The Long Hard Road to Decoupling from China
It’s by now beyond clear that China is no partner to the United States. A difficult, but necessary, separation lies ahead.
We need to start re-shoring our manufacturing and investing in the regional diffusion of supply chains. The imperative of hard decoupling from China is as strong as it’s ever been. Getting there, however, will not be easy. “Re-shoring” is itself a tidy phrase for a complicated process that will take years to bear fruit. Change will require incentives, both positive and negative, including changes to our corporate tax code, subsidies, penalties, and perhaps even concerted efforts to shame American companies into different behavior. And beyond policy, leadership will be required. All this will have to be explained and communicated to the American people. We will simply have to absorb the costs of this, even if it means prices going up for various goods that we have become accustomed to consuming cheaply.
Especially in areas critical to national security and defense, the United States must preserve a degree of autarky that will allow us, should the extreme happen, the sovereign freedom to act. Re-shoring our manufacturing will have the added benefit of eliminating the “technological bleed” that has accompanied globalization over the past 30 years.