Part 3/7:
As the discourse evolves, the question arises regarding the health of China’s economy. Chang argues that the Chinese economy is not growing at the reported pace of 5.4%. Instead, underlying indicators—such as falling tax receipts—indicate a contraction, leading to what he suggests might be a deflationary spiral. A 145% tariff on Chinese imports could exacerbate this downturn, rendering many factories incapable of sustaining sales in the U.S. market, evidenced by factory closures and reduced shipments.