The on-going trade war between the United States and China can be viewed as an inevitable outcome of the democratic American Dream clashing with the despotic Chinese Dream.
President Trump’s trade war against China, based on his accusations that Beijing has stolen intellectual property and adopted unfair practices that have weakened America’s manufacturing industries, has the full support of mainstream public opinion and is in complete accord with the interest of a majority of the American people.
Trump is using the trade war as a means to force China to reveal itself to be a country that practices protectionism while pretending to be a defender of free trade. His ultimate goal is to rectify the current trade imbalance between the U.S. and China caused by the latter’s unfair trade practices, and to reinstate “real” free trade.
Indeed, the U.S.-China trade war is a war between free trade and protectionism rather than friction inside the free trade bloc.
Though Trump’s imposition of stiff tariffs and removing trade barriers could have a great impact on the global trading system, the outcome could be better than widely expected.
Once a really free trade system has been created, it will benefit the global economy and boost prosperity by lowering transaction costs, reducing trade barriers and increasing efficiency via free competition.
In contrast, if no one dares to challenge Chinese-style unfair trade practices and unilateralism, allowing its economy to grow strong by bullying others, Beijing will forge unequal relations with its trade partners and eventually reduce them to its geopolitical vassals.
Such serious consequences are beyond the scope and comprehension of “pure” economists.
Even more important is the fact that China’s rise by improper means has had a severely adverse impact on the development of universal values.
Communist China was so poor no one anticipated it would become a threat to world peace, but it is now so strong economically and industrially that it has built a digital dictatorship to monitor its own people and is promoting the Road and Belt Initiative to trap neighboring countries with debt and force them to concede major political and economic interests — all in an attempt to create a Chinese empire.
In the American Dream individuals are given a chance to accomplish what they can in an open and free society and build a strong democracy, whereas the Chinese Dream is a collectivist nightmare in which individuals are nothing but cogs in the apparatus of the state, manipulated by a small clique of rulers.
Certainly, some economists have been beguiled by the economic development of China and cannot figure out the real significance of the ongoing trade war, much less its importance to the development of civilization.
However, a majority of Americans and many political and economic elites around the world are very much aware why this is a trade war liberal economic institutions cannot afford to lose. (Editorial abstracts — Aug. 13, 2018)