Even playing field

Martin Friedman was the economist who pushed the concept of free trade and his arguments were sound but they were based on having a level playing field. The US trade with China is not on a level playing field and it is costing jobs across America. China places an import tax on American goods and the US does not have an import tax on goods from China. Simple as that! In addition China uses currency manipulation to discriminate against imports. When countries exchange goods though trade they have to account for the difference in currency and in the case of China this means the difference between the Juan and the Dollar. When a country is selling more stuff to the world than it is buying (a trade surplus) the price of its currency is supposed to go up. People and businesses are buying the currency of that country to get the things from that country, which increases demand for that currency. Increase in demand for something pushes its market price up. A currency is said to be “strong” when its price is up, and it can buy more things. China has a large trade surplus but the value of the Juan is not going up because the Chinese government is buying large quantities of US treasuries and this is called currency manipulation. A country is selling more than it is buying and has a trade surplus. If markets are working correctly, its currency would become “strong” because the world is buying its currency to buy its stuff, so its goods would start to cost more. Trump is saying two things about China. First he will place an import tax on goods coming into the country from China. Second he will increase the tax to offset the effects of any currency manipulation. These changes will allow American companies to compete and will tend to bring jobs home and encourage new business growth. All of the criticism of Trump will disappear if he is able to create new high paying jobs. The best welfare plan is a good job.