How Long Can China’s Workers Tolerate China’s Dictator?

Trade fight gives U.S. companies an incentive to replace Chinese labor with automation.

The Wall Street Journal
Date: Sept. 12, 2019
By: James Freeman

Many observers have warned that the Chinese could dominate the field of artificial intelligence. Maybe it will dominate

President Donald Trump and China’s President Xi Jinping during the G20 leaders summit in Osaka, Japan in June. PHOTO: KEVIN LAMARQUE/REUTERS
them. The potential impact of technology on the Chinese workforce could be driving Beijing to try again for a U.S. trade deal.

Lingling Wei and Chao Deng report in the Journal:

China is looking to narrow the scope of its negotiations with the U.S. to only trade matters, putting thornier national-security issues on a separate track in a bid to break deadlocked talks with the U.S.

Chinese officials are hoping that such an approach would help both sides resolve some immediate issues and offer a path out of the impasse, according to people familiar with the plan.

The shift comes as President Trump on Wednesday delayed tariffs on some Chinese imports.

Workers and investors have seen their share of head fakes about the direction of trade negotiations from officials in both governments. But the Journal report suggests the Chinese regime is willing to do more than buy soybeans:

In preparation for a new round of talks scheduled to take place in Washington early next month, Chinese negotiators are making plans to boost purchases of U.S. agricultural products, give American companies greater access to China’s market and bolster intellectual-property protections, these people said.

Meanwhile U.S. officials seem to have wisely selected their top two priorities:

In Washington, Treasury Secretary Steven Mnuchin said Thursday he was cautiously optimistic the two sides could make meaningful progress.

He said the U.S.’s top concerns remain intellectual-property rights and forced joint ventures, as well as currency issues.

A key question has been how long Chinese dictator-for-life Xi Jinping can wait to resolve the trade dispute before many more U.S. companies move manufacturing out of China. He has some room for error in part because rising alternatives like Vietnam can’t compete with China’s massive workforce. But what if manufacturers decide they don’t need a massive workforce?    [FULL  STORY]