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.)
- Facebook CEO Mark Zuckerberg Goes to Washington
- FCC’s Technology Advisory Committee Reprises Preemption of Localities, But This Time Over Small Cell Aesthetics
- Many Facets of Wireless Industry Join to Celebrate Launch of OnGo Using Mid-Band Spectrum
- Benton Foundation Renamed Benton Institute for Broadband and Society, Renewed Focus on Advanced Internet Networks
- Who’s On First? Congress Upset With Wasteful and Petty Antitrust Squabbles Between Justice and FTC
Intellectual Property2 months ago
In Congressional Oversight Hearing, Register of Copyrights Says Office Is Responding to Online Users
Broadband Data4 months ago
Pennsylvania Broadband Speeds Worse Than Previously Believed, According to State Report
Broadband Data3 months ago
California Report: Income Most Significant Factor in Low Broadband Adoption
Privacy and Security2 weeks ago
Comparing Privacy Policies for Wearable Fitness Trackers: Apple, Fitbit, Xiaomi and Under Armour
Broadband Roundup1 month ago
Cable Industry Touts Energy Efficiency, Next Century Highlights Open Access Fiber, Aspen Forum Set
Expert Opinion2 months ago
Geoff Mulligan: A ‘Dumb’ Way to Build Smart Cities
Drones1 month ago
Greater Commercial Use of Drones Will Force Revisions of Federal Aviation Administration Regulations, Say Experts
Fiber1 month ago
‘Dig Once’ Provides Future-Proofing Solution for Federal Highway Infrastructure, Says BroadbandNow