IBM sought a China partnership, not just a sale

news.com ^ | Published: December 12, 2004, 7:55 PM PST | Steve Lohr

[Paul Ross]

This also bears on the general subject, although I think we can all agree Arnaud doesn't understand the need for a lower tax climate in the U.S...and that is only just barely restraining the spending of the Government!:

Insight on the News - Commentary
Issue: 12/13/04

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Rubber checks that don't bounce
By Arnaud de Borchgrave

Foreigners put up 90 percent of the $2 billion required every day to make sure Uncle Sam's checks don't bounce. The profligate uncle thus can write checks that are accepted as payment as long as they are never cashed. This sleight-of-hand shell game is what keeps the international monetary system from imploding. Shakedown rackets and Ponzi schemes are usually less transparent.

American foreign creditors now hold an estimated $11 trillion in U.S. "paper," or 43 percent of the superpower's privately held national debt, up from 30 percent since Mr. Bush became the 43rd president. China, Japan and Saudi Arabia are among the biggest dollar stakeholders, and they have seen their assets fall 35 percent against the Euro and 24 percent against the yen.















The Bush administration pooh-poohs any connection between tax cuts coupled with soaring deficits, from the federal budget to the national debt, and an insatiable appetite to borrow and spend. What about the $3 trillion surplus left by the Clinton administration that is now a projected $5 trillion to $7 trillion deficit? Nothing to worry about, we are told, because there is a plan to halve it without so much as a small war tax to make us finally understand "we're a country at war," as Mr. Bush keeps telling us.

The $220 billion cost of Afghanistan and Iraq this far has not changed any minds in the White House that the pre-war tax cuts must be maintained. More borrowing should do the trick. The more U.S. bonds and T-bills are sold abroad, the less need to curb the ravenous appetite for foreign goods. Thus, the United States can have its cake and eat it too.

The $420 billion defense budget, almost more than the rest of the world spends on its armed forces, will top half a trillion dollars before the end of Mr. Bush's second term, and social programs will keep pace, all without tax increases. The United States is expected to borrow $670 billion this year, according to estimates made last week by the Organization for Economic Cooperation and Development (OECD). The 10 Nobel laureates whose recent open letter urged a dose of fiscal restraint to curb current manifestations of "fiscal irresponsibility" were dismissed as eggheads talking through their mortarboards.

London's prestigious Economist thought the situation was alarming enough to put "The Disappearing Dollar" on its cover this week. It showed a dollar bill as a leaf on a tree, half eaten by a worm.

Foreign central banks, the major purchasers of U.S. securities, are spooked. Either they stand idly by and watch the value of their reserves continue to plummet - or they begin moving them into euros, or a basket of several currencies. Saudi Arabia has sold some U.S. paper for cash to go into new projects in the kingdom. China (with $515 billion) and Japan ($720 billion) have switched steadily out of dollars throughout 2004.

The Bank for International Settlements reported over the weekend dollar-denominated deposits fell to 61.5 percent of total deposits by OPEC members in the second quarter of 2004 - from 75 percent in the third quarter of 2001. Euro-denominated deposits rose to 20 percent from 12 percent over the same period.

Asia as a whole has accumulated $2.2 trillion in foreign reserves. The U.S. trade deficit with China, now nearing $150 billion for 2004, grows alarmingly from year to year. Wal-Mart alone imports $18 billion worth of Chinese-made goods for its stores. When China and India can compete across the entire spectrum of high-tech networking jobs, globalization begins to lose its allure. China's sidewalk moneychangers are betting the renminbi (RMB) is now a stronger currency than the dollar. Chinese companies are luring Chinese American executive talent from U.S. multinational corporations with higher compensation packages.

Seemingly unconcerned, the Bush administration says the external deficit has little to do with conspicuous consumption and much to do with the sluggish economies in Europe and Japan. Fast buck economists - or reckless high rollers - argue the disappearing dollar could be the answer to all of the administration's problems, as it will automatically shrink the U.S. deficit. And the more the dollar falls, they explain, the more expensive European and Japanese goods become, choking off their exports to America and boosting now much cheaper U.S. exports.

