The focus has shifted to Chinese practices that many American companies and trade experts agree are more onerous and threatening to the future of U.S. economic security. China has in recent years moved to erect various rules and policies aimed at protecting its lucrative market from foreign domination while nurturing its own national champions to compete globally.
The Chinese economic strategy is shifting away from attracting multi-national foreign direct investment to unfairly supporting Chinese-owned companies. China is now adopting policies and rules that pressure foreign firms to share technology with Chinese companies, or the Chinese government, as a condition for doing business in China.
For well over a century the federal government was largely financed by tariffs averaging about 20 percent on foreign imports. All the way up to 1972 tariffs were generaly well over 7 percent and in most years averaged 20 to 30 percent. Tariffs kept our home-based manufacturing strong. Americans expected to pay more for foreign products than those Made In The USA. Now we pay far less for Chinese-made products than the American equvalant or non-equavelient becuse those American products are no longer made in the U.S. We need a much stronger tariff policy. The high-profile failure of solar equipment maker Solyndra was attributed in large part to a sudden influx of low-cost Chinese panels, despite the advanced solar technology developed by U.S. engineers working at Solyndra.
The U.S. government must respond to China’s unfair trade practices with much higher tariffs than just 2.9 to 4.73 percent if we are to restore a strong manufacturing sector in the United. States.
The U.S. government should impose robust import levies and tariffs (tax) on particular classes of imports that are determined to be manufactured outside the United States and exported back to the United States that do not qualify as “Fair Trade” and unfairly undercut an American-make equivalent. At present, American corporations are increasingly abandoning the United States and its communities to invest in productive capital formation outside the United States, particularly in China, Mexico, India, and other parts of Asia. As a result, America is experiencing the de-industrialization of America. Such overseas operations have the advantage of “sweat-shop” slave labor rates relative to American standards, low or no taxation, supportive infrastructure provisions, currency manipulation, and few if any environmental regulations––which translate to lower-cost production. Thus, producing the same product or service in the United States would be far more expensive. For most people, economic globalization means a growing gap between rich and poor, technological alienation of the labor worker from the means of production, and the phenomenon of global corporations and strategic alliances forcing labor workers in high-cost wage markets, such as the United States, to compete with labor-saving capital tools and lower-paid foreign workers. Unemployment is high and there is an accelerating displacement of labor workers by technology and cheaper foreign labor, resulting in greater economic uncertainty and unstable retirement incomes for the average American citizen––causing the average citizen to become increasingly dependent on government wealth redistribution programs.
We need a policy change, which assures truly “Fair Trade” and that exponentially reduces the exodus of our manufacturing prowess and invigorates America’s entrepreneurial exceptionalism and competitive spirit to create products and services in the spirit of “the best that they can be.” We need policies that will de-incentivize American multichannel corporations and others from undercutting “American Made,” while simultaneously competitively lowering the cost of production through expanded capital worker ownership. At present, the various incentives in place do not broaden capital ownership but instead further concentrate ownership.
