ELECTRIC VEHICLES FROM CHINA AND USE OF TARIFFS TO DEFEND DOMESTIC INDUSTRIES?
(RE: https://t.co/KkONn9ltoF @firstpost )
Why The Tariffs?
1) No one will trust the Chinese supply chain. Chinese strategy is ‘delay and deceive’. They use moral language to hid immoral ambitions. This strategy is as old as Sun Tzu. The Chinese NEVER have a moral ambition any more than the Russians or the Mullahs of Iran
2) EV’s are a strategic industry and EV’s produce external strategic industries.
3) But most importantly if the price of a good is lower because of lower labor costs (china) and government subsidy (china) then you are:
… a) Exporting your labor and their income to another country;
… b) Exporting capital to another country and not creating capital internally;
… c) And/or depriving your population of skills both in the industry and in tangent industries.
So when England sold it’s looms to Spain, and Spain to East Asia, this made sense. But the same is not true of technical skills, scientific research, and a skilled work force.
So when the USA wanted to avoid another world war and create a world of free trade, it made sense to export the American economic advantages to developing countries and countries that needed reconstruction from the wars.
However, the moment a group seeks to impose authoritarianism, to undermine the world order of free trade, and to seditiously undermine economies, there is no longer an advantage in importing cheaper goods for the population. (In economics this is called ‘accounting for both the seen and unseen costs’).
This disadvantage to export of capital, income, labor, skill, technology, and scientific research is especially true in a place like America where the problem is more one of extraordinary wealth resulting in the vast majority of the country rising to exceed the level of their personal, financial, economic, and political incompetency (whole country peter principle), and then putting that wealth into poor choices in a population rolling in hyper-consumptive hedonism at the cost of their physical and mental health, and their social and political cohesion as a people.
Cheers
CD