Supply relationships reflect relative cost, and relative cost can change

The argument

Proponents of this position argue that the case against decoupling usually treats the existing pattern of trade as a natural feature of the world rather than as the outcome of a comparison that firms make and can remake. The two economies are linked because, for a long period, sourcing from one in order to sell in the other was cheaper than the alternatives. That is a statement about relative cost at a particular time, not a permanent condition. What changes the comparison, on this account, is the pricing of risk. Once a firm has reason to believe that a supply route may be interrupted by export controls, tariffs, sanctions, port closures or retaliation, the expected cost of depending on it rises even if nothing is actually interrupted. Insurance, dual sourcing, inventory held against disruption and the capital tied up in it are all real costs, and they attach to the existing arrangement rather than to the alternatives. Proponents argue that this is enough: suppliers that were uncompetitive on price alone become competitive once continuity is valued, and the firm relocating capacity is not obeying an instruction but following a changed calculation. The expected pattern follows from that mechanism. Decoupling of this kind would not be announced or completed on a schedule; it would appear as a steady diversion of new investment toward alternatives while existing facilities are run down rather than replaced. Proponents point out that this is exactly how previous reorganisations of global production proceeded, and that each looked impossible to those describing the arrangement it displaced. The question is not whether separation could be legislated but whether the terms can shift enough for firms to choose it, and proponents hold that political risk has already shifted them.

Premises

Counter-arguments

Critics answer that pricing risk shifts marginal decisions without touching the core. New investment can be diverted while the capabilities that matter remain concentrated where they are, and a firm that moves final assembly while importing every significant component has changed its address rather than its dependence. They also argue that the comparison with earlier reorganisations is misleading: those moved production toward cheaper locations, with the market pushing in the same direction as the firm, whereas this one asks firms to pay more indefinitely for political reasons. Arrangements sustained against commercial advantage have tended not to last.

Rejecting the premises

[Rejecting P3] Pricing continuity changes marginal decisions without touching the core, and a firm that moves final assembly while importing every significant component has changed its address rather than its dependence. [Rejecting P4] The comparison with earlier reorganisations is misleading, because those moved production toward lower cost with the market pushing the same way, whereas this asks firms to pay more indefinitely for political reasons. [Rejecting C] A change in the terms is not sufficient for separation unless it reaches the capabilities rather than the siting of production, and the argument gives no reason to think it does.