China retaliated Monday against President Donald Trump’s $60 billion of tariffs with just $3 billion of tariffs on mostly fruit, wine, nuts and pork.
China’s State Council Customs Tariff Commission announced that the approval of the State Council, the communist regime would suspend “tariff reduction obligations” of about 15 percent on 120 mostly agricultural products and 25 percent on pork, “in order to safeguard China’s interests and balance the losses caused by the U.S.”
The U.S. goods deficit with China was about $309 billion in 2016. That means China exports to the U.S. of $462.6 billion were over four times China’s imports from the U.S. But in the same year, the U.S. had a surplus in services of $38.0 billion, with $54.2 billion of services exports to China and only $16.1 billion of service imports.
President Trump blamed the Clinton administration’s advocacy for China’s admission to the World Trade Organization in 2001 and the Obama administration’s tech outsourcing policies for the trade deficit. Trump argued that losing 60,000 U.S. factories and 5 million manufacturing jobs since 2001 is why America’s Upper MidWest became the “Rust Belt.”
According to the Economist, the only economic sector advocating for America’s unbalanced trade relationships with China is California’s Silicon Valley, which “generates almost $200 billion in profits from outside of the United States each year.” Silicon Valley has offshored manufacturing, and often shelters its profits in tax havens.
Over 45 percent, or $208 billion, of China’s trade export surplus with the U.S. comes from computers and electronics, according to GV Wire. More concerning, the U.S. annual balance for advanced technology products sales has fallen from a $35 billion surplus in 1992 to a $92 billion deficit in 2015.
The TechCrunch blog nicknamed Silicon Valley the “Valley of the Democrats” during Barack Obama’s presidency. The vast majority of Silicon Valley tech CEOs supported Obama’s 2012 Presidential re-election bid; 83 percent of employee donations from top tech firms went to Obama. Venture Capitalist Peter Thiel told TechCrunch, “Most of Silicon Valley, most of the executives, tend to be Democrats.”
Silicon Valley’s tech elite has almost exclusively backed the Democrat establishment for two decades. Tesla’s Elon Musk donated directly to Hillary Clinton; Facebook’s Mark Zuckerberg wrote big checks to San Francisco’s Democratic Party organization; and Microsoft’s Bill Gates heavily funded three Democratic congressmen.
The bipartisan Center for Responsive Politics, which tracks the influence of Silicon Valley money on American elections and government bureaucrats, commented, “Just as water flows downhill, money in politics flows to where the power is.” Their research found that since the rise of Obama in 2008, Silicon Valley’s annual lobbying expenditures skyrocketed by 800 percent, from $17.8 million to $139.5 million.
With a new administration in place, and new trade policies, that investment looks to have been a bad one.
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