I am no fan of the Chinese government and support President Trump’s efforts to leverage better trade deals. At the same time I'm not a fan of elements of the Administration pushing for bans of specific companies that produce goods that consumers want in the U.S. There are a few examples today of companies that are being targeted for blacklisting because they originate in China, yet the politicians who are trying to ban them rely on iPhones, computers and furniture all manufactured in China. The hypocrisy of politicians is not a surprise.
A good starting point of discussion is that the most popular product in the United States today – the iPhone. They are manufactured in China, India and Vietnam. According to CNBC reporting on April 3, 2005, “the majority of Apple’s iPhones are still assembled in China by partner Foxconn.” Yet no rational politician, nor one who likes being re-elected, would call for a ban on Apple products.
Apple is but one of many American-owned companies that relies on production in China. According to the Coalition for a Prosperous America (CPR) in a report issued last year, Ford, Carrier, Apple, Tesla, Coca-Cola, Cummins, RTX, Honeywell, Walt Disney and Caterpillar also rely on Chinese production capacity. According to CPR, some of these companies are shifting out of China, but not to the U.S. They will either move to Mexico, Vietnam or India, where production capabilities mirror those in China.
One alternative strategy to tariffs deployed by protectionists is to flat out ban companies that are incorporated outside of the United States. A victim of economic isolationism on the right is the commercial drone manufacturer DJI. They are a privately held Chinese company that makes the most popular flying camera in the world and one that is used by first responders in the United States to save lives. Protectionists convinced Congress to pass legislation, Section 1709 of the 2025 National Defense Authorization Act (NDAA) requiring a risk assessment review by the federal government before the company is banned. The clear goal of the legislation is to protect American drone manufacturers from competition.
Cronyism seems a possible motivation for government to attempt to ban the company. One competitor, Skydio, is registered to lobby for “Commerce Department rulemaking on drone national security issues.” A likely result of that lobbying effort was that the Department of Commerce opened up a national security probe into imported drones, including DJI technology. This smacks of cronyism, because Skydio would be the biggest beneficiary of a DJI ban.
It makes sense to ban companies that pose a national security risk to the United States, yet it makes no sense to ban companies that pose zero risk. When the Trump Administration closed the de minimis exemption for small packages to avoid tariffs, fees and inspections, that served as a de facto ban on importers like SHEIN and Temu from selling inexpensive goods to willing American consumers. On June 5, 2025 CNBC reported “use of low-cost e-commerce giants Temu and Shein has slowed significantly in the key U.S. market amid President Donald Trump’s tariffs on Chinese imports and the closure of the de minimis loophole, new data shows.” The Administration used national emergency powers to prevent young women from purchasing inexpensive summer clothing from SHEIN and families from purchasing some low-cost back yard furniture from Temu. This ban will not result in insourcing of manufacturing, but will result in American consumers choosing to not purchase those items.
Cronyism is not unique to the DJI battle. The pre-text of the closing of de minimis was an “unusual and extraordinary threats, which have their source in whole or substantial part outside the United States, to the national security, foreign policy, and economy of the United States.” Somehow inexpensive tee shirts pose a national security threat to the United States. Protectionist organizations like the National Council of Textile Manufacturers President Kim Glas praised the recent push to end de minimis, because low cost consumer goods “harmed American manufacturers and workers and endangered American consumers.” The make-believe national security argument was manufactured to by those who want no trade with foreign nations.
Government protectionism and economic isolationism is time bomb that will hammer the U.S. economy in the upcoming months. This will be an unwelcome surprise to the supporters of protectionism when they face the voters in the midterm elections next fall.
