tag:blogger.com,1999:blog-1331441403058020963.post7819432983223291126..comments2024-03-28T06:49:24.930-04:00Comments on International Political Economy at the University of North Carolina: Hegemonic Instability TheoryThomas Oatleyhttp://www.blogger.com/profile/14092437150746625670noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-1331441403058020963.post-91788402957893100672009-12-11T15:54:27.547-05:002009-12-11T15:54:27.547-05:00I remain convinced that that cure is worse than th...I remain convinced that that cure is worse than the disease.<br /><br />Suppose the U.S. slaps heavy tariffs on China, and China responds by selling off Treasuries. What happens? <br /><br />Depression is the only likely outcome.<br /><br />For the world to get nearer to full employment, the U.S. still needs to be a net importer. But maybe the problem is simply the speed of the transition. Maybe China needs to grow at 6% rather than 8%. Clearly, China needs to save less than 40% and spend more domestically, and not just on infrastructure. <br /><br />So let me ask you which policy set is most likely to achieve that: stepped revaluations of the yuan leading to a full float within the next, say, 15-20 years, or a trade war fueled by competitive devaluations? <br /><br />And does a trade war even lead to a more balanced global economy? I don't see how an affirmative answer is the most likely.Kindred Winecoffhttps://www.blogger.com/profile/14330671232391851377noreply@blogger.comtag:blogger.com,1999:blog-1331441403058020963.post-51047273119416823722009-12-11T15:33:43.663-05:002009-12-11T15:33:43.663-05:00KW, we've been here before: a nice, protracted...KW, we've been here before: a nice, protracted <a href="http://ipezone.blogspot.com/2009/01/3-0-1-liberal-case-for-us-china-trade.html" rel="nofollow">trade war</a> is just the thing we need to get recalcitrant belligerents to act for the common good.Emmanuelhttps://www.blogger.com/profile/04615366847433704476noreply@blogger.com