Is it Right for America to be Engaging in a Trade War with China?
So whatever you wish that others would do to you, do also to them, for this is the Law and the Prophets.
I recently read a CNN story about how President Trump’s trade war with China was nationalistic behavior at the expense of the global economy. Much of the impression that Trump is a nationalist comes from his quote, “Make America Great Again.” I already thought America was great, but we could always be better. I also think countries like Canada, Great Britain, Germany, and many others are great countries as well, but I believe that they, too, can be better. The fight with China is not a “nationalistic” fight but instead pushing back against unfair trade practices.
As a former business person who had to do business with China, I knew of many of their unfair practices. Technology companies had to give up their hard-earned intellectual property to do business in China. China subsidized their businesses in industries that they wanted to expand, such as the steel industry. These subsidies almost wiped out our own steel industry. Not only did Americans lose jobs but other steel-producing companies felt the same impact.
In some cases, payoffs have to be made to Chinese local officials. The companies I worked for did not comply and refused to engage in bribery.
China also supports its currency to provide an unfair advantage to their companies, while other nations allow their currency to float naturally.
China’s industries do not comply with international environmental standards and have become one of the most polluted countries in the world. Other nations that comply bear a significant cost disadvantage because they are good world citizens.
China produces 90 percent of the drug Fentanyl, which has contributed to the extreme drug crisis in America. While not an economic issue, it is a social issue that is costing America and other nations billions of dollars to address.
China regularly engages in cyber espionage to steal America’s and other countries’ hard-earned technology. Even my own website has “bots” that probe for information. Most coming from Russia or China according to my web hosting provider. Thankfully, I don’t have any great secrets and a strong firewall to prevent attacks.
It’s an abuse of its citizenry is currently being played out in Hong Kong, where the people want more freedom but are being denied. And let us not forget that they engage in some of the world’s most extreme persecution of Christians.
The trade war isn’t just about trade, it is about our country standing up against a despotic regime. President Xi recently had the Chinese constitution changed to make him president for life. This is a tough battle against a tough foe. This isn’t about nationalism, it is about fair play.
In my book Jesus & Co., It talks about the Golden Rule, “Do unto others as you would have them do unto you.” This is an important moral and business concept spelled out in the book. Any business that wants to survive in the long term should follow this concept. The same is true for countries. History is littered with companies and countries that eventually suffer due to having a bad moral compass.
While we read headlines every day about the latest updates in the trade war, it is silently having an effect. China’s growth has slowed, and in the last year they have lost 10 percent of their manufacturing orders, with more losses to come. As their economy has slowed, their debt has risen dramatically. In an effort to mask the deterioration in their growth, they have increased their debt. According to the Institute of International Finance, today, China’s total debt stands at $40 trillion or 300 percent of its gross domestic product, which accounts for 15 percent of the total world’s debt. And that number is growing. Much of China’s debt is shadow debt and not reported.
China is under pressure and needs to find a deal that is workable for the world. For too long they have bullied the rest of the world and gotten away with it. Companies who want to do business in China have to give in to their abuse or risk losing out on the world’s second-largest economy. This is largely because politicians around the world have not pushed back.
While I often disagree with Trump’s rhetoric, I do agree with his fighting back. He is standing up to a known world-wide bully, and he is winning. Not only will Americans benefit, but the rest of the world will as well. You don’t hear much from other countries, but they are silently on board with the trade war. Not only is manufacturing returning to America but other countries are also benefiting from increased orders. Ultimately consumers around the world will have lower prices, and their countries will have more jobs.
We need to be careful when we label things good for the world as nationalistic. In this case, the trade war is good for all world citizens. Whenever any country stands up to abuse it benefits all its global neighbors. I know Jesus wouldn’t approve of Chinese business practices or their social abuses. This isn’t a nationalist issue, but a moral issue.
Blessings, until next time,
Bruce L. Hartman