole gave them way more than $950M in benefit. This problem is very broad across tech in China. All other developed countries enforce IP infringement, China does not. Enforcing company by company is not getting the job done. Getting China to enforce IP infringement and getting equal tariffs are the goals. The tariffs are very unlikely to last long. No country wants a trade war. This is Trump forcing a negotiation. He may not win but he is forcing the issue.

[Simon MacGowen]

The environmental degradation in China is horrifying. If you're from the west and not used to breathing the toxic soup that usually hangs over the large cities (Beijing), your lungs will start to hurt after being there for a day or two. Food security is up at the top of that list of challenges as well. How to feed the largest population with precious little clean water and non-contaminated arable land is going to be incredibly difficult.

"Cheap" items from there will have come at a terrible cost.

China has now stopped accepting the imports of recyclable plastics, and many western countries (cities and towns), used to shipping trashes (including discarded computers etc.) to China, are now looking for other solutions including trying to find other Asian countries which are willing to take them. Wonder if we in the west would look at this "imbalance" and do something about it!

So that part of the world is good for use as landfills and ours isn't? Talk about imbalances!


Simon

[Joe Jensen]

China has now stopped accepting the imports of recyclable plastics, and many western countries (cities and towns), used to shipping trashes (including discarded computers etc.) to China, are now looking for other solutions including trying to find other Asian countries which are willing to take them. Wonder if we in the west would look at this "imbalance" and do something about it!

So that part of the world is good for use as landfills and ours isn't? Talk about imbalances!


Simon

I have to travel there frequently for work. Eating there always concerns me, especially seafood as much of it is farmed and the fish farms are super scary.

[Simon MacGowen]

This is Trump forcing a negotiation. he is forcing the issue.

Good...but the EU, Canada, and even Mexico are not stealing like China!

Simon

[Charlie Jones]

I wouldn’t worry about a trade or tariffs. The US holds most of the cards. If the Chinese want to sell their cheap machinery here they will back off on a trade war. If they don’t Taiwan or some other countries will take up the slack. An American company may even get in the game. Just hold off a little while before buying or buy before the tariffs go into effect. This will all straighten out as other governments realize the US means business. We have been very tolerant of their tariffs and price controls and thefts for years. It is about time to end that. We finally have a leader who can make it happen.

[Chris Parks]

The thing is this: at this stage, China needs the US more than the US needs China to accomplish it's long term goals.

That is classic western thinking, we think in years and at most a decade or two, the Asians think in centuries to achieve their goals. There is a big push by China at the moment and in the long term which is being talked about in the Asian/western pacific/sub continent regions about this new Chinese policy....

https://www.smh.com.au/world/asia/ch...18-p4zm4k.html

Taken from here which has more information

https://www.smh.com.au/topic/belt-an...initiative-jle

And it has begun, the first train that links London the China

https://www.youtube.com/watch?v=9GQrO6kAMcA

China will in the coming century steam roll the western world but every western country has their head in the sand.
You can call me a pessimist which I am sure will happen but I prefer to think I am a realist.

[Matt Mattingley]

The way I look at it, it’s just a tax on Business owners, and consumers, Middle-class, upper class. The next thing that will happen with this kind of inflation is...minimum wage will rise to 10-$12/hour. Business costs will rise and the popular vote will be won.

This is a popularity contest. If everybody goes to the poles that got a raise and their boss made less how will the voter turn out be next time round?

[Matt Mattingley]

Ive

That is classic western thinking, we think in years and at most a decade or two, the Asians think in centuries to achieve their goals. There is a big push by China at the moment and in the long term which is being talked about in the Asian/western pacific/sub continent regions about this new Chinese policy....

https://www.smh.com.au/world/asia/ch...18-p4zm4k.html

Taken from here which has more information

https://www.smh.com.au/topic/belt-an...initiative-jle

And it has begun, the first train that links London the China

https://www.youtube.com/watch?v=9GQrO6kAMcA

China will in the coming century steam roll the western world but every western country has their head in the sand.
You can call me a pessimist which I am sure will happen but I prefer to think I am a realist.

You know your stuff. But there is a lot of debt everywhere. The guy at the top is going after countries that have the most debt, but also have the most steak in US treasurys and bonds.

He’s asking for is shareholders to give back or he’s going to make his citizens, that consume shareholders products, pay!

I would like him to put a tariff on every border 25%! Built US or get taxed! Everything from water, electricity, fuel, electronics, vehicles, machines, airplanes, Metal, dairy, agricultural, every thing that crosses the border.

Whether it is from Nigeria, Kuwait, Japan, Canada, Mexico, Middle East, South America, China, Taiwan, Australia, England, UK, Iron, Iraq, Kuwait, United Arab emirates… put 25% tariff on them all! This will make America great again!

Iceland does 150% to 200% tariff on everything shipped into the country!

But they consume the most electricity per capita of the entire world. This is some more food for thought.

[Chris Parks]

When the US became economically dominant in the early 20th century and more so after WW2 the rest of the world shrugged and got on with it so to speak. Now that the US is being threatened from another country that eventually will take over that role the US is in panic mode about the whole thing. Countries have periods of influence and dominance, witness the period that Britain ruled the world and how its influence has faded in the period since the last world war. The same will happen to the US, maybe to a lesser degree but it is inevitable. I won't see it as the decline takes place but I will put money on it happening.

[Matt Mattingley]

When the US became economically dominant in the early 20th century and more so after WW2 the rest of the world shrugged and got on with it so to speak. Now that the US is being threatened from another country that eventually will take over that role the US is in panic mode about the whole thing. Countries have periods of influence and dominance, witness the period that Britain ruled the world and how its influence has faded in the period since the last world war. The same will happen to the US, maybe to a lesser degree but it is inevitable. I won't see it as the decline takes place but I will put money on it happening.

The guy at the top called this the “on“ a national security risk... this is no different then implementing the Adam bomb affect... Who is at risk of fall out... and what are the implications?

Result, we will all pay more for machines and everything built from other countries. Who is crying? We have lots of money, let’s spend it!