Posted on 05/06/2004 9:42:05 AM PDT by ninenot
In a May 4 editorial, the Wall Street Journal accused Democratic presidential candidate Senator John Kerry of having a “paranoid” worldview and engaging in “xenophobia” because he has been talking about taking action to open foreign markets to U.S. exports, revive American manufacturing, and regain some of the 2.6 million manufacturing jobs lost since 2000.
I will not discuss Sen. Kerry’s proposals, which are far too timid to make much of a dent in the massive and growing U.S. trade deficit – likely to hit $600 billion this election year. Instead, this column will examine what the WSJ’s extremist rhetoric and misstatements of facts say about the philosophy and worldview of its editorial writers, whose allegiance apparently starts and ends within the narrow financial district from which the paper takes is name.
These citizens of the world are opposed to anyone thinking in terms of national interests. And they make fun of the notion that anyone else in the world thinks in terms of their national interests or have any loyalty to their countries. Thus it is safe for our leaders to ignore their duties as well.
Let’s look at specific policies the WSJ editorial criticized, all of which predate the Kerry campaign. The "Super 301" trade law was branded as a measure that “nitpicks U.S. trading partners for rules violations and punish them with trade sanctions,” which the WSJ called “mean-spirited, not to mention paranoid.” Yet the purpose of “Super 301" was to open foreign markets by identifying foreign measures that limit U.S. exporters’ ability to take advantage of trade agreements.
The WSJ has endorsed recent trade agreements, claiming they will open markets, but they will not so unless American officials are able to enforce the terms that were reached during negotiations. Adam Smith understood this process within the context of his defense of free trade, arguing in The Wealth of Nations that when other states block British exports, “Revenge in this case naturally dictates retaliation, and that we should impose the like duties and prohibitions upon the importation of some or all of their manufactures.”
The WSJ view that it is “nitpicking” to require trading partners to honor their agreements feeds the belief that as the voice of transnational corporations with “global supply chains,” the WSJ cares little about U.S. exports.
Consistent with the position that foreign production is more important to its favored constituents than is domestic enterprise, the WSJ editorial also mocked any attempt, by either Bush or Kerry, to pressure China into halting its mercantilist currency manipulation. Indeed, the WSJ goes out of its way, and into the field of willful disinformation, to protect Beijing from criticism and to dampen any ill will against those transnational firms which are helping China pursue its ambitions.
What can one make of the WSJ assertion that China has lost manufacturing jobs? The big concern being expressed in most circles is that China is growing at unsustainable rates, that the pace of growth is “overheating” the economy, which recorded a gain of 11.5% last year in GDP.
Firms like Motorola, Intel, Boeing, General Motors and hundreds more have poured billions into new Chinese factories. Fixed-asset investment, an aggregate measure of capital expenditures by government and business, was 43% higher this March compared to last year. Yet, the general inflation rate in China is not much higher than in the United States (under 3%), indicating that the boom is being led by production increases and job creation.
China’s growth is so strong, it is driving up world commodity prices as it sucks in raw material, oil, and capital goods to expand industrial output and capacity. The rise of the Chinese economy is felt by Americans every time they buy a gallon of gasoline. China's breakneck economic growth, fueling record oil imports, is the main factor behind this year's surge in world crude oil prices (and thus gasoline prices) reports the International Energy Agency.
Imports of production inputs is the source of the small trade deficit China has run the first two months of this year. The WSJ tries to spin this as if China is suffering the same problems as the United States, but this is so untenable a contention it can only be seen as a sign of how desperate the WSJ has become in pushing a losing argument. The U.S. deficit is the result of Americans importing goods made overseas, China’s deficit is the result of importing what is needed to produce those goods. Americans are spending money and going into debt, the Chinese are making money and expanding their ability to produce wealth.
China’s demand for steel is causing worldwide shortages. The Consuming Industries Trade Action Coalition has warned, “U.S. manufacturers are facing major steel supply disruptions and shortages that could contribute to plant closures and job losses.” The French builders federation, according to Agence France Presse, has stated, “Everything is going to China and there is nothing left to feed the furnaces to keep production flowing.” But since China remains the cheap site for production, the incentive is for foreign steelmakers to set up new mills in China, with Chinese partners, rather than try to export steel from Europe or the United States.
Of course, China will turn the resources flowing into the country into expanded exports. The U.S. trade deficit with China will continue its upward trend as the American market is the top destination for Chinese-made goods.
While China’s growth is being structured to benefit China, the WSJ applauds how America’s deficit is helping to benefit foreign interests. “The U.S. deficit is a world-wide blessing in its benefits to national economies” elsewhere, says their editorial. And, of course, it benefits those transnational corporations which have moved their factories overseas and become the darlings of the WSJ writers by doing so.
There was some inkling in the editorial that the current situation is unsustainable, but what is the WSJ remedy when the crash comes? “When the U.S. can no longer finance its trade deficit, some adjustment will have to be made in the U.S. government's spending and borrowing habits.” In short, others will have to adjust, as no change in trade policy or practice which would adversely impact transnational business is to be made. Treating the problem at its source is an idea that is out-of-bounds for the WSJ, which is why the Wall Street Journal has no credibility on the subject of trade policy for those whose concern is what is best for America.
It will be good for the economy when it goes from trade war to shooting war, and we destroy everyone else's industrial base.
A lot of folks forget that the period 1945-1970 was a complete aberration in history--never had one country had so much of the world's industrial base, and WW2 was the reason.
Oh I disagree. Look at what Clinton did, opened up the Chinese market so we could ship them our best missle technology. Certainly Kerry could open up that North Korean market so we could improve the accuracy of their nukes. If North Korea is gonna fire nukes, we want them to be accurate....
It is always amusing to see a dem scumbag crap weasels question some one else's integrity or accuse them of sinking to a new low. Crap weasels rise to a new low!
Already demonstrated to be largely capital transactions, i.e., the Brits bought another US company.
Look, I think (as does Hawkins) that Kerry sucks. Even the Dimowit Establishment agrees.
Having said that, do you want to get to the point?
Kissing the PRC butt, ignoring their continuing human rights violations, ignoring their 'fix' of their currency, and ignoring their MASSIVE pollution of the country (we're not talking about a couple of grams of mercury here)--in combination with their piquant "labor practices" (i.e., slavery) is the point. Get it?
You ought to look at the "nostalgic, cheap, liberal" Republican Party platform of 1900.
Some of us are patriots. Want to join?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.