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Much is rightly made of the poisonous and dangerous goods coming
from China. The safety issues are weighty. But in 10 years,
China is likely to have resolved most of the problems. Nobody
will buy the lead point toys anymore... or the poison toothpaste... or
the rotten shrimp. Probably.
The safety concerns are virtually unrelated to the gargantuan deficit trends. David Barboza points this out in a NYT article.
Our trade deficit will grow... and grow... and grow.
Unless the cost structure changes. The cost differential is not
comparative advantage. It is government created. If you
talk about "comparative advantage", you are either stupid or intentionally misleading.
China has an ongoing 40% firesale on all goods because they
dropped the yuan's value relative to the dollar, and pegged it.
12 years ago. About the time it took for China to become 1/3 of
our trade deficit, comparable to our energy trade deficit. This
is called currency manipulation.
China and 140 other countries place double digit tariffs on our
goods sold to them, and double digit subsidies on their goods coming to
us. They are not called tariffs and subsidies, but are
economically equivalent if you are selling or buying. They are
taxes placed on our goods, and tax rebate checks given to ALL their
companies which export. This is because the WTO allows these
shenanigans with value added tax regimes.
These are called, in trade parlance, border adjustable taxes.
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