In the News: Mary E. Lovely

"The sanctions are a very big deal," says Mary Lovely, professor of economics and senior fellow at the Peterson Institute for International Economics. "The Chinese see them as a major threat and do not want a costly trade war."

Mary Lovely, professor of economics, says the reason why the United States and China have such drastically different tariff rates for imported cars is because of a pre-existing deal between the countries to keep car tariffs high while slashing import taxes on other goods, such as soybeans.

"We don't want to press our interests in citizenship upon the students," says Amy Lutz, associate professor of sociology, who will be teaching the new MAX course on research methods and civic engagement. "We want them to develop it themselves. We're there as mentors. So it shouldn't be that we give them the Action Plan and they fill it in. It should be initiated by the student's desire to engage with a particular social problem."

The web of relationships and mutual benefits between America and China is too complex to dismiss with campaign rhetoric.

"My concern would not be economic, it would be political," says Professor of Economics Mary Lovely regarding last year's rise in the U.S. trade deficit. “I’m afraid this will be more fuel for an aggressive trade stance toward China, afraid that will lead to retaliation by China, and I think it will cause job destruction in the United States as well as in China.”

"They raise the already high risk of new U.S. tariffs on Chinese imports, almost certainly to be quickly followed by a carefully targeted Chinese response," says Mary Lovely, professor of economics. "Unfortunately, while destructive of jobs both here and in China, these responses will not move the needle on the U.S. trade deficit."

"Changes in trade policy in 2017 were small and, in any case, unable to move the needle on the deficit," says Professor of Economics Mary Lovely. "If the recent tax cut stimulates spending and business investment in the U.S., as the president hopes, we may well see an even larger deficit for 2018."

President “Xi has really staked his future on the high-tech sectors in China,” Professor of Economics Mary Lovely says about the race between the U.S., China and other nations to develop the next wireless communications technology, known as 5G.

"Right now, trade policy looks very rear-view mirror," says Mary Lovely, professor of economics. "Just worrying about 500 jobs here or 1,000 jobs there seems to miss the need for long-term strategy." 

According to Professor Mary Lovely, a drawback to the hefty tariffs President Trump imposed on imported washing machines and solar panels is that "there will be less innovation in the long term." 

"However the Trump administration tried to achieve the goal of reducing the overall trade deficit quickly would come into conflict with other very important Trump administration objectives," says Mary Lovely, professor of economics.

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