China tariffs won’t make America great again

TOKYO — It’s hard to miss the time-warp dynamic surrounding the US-China trade war as it intensifies in real-time.

Take US President Joe Biden’s recent move to quadruple tariffs on China-made electric vehicles to 100% and ratchet up import taxes on China’s advanced batteries, solar cells, construction cranes, medical equipment, aluminum and steel.

Here, Biden is reading from the Trumpian playbook dating back to the mid-1980s. And it’s a bad pivot by a White House that started out pledging to raise America’s competitive game and resist the protectionist policies that characterized Trump’s 2017-2021 presidency.

The trouble for both presidential contenders at this November’s election is that tariff-heavy responses to trade deficiencies attempt to revitalize an economic system that no longer exists.

“Ultimately, we think protectionism from the West could remain a near-term overhang for Chinese EV/parts makers aiming for rapid global expansion,” says Morgan Stanley analyst Tim Hsiao. “But we think it is unlikely to halt China’s EV push in the long run.”

This stuck-in-1985 problem can be found elsewhere in Asia and beyond. Japan’s last 13-plus years have been largely about bringing back the trickle-down economics of the Ronald Reagan era.

Beginning in late 2012, then-Japanese Prime Minister Shinzo Abe placed a bet that monetary easing alone could fuel a surge in corporate profits that would kick off a virtuous cycle.

The plan was for booming stocks to encourage CEOs to fatten paychecks, catalyzing increased spending and faster economic growth.

Japan got the stock rally part of the plan right. Aggressive Bank of Japan easing, a plunging yen and some steps to improve corporate governance saw the Nikkei 225 Stock Average top its