Saturday, January 19, 2019

China Offers Tariff Elimination


But no mention of intellectual property theft. See below:

CHINA OFFERS TRUMP A TRADE DEAL THAT WILL ELIMINATE THE TRADE DEFICIT BY 2024, By Steven Ahle, 1/19/19.

Once again President Trump is making the Democrats and their pet economists look like fools. They have been accusing him of wrecking the economy in his trade war with China.

But it now appears that the president has won the standoff. China is offering a package of increased purchases from the United States that would greatly benefit farmers and quite possibly Boeing.

The deal will include doing away with all tariffs on both sides and China agreeing to increase buying products from the United States. They say the deficit will be reduced to zero by 2024.

Liberal economists will come up with a dozen reasons why it’s a bad deal, but none of which can be verified until after Trump’s second term.

From Bloomberg: China has offered to go on a six-year buying spree to ramp up imports from the U.S., in a move that would reconfigure the relationship between the world’s two largest economies, according to officials familiar with the negotiations.

By increasing goods imports from the U.S. by a combined value of more than $1 trillion over that period, China would seek to reduce its trade surplus — which last year stood at $323 billion — to zero by 2024, one of the people said. The officials asked not to be named as the discussions aren’t public.

The offer, made during talks in Beijing earlier this month, was met with skepticism by U.S. negotiators who nonetheless asked the Chinese to do even better, demanding that the imbalance be cleared in the next two years, the people said. Economists who’ve studied the trade relationship argue it would be hard to eliminate the gap, which they say is sustained in large part by U.S. demand for Chinese products.

U.S. stocks extended gains and the dollar rose following the news. The S&P 500 Index rallied, climbing 1.3 percent by 1:27 p.m. and heading for its fourth weekly advance, while the dollar traded at session highs.


Comments

None of this would have happened except for Trump’s Tariffs on Chinese Imports. The problem is that global corporations have unbolted from their nationalities and home countries. The problem with that is that all economies are national and based on home country laws. Without competition there is no incentive for companies to do the right things. Without countries who compete with each other there is little use for government and less use in defending it.

Norb Leahy, Dunwoody GA Tea Party Leader

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