China expert Leland Miller, co-founder and CEO of China Beige Book International, says that trade is not the issue. The real question is control of supply chain choke points.
These could be supplies of scarce materials, such as rare earths, that are used in worldwide manufacturing processes. It could also be control over key ports or routes that supply products to the world.
Tariffs don’t matter much in this context; they can change, be skirted, or negotiated. Miller pointed out that worldwide, tariffs aren’t actually that high. Control over supply can be used to cut off countries or individual firms that aren’t doing what you want.
Looked at in this light, we can see the China-US struggle over ownership of the Hutchison Panama Canal ports as an effort to control a choke point in trade. We can also see the Houthi effort to gum up the Strait of Hormuz and the Red Sea as a control effort— to improve Israel’s behavior towards Gaza; with the help of Iran. The Hecksher-Ohlin theory of trade says that nations should trade when there is an imbalance in resources of whatever kind– labor, raw materials, educational capacity, agricultural land. And to exploit these advantages to defeat competitors is as old as warfare itself. Miller believes the Chinese are positioning themselves to wipe out economic competition when they see fit.
The US government will then become a participant, and perhaps a controller, of the free markets. That’s already happening as the US government takes a stake in companies here in the US. So it won’t be free enterprise, but government-influenced markets.
I don’t believe selling interests is necessarily our best course as a nation. Business becomes dealmaking in exchange for foreign cash, that evaporates into the hands of a few rich owners. The people, or workers, don’t benefit; instead they see the higher prices brought on by controls on supply.
John Kingston Tuesday, October 21, 2025
https://www.freightwaves.com/news/china-expert-miller-why-supply-chain-choke-points-matter-most
Supply Chain and Logistics 