Quote:
Originally Posted by artillery77
One of the reasons China became the new industrial center is they decided to heavily subsidize steel and sell it at a loss. At the time of their rise, many countries could offer cheap labor, but China could offer cheap labor and cheap steel, as they had no intention of making money from their steel, but rather moving up the supply chain to get the world's manufacturing.
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This is actually a good point, if one supplier or one country is allowed to become the sole source for that good/item, they can raise the price as high as they want and if you wanted that product, you would be forced to pay it, regardless how much of a ripoff it is. So if you let market forces work without government intervention, China could force everyone else that makes steel out of business, and become the sole supplier. Then when they triple the price of steel, if you want steel you would have to pay for it. It takes years to get a factory back online, train workers, set up an assembly line, it's not like you can just flip a switch and start making steel again.
National defense is a consideration too, say China become the sole source of steel, then cuts off the rest of the world and starts making tanks and other weapons of war, with no steel source, the United States couldn't start ramping up production of it's own military hardware to match China, they would have to a wait months perhaps as long as a year before American manufactures could start producing steel in large qualities for the military.
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