Amid all the squeals in Washington at the yawning US trade deficit with China, one strikes a specially resonant political chord: that unfair Chinese competition is annihilating US manufacturing industry and "stealing American jobs". The assertion is so common it has assumed the status of fact. Yet it is almost entirely false.
For a start, the bilateral imbalance may be overstated. After ironing out the wide discrepancies between both sides' data, Oxford Economics, a consultancy, finds China's share has hovered at about a fifth of the total US merchandise deficit since 1995. That suggests the former is as much a result as a cause of the latter's growth. Heaping all the blame on China would be off the mark, even if US manufacturing were dying.
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