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Sunday, September 13, 2009

China's Response to Tire Tariff

Trade War?

In latest export salvo, China takes aim at U.S. auto parts and chicken products - LA Times.

The US applied a Tire Tariff and China is now responding with this, on top of the WTO appeal. I believe that the past humiliation of China by Western Powers (see Qing Dynasty and Modern Chinese Nationalism) will make it so China sees the need to retaliate to prove that the Chinese government is not allowing the United States to take advantage of China. My guess is the US executive branch was more focused on Health Care and using this as a feel good way at minimal cost to look tough on trade , and misgauged the reaction from China.

Personally, if I was in the US government I would become very worried about this development...

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