7 ms·

Trump orders U.S. firms out of China after Beijing sets new tariffs

62 points by SolaceQuantum 7y ago

derwiki 7y ago
> It’s unclear what legal authority Trump would be able to use to compel U.S. companies to close operations in China or stop sourcing products from the country By unclear, they mean no legal authority.
- adamiscool8 7y ago
  Does Beijing have legal authority to compel the reverse, or does it rely on appeals to patriotism and backchannel enforcement to get it done?
  - BubRoss 7y ago
    It's a dictatorship, they will do whatever they want.
    - theseadroid 7y ago
      I encourage you to watch this: The Rules for Rulers https://www.youtube.com/watch?v=rStL7niR7gs https://www.youtube.com/watch?v=rStL7niR7gs TLDR: dictators can't do whatever they want.
- gist 7y ago
  It can also mean that the writer, in a rush to get the story out, does not have time to get informed opinions to make a point.
- save_ferris 7y ago
  Not sure why this is getting downvoted. It was only the other day that Trump was referring to himself as “the chosen one”.
  - pests 7y ago
    Listen, I'm not a fan of Trump but that was taken out of context. Go read the full quote. The statement was more "no one has done this yet, I'm going to do it" and not claiming any specialness.
umvi 7y ago
It's hard to just pick up and switch when you are so entrenched. That said, I would love if more US companies built stuff here in the US. Yeah, prices might be a little higher, but at least we aren't exploiting the labor of vulnerable people in foreign countries anymore.
- nickpinkston 7y ago
  I don't know. People in developing countries choose to work long hard hours because it's better than what they've had and they all want to better their condition. It's not perfect, but better than the alternative.
- gist 7y ago
  Vulnerable? Maybe. But they are taking less pay because they have no other alternatives. Buying nothing from them does not improve their situation. In fact much of the Chinese (or other low cost countries) economy has come from the vast amount of US dollars that have been injected for low cost goods. That has for sure raised things in those countries. Not for everyone but it's not like the 1950's either or even close. Ask anyone who grew up in the 60's and 70's what China was like back then.
- theseadroid 7y ago
  Many Chinese would thank you because you bought stuff manufactured by them. Without the opportunity to work on those "exploiting job", they'd be doing something with much less pay and much more hard works, and many of their next generations would be still doing the same job instead of having the opportunity to gain better education.
- bazooka_penguin 7y ago
  I think pollution is a bigger problem. Even some runoff causes nation wide attention and scandals in the public eye.
  - kombucha11 7y ago
    That's my question: do the people that want 100pc of the manufacturing to come back to the US have a plan for the inevitable ecological fallout? When we outsourced production to China we also outsourced the pollution produced by that manufacturing.
mindthegap 7y ago
> “Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.” What a weird tone. Is that a thing in the US? Can the president (legally) order companies "home"? Doesn't sound like "land of the free" to me.
- jakewalker 7y ago
  Absolutely not. It's not remotely a thing, and would not withstand any scrutiny whatsoever.
  - coliveira 7y ago
    Except that it is happening right now, and I don't see politicians doing anything substantial to stop it.
    - krapp 7y ago
      There's nothing to stop. Trump no more has the authority to order U.S. businesses around than you or I. He's an authoritarian thug who still doesn't know how governing works.
      - coliveira 7y ago
        The president controls the defense apparatus, which can label any country they wish a "threat to national security", which according to laws enacted since 9/11 can prevent American companies to do business with other countries. In the post 9/11, trumpian world, economic freedom depends on the mood of the president.
        krapp 7y ago
        I'm sure you feel this is a really strong argument to make but don't copy and paste replies in a thread like that, it's spamming the thread.
Canada 7y ago
Orders US firms out of China? I was not aware that the president had such authority.
- jakewalker 7y ago
  He does not. Which doesn't make the headline inaccurate. But he does not have that authority, and no one right-thinking believes that he does.
alexibm 7y ago
Recently, I was in Germany (I live in Baltimore, MD) and was pleasantly surprised that a lot of goods are made in Germany. It is hard to find anything in our stores that isn't made in China.
- johnnyletrois 7y ago
  Germany’s mittelstand is remarkable. Sweden’s domestic manufacturing industry is also impressive. Edit for spelling.
- deleted 7y ago
  [deleted]
Aperocky 7y ago
It won't matter if US implement 100% tariff on China, what's going to happen next is that they're still going to create 800 parts in China, which gets shipped to Vietnam and assembled there and exported as a product of Vietnam. Vietnam (or whatever other country) would benefit at the cost of China/United States and more carbon emission due to shipping. The enormous electronic manufacturing in China isn't moving anywhere, there's just nowhere that has the scale, infrastructure,and the know how to produce cheap electronic products. If you think this is still all just people on the assembly line, you've got a very historical understanding of this process.
