Article Review The US The Likely Loser Of The Trade War With China

The US the Likely Loser of the Trade War With China 1

Article Review. The US the Likely Loser of the Trade War With China.

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Article Review. The US the Likely Loser of the Trade War With China.

The article, US the likely loser of the trade war with China, written by ken Moak in

September 2017 elaborates some of the possible consequences that the USA’s economic policies

towards China may cost it in the long run. It argues that in the next two years, the USA will be

experiencing serious economic crisis orchestrated by declining local demands. This follows a

series of attacks that the USA has launched against both North Korea and China on allegations

that the two countries are working on nuclear plants. The USA threatened North the adamant

North Korea with embargoes should they dare test any nuclear missiles. However, the leader of

North Korea promised to keep the fire burning. The article has a central hypothesis that the USA

is intimidating North Korean trade partners with embargoes because the USA believes that by so

doing, she can, at last, orchestrate the fall of eastern communism, especially in Beijing.

The environment in this context is trade and industry as they relate to the political

economy of the trading countries. The USA is weighing, not only the possibility of remaining

powerful as a capitalist country but also to remain the best politically stable country by

controlling all the nuclear programs of the rest of the nations. According to (Aitime.com, 2018

web) the USA stands to lose should it go ahead and place trade barriers between it and China.

This is because the USA consumes at least 18% of Chinese exports. China's likely response to an

embargo that shuts this trade may emulate what happened in the year 2007 when at least 23

million Chinese workers were laid off and returned home. What followed was a series of

economic stimulus programs to promote local employment of the laid-off workers which later

created a mini economic rejuvenation.

According to Garfield and Santana (1997 p15), the trade barriers have serious

consequences to the victim country in terms of welfare economics. For instance, during the

The US the Likely Loser of the Trade War With China 3

Cuban crisis when the USA placed trade barriers against Cuba, it suffered serious wellness

problems like rising cases of infectious diseases, poor nutrition and violent deaths among others.

This is a costly exercise for both the USA and China or North Korea. Cooper and Li (2006 p305)

argue that some of the USA’s sanctions policies have not only been costly but also ineffective.

This confirms that authors arguments that the US sanctions against China may as well work

against the US itself. Hence, there are some salient issues which sanctions may not effectively

deal with. In the case of Pyongyang, the leader had always maintained that in as North Korea can

do a significant harm to the United States (VanWagenen, 2000 p239).

The orthodox theory of international relations applied in this context is the liberalism

theory. Liberalists argue that the international relation exist as a means of exchange for two

states which benefit from the exchange equally. As such, there is no superior person in such an

exchange. In as much as there could be the move by one state to influence the decisions in such

kind of exchange, it may not succeed because there is least influence of power. In this article, eh

author argues that in as much as the USA may issue sanctions on China and North Korea, the

consequences may be detrimental even to the United States itself. It is obvious that the United

States tries to exert its power to influence the spread of their economic and political ideology in

the east through trade wars. However, this may fail because as much as both China and North

Korea benefit from the trade with the United States, the United States also benefits from the

trade immensely. Hence, there is a reciprocal relationship between eth two countries as defined

by the liberalist perspective.

The strength of this article is that it is up to date and it uses information of from the

events that are very current. The stalemate between the USA, Pyongyang and China has been a

hot topic in the international politics since president Trump assumed the office. Hence, the

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military propaganda that North Korea has been using to threaten the USA is very important in

the understanding of the topic of international political economy. Moreover, the article

acknowledges the historical developments of the discord between the three nations.

Suggestively, this is a continuation of the cold war in which China and the eastern world spread

socialism while the USA and the west spread capitalism. The article suggests that the USA is

determined to fight the Chinese socialist using the trade wars.

The weakness of this article is that it fails to elaborate specific ways in which China will

react to the embargoes, could USA end up subjecting them to them. What comes out in the

article are the past experiences of how China had responded to similar political climates in its

economy. The fact that the Chinese stimulus package of 50billion after 2007 crisis met its

objective of economic rejuvenation in rural areas does not mean that it is the sure way through

which China will deal with similar situation again. The article should have addressed the sure

ways through which China can respond to such advances by citing policies that are already in

place. The alternative theory through which this article could have presented the issue is the

theory of political economy. Political economy elaborates the relationship between politics and

economic gains by the two countries that are in the game. The author could have argued that the

USA uses the trade wars against a bigger economy like China so that the Chinese communism

idea may not influence the world like the US's capitalism is doing. At the beginning of the

article, the author was keen enough to note that "the US hardline policy against Pyongyang

because a trade war could topple the Communist regime in Beijing" (Atimes.com, 2018 web).

The USA can remain a superpower for as long as there is no other threat from outside in terms of

military training and investment in nuclear energy. Hence, if the USA lets China invest in

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nuclear energy, it may threaten the US's superiority in terms of politics. The US must work as

hard as possible to thwart this military expedition by China through whichever means.

The US the Likely Loser of the Trade War With China 6

Bibliography

Garfield, R. and Santana, S., 1997. The impact of the economic crisis and the US embargo on

health in Cuba. American Journal of Public Health, 87(1), pp.15-20.

Gandolfo, G. and Gandolfo, G., 1998. International trade theory and policy. Roma: Springer.

Cooper Drury, A. and Li, Y., 2006. US economic sanction threats against China: Failing to

leverage better human rights. Foreign Policy Analysis, 2(4), pp.307-324.

VanWagenen, P., 2000. US Economic Sanctions-Non-Traditional Success against North

Korea. Law & Pol'y Int'l Bus., 32, p.239.

Harrison, G.W. and Rutström, E.E., 1991. Trade wars, trade negotiations and applied game

theory. The Economic Journal, 101(406), pp.420-435.

Harrison, G.W. and Rutstrom, E.E., 1987. Trade Wars and Trade Negotiations: A Computational

Approach.

Atimes.com. (2018). US the likely loser of trade war with China. [online] Available at:

http://www.atimes.com/us-likely-loser-trade-war-china/ [Accessed 16 Apr. 2018].

Archick, K., Grimmett, R.F. and Kan, S., 2005, May. European Union's Arms Embargo on

China: Implications and Options for US Policy. CRS Report to Congress. LIBRARY OF

CONGRESS WASHINGTON DC CONGRESSIONAL RESEARCH SERVICE.

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