Scything through heartland America, the human toll has been immense. More than 3.4 million jobs in the United States have been lost since China joined the World Trade Organisation 17 years ago.
At least 1.3 million jobs have disappeared in the past decade, fueling the trade war between Beijing and Washington and adding US$100 billion to the US deficit.
“The growth of the trade deficit with China between 2001 and 2017 was responsible for the loss of 3.4 million [American] jobs, including 1.3 million since 2008, [which was] the first full year of the Great Recession,” a report released by the Economic Policy Institute, a non-profit, liberal think tank based in Washington, revealed.
“Nearly 74.4% [or] 2.5 million of the jobs lost were in manufacturing,” co-authors Robert E Scott and Zane Mokhiber pointed out.
The sheer depth and scale of the problem affected 50 states, and demolished the computer and electronic parts industries, the study showed, as major US companies relocated manufacturing to China.
Other sectors which were badly hit included apparel, electrical equipment and appliances.
‘Electronic parts’
This, in turn, “contributed heavily to the crisis in US manufacturing employment,” triggering anti-China sentiment and the broader economic Cold War between President Donald Trump’s administration and President Xi Jinping’s government.
“The trade deficit in the computer and electronic parts industry grew the most [and up to] 1,209,000 jobs were lost,” the report highlighted. “Surging imports of steel, aluminum and other capital-intensive products [have also] threatened hundreds of thousands of jobs in key industries such as primary metals, machinery and fabricated metal products.”
Again, this strikes at the heart of Washington’s dispute.
Yet in Beijing, Trump’s bruising battle is seen increasingly as a way to contain China’s growing economic and military might.
By weaponizing tariffs on more than $250 billion worth of Chinese imports, the White House hopes to force Xi to change course and recast the “Made in China 2025” high-tech program, as well as adding a thick layer of transparency to the $1 trillion Belt and Road Initiative.
“[But] what Trump hoped would be a blitzkrieg has turned out more like trench warfare,” Keyu Jin, a professor of economics at the London School of Economics, said. “In China’s view, what the US is really reacting to is not only the specifics of its trade policy but also its overall development model and its aspirations to become a major global power – aspirations that are not out of reach.”
Caught in the crossfire are segments of the US manufacturing workforce.
The use of Chinese state subsidies, currency manipulation and excess production has created an unlevel playing field, according to the Economic Policy Institute’s study, echoing the views of Washington.
“China’s trade-distorting practices, aided by currency manipulation and its suppression of wages and labor rights [have] resulted in a flood of dumped and subsidized imports that greatly exceeded the growth of US exports to China,” Scott and Mokhiber stressed, adding that this had compressed wages in key industries.
Naturally, Beijing has repeatedly denied these allegations, insisting it believes in free trade, open markets and the WTO rule book.
At the same time, the ruling Communist Party has made it clear China will not capitulate.
Xi reiterated the Party line during his trip to Guangdong earlier this week when he called on the country to become “self-reliant.”
“To go from a big country to a strong one, we must give paramount importance to the development of the real economy,” he said. “Manufacturing is a key to the real economy, and the core strength of manufacturing is innovation or the control of core technologies.
‘No surrender’
“We must … seek innovation by relying on ourselves, and I hope all enterprises will work in this direction,” Xi added.
Reams of editorials from China’s state-owned media have underscored this approach in the past three months while ‘no surrender’ rebuttals have been issued after US threats.
Zhang Qingli, a vice-chairman of the influential Chinese People’s Political Consultative Conference, repeated that mantra during a meeting involving the American Chamber of Commerce in Hong Kong on Monday.
“We don’t fear a trade war. We don’t want it, but we don’t intend to back down,” Zhang was quoted as saying in the Chinese press.
Still, the US is digging in for the long haul.
Last year, the trade deficit stood at more than $375 billion, while in September it hit a record $34.13 billion for a single month and a staggering $225.79 billion for the first three quarters of the year.
“Many fear that this is only the beginning of a long conflict that could include casualties – far outside the realm of trade,” Jin, of the London School of Economics, said.
A harrowing thought after heartland America’s lost decades and lost jobs.
you miss some major variables.. 1.the usa invented most of the major inventions in the last century. therefore, no need to worry about competition if you don’t allow it. 2. where is the logic of doing business with countries that you will go to war with? if you outsource all your factories to these countries, what happens to these factories if the country where they are located declare war on you? …frankly, I think corporations are starting to understand this and that is a major reason why they are all returning to the usa. their home country.
Richard Truong the truth hurts. doesn’t it?
Richard Truong the truth hurts. doesn’t it?
Ahson Aftab R&D? point out to me ANY major invention by the chinese in the last century. something like the airplane, the computer, internet, microchip, cell phone, etc… ANYTHING?
fact is.. china is only good at copying things. when I was still working, I was in biotech. and there were many scientist from china working there as guests. frankly, I was not impressed by their expertise. they were there to learn. EVERYBODY knew this.
Ahson Aftab R&D? point out to me ANY major invention by the chinese in the last century. something like the airplane, the computer, internet, microchip, cell phone, etc… ANYTHING?
fact is.. china is only good at copying things. when I was still working, I was in biotech. and there were many scientist from china working there as guests. frankly, I was not impressed by their expertise. they were there to learn. EVERYBODY knew this.
Absolutely agree- peace is better than war. But WAR IS BETTER THAN SURRENDER! Here’s why:
The history of China has mostly been more "Let’s talk" instead of fight. Hence, their present thinking – let’s negotiate rather than fight but who do we negotiate with?
In the Han Dynasty and several others that followed, China sometimes even offered Chinese princesses in marria"long list of demands"ge to secure the peace with "barbarians" in preference to war.