- NohatCoder 7y ago
  Every country with tariffs have an army of bean counters whose job it is to deal with that kind of loopholes. Sure something will slip though, but anything big will get caught.
  - Aperocky 7y ago
    What do you mean? The stuff is made in Vietnam. Just like all of apple which source their chips to Intel and then assembled in China still count as made in China as a whole in the tariff book. This practice is as legal as it gets and cheaper than paying that 25% extra.
    - NohatCoder 7y ago
      You may argue that it is made in Vietnam, but if whoever has to tax it don't agree, your argument counts for nothing. The US taxation officials don't have to come up with a non-contestable argument for why it is a Chinese product, they just need an argument that their own courts will accept, that generally isn't a particularly high standard in a situation where the USA and China are locked in a trade war.
      - Aperocky 7y ago
        Yes, the computer is made of 2750 parts, these parts come from 21 countries and some of them made several loops through different country. The final assembly place is $INSERT_COUNTRY. Now tell me, if the $INSERT_COUNTRY is Vietnam, how will the US government justify say this is not? because right now that $INSERT_COUNTRY is China and they're levying tax on that basis. You seem to grossly underestimate how interconnected the world is today.
tibbydudeza 7y ago
Well it makes about as much sense as buying Greenland. Good luck with that ... my money is on China.
- zaroth 7y ago
  If it was actually possible to buy Greenland, for say $50 billion, it would be an incredible deal for the US. It has rare earth deposits, but more importantly as the Arctic undergoes drastic climate changes—particularly in the availability of shipping lanes—it becomes increasingly strategically significant. Importantly, Greenland is a net economic loss to Denmark of about $500 million per year, so it would be saving Denmark a great deal of money to let the US take it off their hands.
  - thrill 7y ago
    That could be put to a vote in Greenland. Trump says to the ~57,000 residents, "I'll give each of you a million bucks if you vote yes". What do you think will happen?
jhallenworld 7y ago
I suspect this plays quite well in the key battleground states of Michigan, Pennsylvania and Wisconsin. That's the only thing he's going to care about.
ivl 7y ago
This article really took the absurdist language out of his chain of tweets. I think it's unfortunate, no need to deny people the depressed chuckle when they read: > ....My only question is, who is our bigger enemy, Jay Powell or Chairman Xi? Along with the use of "are hereby ordered" as nothing but bluster.
ladyattis 7y ago
I don't grasp why Trump thinks these kinds of messages are any good. Maybe it's okay for his campaign but if we're talking the country, it's clear it doesn't help. All it does is it make companies great and small have to scramble for any kind of contingent plan to deal with him. I'm not a fan of capitalism but I'm a fan of keeping myself fed. The more he meddles in these affairs in such a haphazard way the more it makes the economy unstable. All I can say is that he better pray to whatever god he believes in that it doesn't wind up leading to a recession or a depression.
Simulacra 7y ago
Playing devils advocate a little with some of the comments, I think this is a long time coming for China. The trade imbalances, current manipulation, and other elements of Chinese governance that has allowed them to get away with so much, for so long, has reached a zenith. If previous administrations of all stripes had done more to protect American interests, perhaps the strong measures of today would not have been necessary.
Simulacra 7y ago
Relevent: https://www.wsj.com/articles/for-manufacturers-in-china-breaking-up-is-hard-to-do-11566397989?mod=rsswn https://www.wsj.com/articles/for-manufacturers-in-china-brea... "Manufacturers Want to Quit China for Vietnam. They’re Finding It Impossible."
jefe_ 7y ago
The U.S. business community decided years ago that manufacturing should move overseas. Ever since, the entire U.S. economy has been centered around the assumption of cheap imports, with the exception of one key product: microprocessors, a product where the U.S. has long retained dominance. This dominance provided an opportunity for balance in the U.S. trade relationship with China, but the leverage was never really used to truly demand changes to trade practices. Now, the U.S. is starting to wonder if moving everything to China was such a good idea, but due to Chinese microprocessor advancements, the U.S. lacks that key trade leverage item they had to realistically negotiate, and many of their traditional 'negotiating' techniques won't work with China. The U.S. can't go to war with China. The U.S. can't ban Chinese imports. The U.S. can't overthrow Chinese Government. Just as U.S. has built their whole economy around imports, China has done the same with exports, they need to put people in jobs and keep the exports flowing, so they have no real incentive to rework a favorable deal. So really the U.S. is relegated to performing a Symbolic Trade war: Declare China a Currency Manipulator, Stir the pot in Hong Kong, Requesting Companies return to the U.S. All the while, the markets are pretending the Trade War is real, delivering massive swings for large investors capable to profiting from the volatility.

