A few key things to keep in mind in this trade war with China.  

1. We are the customer and China has shafted us. 2. China needs us more than we need China.

In 2000 we welcomed China into the international trading community. We made it official by an act of Congress.

We assumed the following: This would help China prosper. China would then treat its people more humanely. It would play by international rules of fair trading. It would open its markets to American products and services.

This is what fair trade is all about.

We were wrong on all counts. China increased abuse of its people. China stole and steals our intellectual property. China restricts imports from the U.S.  China demands U.S. companies transfer technology to China. In order to operate there.

In addition, China has mapped out a program to totally dominate world trade. To hold countries to ransom. In ruthless fashion.

The welcome we extended to China turned into a rout. China took every advantage. And gave little in return.  The results are painful to tabulate.

One MIT economist reckons China’s actions savaged our manufacturing. It directly eliminated over 1 million U.S. manufacturing jobs between 2000 and 2007.  

Yes, blame various administrations for ignoring this. For whining, but not acting. Yes, blame various companies. For taking advantage of dirt-cheap labor in China. For allowing China to plunder our technology and intellectual property.

And yes, blame our politicians. And our economists. For falling for the idea that this was inevitable. For losing faith that America could compete. For lack of imagination.

It WAS inevitable that we could not compete. Given China’s cheating. Given her barriers to U.S. businesses. Given her tariffs on U.S. products.

Trump has stopped this defensive thinking. He has demanded China play by the rules. In this, he has pulled a Reagan.

State Department experts and assorted pundits thought Reagan was wrong and dangerous. Because he challenged what they felt was inevitable: That we would continue to compete with the USSR.

Reagan instead literally declared our goal was to win. That was a new and frightening thought in Washington circles. Win? What a dunce he was.

Reagan appreciated something they ignored. The Soviet economy was running on fumes. If we raised the stakes, the Soviets could not afford to keep up.

Trump appreciates something many of his critics ignore. We are the customer. We are a huge market. China desperately needs our business. Much more than we need China’s.

He also appreciates that China has severely damaged our manufacturing. It has devastated a lot of our middle class. He appreciates China has hallowed out our manufacturing towns and cities.

Like Reagan, he introduced an idea that never crossed the minds of Washington elites.  That we could do more than compete with China. We could win.  By that I mean that we could level the playing field in major ways. That we could strengthen our manufacturing.

To win, he slashed regulations on businesses. And reduced their taxes. These moves help our businesses grow more competitive. And then he challenged the Chinese. And threw up tariffs to squeeze concessions from them.

Joe Biden scoffs that China will eat our lunch.  “They’re not bad folks… They’re not competition for us.”  Joe, China has already eaten our lunch! And drunk our beer! They are creeping toward our dessert.

Already we see some fruits of this change in our thinking. We see half a million manufacturing jobs return to the economy. We see a small but steady pullback of jobs that companies shipped to China.

We see that the devastation of our middle class has taken a breather. It is possible it may have reversed, but too early to say.

We see China’s economy slowing. We see foreign investors keeping their powder dry when it comes to investing more in China. We see a lot of China’s business fleeing to Vietnam. In part, because of the theft and espionage we have highlighted.

America is dealing with the Chinese problem the way many other countries would like to. They don’t have the economic strength – and some, not the courage – to do so.

What we are doing is called leadership.

Trump’s critics decry this high-stakes gambling. They fear we could lose. His supporters reckon he knows what cards China holds. And he figures we hold better ones. Just as Reagan knew we held better cards than the old USSR.

From Tom…as in Morgan.

Find Tom on Facebook. You can write to Tom at tomasinmorgan@yahoo.com.