Sure, but say it is: you assume a long-term trade barrier with China, invest in US factories and employee training, bring folks in from outside, start your production, get some competitive wins in the domestic (but obviously not international!) electronics market...
Then some future administration decides on detent and signs a free trade agreement to open markets or whatnot, yada yada. China marches right in and eats your lunch. Again.
Trade barriers do not do anything to address fundamental inequities in production efficiency. To be blunt: China is great at making electronics not because they have all the talent. They have all the talent because China is poor, still. The US is not (though it looks like we're aiming that way). Ergo Chinese production efficiency will be higher.
What trade barriers with China actually do isn't to bring manufacturing back to the US, of course. It's to move production from China to Vietnam or the Philippines or India or wherever isn't tariffed. Then of course we'll need to apply tariffs to them, and so on.
Doesn't need to move production to Vietnam. Needs to move finished product to Vietnam and replace "Made in China" sticker with "Made in Vietnam" one.
As to the poor part, after Xi is done with dumping treasuries, and subsequent US default and USD cratering, the salaries would be on par on both sides of the ocean (as they should be).
Which would also automatically solve the illegal immigration problem. And fentanyl problem (no money no honey).
> They have all the talent because China is poor, still.
That’s why China has (somewhat) inexpensive labor. It does not explain why China has far more plastic engineering talent, electrical engineering talent, etc than the US.
They have more talent because that's where talent is needed. You don't staff factories with "talent", you staff them with labor. Then you need "talent" to design the process. It all feeds back. We used to have injection molding plastic experts in the US in the 70's! The technology was invented here. But they all retired and no one stepped in to replace them because those factories all closed down. Chinese kids picked up the slack.
The US wasn't sleeping though. We trained a generation of software engineering talent that remains the envy of the world. There are whole web sites devoted to this "Hacker" subculture, even. Maybe we can find one.
Seriously: there's no problem here. This is the way economies work.
China really isn’t that poor anymore. A lot of their recent productivity gains are coming from automation, and they are leaning into harder than the Japanese did in the 90s.
I'm going to push back a bit here: things are improving, and China is already as rich as Mexico...now I get that American's have a unjustly bad impression of Mexico because of poverty at the not very populated border, but Mexico isn't a poor country, nor is Thailand, etc...these are all middle income countries that are quickly approaching high income countries.
Having lived in China for 9 years, and left 9 years ago, I can't really justify calling China poor anymore. Ya, they have a huge rural area and they still have lots of poor people, but they have a huge middle class (even if it isn't a majority of the country) that can afford a lot of things.
Chinese wages remain about 6-10x lower than US workers expect for the same kind of job. Whether that's "poor" or not is arguable. There are much poorer nations. Nonetheless US wage levels simply aren't going to compete, and it isn't even close.
Right. When I was working in China, I was only making about half as much as I do now at Google. The gap is much smaller for SWEs, even my local colleagues weren't making much less than I did. China is definitely an upper middle-income country, officially and just by looking at the numbers. They are breaking into being a lower high-income country next, and the graph really isn't slowing down.
But they are going off a demographic cliff, and that is why they are investing heavily in automation. They just won't have the people to do this work in the future, and expanding abroad and investing in robots are the only options for them.
Since he's even taxing empty islands, I doubt the end result will be anything else than either not selling to the US or selling to the US with a grey market.
If you put tariffs on the whole world, it's basically the same thing as a global economic sanction, similar to what Russia suffered.
Then some future administration decides on detent and signs a free trade agreement to open markets or whatnot, yada yada. China marches right in and eats your lunch. Again.
Trade barriers do not do anything to address fundamental inequities in production efficiency. To be blunt: China is great at making electronics not because they have all the talent. They have all the talent because China is poor, still. The US is not (though it looks like we're aiming that way). Ergo Chinese production efficiency will be higher.
What trade barriers with China actually do isn't to bring manufacturing back to the US, of course. It's to move production from China to Vietnam or the Philippines or India or wherever isn't tariffed. Then of course we'll need to apply tariffs to them, and so on.