micky107 wrote:Per wrote:rats19 wrote:60 billion dollar trade deficit between the 2 countries. I would say trump has some leeway there...
So, you mean, the bigger wealthier country buys more from the smaller poorer country than vice versa?
Well, shucks darn! Who would have thought such a thing.
Sounds like China and the rest of the poor world!
Yeah, well, even if the US only has 300 million people, compared to the 500 million of the EU or 1.4 billion of China, in the world of economics, America is still number one.
The GDP of the USA is a little more than USD 18 trillion.
The GDP of China is a little more than USD 11 trillion.
The GDP of the European Union is somewhere between USD 16 and 18 trillion, depending on exchange rates.
https://en.m.wikipedia.org/wiki/List_of ... _(nominal)
So, yeah, when we are talking trade, the USA is still the bigger wealthier country, even when compared with China. And you know a funny thing? People with a lot of money tend to have more money to spend than people with less money. It's not rocket science.
But here's the beauty of it; when rich nations trade with poor nations, the poor nations get richer, which means they gradually start buying more stuff from the rich countries as well. It's a win win situation.
For the past five years car sales have been higher in China than in the USA.
And guess who benefits from that....
http://www.wsj.com/articles/u-s-car-exp ... 1423174695
In 2014, U.S. exports to China were over ten times higher (307,425) than they were in 2009 when the United States exported 25,065 vehicles to China This has been a rapid ascent for manufacturers in the United States given that exports to China were less than 1,000 units as recently as 2003. While many international automakers established plants in China to help meet the demands of this large and growing market (the largest in the world), it is clear from these trends that there remains an interest in U.S.-made vehicles in China.
http://www.trade.gov/td/otm/assets/auto ... er2015.pdf
Because China has been able to build up a well functioning export industry, more and more Chinese are reaching a level of wealth where they can afford buying a car, and many of them prefer to buy an imported car, to show their neighbours how successful they are. A trade war with China would be disastrous for the American auto industry.