Trump actually started to decouple America from China
Noah Smith
· Noahpinion
· May 13, 2026 at 09:40
· ⏱ 13 min read
| Read on Substack ↗
Summary
The article argues that Trump's tariffs, combined with the 'China Cycle' of technology appropriation and geopolitical risk, have meaningfully reduced direct U.S. import dependence on China, though supply chains remain indirectly dependent via intermediate goods from China routed through third countries. For markets, this means the decoupling trend benefits assembly economies like Vietnam and Mexico while China moves up the value chain, but the shift is slower than headline numbers suggest and the indirect dependence complicates any simple 'US vs China' trade narrative.
•The percentage of U.S. imports from China has plummeted, with a WSJ chart showing a sharp decline from roughly 20% to under 12%.
•About 60% of reshoring in 2025 relocated from China, and 9% of Ohio manufacturers reported reshoring in 2025, up from 4% in 2021.
•Trump's tariffs on China dwarf those on friendly countries, as shown by a Stephen J. Douglass chart comparing tariff rates.
•Most of America's PCs are now made in Vietnam, shifting from China over the past two years (Chad P. Bown data).
•Foreign direct investment into China collapsed, with a World Bank chart showing a steep drop from over $150B to near zero.
•Hsu, Peng, and Wu (2024) found a substantial increase in indirect U.S. dependence on China via Vietnam and Mexico through intermediate goods, though data ends in 2022.