[anon23423532]

It's punishment for stealing hundreds of billions of dollars of IP, illegally subsidizing businesses to steal market share, and general national security by not outsourcing knowledge and infrastructure critical to national security to save a few bucks.

It's easy to let someone push you back inch by inch instead of fighting back, but eventually you're on the edge of a cliff and have nowhere else to go.

I'd take short term pain over one day waking up and realizing that China has total control over manufacturing for everything essential for modern life and in exchange we got cheap consumer goods for a few years.

[luma]

I understand the rationale, which is pretty clearly laid out here: https://ustr.gov/sites/default/files/Section%20301%20FINAL.P...

What I don't understand is the response. The burden of this cost has entirely been placed upon US businesses purchasing products from (in many cases) the only place you can buy them and then assembling the completed product in the US with US labor.

As someone doing small-scale production in the US, the simple way for me to avoid these tariffs is to have China assemble everything. Finished consumer goods have been explicitly avoided in this list. Can you explain to me how this is helping US manufacturing?

[sitkack]

It prevents the tariff from being applied to iPhones and MacBooks.

[frgtpsswrdlame]

Yes but I see your comment as a rationale for an additional tariff that covers your circumstance.

In what way would you punish China for their bad actions regarding US technology?

[radlad]

Sometimes doing nothing is better than doing something. In this case, doing something (a) does not harm China, as intended, as they are still the only viable place to purchase these items, yet (b) actively harms business in the United States, as we are paying the additional cost ourselves.

[frgtpsswrdlame]

(a) I mean this tariff does definitely harm China. The reason they're the only viable place to purchase these items is because they're so cheap. Making them more expensive gives space for non-Chinese competitors to enter into business.

(b) It actively harms some businesses, but also gives room for new companies to form where they wouldn't have been able to previously. It's wrong to claim this hurts 'business' in a broad sense.

>Sometimes doing nothing is better than doing something.

Perhaps but in this case better for who? It doesn't seem to me that - for most Americans - allowing the Chinese to steal our technology and then underprice our businesses with cheap labor is beneficial.

[systoll]

> allowing the Chinese to steal our technology and then underprice our businesses with cheap labor [is not beneficial to most Americans]

This tariff isn't preventing that, or punishing the Chinese companies involved.

> The reason they're the only viable place to purchase these items is because they're so cheap. Making them more expensive gives space for non-Chinese competitors to enter into business.

This tariff makes American assembly of Chinese components more expensive than it already is. Finished goods made in China are unaffected.

For example, an assembled-in-china iPhone will stay the same, but the moment this comes into effect, the cost of making the Mac Pro in the US will go up substantially.

To avoid this, apple can either:

1. Shift Mac Pro assembly to any other country.

2. Switch out all their suppliers and components to ensure that nothing comes from China.

Most products have done #1 without the tariff. The tariff just makes it harder to justify keeping anything in the US.

[orwin]

It does not harm china that much:

It's too late for IP on old products, China is becoming more and more interesting for european "brain" (or US is less interesting, i don't know), and China education have caught up to western education (at least in STEM) during the last decade.

The tariffs attack the wrong goods: Us manufacturers will still be buying them at 25% up, and chinese and europeans will sell finished products lower than manufacturers. And China can actually outsource the finishing touch of unfinished products in SW Asia or (even better for almost everyone) in Africa.

Honestly i don't really care but i am interested on how India/Indonesia (and some african countries i hope) will take advantages of Trump policies. To me this is a good thing for the world, general "comfort" of several countries could rise thank to Trump. I know it's frowned upon here, but i like several move he made, including this, and how he made european countries closer.

[AFNobody]

> Perhaps but in this case better for who? It doesn't seem to me that - for most Americans - allowing the Chinese to steal our technology and then underprice our businesses with cheap labor is beneficial.

- China's labor prices are increasing faster than they are in the US. So fast in fact, people are automating factories in China and/or moving factories to other countries.

- Every country _except_ the US will continue to buy those goods at the real market price.

- This is just exporting US jobs to Mexico/Canada who will assemble and import into US via NAFTA. That is the best case.

- Worst case this sets off a permanent trade war with China and the US is forced to sever ties with every potential "cut out" through which trade can flow. The US would need to knife all of its allies in the back and impose these tariffs on all nations for this to actually work.

- The correct response to China's behavior was the TPP followed by multilateral action to punish China.

[TooBrokeToBeg]

> the TPP followed by multilateral action to punish China.

