Breaking down the China-US trade war and Donald Trump's hypocrisy

Breaking down the China-US trade war and Donald Trump's hypocrisy

Described by US economist Richard Wolff as “phoney and costly” posturing by a politician and a “made-for-TV spectacle”, US President Donald Trump’s trade war with China has turned out worse than Fergie’s last album. There is little reason, I suppose, for us to be angry when the trade war hasn’t affected our economy significantly. But what really deserves a rebuke is the hypocrisy that is inherent in US foreign policy and their attitude towards countries who are simply minding their own business.

The rationale behind Trump’s trade war is that China is forcing US companies to hand over technology when they do business in the country, and that government intervention gives Chinese firms an advantage when they are competing in their home turf.

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For a country that has historically been a strong supporter of libertarian economic principles, America's posturing seems to be inconsistent with their attitude in the past. According to the libertarian orthodoxy, everyone is a rational decision maker and is free to make choices that best serve their needs - under any circumstance. They also reject the idea that seemingly “free” choices can in fact be affected by undue influence or the better bargaining position of the other party.

Applying this to the present case, it would seem that the the US's beloved principles wouldn't side with government intervention against China. Firstly, government intervention in the libertarian view is almost never justified because “markets solve everything”. Secondly, such principles would also suggest that U.S companies have nothing to complain about because they freely decided to enter the Chinese market with full knowledge of the various challenges which might arise. Therefore, there's no reason to punish China for acting no more maliciously than an ordinary market participant.

Economic theory aside, the US has acted in bad faith by pressuring its allies to ban Huawei’s 5G network from their countries. This is a prime example of market distortion. The charge rings especially true given that independent investigations by Western governments, such as Britain’s, have shown that there is no legitimate security concerns that would warrant a ban. Government intervention, it seems, is only justified when the US does it.

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Finally, no discussion of US aggression would be complete without mentioning the charges against Huawei heiress, Meng Wanzhou. Meng is accused of fraudulently attempting to evade sanctions on Iran, which is not an offence that we should recognise. This is because America’s friendly relations with countries such as Saudi Arabia disqualify it from playing the “freedom and democracy” card to justify actions against Iran, and the way the US uses its overwhelming economic power against smaller nations is nothing short of despotic.

The problem today is that US hegemony has been accepted as the norm. Many European Union member states bow to the whims of whichever government is in power in the US and are willing to do their business for them. Regardless of your position on China, it is a good thing that there is still another country in the world that can oppose US dominance at every turn and let weaker parties have a voice.

Edited by M. J. Premaratne

This article appeared in the Young Post print edition as
China standing up to US hegemony

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