Trade War: U.S. All Talk, No Action

Does anybody really believe the Clinton administration is prepared to shoot down Boeing’s access to its most lucrative new growth market for commercial aircraft? Or that it would let Toyota walk away with the rich contracts, sought by General Motors and Ford, to build engines for China’s awakening automobile industry?

The trouble with impending trade wars - the kind we’re always threatening to declare against Japan, Europe or China - is that they never happen.

Last year the United States was going to start a trade war with China over the issue of human rights. We all remember the deadline came and went. Does anybody recall how the issue was settled?

Yet another trade war is scheduled to start Sunday. That’s the day the United States says it is prepared to impose 100 percent tariffs on $1 billion worth of Chinese exports to the United States, an action certain to provoke a similarly massive Chinese retaliation.

This time the main issue is pirated software and other fake goods that the United States accuses China of tolerating, at a loss of billions for American copyright owners.

The Chinese, with an understandable memory of Western perfidy during the Opium Wars and the era of the Treaty Ports, have pretended to be offended to their bones at this “intolerable” U.S. interference in China’s domestic affairs.

Anyway, here are two of the most important nations on Earth, seemingly heading for a trade rupture of volcanic proportions and consequence.

But if anybody believed it was going to happen, the congressional delegations of Washington state and Michigan, homes to Boeing, Ford and GM, would be in a beastly snit. So would the delegations of every other state with major stakes in Chinese trade and investment. An army of lobbyists for the Fortune 500 companies, most of which have Chinese investments or the hope of major ventures there, would have been camped on the White House lawn. Newt Gingrich would have told another bedtime story about pigs and giraffes to illustrate the administration’s ineptitude in this affair.

Instead, even as the clock ticked, Energy Secretary Hazel O’Leary was in China this week with an entourage of 75 American businessmen witnessing the signing a energy deals worth a potential $1 billion and proclaiming the president’s “great hopes” for a “strong relationship” with China.

And there were unmistakable signs that the Chinese had done their arithmetic and figured out their huge trade surplus with the United States was at least worth arresting a few people. It was as if the Beijing leadership had gotten together and said the Chinese equivalent of, “Gee, guys, we are a police state.” Chinese newspapers reported this week that police had raided several pirate computer disk plants in southern China, seizing in one case 30,000 counterfeit disks.

A few more showboat crackdowns, and suddenly China will be hailed as a model of compliance with international copyright principles. In a burst of cordiality this week, the Chinese invited Charlene Barshefsky, the deputy U.S. trade representative, to come to Beijing.

And so the chances of a war seem to be evaporating rapidly even as it is clear they never really existed. With all the money to be made in China these days, there is invariably a point where firm principle becomes raging elasticity on both sides.

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