During the 1850s and on, the Qing Emperor offered the British, Americans, and other marauding Western imperilaists concessions to trade with a self-sufficient China of that time. Instead, the Western "powers", using "gunboat diplomacy" trafficked opium into China, drained Chinese treasury of silver, demanded Chinese pay millions of silver for wars they themselves started, and trampled on the Chinese people and devastated China. A weakened China fell prey to Japanese fascists, who raped and burned the Chinese nation and who made the infamous Twenty-One Demands on China. This is the period still very vividly remembered as "The Hundred Years of Humiliation". Since then, China has vowed never again will they subject themselves to such humiliation.
2. When the US Government says "Our asks are on the table" – is this "long list of demands" the new "Twenty-One Demands" that China must submit to? Without any reciprocal concessions? Must China surrender unconditionally to the US?
If so, the Chinese will fight rather than submit – because the very recent 100 years of experience have taught them that once China gives in to a demand, there will be more.
Absolutely agree- peace is better than war. But WAR IS BETTER THAN SURRENDER! Here’s why:
The history of China has mostly been more "Let’s talk" instead of fight. Hence, their present thinking – let’s negotiate rather than fight but who do we negotiate with?
In the Han Dynasty and several others that followed, China sometimes even offered Chinese princesses in marria"long list of demands"ge to secure the peace with "barbarians" in preference to war.
During the 1850s and on, the Qing Emperor offered the British, Americans, and other marauding Western imperilaists concessions to trade with a self-sufficient China of that time. Instead, the Western "powers", using "gunboat diplomacy" trafficked opium into China, drained Chinese treasury of silver, demanded Chinese pay millions of silver for wars they themselves started, and trampled on the Chinese people and devastated China. A weakened China fell prey to Japanese fascists, who raped and burned the Chinese nation and who made the infamous Twenty-One Demands on China. This is the period still very vividly remembered as "The Hundred Years of Humiliation". Since then, China has vowed never again will they subject themselves to such humiliation.
2. When the US Government says "Our asks are on the table" – is this "long list of demands" the new "Twenty-One Demands" that China must submit to? Without any reciprocal concessions? Must China surrender unconditionally to the US?
If so, the Chinese will fight rather than submit – because the very recent 100 years of experience have taught them that once China gives in to a demand, there will be more.
Those 3.4 million job losses it is because your corporations and entrepreneurs are GREEDY …China just facilitated the way for them …bit TRUMP cut their taxes !!! So Christmas on the double for them and increased taxes for ordinary folks with tariffs !! Well done …that’s the best way for the future according to USA politicians .
Those 3.4 million job losses it is because your corporations and entrepreneurs are GREEDY …China just facilitated the way for them …bit TRUMP cut their taxes !!! So Christmas on the double for them and increased taxes for ordinary folks with tariffs !! Well done …that’s the best way for the future according to USA politicians .
Another way of looking at it of course is to conclude that moving production offshore was the only way US manufacturers could remain globally competitive. The alternative was for them to go out of business, which would certainly not have saved any jobs. These studies that try to isolate one simplistic cause/effect relationship while ignoring countless other variables are not worth reading.
Another way of looking at it of course is to conclude that moving production offshore was the only way US manufacturers could remain globally competitive. The alternative was for them to go out of business, which would certainly not have saved any jobs. These studies that try to isolate one simplistic cause/effect relationship while ignoring countless other variables are not worth reading.
Rod Coffman Your figures are simply not correct.
"Labor Force Participation Rate in the United States remained unchanged at 62.70 percent in September of 2018. Labor Force Participation Rate in the United States averaged 62.99 percent from 1950 until 2018, reaching an all time high of 67.30 percent in January of 2000 and a record low of 58.10 percent in December of 1954."
https://tradingeconomics.com/united-states/labor-force-participation-rate
Rod Coffman Your figures are simply not correct.
"Labor Force Participation Rate in the United States remained unchanged at 62.70 percent in September of 2018. Labor Force Participation Rate in the United States averaged 62.99 percent from 1950 until 2018, reaching an all time high of 67.30 percent in January of 2000 and a record low of 58.10 percent in December of 1954."
https://tradingeconomics.com/united-states/labor-force-participation-rate
Jerry Bingsell Chin these days what ever the west used to manufacture, China is doing a far batter job at it. All the products around you are made in China, in cade you haven’t noticed yet…..the thousands of innovations in those products are all Chinese. The only monopoly the west has now is in the defense industry and civil aviation and a handful of other niche industries. In the next decade or so China would totally eclipse the US in even those handful of areas….this is a trend you can’t change or challenge.
Jerry Bingsell Chin these days what ever the west used to manufacture, China is doing a far batter job at it. All the products around you are made in China, in cade you haven’t noticed yet…..the thousands of innovations in those products are all Chinese. The only monopoly the west has now is in the defense industry and civil aviation and a handful of other niche industries. In the next decade or so China would totally eclipse the US in even those handful of areas….this is a trend you can’t change or challenge.
If you know history, you wouldn’t talk like this. Shame…
If you know history, you wouldn’t talk like this. Shame…
Jerry Bingsell Chin, most of the technical papers and industrial patents are coming outta China these days, in case you didn’t know. Go do a Google….. And keep in mind, where there is manufacturing, there is R&D…..its a fact!
Jerry Bingsell Chin, most of the technical papers and industrial patents are coming outta China these days, in case you didn’t know. Go do a Google….. And keep in mind, where there is manufacturing, there is R&D…..its a fact!
why not other WTO member affected the most? That why US the most went wrong compare to other member.Due finacial and employment fault ?????