So subserving the US to a more ludicrous IP extension (both in duration and power) from less totalitarian (than china) nations (but still more than the US) is the solution? Laughable and misguided.

[kinsomo]

> (a) does not harm China, as intended, as they are still the only viable place to purchase these items, yet (b) actively harms business in the United States, as we are paying the additional cost ourselves.

There's an important qualification: that's probably only true in the short or medium term. I believe the goal is that the higher cost would produce economic space for competitors to enter the market.

Ironically, I believe the WTO rules allow for countries classified as "developing" (like China) to maintain high tariffs to develop local industry for precisely this reason.

[curiousgal]

>that's probably only true in the short or medium term

Exactly, except there is no long term because the following administration will undo all of what the current one has done.

[mistermann]

Citation?

[jtmcmc]

a multilateral action like say a non terrible version of the TPP...

[kinsomo]

> What I don't understand is the response. The burden of this cost has entirely been placed upon US businesses

I don't think that's true, which is proven by the fact that China is strongly opposed to the tariffs and plans to retaliate with their own. China's exports will go down, so it will cost them too.

[defertoreptar]

If the USA goes up 25% and then China goes up 25%, then it will impact China's GDP far more than USA's. China's economy relies much more on trade with the USA than the other way around.

[lancewiggs]

It depends what they apply it to - and we can bet that a lot of thought will go into that.

[znpy]

> The burden of this cost has entirely been placed upon US businesses

This is imho the right thing to do: on the large volume, it might make it economic enough to just build such components in the us, recreating old jobs of the now lost middle-class.

[EpicEng]

I don't know why you're being downvoted; China absolutely does all of those things. They are not playing fair in the global market and never have. One can debate whether or not the tariff is the right approach, but let's not pretend that China is a victim.

[tehbeard]

GP never said China was a victim, just that a tariff screws over US companies, not China.

[EpicEng]

Sure, I didn't mean it that way. I was referring to what I assume the down voters were thinking, but I wasn't very clear.

[anon23423532]

If manufacturing moves elsewhere and a few million already disgruntled Chinese are out of jobs, Chinese government has big problems. Their impotent threat towards the US ag industry is also laughable when we produce 40-50% of the worlds soybeans and corn. Increasing food prices for the millions of unemployed workers is surely a winning strategy

Cheap labor is plentiful, there's only one US consumer market. China has no leverage here.

[elago]

I'm curious how are you coming up with these economic projections? Are you running simulations? Reading reports? Are you an economist?

What if China just sells to other customers? What is China subsidizes it's manufacturers, so they get paid and keep their production capacity whether or not they're actually producing? Exactly like soybean and corn farmers in the US are btw.

The whole thing seems incredibly complex, and most of the economic opinions I read about don't say "markets are better when the goverment skims 25% off of all transactions".

So I'm curious how you immediately come to the conclusion "USA Wins, China has no leverage, game over".

[anon23423532]

They can try selling to other customers, but US is still around 25% of global GDP and probably a larger percentage of the market for the components that have been tariffed. Chinese government would have to print a lot of money to make up for that, which causes it's own issues, especially when considering the amount of debt China has already racked up.

The point isn't for the government to skim 25%, it's to get China to trade fairly or if worse comes to worse bring manufacturing back to the US.

In the event of a trade war US has leverage because we have the market and a essential product, food. US consumers can live without another 42in tv, Chinese can't live without food and they are entirely dependent on importing that food.

[evgen]

> US consumers can live without another 42in tv, Chinese can't live without food and they are entirely dependent on importing that food.

But they aren't dependent on importing that food from the US. Brazil, Australia, Thailand, Indonesia, Malaysia, Canada and Argentina are all happy to step up and take over for US producers who are now going to see demand fall through the floor and these producers have been preparing for the inevitable shoe to drop in retaliation for US tariffs for months now. Luckily most of the damage is going to be felt in those central plains red states, so we can all ruefully shake our heads and remind them that this is what happens when morons elect one of their peers.

But I am sure people are just going to be overjoyed when their Christmas electronics are significantly more expensive, and we will see how long they believe delusional statements like ones claiming that this action will "bring manufacturing back to the US" -- I am betting that line will get you a beat-down in the Midwest by next spring.

[mcphage]

> if worse comes to worse bring manufacturing back to the US

If these tariffs are on components and not manufactured goods, then it seems like it would push manufacturing into China, not bring it back to the US.

[sangnoir]

> US consumers can live without another 42in tv, Chinese can't live without food and they are entirely dependent on importing that food.

