BEIJING, May 17 (Xinhua) -- Washington is waging a bullying campaign in an attempt to coerce Beijing into swallowing trade concessions it cannot accept.
While wielding a big stick of punitive tariffs, the Trump administration is also trying to mislead the international community into believing that China is to blame for the ongoing trade tensions.
The first lie is that China has been deliberately pursuing a huge trade surplus with the United States.
Mainstream economists worldwide have already refuted such a claim. According to Stephen Roach, a senior fellow at Yale University, the fact that the United States ran trade deficits with over 102 countries in 2018 reflects a profound shortfall in domestic savings.
When Americans are consuming far more than their country can deliver, the United States needs to import surplus savings from overseas and run huge current-account deficits to attract the foreign funds. Therefore, trade deficits are the result and not some kind of a foreign conspiracy.
The truth is that tariffs on imported products would not help the United States water down any trade deficit. Statistics show that in 2018, the year when Washington kicked off its tariff bullying, U.S. merchandise and service trade deficits still increased by 12.5 percent, reaching 621 billion U.S. dollars, a ten-year record high.
Another unwarranted accusation made by Washington is that trading with China is slashing jobs in the United States. According to a report released by the U.S.-China Business Council, China-U.S. trade has supported almost 2.6 million jobs in the United States across a range of industries.
Raising tariffs is highly likely to cause job losses in the United States because supply chains would be disrupted and corporate costs would rise.
As for Washington accusing China of forced technology transfers and theft, don't believe it. Such accusations are conjured up by desperate U.S. politicians looking to score points. They have ignored the fact that technology transfers between Chinese firms and their foreign partners happen on a consensual basis.
Over the past few decades, China has achieved some notable progress in cutting-edge technology because it has stepped up measures to encourage innovation and protect intellectual property rights.
So far, China has joined almost all major international conventions on intellectual property. Its firms always pay for patents they use. In 2017, royalties paid by China to the United States reached 7.13 billion U.S. dollars, accounting for a quarter of the total intellectual property charges China paid to other countries, according to data.
China has worked hard to improve its business environment for foreign investment. In January this year, the U.S. electric carmaker Tesla Inc. broke ground in Shanghai to build a factory, becoming the first foreign automobile company to do so in China. That is a vote of confidence in the country.
Last but not least, Washington's belief that tariffs will be paid by China is another lie. In fact, these tariffs are a tax on Americans.
Already, U.S. consumers are feeling the heat. According to a recent study by the University of Chicago and a Federal Reserve Board Governor, the price of washing machines have gone up by an average of 12 percent after additional tariffs were imposed. That's almost 100 bucks per washer.
The tariff war on China has already stoked a wave of opposition from U.S. industry. Several U.S. industrial groups including the American Soybean Association, the National Retail Federation, and the Information Technology Industry Council denounced the move, saying it will jeopardize American jobs and increase costs for consumers.
The fact that economic relations between China and the United States are highly intertwined means Washington cannot pull itself out of the situation unscathed.
Moreover, its tariff strategy is already sending shock waves around the world. Global stock markets have been on a roller coaster ride in recent weeks. Investors are facing huge uncertainties, and a future global economic recovery is very much in doubt.
Decison-makers in Washington need to understand that bullying isn't the solution to its trade disputes with Beijing. Only a trade deal that respects China's sovereign rights and legitimate concerns will do.
Related:
America's False Narrative on China: Stephen S. Roach
BEIJING, May 17 (Xinhua) -- Stephen S. Roach, a senior fellow at Yale University's Jackson Institute of Global Affairs and a senior lecturer at Yale's School of Management, recently published a signed article on Project Syndicate, titled "America's False Narrative on China." Full story