62 points by SolaceQuantum 7y ago

> It’s unclear what legal authority Trump would be able to use to compel U.S. companies to close operations in China or stop sourcing products from the country By unclear, they mean no legal authority.

adamiscool8 7y ago
Does Beijing have legal authority to compel the reverse, or does it rely on appeals to patriotism and backchannel enforcement to get it done?
- BubRoss 7y ago
  It's a dictatorship, they will do whatever they want.
  - theseadroid 7y ago
    I encourage you to watch this: The Rules for Rulers https://www.youtube.com/watch?v=rStL7niR7gs https://www.youtube.com/watch?v=rStL7niR7gs TLDR: dictators can't do whatever they want.
gist 7y ago
It can also mean that the writer, in a rush to get the story out, does not have time to get informed opinions to make a point.
save_ferris 7y ago
Not sure why this is getting downvoted. It was only the other day that Trump was referring to himself as “the chosen one”.
- pests 7y ago
  Listen, I'm not a fan of Trump but that was taken out of context. Go read the full quote. The statement was more "no one has done this yet, I'm going to do it" and not claiming any specialness.

umvi 7y ago

It's hard to just pick up and switch when you are so entrenched. That said, I would love if more US companies built stuff here in the US. Yeah, prices might be a little higher, but at least we aren't exploiting the labor of vulnerable people in foreign countries anymore.

nickpinkston 7y ago
I don't know. People in developing countries choose to work long hard hours because it's better than what they've had and they all want to better their condition. It's not perfect, but better than the alternative.
gist 7y ago
Vulnerable? Maybe. But they are taking less pay because they have no other alternatives. Buying nothing from them does not improve their situation. In fact much of the Chinese (or other low cost countries) economy has come from the vast amount of US dollars that have been injected for low cost goods. That has for sure raised things in those countries. Not for everyone but it's not like the 1950's either or even close. Ask anyone who grew up in the 60's and 70's what China was like back then.
theseadroid 7y ago
Many Chinese would thank you because you bought stuff manufactured by them. Without the opportunity to work on those "exploiting job", they'd be doing something with much less pay and much more hard works, and many of their next generations would be still doing the same job instead of having the opportunity to gain better education.
bazooka_penguin 7y ago
I think pollution is a bigger problem. Even some runoff causes nation wide attention and scandals in the public eye.
- kombucha11 7y ago
  That's my question: do the people that want 100pc of the manufacturing to come back to the US have a plan for the inevitable ecological fallout? When we outsourced production to China we also outsourced the pollution produced by that manufacturing.

mindthegap 7y ago

> “Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.” What a weird tone. Is that a thing in the US? Can the president (legally) order companies "home"? Doesn't sound like "land of the free" to me.

jakewalker 7y ago
Absolutely not. It's not remotely a thing, and would not withstand any scrutiny whatsoever.
- coliveira 7y ago
  Except that it is happening right now, and I don't see politicians doing anything substantial to stop it.
  - krapp 7y ago
    There's nothing to stop. Trump no more has the authority to order U.S. businesses around than you or I. He's an authoritarian thug who still doesn't know how governing works.
    - coliveira 7y ago
      The president controls the defense apparatus, which can label any country they wish a "threat to national security", which according to laws enacted since 9/11 can prevent American companies to do business with other countries. In the post 9/11, trumpian world, economic freedom depends on the mood of the president.
      - krapp 7y ago
        I'm sure you feel this is a really strong argument to make but don't copy and paste replies in a thread like that, it's spamming the thread.

Canada 7y ago

Orders US firms out of China? I was not aware that the president had such authority.

jakewalker 7y ago
He does not. Which doesn't make the headline inaccurate. But he does not have that authority, and no one right-thinking believes that he does.

alexibm 7y ago

Recently, I was in Germany (I live in Baltimore, MD) and was pleasantly surprised that a lot of goods are made in Germany. It is hard to find anything in our stores that isn't made in China.

johnnyletrois 7y ago
Germany’s mittelstand is remarkable. Sweden’s domestic manufacturing industry is also impressive. Edit for spelling.
deleted 7y ago
[deleted]

Aperocky 7y ago

It won't matter if US implement 100% tariff on China, what's going to happen next is that they're still going to create 800 parts in China, which gets shipped to Vietnam and assembled there and exported as a product of Vietnam. Vietnam (or whatever other country) would benefit at the cost of China/United States and more carbon emission due to shipping. The enormous electronic manufacturing in China isn't moving anywhere, there's just nowhere that has the scale, infrastructure,and the know how to produce cheap electronic products. If you think this is still all just people on the assembly line, you've got a very historical understanding of this process.

