WASHINGTON, July 22,2019 - As friction continues in the trade war between U.S. and China, policy experts believe that continuing to impose import tariffs will hurt U.S. innovation and provide China more economic leverage in the long run.
The U.S. has an estimated billion-dollar welfare loss due to its heavy reliance on tariffs, said Joshua Meltzer, senior fellow of global economy and development at the Brookings Institute on Thursday. Tariffs are “unlikely” to put U.S-China relations on a stable footing, he said.
The tension within these foreign relations is one of the most consequential and multilateral issues facing the global economy, said Cheng Li, director of the John L. Thornton China Center. Last year, U.S. and China have had zero percent of mutual investment between their tech sectors.
Derek Scissors, resident scholar at the American Enterprise Institute, said that the World Trade Organization is not equipped to resolve these technological issues. The U.S. currently does not have implementing regulations of export controls, he said, and that is why we need unilateral action on this matter.
Panelists also recognized that the Chinese state-led economic model makes future negotiations difficult, said Neena Shenai, visiting scholar at AEI.
China doesn’t believe in comparative advantage but in “absolute” advantage, said Rob Atkinson, president of the Information Technology and Innovation Foundation. That, he said, is the “core” problem.
Atkinson added that the Chinese president made a “strategic blunder” with pushing indigenous domestic innovation, which alienated imports.
For the U.S. to work with China on a “sustained” basis, said Scissors, China needs to have “some level” of pro-competition, pro-property reform. In an anti-competitive market, China will not do well unless it can harness a single, “transformational” technology, he said.
Despite the differences in China’s economic model, continued collaboration may be in the U.S.’ best interests.
If we use dictatorship as a reason not to trade with China, said Atkinson, then we would not be trading with forty percent of the world’s economy.
China has a “long way to go” before it can think of replacing the U.S. as a superpower, said Li. Huawei CEO Ren Zhengfei had acknowledged that within the next couple years, Huawei could lose around 30 billion U.S. dollars due to the import ban.
The goal should not be to stop China from rising, said Atkinson, but rather to stop China from hurting our economy while they do so.
(Photo of event by Masha Abarinova.)
- The California Consumer Privacy Act Lets People Know What Information is Collected, But Can’t Stop It
- FCC Chairman Ajit Pai Announces Public Auction of C-Band, Connecticut Peels Back Broadband Barriers
- Commerce Department Extends Huawei Temporary General License For 90 Days
- T-Mobile’s Acquisition of Sprint Passes Federal Muster, But 16 States Press On in Opposition
- Comcast Touts 100 Gigabit Service, SHLB Seeks Reconsideration on Telehealth, Senate Clears Emergency Communications
Signup for Broadband Breakfast
Intellectual Property4 months ago
In Congressional Oversight Hearing, Register of Copyrights Says Office Is Responding to Online Users
Broadband Data5 months ago
California Report: Income Most Significant Factor in Low Broadband Adoption
Broadband Data6 months ago
Pennsylvania Broadband Speeds Worse Than Previously Believed, According to State Report
Antitrust2 months ago
Addressing the Impact of Big Data Upon Antitrust is More Complicated Than a Big Tech Breakup
Privacy and Security3 months ago
Comparing Privacy Policies for Wearable Fitness Trackers: Apple, Fitbit, Xiaomi and Under Armour
Expert Opinion4 months ago
Geoff Mulligan: A ‘Dumb’ Way to Build Smart Cities
Antitrust2 months ago
Broadband Roundup: Everyone (Almost) Gangs Up on Google, Muni Broadband Fact Sheet, SHLB Anchornet Conference
Broadband Roundup3 months ago
Cable Industry Touts Energy Efficiency, Next Century Highlights Open Access Fiber, Aspen Forum Set