Michael B. G. Froman
In early February, as he flew in Air Force One above the body of water he’d recently renamed the Gulf of America, President Donald Trump declared that he would levy tariffs on all imported steel and aluminum. Two weeks later, he issued a presidential memorandum laying out new guidance for screening investment from Chinese firms in the United States and U.S. firms into China. And throughout the early weeks of his administration, Trump has emphasized the importance of bringing manufacturing back home, telling firms that, to avoid tariffs, they should make their products in the United States.
Tariffs and protectionism, restrictions on investment, measures designed to drive domestic production: Washington’s economic policy suddenly looks an awful lot like Beijing’s policies over the last decade or so—like Chinese policy with American characteristics.
The U.S. strategy of engagement with China was based on the premise that, if the United States incorporated China into the global rules-based system, China would become more like the United States. For decades, Washington lectured Beijing about avoiding protectionism, eliminating barriers to foreign investment, and disciplining the use of subsidies and industrial policy—with only modest success. Still, the expectation was that integration would facilitate convergence.
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