All fair points, but can US politicians live with opposition from the agricultural lobby and/or rural vote? Political expediency beats long-term economic planning when politician's livelihoods are on the line.

[simplify]

> The point isn't for the government to skim 25%, it's to get China to trade fairly

How is it currently unfair?

[sfoblowsjose]

"consumers can live without another 42in tv." So you think. Americans will rage if these taxes land on them. There will be hell to pay. Fuck with Americans TVs and iPads, we will go to war.

[sheepmullet]

> and most of the economic opinions I read

Have you read the economic opinion on income taxes?

Hint: They also make markets less efficient. But nevertheless we think the trade off is worth it.

[xbmcuser]

Isn't this playing into China's hands they want to move up value chain from providing components to whole devices. Now chinese made devices will be at least 25% cheaper on components alone they already have the advantage of cheap labour. In the last few years assembly plants were supposedly coming back to the US now that would less likely.

[Theodores]

Those of us in the rest of the world view U.S. agricultural products as subsidised and dumped on the world market. Look at the history of the Chicken Tax to see the long history of this.

The rest of the world would actually prefer jobs for our own farmers and we would also prefer to not be eating genetically modified junk from America. It is theoretically possible to live without a Harley Davidson motorbike and whatever else America actually makes these days, as for food, that is vital. Therefore in places like Japan rice is given special protection.

I hope the Chinese respond by selling off the many trillions of US bonds/debt they have been buying over the years.

I also hope that the petro-dollar is no more and that the world can move to an era of genuine fair trade.

[chrisjc]

I agree with you, although the thought of millions of nationalized, disgruntled, unemployed citizens within a highly industrialized country is rather terrifying in general, not just for the Chinese government.

[ojbyrne]

Nobody votes in China. There is an election coming up in this country.

[pjc50]

Whereas the US has always played fair in the global market and never used its dollar position, tarriffs, sanction, invasions etc for market advantage?

[azinman2]

The dollar floats in value. The Chinese manipulated their currency to make their exports cheaper for years... which worked. Only recently have they eased off on that. They also heavily subsidize shipping to make it cheap to export, make it difficult to sue anyone stealing IP, etc etc.

Sanctions in the US have been about avoiding wars, rather than trade. There are also other global reserve currencies... value of dollar was earned.

Invasions have been shady for raw materials, for sure. Chinese are getting that in smarter ways now, but building their new “Silk Road,” which is a way to ensure they get raw materials mined by Chinese labor by Chinese companies in foreign land by propping up existing corrupt officials. Basically they took a US playbook and made it “better.”

[EpicEng]

China imposes massive tarrifs on the US, subsizes the majority of its economy, and is one of the most protectionist economies in the world. No one ever said the US is perfect in all things, so I'm not sure who you're arguing with, but if you want to compare specifics on China v the US you're going to lose.

[merpnderp]

You're comparing apples and oranges. When has the US government stolen trade secrets from foreign companies and then bootstrapped new domestic companies to compete against them?

China has surely done all the things you're accusing the US of, but they aren't being punished for that.

[tomarr]

The US actually did this extensively during its own industrialisation, stealing IP from Britain and shielding its own fledgling domestic industries (textiles was the tech sector of the day).

Britain took steps as extensive as banning skilled people from travelling to the USA.

All this is just historic and doesn't necessarily feed into what should be done in the present situation, but it is useful to note that this is a common path that developed countries have followed in the past:

- ignore/steal IP

- protect and subsidise domestic equivalents

- upon domestic industry being competitive, reciprocally lower tariffs

- once fully developed, lobby for free trade and strong IP protection

[pjc50]

http://money.cnn.com/2015/04/30/news/airbus-germany-nsa-spyi...

(I'm not sure anything has been proven definitively in the open, but I'm not sure that applies to all these China allegations either)

[merpnderp]

So you would have had a problem with the EU retaliating if they’d felt they had enough proof for a case?

[Spooky23]

Be careful. The US doesn’t exactly “play fair” either.

[debt]

Not every single Chinese tech firm does these things. It's possible to develop a more nuanced view of China other than "China bad tariff good".

Why not investigate which firms committed which crimes and punish those specific firms? It's a smarter approach that helps our justice system and China's.

But "smarter" isn't part of this administrations playbook.

[jandrese]

While I agree that you could find firms that have not stolen IP to make their product, trying to nail down the sanctions to individual businesses would never work. The number of entities you would need to track and audit is enormous and it's way too easy for someone to launder the information around to supposedly "good" businesses.