But such a laissez-faire policy - besides poisoning anew trans-Atlantic and trans-Pacific relations - will only encourage the dollar stakeholders all over the world to unload ever faster. The dollar is expected to shrink an additional 30 percent during the Bush 43B mandate. This could then be the biggest default in history, wiping out anyone holding dollar assets, and burying the dollar as a global reserve currency.

The Europeans blame intemperate U.S. borrowing and meager household savings. They know the more the dollar drops, the more claudicant their economies.

A run on the dollar would knock the props from under American global alliances and further erode what little support the United States has left for defeating the insurgents in Iraq and midwifing a democratically elected government. The only victor in such a tragic denouement would be Osama bin Laden and his global network of extremist troublemakers and terrorist destroyers.

In his last video, just before the Nov. 2 elections, bin Laden referred to religiously inspired Arab volunteers with whom he fought the Soviet occupation of Afghanistan in a war he says, "bled Russia for ten years, until it went bankrupt and was forced to withdraw in defeat."

Bin Laden clearly believes he can do it again. "So we are continuing this policy of bleeding America to the point of bankruptcy," he said, speaking without his habitual automatic weapon in the picture.

A horizon of endless deficits and a dollar with the buoyancy of a lead balloon is a recipe that can only please the countless millions who wish us ill.



Arnaud de Borchgrave is editor at large of The Washington Times and of United Press International.

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[Golden Eagle]

Still waiting on your answer to post #32, what will you say when they take their properties and technologies acquired from the US, and use them to wage war against the US and/or our allies? Give them more technology? What's your Plan B, or do you even have one?

[Golden Eagle]

And while I'm on here, which isn't much these days, answer me this: where do we draw the line on what technology you want to hand over to them in the hope it won't be used against us or our allies one day?

Should we wait until our EP-3's are forced from international airspace into landing on their islands, or should we just go ahead and hand them over without incident? Should our pilots back in 2001 have ditched those planes, or in your opinion are we only asking for war by keeping our technological superiority? I bet I know what your CEO buddy over at IBM thinks. We should just be giving them that stuff, so we can maybe sell them some spare parts down the line, right?

[Nick Danger]

Eagle, you're making this sound like IBM just sold them the plans for some super-stealth widget. It's motherboards for Intel boxes... and metal cases. Those are all made in China now anyway. What's on a motherboard now... six-layer, maybe ten-layer technology? Who cares; that stuff is ten years old. Girls can make them.

[Golden Eagle]

Your sidesteps aren't working. You're the one who said providing the Chicoms with technology is in our best interest, so I'm asking A) where do you supposedly draw the line and B) if/when it's proven it was a mistake and they use our own technology to attack us or our allies, how will you ever rectify your poor decision?

In the meantime you can quit your attempts at putting down the importance of the modern personal compuer to military applications, especially those of IBM pedigree. Using the foreign born Linux software with communist roots which your buddies at IBM pumped up for the Chinese for free , you can build some of the most powerful supercomputers on earth, so powerful that legislation is being considered that limits their exports to our potential advesaries. Too bad it's not already in effect, I guess we can thank the fat cats at companies like IBM that it's not. Apparently guys like you too.

[Nick Danger]

where do you supposedly draw the line

We already have a process for that. The government has a list of technologies that you can't sell to certain countries. I frankly don't know what's on that list these days, because I don't sell anything to anybody overseas. When I run out of customers in this city, I'll look into the surrounding states. I have 50 of those to go before I start worrying about overseas customers.

Eagle, if "isolating" worked, Castro and Kim the Nutcase would be gone. Instead they are 2 of the last remaining communist regimes.

I am aware that characterizing all critics of the Micrsoft Corporation as "communists" is part of your shtick. So is everyone else who follows your posts... so do your worst.