NohatCoder 7y ago
Every country with tariffs have an army of bean counters whose job it is to deal with that kind of loopholes. Sure something will slip though, but anything big will get caught.
- Aperocky 7y ago
  What do you mean? The stuff is made in Vietnam. Just like all of apple which source their chips to Intel and then assembled in China still count as made in China as a whole in the tariff book. This practice is as legal as it gets and cheaper than paying that 25% extra.
  - NohatCoder 7y ago
    You may argue that it is made in Vietnam, but if whoever has to tax it don't agree, your argument counts for nothing. The US taxation officials don't have to come up with a non-contestable argument for why it is a Chinese product, they just need an argument that their own courts will accept, that generally isn't a particularly high standard in a situation where the USA and China are locked in a trade war.
    - Aperocky 7y ago
      Yes, the computer is made of 2750 parts, these parts come from 21 countries and some of them made several loops through different country. The final assembly place is $INSERT_COUNTRY. Now tell me, if the $INSERT_COUNTRY is Vietnam, how will the US government justify say this is not? because right now that $INSERT_COUNTRY is China and they're levying tax on that basis. You seem to grossly underestimate how interconnected the world is today.

tibbydudeza 7y ago

Well it makes about as much sense as buying Greenland. Good luck with that ... my money is on China.

zaroth 7y ago
If it was actually possible to buy Greenland, for say $50 billion, it would be an incredible deal for the US. It has rare earth deposits, but more importantly as the Arctic undergoes drastic climate changes—particularly in the availability of shipping lanes—it becomes increasingly strategically significant. Importantly, Greenland is a net economic loss to Denmark of about $500 million per year, so it would be saving Denmark a great deal of money to let the US take it off their hands.
- thrill 7y ago
  That could be put to a vote in Greenland. Trump says to the ~57,000 residents, "I'll give each of you a million bucks if you vote yes". What do you think will happen?

jhallenworld 7y ago

I suspect this plays quite well in the key battleground states of Michigan, Pennsylvania and Wisconsin. That's the only thing he's going to care about.

ivl 7y ago

This article really took the absurdist language out of his chain of tweets. I think it's unfortunate, no need to deny people the depressed chuckle when they read: > ....My only question is, who is our bigger enemy, Jay Powell or Chairman Xi? Along with the use of "are hereby ordered" as nothing but bluster.

ladyattis 7y ago

I don't grasp why Trump thinks these kinds of messages are any good. Maybe it's okay for his campaign but if we're talking the country, it's clear it doesn't help. All it does is it make companies great and small have to scramble for any kind of contingent plan to deal with him. I'm not a fan of capitalism but I'm a fan of keeping myself fed. The more he meddles in these affairs in such a haphazard way the more it makes the economy unstable. All I can say is that he better pray to whatever god he believes in that it doesn't wind up leading to a recession or a depression.

Simulacra 7y ago

Playing devils advocate a little with some of the comments, I think this is a long time coming for China. The trade imbalances, current manipulation, and other elements of Chinese governance that has allowed them to get away with so much, for so long, has reached a zenith. If previous administrations of all stripes had done more to protect American interests, perhaps the strong measures of today would not have been necessary.

Simulacra 7y ago

Relevent: https://www.wsj.com/articles/for-manufacturers-in-china-breaking-up-is-hard-to-do-11566397989?mod=rsswn https://www.wsj.com/articles/for-manufacturers-in-china-brea... "Manufacturers Want to Quit China for Vietnam. They’re Finding It Impossible."

jefe_ 7y ago

The U.S. business community decided years ago that manufacturing should move overseas. Ever since, the entire U.S. economy has been centered around the assumption of cheap imports, with the exception of one key product: microprocessors, a product where the U.S. has long retained dominance. This dominance provided an opportunity for balance in the U.S. trade relationship with China, but the leverage was never really used to truly demand changes to trade practices. Now, the U.S. is starting to wonder if moving everything to China was such a good idea, but due to Chinese microprocessor advancements, the U.S. lacks that key trade leverage item they had to realistically negotiate, and many of their traditional 'negotiating' techniques won't work with China. The U.S. can't go to war with China. The U.S. can't ban Chinese imports. The U.S. can't overthrow Chinese Government. Just as U.S. has built their whole economy around imports, China has done the same with exports, they need to put people in jobs and keep the exports flowing, so they have no real incentive to rework a favorable deal. So really the U.S. is relegated to performing a Symbolic Trade war: Declare China a Currency Manipulator, Stir the pot in Hong Kong, Requesting Companies return to the U.S. All the while, the markets are pretending the Trade War is real, delivering massive swings for large investors capable to profiting from the volatility.