Slippery slope of protectionism

Is the US introducing a 30% tariff on Chinese tyres going to escalate into bigger shows of protectionism? China has already answered with their own proposed tariffs.

If the US/China start down this road, where does it end? Or is this more a one off occurrence and unlikely to be repeated in a meaningful way? I thought when Obama said it last year that the 'Buy American' slogan could be a dangerous idea to promote. I think the same when I hear Gerry on TV saying "if you're not buying Australian, why? Why not!"
 
If the US/China start down this road, where does it end? Or is this more a one off occurrence and unlikely to be repeated in a meaningful way?

Who knows Steve? One thing I have noticed is that with Obama and Rudd we seem to be seeing the triumph of symbolism and rhetoric over serious policy in the new world political order. This is unsustainable on a political level because people see through the spin and fog eventually. Mind you at least Obama is having a red hot go on real health policy reform, even if it doesn't succeed.

With the domestic political pressure in the US to "look after their own" via tariff protection well entrenched, for example in the farm sector, then I can definitely see more cases of Obama making all the right free trade statements on one hand but actually doing this more often on the other! Probably part of calling in a few political favours to get his health plan through...

No doubt the Chinese will reciprocate but you have to ask what does the US lose from this? Imports of high value / high tech goods into China from the US are the only meaningful sector and China needs these so raising tariffs on them is likely to be counter productive. There isn't much of other US imports into China so you have a strong incentive for the US to do this - there isn't much downside in terms of their exports to China. Particularly when China keeps playing other games with pegging the yuan to the US$ to keep their products cheap. Why should the US keep being nice when they keep getting stung in return?

IMO the real problem is the imbalance created in a relatively open, free and democratic country like the US trying to deal with a strictly controlled, one party state that has little respect for human rights, like China. The playing field is never going to be level and it is probably better to just acknowledge that rather than keep up this charade that we can all just get along when our core values are polar opposites. Something has to give...
 
very disappointing to see. the sooner the better, that the populous realise that we live in a global world, hence global economy, and instead of protecting a uneconomical and inefficient product, countries are forced to find their niche markets - an supply those niches to the world.
 
all it will do is solidify any tension between CHN and USA.

if they won't trade with each other, then there'll be a battle for the global market.

you watch - USA will lose and then start a war they can't win - they'll try to take Taiwan or give Taiwan democracy or something, then that Nostradamus prediction of "2 million soldiers of oriental descent will land on the shores of the states united" will be a self fulfilling prophecy.
 
very disappointing to see. the sooner the better, that the populous realise that we live in a global world, hence global economy, and instead of protecting a uneconomical and inefficient product, countries are forced to find their niche markets - an supply those niches to the world.

problem with what you are saying is that when something happens which breaks the supply, you are going to regret getting rid of those producers, however uneconomical and inefficient they might have been.
 
then that Nostradamus prediction of "2 million soldiers of oriental descent will land on the shores of the states united" will be a self fulfilling prophecy.

ah yes fits in with my dream last night... "behold the mushrooms that spring from the oriental earth"
 
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