US will pay for companies to bring supply chains home from China: Kudlow - COVID-19 has highlighted the problem of relying too heavily on one country for production

[Dan Warnick + 6,100]

Finally!  The Trump Administration is going all-in to help U.S. companies move their operations back to the U.S. from China, and to protect critical supply chains from being controlled by a foreign government (China) that does not have our best interests at heart.  It is a first move of sorts and it will be interesting to see if the proposals are followed with concrete incentives, and whether or not those incentives are good enough to make companies actually take the leap and move back to the U.S., but it is a start.

US will pay for companies to bring supply chains home from China: Kudlow

The Trump administration is willing to pay for U.S. companies to uproot their supply chains and bring them home from China, according to the president's top economic adviser.

The COVID-19 pandemic has caused supply chain disruptions and elevated concerns the U.S. has become too reliant on production in Asia, and specifically China, for goods and key technologies.

China is the world's largest producer of personal protective equipment, including masks, test kits and more that is needed to control the spread of COVID-19, which was first identified in Wuhan, China, and has infected more than 5.5 million people worldwide.

CORONAVIRUS PRESSURES US MANUFACTURERS TO BRING PLANTS HOME FROM CHINA

"We welcome any Americans companies in Hong Kong or China mainland, we will do what we can for full expensing and pay the cost of moving if they return their supply chains and their production to the United States," chief White House economic adviser Larry Kudlow told FOX Business’ Stuart Varney on Tuesday.

Tensions between the U.S. and China have flared in recent weeks after the Chinese government's initial handling of the COVID-19 pandemic and were further strained after Beijing last week moved to tighten its grip on Hong Kong by introducing a national security bill that would bypass the city’s legislature, effectively ending the “one country, two systems” principle used to govern the city.

"I think taking over Hong Kong's national security parameters and judgments was a mistake," Kudlow said. "They're supposed to have one country and two systems, and now we're seeing an attempt, I think, to have one country and only one system."

Kudlow said he "didn't want to speculate" on whether China's aggressions in Hong Kong could kill the phase one trade deal.

U.S. Trade Representative Robert Lighthizer and Chinese Vice Premier Liu He recently held "constructive" talks and the trade deal remains on, "for now," according to Kudlow.

[Enthalpic + 1,496]

22 minutes ago, Dan Warnick said:

The Trump administration is willing to pay for U.S. companies to uproot their supply chains and bring them home from China, according to the president's top economic adviser.

If China did that you would call it an illegal government subsidy.

Edited August 10, 2020 by Enthalpic

[In Suspense + 14]

35 minutes ago, Enthalpic said:

If China did that you would call it an illegal government subsidy.

Where national security is involved definitely more of an investment than subsidy!

[Yoshiro Kamamura + 274]

So far, the only thing Trump has achieved with his protectionism was GM moving its production plants to China:

https://www.breitbart.com/politics/2019/08/30/donald-trump-scolds-general-motors-for-moving-plants-to-china-after-bailout/

A classic, cold, profit-seeking move from GM. First, calmly collecting any money there was to be collected (a fool, who hands out free gifts, twice the fool who does not accept them), then doing what was originally planned anyway. 

[Marcin2 + 725]

20 hours ago, Dan Warnick said:

Finally!  The Trump Administration is going all-in to help U.S. companies move their operations back to the U.S. from China, and to protect critical supply chains from being controlled by a foreign government (China) that does not have our best interests at heart.  It is a first move of sorts and it will be interesting to see if the proposals are followed with concrete incentives, and whether or not those incentives are good enough to make companies actually take the leap and move back to the U.S., but it is a start.

US will pay for companies to bring supply chains home from China: Kudlow

The Trump administration is willing to pay for U.S. companies to uproot their supply chains and bring them home from China, according to the president's top economic adviser.

The COVID-19 pandemic has caused supply chain disruptions and elevated concerns the U.S. has become too reliant on production in Asia, and specifically China, for goods and key technologies.

China is the world's largest producer of personal protective equipment, including masks, test kits and more that is needed to control the spread of COVID-19, which was first identified in Wuhan, China, and has infected more than 5.5 million people worldwide.

CORONAVIRUS PRESSURES US MANUFACTURERS TO BRING PLANTS HOME FROM CHINA

"We welcome any Americans companies in Hong Kong or China mainland, we will do what we can for full expensing and pay the cost of moving if they return their supply chains and their production to the United States," chief White House economic adviser Larry Kudlow told FOX Business’ Stuart Varney on Tuesday

It would be nice to see it happen, first positive economic move to strengthen US manufacturing.

 But I think it is just Kudlow posturing for the election and stockmarket purposes.

Long way to executive order.
That is what I find self defeating in Trump policies regarding China: negative, sanction moves, destroy theirs and not improve ours.

Still hope it will happen.

But there should be at least a list of industries that are to be supported for this to look credible for people, not only for algos.

[0R0 + 6,251]

On 8/9/2020 at 9:16 PM, Enthalpic said:

If China did that you would call it an illegal government subsidy.

China has been doing so for decades, they didn't stop. Thus similar action is required of  its trading partners or those who no longer want to engage with it. Since China has been at war with the West despite posing as a trade partner for these last 3 decades, this should be considered a preparation before triggering the "trading with the enemy" law which would force all China holdings in the US to be sold, without China receiving the proceeds. And would force US companies to detach from their holdings in China. .

[BLA + 1,666]

Companies that mfg in China and sell  in U.S. pay little or no tax anywhere by using transfer pricing tax loopholes. 

Do like India does. India put an import duty on cell phones.  Guess what .   .   .   Apple was forced to build mega factory in India.

Apple pays no U.S. corporate income taxes.

I say keep it simple , put a 7% import duty on all mfg goods imported.  Then watch how many Pharma, auto, electronic, semiconductor, etc companies (both U.S. and foreign) move to U.S.

Phase in the plan over 7 years to give mfg time to build and move. 

I see regional trade groups developing.  China will try to snare as many of the European , African and mideast countries in their Belt and Road trap.

Edited August 12, 2020 by BLA