American multinational corporations and the U.S.-China trade war

This chapter examines the role of interest group politics in shaping the Trump administration's trade war with China. It explores how China's integration into the global trading system in the 2000s created political backlash in both China and the United States, stoking the embers of economic nationalism in both countries. In China this political backlash caused the government to embrace indigenous innovation. In the United States, it meant that trade with China would be framed increasingly as a national security rather than economic issue. The confluence of these trends helps explain why American MNCs, which worked so hard in the 1990s for China's accession to the WTO and are largest stakeholders in the U.S.-China relationship, have not only failed to constrain the escalation of tariffs but actually contributed to the decision to start the trade war. Ambivalent distributive politics among MNCs coupled with ideological convergence in Congress towards "getting tough on China" both contributed to the collective action failure that created the U.S.-China trade war.