U.S. Says 'enough' to China Trade Surplus, Threatens Tariffs

You've probably heard about the profits to be made investing in China these days. Surely you've also noticed that much of what you buy, from goods at Wal-Mart to expensive electronics, says "made in China." People are enthusiastic about both benefits to the Chinese boom times, but economic imbalances have costs further down the road, and US regulators have their eyes on that.

As China's financial markets have opened up, and the economy has been booming domestically and internationally, investors have been enjoying the benefits, but the trade surplus between the US and China has been growing also. Biding their time, on the heels of a significant drop in the Chinese stock market, American officials have said that it's time to implement tariffs on Chinese goods flowing into the American market.

Chinese officials have said that tariffs are not necessary, saying they would be "trade protectionism" and that the results would be bad trade, and "disaster" for business, according to Businessweek.

The US Congress is preparing to act on their belief that it is time enact punitive tariffs, with a 27.5% increase, blaming a $232.5 billion trade deficit with China last year, and a loss of American manufacturing jobs, on currency issues, and using the tariffs to force China to address perceived problems with their currency valuation.

China replied by noting that much of the goods being exported to the US are produced by US companies with factories in China. They also noted that they had identified problems and also wished for trade balance, but that changes they had made would only be effective in the longer term.