Seeing how they had an $800 billion trading surplus with US, I'd expect that.
The "green bits" are pumped into real estate across the US (not to mention Canada, the UK, and Auckland), inflating housing prices and making it harder for housing consumers to acquire property (kudos Vancouver for your foreign buyer tax!). Jobs are not created with these investment dollars.
Warren Buffet warned us of this: https://www.youtube.com/watch?v=bGo_NL-eclw (trade imbalances lead to serfdom)
In places that can build more housing, it is done. In places it can't be done, or the local citizens don't want it done, it is not. "Build, baby, build!" is just as ridiculous as "Drill, baby, drill!" [1] We work backwards from those two fundamental truths.
I have a feeling places like SF and NY have already tried this. Considering most of these foreign investors are most interested in these two cities over lets say Nebraska, it's hard to see how NY just needs to "build more supply" is a solution.
> If we had policies that encouraged always building
We have those in Australia, it's called negative gearing. We also have the most expensive houses when compared to average income and our cities have taken your advice and started to build up at rapid paces. Still hasn't worked.
The Aus government is now suggesting we lower our immigration cap from 1% of total pop yearly so maybe that will help.
Isn't it just a strange (legal) tax loophole which enough people take advantage of that it's difficult to get rid of politically?
Also there are other forms of tax besides property tax, so governments don’t need expensive property to fund their services.
Indeed. That was basically post-war US economic policy in a nutshell. The worrying about reducing the trade deficit is a purely political argument. Trump is simply the first person in power to actually believe the nuttery.
You're doubling the trade surplus. It was $375 billion for 2017. Total trade was $635 billion.
China's trade surplus with the US for 2018 is running slightly higher, it'll probably come in near $410b. Mostly due to the US consumer and economy being pretty revved up this year.
The impression that that readers of say the New York Times would be left with at this point is that Trump stupidly imposed tariffs that only hit American consumers, whereas China brilliantly targetted tariffs right at Trump's base. This appears to be the precise opposite of the truth: the tariffs on China are mostly affecting China, and whilst the overall impact of the soy tariff isn't clear it was definitely the result of it being one of the few things the US exported to China in significant amounts rather than of ingenious Chinese planning.
BUT there is a whole other dynamic attached to tariffs. I.e. the foreign producer lowering it's prices to not lose important clients.
It's pushing companies to move their supply chains out of China, as few are expecting that this is a short-term trade conflict.[1] This will go on for decades in varying forms.
The US wins in all scenarios from that effect. Some limited manufacturing comes back to the US; win. Some manufacturing moves to Mexico, whose labor costs are now often cheaper than China's; win. Some manufacturing moves to China's Asian rivals with cheaper labor costs, such as Vietnam; win. The US will push half a trillion dollars into Vietnam via a trade deficit over the next decade, that they can use to develop with. Every dollar of supply chain the US pushes out of China and into smaller neighboring rivals, is a win for the US strategically. The goal is to dilute China and redistribute trade into numerous other Asian nations that aren't a superpower threat. This isn't just a trade conflict, it's the start of a long-term political contest over whether China is going to acquire hegemony over Asia - something only China has an interest in, which leaves the US with a dozen regional allies against that outcome.
The strongest results will be the long-term supply chain shift that will gradually take place over a decade or more. The longer the US keeps up the pressure the better that outcome.
[1] https://www.bloomberg.com/news/articles/2018-10-23/companies...
I definitely didn't think imposing tariffs was a good idea, but once it was explained that a lot of other countries (including Canada) impose a lot of tariffs on us, and that this action was an attempt to level the playing field, it suddenly seemed like it wasn't such a stupid idea after all, and it may actually be working to the benefit of the U.S.