First to Checkmate, U.S. or China?
Shoes' Account of the Trade War Story
Translated from: 中美貿易戰，鹿死誰手？鞋子探端倪
This past year, the world has been bombarded by arguments and reports all centered on the U.S.-China Trade War. We’ve oftentimes seen the U.S. President Donald Trump tweeting attacks toward China, while Xi’s administration responds with equal ferocity, both promising a defeat through any measure of punitive actions. As the skirmish continues, it seems that we can only sit and watch who the final winner is.
Let us not sit with the common crowd waiting for the unknown. Let us, instead, dissect this ongoing economic battle through the lens of “shoes”.
It was late March in 2018 that the U.S. President, Donald Trump, declared a trade war against the People’s Republic of China as he denounced the country’s surreptitious theft of intellectual property owned by American companies. Accordingly, the U.S. has a trade deficit of approximately $337 billion dollars each year with China (Legrain, 2018), meaning that the Americans import far more goods from the Chinese than they export to these communist fellows. Trump argues that punitive tariffs are completely justified considering the cause, while also serving as a mean to pressure the Chinese government in stymieing the revolting practices of plagiarism (Legrain, 2018).
Claiming so, however, was Trump right about the whole game?
As you may have fathomed, the answer appears to be a big “NO” otherwise we will not be discussing about it a year later.
Through an analysis of “shoes”—one of the daily commodities of our lives—we may notice that currently the world’s largest shoe markets (excluding work and safety shoes) lie in the U.S., China, Brazil, Japan, and Russia, among which United States and China serve as the biggest and second biggest respectively (Statista, 2019).
The average revenue per capita in the U.S. shoes market is around $277 (7-8 pairs of shoes on average), whereas the average shoe cost for the Chinese is $44 (1-2 pairs of shoes on average), which means that the average Americans spend about 6 times more on shoes each year than the Chinese do. Furthermore, the U.S. shoes’ trade market has grown 9% while China’s only grew 6% despite its 1.3 billion population.
Notwithstanding that United States surpasses China in purchasing goods, it is far from beating its counterpart at the point. According to World Footwear (2019), about 70% of the shoes on the U.S. market today are imported from China, meaning that once the Federal government imposes its recently announced 10% tariffs on Chinese imports, the cost of the commodity would go up thereby affecting the American shoe prices in general. Unfortunately, this tragedy will be left for the Americans to suffer, which is probably why shoes and other daily necessities were removed from the newest tariff list announced by Trump’s administration on August 14th, fearing that the carols for Christmas becomes the cries about this coming holiday (Wiseman & Rugaber, 2019).
One year has passed since the trade war started, and no one is certain how this will end. As Christmas approaches, the Hong Kong anti-extradition bill looms on, the various missile attempts made by the North Korean leader Kim Jung Un…what we seem to know is that this game is destined to continue its wrestles between the economy, trade, and politics of these two powerful entities.
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