Is the US actually too chicken to take on China for trade?
A weak yuan guarantees Beijing massive trade surplus even as the White House tries tamp down on Chinese imports Since China offered a truce in the trade war last October following its threat to deprive the United States of rare-earth magnets, the Trump administration has been happy to stop escalating. After all, imports from China have been falling, down by 40% in the year to June, compared with…
The United States appears reluctant to confront China over trade, despite a significant trade deficit. While China's share of US imports has dropped, it remains a substantial portion of total value added. The White House recently acknowledged that blocking imports is not equivalent to avoiding Chinese goods altogether, citing a report highlighting how rerouted shipments destroy American jobs.
However, the administration has resorted to AI-powered border detection to target rerouted imports, but this approach is unlikely to significantly impact the US import bill or pressure China's exports. The undervalued Chinese yuan is a more direct solution to curb China's exports, which are detrimental to global economies. Despite economic and political complexities, addressing the yuan's value could potentially reduce China's trade surplus, stimulate domestic consumption, and encourage fiscal restraint in the US.
However, the US has not prioritized fiscal discipline, and the yuan's weakness reflects broader economic dynamics.
Written by urgent.news from The Guardian US's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
Also reported by 1 other outlet
- Is the US actually too chicken to take on China for trade? theguardian.com
