Commentary：’US is losing out in trade with China’ rhetoric should end

People’s Daily Commentator

 

Recently, the US government has repeatedly expressed its dissatisfaction with the World Trade Organization, threatening to “exit” the WTO and claiming that the US has been treated unfairly in terms of trade and has suffered losses. It is worth noting that this so-called “America is losing benefits in bilateral trade” idea is the reason why the US has waged this unwarranted trade war. The most developed country with the strongest comprehensive strength in the world is claiming that it has been bullied and devastated in international trade. This is really a strange claim that surprises the world.

 

Whoever pays the piper calls the tune. It is well known that the US dominated the creation of the international economic, trade, and financial systems after World War II, and in the following decades, it has firmly grasped its right to make and amend rules of international economic and trade. From the GATT to the establishment of the WTO, from the Bretton Woods system to the transformation of the international monetary system, the US has always played a major role as the designer of international economic and trade rules and as the leader of the global economic order. It is unconvincing that a “referee” would formulate a set of rules that would make himself lose. The US has not been idle for a moment to maintain its own advantages through formulating rules. In recent years, it has frequently adjusted and upgraded international trade and investment rules to maintain its core competitiveness and better align international economic and trade rules with US interests. By doing this, the US attempted to maintain its “pre-emptive rights,” and to ensure a global economic governance system that always favors the US.

 

Numbers show how much profit the US has really made. Rule makers are often the biggest beneficiaries, and the US knows this well. It is no coincidence that the US became the country with the greatest global comprehensive strength after WWII. In the process of forming international economic and trade rules, the US has enjoyed the institutional welfare brought about by economic globalization, and continuously enhanced and consolidated its economic hegemony by allocating resources globally, thus gaining the most from the multilateral economic and trade system and economic globalization. With regard to the economic and trade field, the US is a major player.

 

Last year, US trade volume of goods hit $3.89 trillion, and the service trade volume was $1.31 trillion, ranking second and first in the world, respectively. In the financial sector, the US dollar accounts for 62% of global foreign exchange reserves. Its special status enables the US to collect “coinage tax” by issuing US dollars, and obtain huge economic benefits. In the energy field, the US became the world’s largest natural gas producer in 2009, and replaced Saudi Arabia as the world’s largest oil producer in 2013. What’s more, American capital has won abundant returns in the world. The US has imported a large number of high-quality goods from developing countries for the benefit of its people. The US dollar has been heavily stockpiled by various countries, who share the inflation risk. Holding global leading technologies, American companies at the high-end of the value chain have earned excessive profits and gained the most from economic globalization. While enjoying the biggest slice of the pie, the US is complaining about the multilateral trading system, calling it “unfair.” The “America has lost profits in trade because of China theory” has completely exposed the greed of the US as it seeks to maximize profits and chase after large profits in international exchanges.

 

Whether it is the US or other countries that break the rules, it is necessary to look at the facts. While blindly accusing other countries of not complying with trade rules, the US has severely distorted market competition, hindered fair trade, and undermined global industrial chains. Its harmful policies and actions are everywhere, and it is these policies and actions that undermine the rules-based multilateral trading system. With regard to market competition, the US provides huge subsidies to support industrial development, resulting in its own overcapacity or even monopoly in related industries. In terms of external procurement, the US government has set up a large number of discriminatory conditions, hindering the free circulation of quality products from other countries into the US market, resulting in unfair treatment for businesses from other countries. In terms of trade barriers, the US emphasizes a huge trade deficit with other countries, while at the same time it imposes strict export controls in certain investment areas. It abuses the concept of national security and restricts investment, hindering the free flow of economic factors and damaging investment facilitation. The US is the country that generated the most access to sites with pirated content worldwide, but it has long ignored the loopholes in its intellectual property protection.

 

Since the US has been attacking and waging trade wars for a long time, people with a right mind can see that the so-called “America is losing benefits” claim is far from being as simple as faking to be the victim. It is feared that the US has a larger plan behind these groundless claims and refrains. To put it bluntly, it is just setting a so-called basis for its carrying out trade protectionism.

 

It is understandable that US has its own requests and hopes for changes of the status quo, but the key is to adjust its own mentality and correct its stance. It’s naïve to believe that by claiming “America is losing benefits,” facts will be blurred and other countries will be forced to accept any price that is demanded. In today’s world, international trade sticks to fairness, and trade bullying is not acceptable. The rules of international trade are already established, and the platform for multilateral dialogue has always existed. By threatening trade protection, the US will send the world economic order into chaos, and will put itself into a hard situation.

 

It is impossible to make the world economy to go back to isolationism, because it is simply against the historical trend. International trade must progress and undergo advancement, which is something the US should know better than anyone else. “The US is getting hurt in trade” claim should come to an end!