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The U.S. effectively is trying to cripple a few major corporations from China... their response is "I'm going to take my Panda back" I don't really see China's

The U.S. effectively is trying to cripple a few major corporations from China... their response is "I'm going to take my Panda back" I don't really see China's negotiating position here, but if that's what they can do - then the U.S. definitely has the leverage.

pgeorgi 7y ago
It's not an economic tool but one of diplomacy (see https://en.wikipedia.org/wiki/Panda_diplomacy https://en.wikipedia.org/wiki/Panda_diplomacy), and the action now is likely more of a signal to the Chinese people than to the American.
blisterpeanuts 7y ago
The Chinese also didn't think this through very clearly; environmentalist types who love the pandas are probably not pro-Trump.
- gremlinsinc 7y ago
  No but this gives progressives even more fuel for the fire of discontent, maybe it encourages one more person to jump off the Trump train, doubtful, but it adds more sour to the GOP brand, and they already make warheads seem like werther's originals.
Spooky23 7y ago
It's a way to signal displeasure in a diplomatic way. It's not about a bear, it's about taking back a gift. Diplomacy is more about subtlety. US headlines are dominated by our administration's boorish behavior and we don't get a good picture. The reality is that these issues are more nuanced, and China can achieve outcomes that benefit them in different ways. A common narrative that the BRIC countries are developing is that the US is too volatile to deal with. Re: leverage, at the end of the day, the US doesn't have the capability to do lots of manufacturing. Our primary export to China is cash. We don't have the machinists, don't have the ability to train for the skills needed to manufacture, and will need to buy tooling from China. Real competitive pressure is decades away. The vaporization of commercial banking means that nobody will be building factories either. Tariffs generate revenue and are regressive, but ultimately you need to get your iPhone somewhere, and the fabs for SSD, memory, etc and a million other components are located mostly in China. Forget about this as a "trade deal", it's a tax increase.
- Fjolsvith 7y ago
  > Re: leverage, at the end of the day, the US doesn't have the capability to do lots of manufacturing. Our primary export to China is cash. We don't have the machinists, don't have the ability to train for the skills needed to manufacture, and will need to buy tooling from China. This is not a problem for the US. Companies have accelerated a shift of manufacturing to other Asian countries during the last year [1]. As far back as 2013, China was facing an exodus of factories [2]. > Real competitive pressure is decades away. I doubt this. Although some opinions say China has more leverage than the US [3], "The country’s heavy debts, built up over years of lending used to spur growth, limit its options. If it retaliates against the United States sharply by devaluing its currency or shutting factories crucial to global supply chains, the moves could ricochet and hurt its own newfound wealth. ... Its tremendous success in nurturing its own homegrown industries, which has helped China’s economy rise up the value chain, has reduced its imports of American goods, giving it fewer items to hit with tariffs." [4]. 1. https://www.theepochtimes.com/us-tariffs-adds-financial-pressure-to-foreign-manufacturers-in-china-pushing-them-to-leave_2610229.html https://www.theepochtimes.com/us-tariffs-adds-financial-pres... 2. https://www.mckinsey.com/business-functions/operations/our-insights/a-new-era-for-manufacturing-in-china https://www.mckinsey.com/business-functions/operations/our-i... 3. https://www.theatlantic.com/international/archive/2019/05/china-has-more-leverage-thank-you-think-trade-war/589726/ https://www.theatlantic.com/international/archive/2019/05/ch... 4. https://www.nytimes.com/2019/05/17/business/china-trade-influence.html https://www.nytimes.com/2019/05/17/business/china-trade-infl...
  - Fjolsvith 7y ago
    Starting to look like China is having some supply chain disruption too: https://www.digitalphablet.com/intel-and-qualcomm-also-bans-huawei-stops-supply-with-immediate-effect https://www.digitalphablet.com/intel-and-qualcomm-also-bans-...

pgeorgi 7y ago

It's not an economic tool but one of diplomacy (see https://en.wikipedia.org/wiki/Panda_diplomacy https://en.wikipedia.org/wiki/Panda_diplomacy), and the action now is likely more of a signal to the Chinese people than to the American.

blisterpeanuts 7y ago

The Chinese also didn't think this through very clearly; environmentalist types who love the pandas are probably not pro-Trump.

gremlinsinc 7y ago
No but this gives progressives even more fuel for the fire of discontent, maybe it encourages one more person to jump off the Trump train, doubtful, but it adds more sour to the GOP brand, and they already make warheads seem like werther's originals.

Spooky23 7y ago

It's a way to signal displeasure in a diplomatic way. It's not about a bear, it's about taking back a gift. Diplomacy is more about subtlety. US headlines are dominated by our administration's boorish behavior and we don't get a good picture. The reality is that these issues are more nuanced, and China can achieve outcomes that benefit them in different ways. A common narrative that the BRIC countries are developing is that the US is too volatile to deal with. Re: leverage, at the end of the day, the US doesn't have the capability to do lots of manufacturing. Our primary export to China is cash. We don't have the machinists, don't have the ability to train for the skills needed to manufacture, and will need to buy tooling from China. Real competitive pressure is decades away. The vaporization of commercial banking means that nobody will be building factories either. Tariffs generate revenue and are regressive, but ultimately you need to get your iPhone somewhere, and the fabs for SSD, memory, etc and a million other components are located mostly in China. Forget about this as a "trade deal", it's a tax increase.

Fjolsvith 7y ago
> Re: leverage, at the end of the day, the US doesn't have the capability to do lots of manufacturing. Our primary export to China is cash. We don't have the machinists, don't have the ability to train for the skills needed to manufacture, and will need to buy tooling from China. This is not a problem for the US. Companies have accelerated a shift of manufacturing to other Asian countries during the last year [1]. As far back as 2013, China was facing an exodus of factories [2]. > Real competitive pressure is decades away. I doubt this. Although some opinions say China has more leverage than the US [3], "The country’s heavy debts, built up over years of lending used to spur growth, limit its options. If it retaliates against the United States sharply by devaluing its currency or shutting factories crucial to global supply chains, the moves could ricochet and hurt its own newfound wealth. ... Its tremendous success in nurturing its own homegrown industries, which has helped China’s economy rise up the value chain, has reduced its imports of American goods, giving it fewer items to hit with tariffs." [4]. 1. https://www.theepochtimes.com/us-tariffs-adds-financial-pressure-to-foreign-manufacturers-in-china-pushing-them-to-leave_2610229.html https://www.theepochtimes.com/us-tariffs-adds-financial-pres... 2. https://www.mckinsey.com/business-functions/operations/our-insights/a-new-era-for-manufacturing-in-china https://www.mckinsey.com/business-functions/operations/our-i... 3. https://www.theatlantic.com/international/archive/2019/05/china-has-more-leverage-thank-you-think-trade-war/589726/ https://www.theatlantic.com/international/archive/2019/05/ch... 4. https://www.nytimes.com/2019/05/17/business/china-trade-influence.html https://www.nytimes.com/2019/05/17/business/china-trade-infl...
- Fjolsvith 7y ago
  Starting to look like China is having some supply chain disruption too: https://www.digitalphablet.com/intel-and-qualcomm-also-bans-huawei-stops-supply-with-immediate-effect https://www.digitalphablet.com/intel-and-qualcomm-also-bans-...