So, after all the rhetoric and bravado…I would be hesitant to suggest tariff’s, standing alone, will accomplish what’s being argued for, after all, this is China! It is doubtful a single person can apply coercions, sanctions, and threats of retaliation to the Chinese Communist government to influence change. And, by change, I mean, suddenly become receptive to accepting and imposing western influenced trade laws upon their people, as espoused and ratified by the World Intellectual Property Organization and the World Trade Organization respectively. https://kpstrat.com/wp-admin/post.php?post=227
But, any administration’s public and oft-repeated presumption that…economic sanctions (ala tariffs) will quickly manifest to deter – inhibit (China’s) indisputable, but deeply institutionalized mandates for state sponsored and independent entities to routinely engage in the practice of seeking, acquiring, and applying others intellectual and structural capital, knowhow, and IP, is audacious, misleading, and conveys a misperception of what’s at stake.
Another reason that tariff’s or similar government initiatives are not likely to…produce the desired institutionalized behavioral changes (within-throughout China’s international trade arena with any semblance of urgency, but yes, necessary to mitigating broad and persistent misappropriation-infringement of IP, is that
infringement-misappropriation of others IP is generationally, institutionally, and culturally embedded.
Once understood in these contexts, it’s prudent to…recognize China’s business, trade, and cultural history as being described in dynasties, while U.S. history is measured in mere centuries. Either way, China, and the myriad of other countries where sophisticated ‘bad actors’ have proliferated in the past quarter century, have been consistently and aggressively engaged in asymmetric pursuits of others ‘knowledge and know how’ and its unlikely, in my judgement, it will end abruptly as nationalistic rhetoric suggests.
Rhetoric that singles out and calls for China to…amend its practices by imposing successively broader and higher tariffs, may translate as good political optics and resonate in partisan political rallies in the near term. But, I am unaware of U.S. companies among the Fortune 1000, while they may publicly support the imposition of tariffs to influence these desirable changes, few, if any, are expecting a complete and permanent about-face by this Chinese Communist government. https://kpstrat.com/wp-admin/post.php?post=3894
It is here that I can only wish this ‘west wing’ becomes substantially more adept…at Chinese cultural history. So, will such actions lead to measurable reductions or mitigation in economic espionage perpetrated by Chinese entities and the multitude other countries engaged in similar activities? Again, as one who has been engaged in this arena for many years, I share enthusiasm there will be a favorable outcome in the foreseeable future. Hopefully, I shall be proven wrong.
The paths to (politically) maximizing tariff-based initiatives, should, in my judgment, be divided in two distinct parts. I might add, as well, none of the below should be perceived as ‘rocket science’…
• clear and current evidence of specific and distinguishable bad actors, not mere anecdotes, i.e., countries and governments who variously sponsor, consistently engage in and/or encourage theft – misappropriation – infringement of intellectual property and its underlying intangible assets.
• bring more specificity to the types and categories of products, knowledge, know how, and IP being targeted and how and why that evolves over time on a need-demand basis.
• objectively measured losses to U.S. businesses, i.e., economic, competitive advantage, employment, etc.
acknowledge challenges to acquiring this data because a large percentage are based on anecdotal (incident) estimates,
• then, portray same in a manner that readily translates to both business decision-makers and creating a more informed public.
Sure, China is a leading culprit…but, also, there are numerous other countries, and individuals which are – have been longtime bad (trade) actors in this (economic espionage) arena. Admittedly, not necessarily on the scale of government sponsored ‘legal’ tactics of China. It is good to recognize, again, that many countries and public-private entities routinely engage in some manner of theft, manipulation, or brokering of others’ economic – competitive advantage information on the trade secret or proprietary level.
• That is, these entities purposefully acquire valuable ‘know how’, reverse engineer, and (mass) produce counterfeits, ala everything from women’s purses, clothing, and men’s running shoes, to increasingly high-tech products such as wind turbine generator apparatus and aircraft parts.
Michael D. Moberly – originally published April 5, 2018 – restructured and re-published on October 6, 2018 – St. Louis – [email protected] ‘Business Intangible Asset Blog’ (since May 2006) where attention span, business realities, and solutions meet!
Readers are invited to examine other relevant resources I have produced at https://kpstrat.com/books/