March 9, 2019 at 12:22 pm

Boecking Discusses Trade Wars in Historical Context

Felix Boecking speaks at OHIO.

Felix Boecking speaks at OHIO.

Boecking, Senior Lecturer in Modern Chinese Economic and Political History at the University of Edinburgh, presented “No Great Wall: Trade, Tariffs, and Nationalism in Republican China, 1927-1945.”

With degrees from the Universities of Cambridge (Ph.D., 2008) and Oxford (B.A., 2003), Boecking also holds a certificate from the Hopkins-Nanjing Center for Chinese-American Studies. Among his research interests are China’s political economy, the history of economics in the People’s Republic of China, and the history of Chinese foreign relations. He is a Fellow of the Royal Historical Society and the Royal Asiatic Society. Boecking’s current project, supported by a Fellowship at the Woodrow Wilson International Center for Scholars in Washington, D.C., is “Economics on the Edge: An Intellectual History of Economists in the PRC since 1949.”

Boecking considers his research to stand at the intersection of political and economic history. Drawing on his recent book, his talk focused on the Chinese Nationalist government and its use of protectionism. While trade has been a somewhat esoteric topic in the past, given recent developments between China and the United States it has become much more relevant today. By examining trade within a larger timeline, Boecking intended his talk to use the past to think about the future.

Boecking explained how protectionism created unintended consequences for Nationalist China between 1927-1945. Taxes on the largely agricultural population, most of whom lived in provinces that the government did not control, led many Chinese to turn to illegally smuggled goods. This not only lessened available revenue but fractured political authority, as many came to question the legitimacy of the Nationalist government.

The government had managed to contain its problems associated with revenue, finances, and a mostly agrarian economy. Once war broke out with Japan in 1937, however, China experienced a rapid decline in revenue. The year before Japan invaded China, tariffs accounted for just under half of the overall central revenue while income tax brought in less than one percent. By early 1940, the government derived less than five percent of its overall customs taxes from Nationalist-controlled areas. When the Nationalists lost control of parts of China that produced the single biggest share of revenue, its reliance on a narrow tax base had a drastic effect on stability. China’s wartime collecting methods, its printing of money to finance the war, and illegal trade that occurred across enemy lines directly undermined the political legitimacy of the Nationalist government after the war.

Boecking argues that if one examines the present through a 1930s lens, the United States and China are not currently engaged in a trade war, but rather a dispute over tariffs and surplus. He also highlighted particular lessons about trade wars. Principally, those instigating such competition should understand their objectives, how they will be achieved, and what the possible political consequences of such a war might be.

For an archived video stream of Boecking’s talk, please click here.

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