So, recent news brings an interesting question to mind, would a total cessation of US-China trade be worse for the US than a single thermonuclear missile strike on the US mainland?
Well, we’d have “less money”, but hiring would go through the roof, national sovereignty would increase, and less than one million people would die (probably - difficult to calculate secondary economic effects of what would be an across-the-board price increase), so…
I’m pretty sure that both the US and China are reliant on the other for things that they can’t actually replace autarchically even at much higher prices (e.g. certain rare earth metals for the US, a lot of IP for China). The adjustment would be pretty steep.
Think it’s the expertise that would be killer. I suspect are whole ranges of manufacturing activities that nobody in the US knows how to do anymore, could be decades before we can do them competently again.
You’s also have the problem of what this would to to southeast asia in general. We may not intend to cut off trade with the rest, but this is the sort of move that could lead to the entire region being cut off to US trade. I guess we didn’t really need computers anyways.
The problem when they went to build a smartphone in the US was not “no Americans know how to build a smartphone”, it was “we lack a sufficiently large and redundant supply chain to respond quickly to unexpected issues, because there isn’t a sufficient density of smartphone component manufacturers.”
This isn’t just “we’re building a new product“ this is “We are taking over all production of all existing products.“ This is an orders-of-magnitude difference..
Sure, but aside from the fact that there are still lots of countries that aren’t China (including Taiwan, which is not China China) to import from, I think the issue is less “lack of expertise” and inability to build computers, than it is the necessary volume of capital expenditures to build all the new plants and buy all the new robots necessary to fill those plants. And we still do a lot of manufacturing here. Manufacturing revenue in the US is up, it’s manufacturing employment that’s down.
I’m not sure it would even be all that much of an increase in price for consumers after the capital expenditures are complete. We’re probably already headed towards manufacture-on-demand programmable modular factories closer to the sites of sale, and this might just accelerate the trend.