America's Real China Problem

As welcome as such a reframing is, the new policy may not go far enough, especially when it comes to addressing the problem posed by China. Yes, given lower Chinese labor costs, Ricardo's law holds that China should specialize in the production of labor-intensive goods and export them to the US. But one still must ask whence that comparative advantage comes, who gains from it, and what such trade arrangements imply for the future. China may look different, at first, because its export model has lifted hundreds of millions out of poverty and produced a massive middle class. China owes its "Comparative advantage" in manufacturing to repressive institutions. As the Chinese economy grew, the Communist Party of China could invest in an even more complex set of repressive technologies. Contrary to what some social scientists and policymakers believed, economic growth has not made China any more democratic. How can America put global stability and workers at the center of international economic policy? First, US firms should be discouraged from placing critical manufacturing supply-chain links in countries like China.