The U.S. Treasury's Jay Shambaugh emphasizes the need for innovative strategies beyond tariffs to counter China's subsidized industrial overcapacity, which distorts global markets. Traditional trade defense methods like Section 301 tariffs may not suffice against China's excess production. Shambaugh advocates for defensive actions to protect firms and workers from distortions in China's economy, urging creative approaches to address overcapacity challenges. Bipartisan efforts and potential legislation aim to extend anti-dumping measures to Chinese goods produced in third countries. The U.S. administration seeks new defensive tactics, highlighting concerns about China's industrial policies and global economic ramifications.