Stephen Roach, senior fellow at Yale University’s Jackson Institute of Global Affairs, testifies at a Senate Banking, Housing and Urban Affairs Security and International Trade and Finance Subcommittee hearing.
“To unwind these types of supply chain…would really turn back the clock on companies like Apple and others that straddle so many countries to bring goods and services to consumer around the world for incredibly low prices,” he said.
Roach reckoned that, for the Trump administration, “it’s going to be bilateral deals, get tough on China, Mexico, Germany and others that are in the cross-hairs of enlightened individuals like Peter Navarro.”
Peter Navarro, director of the White House’s National Trade Council and advisor to President Trump, has repeatedly argued that China practices a perverse form of capitalism that undermines the U.S. economy by working with U.S. businesses against America’s long-term interests.
Navarro, a former economics professor, has said that a trade priority would be the unwinding and repatriating of international supply chains which many U.S. firms rely on.
“I don’t agree with anything Peter Navarro has said or written in his entire career,” Roach told CNBC.
And is China set to assume the mantle of leadership for globalization? Roach said this is unlikely because China has a lot to cope with on the domestic front.
“History tells us that countries that are not attentive to doing reforms, rebalancing and restructuring and boosting productivity at home, if they spread their wings globally, ultimately they’re overextended and will get into trouble.”
