US Exporters Won’t Thrive in a ‘Plus-One’ World
Trump’s tariffs will shift manufacturers from a “China plus one” to a “US plus one” strategy, putting higher-cost US-made goods at a global competitive disadvantage.
Trump’s tariffs will make this unexportable.
Photographer: Luke Sharrett/Bloomberg
President Trump’s tariffs look to bring investment and production back to the US. Some manufacturers will do so, as they vie to sell to America’s voracious consumers. But high tariff walls will delink US suppliers from the rest of the world, incentivizing companies to move from a “China plus one” manufacturing model to a US plus one. The end result will be the marginalizing of US exports in the global economy.
China’s economy took off during the first decade of the 21st century through commercial integration with Asia and its evolution into the go-to source for consumers worldwide. A combination of membership in the World Trade Organization, cheap labor, tax breaks for international businesses and the attraction of its billion-plus consumer market catapulted it to become the biggest global goods producer and second largest economy.