I made the "...those protectionist/mercantilist countries are only hurting themselves and giving foreign consumers cheap goods" point as well, in another thread somewhere. Your "...as long as US government does not tax" wishful thinking is what makes your point fall apart.
What I stated above is that the US government most certainly would use taxation/redistribution (tariffs & subsidies as far as trade is concerned) to "make up for" the perceived losses that sound money would cause its crony cabal.
China isn't the only country that has insufficient capital to subsidize industry. Every country on Earth is in that same blue marble boat.
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