The House's vote on Wednesday to impose sanctions on China unless it let the value of its currency rise is important, but I don't have time to get into it at the moment.

Placeholders for now: I do not agree with the reflexive "Oh no, trade war ahead!" lamentation. That is partly for the reasons laid out on our site by Damien Ma (the legislation is not going to take effect; both sides are becoming more and more accustomed to managing these disputes).

Beyond that is the point I laid out early last year in the magazine, and for which Michael Pettis of Beijing is the most careful and consistent exponent. Short version: when the world's economies are highly-connected and when a global shortage of demand is causing employment problems anywhere, the country with the biggest chronic surplus [China] cannot continue to keep its currency artificially low. Or, it "can," but if it does then other countries can with good reason consider that a predatory, destructive act.

The House legislation, in my view, won't accomplish very much -- and, as I've written here many times, even a significant change in the RMB's value is not going to move factories from Guangdong to Ohio. But that is a different criticism from worrying that the House is taking us into "Smoot-Hawley" territory. Michael Pettis has carefully demonstrated why the national policy with the greatest Smoot-Hawley potential is China's, if it insists on defending its surplus at a time when global economies are supposed to "rebalance." (The Smoot-Hawley tariff was America's attempt to defend its surplus, when demand was collapsing around the world in the 1930s.)

More later. Turn to Pettis for guidance -- or for a different version, less tied to the internal Chinese dynamics, Paul Krugman today.