Trade War with China
is Good for US
By Joel D. Joseph, Chairman, Made in the USA Foundation
In 1972 we did not trade with China at all. Unemployment was at a low 5.2% and the GDP growth rate was 5.3%. In 1973, unemployment went down to 4.9, while the GDP growth expanded to a robust 5.6. There was a small trade deficit with the world in 1972 and a small trade surplus 1973. Since that time, China has taken five million manufacturing jobs away from the United States. Trade with China has impoverished American blue-collar workers while raising living standards in China. This trade has become a one-way street leading to the decline of the United States.
Expanding Trade with China did not Lead to Democratization
Nobel-prize winning economist Milton Friedman wrote in Capitalism and Freedom, "[T]he kind of economic organization that provides economic freedom directly, namely, competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other." Similarly, President George W. Bush made the same point about China: "I believe a whiff of freedom in the marketplace will cause there to be more demand for democracy." Both President Bush and Milton Friedman were wrong: The last twenty years has clearly demonstrated that China is not more democratic now. China is now trying to strangle freedom in Hong Kong and put down protests there.
The U.S. Economy is Too Entangled with China's Economy
China became a member of the World Trade Organization (WTO) in December, 2001. The admission of China to the WTO signified China's deeper integration into the world economy. Now China supplies the United States with more products and components than ever: auto parts, laptop computers, iphones, shoes, clothing and toys. It is difficult to go into a retail store in the United States and find products not made in China.
Soviet dictator Vladimir Lenin wrote, "When it comes time to hang the capitalists, they will vie with each other for the rope contract." The same principle is strangling the United States in China: capitalists have moved five million jobs from the United States to China, cutting their own throats to save a few bucks.
Unbelievably, the U.S. Defense Department is now importing Chinese rocket fuel for Hellfire missiles. This not only weakens the U.S. economy, it directly threatens our national defense. The AGM-114 Hellfire is an air-to-surface missile developed primarily for anti-armor use.
The United States is completely dependent on a single Chinese company (1,2,4 Butanetriol) for the chemical needed to produce the solid rocket fuel used to propel Hellfire missiles. As current U.S. supplies diminish, our military will be dependent on China to maintain this missile system. Hellfire missiles are a critical component in America's arsenal. Common sense dictates, "Thou Shall Not Rely on China for Weaponry." Retired Brigadier General John Adams wrote a report recently titled, "Remaking American Security: Supply Chain Vulnerabilities & National Security Risks Across the U.S. Defense Industrial Base." In this report, General Adams said, "America's vulnerability today is frightening. This report is a wake-up call for America to pay attention to the growing threat posed by the steady deterioration of our defense industrial base. Excessive and unwise outsourcing of American manufacturing to other nations weakens America's military capability."
Importing these crucial products also violates principles of common sense that we should not be reliant on supplies from countries that may be in a shooting war against the United States or our allies. Let's put common sense and independence back into the Pentagon's thinking.