You're talking about the entire supply chain, so you would end up punishing firms that are otherwise innocent because unbeknownst to them they bought resisters or capacitors or silicon plates from a bad actor.

A smart approach is just not feasible at this scale.

[debt]

"so you would end up punishing firms that are otherwise innocent"

That's exactly what the current tariffs do. So I guess if it's too much work to vet individual firms, we just lazily start a trade war? Again, for this administration, sounds about right.

[jandrese]

Yes. You can either punish innocent firms, or punish innocent firms plus lots of extra paperwork.

[EpicEng]

Sure, but I don't think that's a practical solution. Also, tariffs like this aren't intended to harm individual businesses; the intent is to pressure the Chinese government, a government which directly supports and plays a role in IP theft and market manipulation. Why would the US spend an insane amount of resources to lessen the effect when the effect is exactly what they're after?

[sremani]

When two elephants fight, many ants die. There is no precision guided ammo in trade wars. Its brute force!

[s2g]

I would have downvoted for the "general national security" bit.

Everything else, sure. But national security, especially expressed like that, is just another "WON'T SOMEBODY PLEASE THINK OF THE CHILDREN".

[mtw]

The are subsidies everywhere. The US government subsidized the oil industry for dozens of years, same for agricultural sector and major sectors of the economy (See Great Depression). Currently, electrical vehicles are also receive subsidies in most states.

I'm not a big believer in IP (go Free software!). I find though if we have to strictly follow IP, then the US would have to pay for the use of paper and gunpowder, and many other inventions originating in China.

What I hate so much about that it assumes it's all due to Chinese secretly stealing American IP. Nope - just go to China. People are working extremely hard and industrious. There is also 1.4 billion Chinese. And while there are good American products, there are also great German-made robots and tech, Korean chips, French nuclear reactors that Chinese would rather have than American products. Focus on building better products, work hard, and it will work out.

[defertoreptar]

This goes beyond subsidies. We're talking about espionage, theft, forced technology transfers, and mandatory joint ventures if you want to set up shop in China.

[fspeech]

"if you want to set up shop in China"

That is a funny line of logic that gets thrown around a lot, considering that the advocates' stated preference is for industries to move out of China. Isn't wide dissemination "about espionage, theft, forced technology transfers, and mandatory joint ventures" enough a deterrence for companies to stop going into China? Apparently not.

[defertoreptar]

> Isn't wide dissemination "about espionage, theft, forced technology transfers, and mandatory joint ventures" enough a deterrence for companies to stop going into China? Apparently not.

You're right, and at the same time, that's not the point. The USA has been granting China favorable deals, which has resulted in trade deficits. The expectation is that the China will at least follow and enforce international trade law. The USA decided that the Chinese government is not doing this and is instead actively subverting it at the expense of US companies. This is a response to that.

[zach43]

> punishment for stealing hundreds of billions of dollars of IP

I feel like its more the other way round...the American IP system is overly expensive and outdated, and should be reformed instead. The repercussions of this are felt most heavily on domestic industries too.

[flyingcircus3]

I concur. There seems to be a common thread in entrenched entities when their hegemony erodes before their very eyes and their well worn levers of power suddenly stop bearing fruits.

It's like when someone loses their wallet, and their first instinct is to completely discount the possibility they just misplaced it, and jump straight to the conclusion that someone stole it.

Start at your only acceptable conclusion, and work backwards to construct a plausible scenario that you can parade around as the obvious culprit.

[cakeface]

Right! If we adopted a chinese approach instead of trying to force ours on them we might actually improve intellectual property laws.

[foobarbazetc]

Your comment is just a giant [citation needed].

None of this is true. “IP” produced by a nominally US corporation with hundreds of offices around the world is not attributable to the US government.

This is just some super simplisitic nationalist BS masquerading as trade policy.

[pstuart]

It would be great to move a bunch of technology/manufacturing back onshore, but that's a different conversation.

This appears to be done for political reasons: https://www.nbcnews.com/politics/white-house/trump-was-angry...

[drb91]

It’s not clear these tariffs will change this. It’s still in China’s interest to gate entry to their markets.

[s2g]

> general national security by not outsourcing knowledge and infrastructure critical to national security to save a few bucks.

That's the best argument?

ZTE was literally being used to spy en masse. maybe start there instead of "general national security".

Care to explain Canada and the EU getting tariffs?

[dboreham]

Look at the early history of the jet engine to see how countries other than China engage in similar tactics.