I spent the morning and afternoon in the room where President Bush was conducting his Economic Conference. He certainly has an ambitious second-term agenda. What did you do today, Eagle? You figure I was invited to that because of my communist ties?

[Golden Eagle]

I frankly don't know what's on that list these days

No surprise at all, somehow doesn't stop you from telling us it's all for the better though does it.

...because I don't sell anything to anybody overseas. When I run out of customers in this city, I'll look into the surrounding states. I have 50 of those to go before I start worrying about overseas customers.

I don't think you could be any more lame, considering you're on here constantly stumping for IBM and other sellouts that are putting countries like China ahead of the US. Read the CEO of IBM's comments at the top of this thread again, and then try to tell me that making China his #1 customer isn't his ultimate desire. He'll gladly move his headquarters to Peking if it means more money for him, they don't call themselves "International" BM for nothing. They were helping the Nazis too but you could apparently care less.

Eagle, if "isolating" worked, Castro and Kim the Nutcase would be gone. Instead they are 2 of the last remaining communist regimes.

They have no power, and aren't getting any either. They are isolated, and lack almost every modern comfort and technological advantage. Yet you try to tell us something is wrong, that it isn't working, and pumping US capital into them for their own betterment instead of ours is the way to go.

I spent the morning and afternoon in the room where President Bush was conducting his Economic Conference. He certainly has an ambitious second-term agenda. What did you do today, Eagle? You figure I was invited to that because of my communist ties?

Quit changing the subject. I have no idea if you were there or what you may have been doing, but if people like you, who want to build up the Chinese government with gifts like the IBM PC corporation less than 5 years after they forced our plane down over international waters, have anything to do with the future of this country we don't stand a chance. You could obviously care less, so long as you got your picture taken on Capitol Hill.

[Nick Danger]

you're on here constantly stumping for IBM

I do that to goad you, Eagle. You and that Butterfly. I consider you both to be shills for Microsoft. It's the only reason you ever come here. I invite anyone to click your name, click on "In Forum," and see if they can find a single post from you that is not on a 'computer' thread in which you are peddling Microsoft talking points. It's all you do, birdie.

[Golden Eagle]

More pathetic excuses from you, Microsoft, what does that have to do with anything we're talking about? The Chicoms don't build supercomputers with Windows, and if they did I wouldn't want them to have anything but illegal copies anyway. Microsoft isn't giving jack sh!t away to them either, what in the hell are you talking about Danger? Is Microsoft who is giving free supercomputer software away to the Chinese? No they are not, but if they were I'd be riding their @$$ just like I'm riding IBM's. So explain, what the hell are you talking about, saying this is all somehow Microsoft's fault that IBM is giving all this tech away to the Chicoms. I don't have jack sh!t to do with them either, I just want to hear how you think you can blame all IBM's long time traitorous actions on M$. It's the most pitiful excuse I can think of.

So who should be selling out the Chinese next, because of their US competition? Should Ford sell out, because they can't compete with GMC? Should John Deere, because they can't compete with Catipillar? You gonna blame General Electric, when Viacom goes Red, and accuse guys like me of working for GE when they call you on it? Is that what you want, our country being bought out by the Chicom governement? Well that's what you're right here defending.

[Nick Danger]

Gribble snarcoptic kapinst.

[Golden Eagle]

Gribble snarcoptic kapinst.

You don't have any worthwhile answers for supporting the likes of IBM, obviously. No reason whatsoever for turning your back on America just so the IBM fat cats get fatter, all you've done so far is sidestep, point fingers at others who aren't to blame, and now talking in what appears to be foreign languages. I don't think you could have been any more pathetic. Well maybe one thing. That guy who was on here supporting IBM and Linux that time when I asked him if he was a US citizen and he said, "yes, I am Amerecan." These are the types of people you are supporting, and you make quite a gang.

Gold Eagle Out.