China-Biden Economic War escalates
In dealing with China, Joe Biden has gone far beyond his predecessor, Donald Trump, who did little or nothing. Prior to Trump, presidents viewed America’s relationship with China as a partnership. Chinese practices were criticized, but nothing was done. His tariffs were imposed on Chinese goods coming into this country because he considered them competitors. The president has not only retained those tariffs, but has also restricted investment flows and imposed export controls.
Academics and commentariat were highly critical of Trump’s tariffs on Chinese goods in 2018. In addition, some people have argued that the levy would hurt the American economy more than the Chinese economy would be hurt by it. China’s sales in America are a lot more important to them than American sales in China. The other worry was that China, as well as other nations, would respond with crippling retaliation to the tariffs. This proved to be unfounded. The complaints of elite opinion in 2018 centered on free trade and globalization as the basis for political liberalization and global prosperity.
Despite the fact that he spoke inarticulately, Trump defended his actions. There was no desire on the part of him to stop the flow of world trade, as he claimed. In this case, he decided to use tariffs to press Beijing to modify its unfair trade policies. These include using domestic subsidies to drive down prices and stealing intellectual property from foreign companies. Further, Beijing has insisted that foreign companies that do business in China transfer their technology and trade secrets to their Chinese partners in exchange for their services. Despite the White House apology, the criticisms were not reduced, and neither were Chinese policies changed as a result of the tariffs.
Bipartisan legislation known as the CHIPS for America Act was approved by the US House of Representatives to restrict China’s access to cutting-edge semiconductors, chip manufacturing machinery, and supercomputer components. ASML has already responded by ordering its American staff to stop serving Chinese clients. With the help of exceptions they were granted, Washington, Samsung, TSMC, and SK Hynix are now able to keep sending comparable products to China.