Posted on 03/23/2006 3:57:28 AM PST by John Filson
-- Beijing politely rolled out the red carpet this week as two leading U.S. senators began a fact-finding mission to determine how to punish China for manipulating its currency. But half a world away in Geneva, China's delegate to the World Trade Organization lobbed a rhetorical bomb at the United States, accusing Washington of hyping national security concerns to restrict foreign investment on its home turf.
"By interpreting and applying WTO national security clauses in an excessive way, [the United States] has again seriously undermined the credibility of the multilateral trade regime, over which China is highly concerned," Chinese WTO envoy Sun Zhenyu told his fellow ambassadors yesterday.
The comments appeared to be directed at U.S. political backlash that helped kill a bid last year by China's CNOOC Ltd. to acquire Unocal Corp., a Houston-based U.S. oil and gas producer.
"Recently the United States exerted pressure and imposed restrictions on inward [foreign direct investment] on account of national security, which prevent foreign companies from seeking mergers and acquisitions [there]," Mr. Sun added.
The verbal attack, which coincides with the release of a WTO report on U.S. trade policy, marks the latest flashpoint of an increasingly strained relationship between the two economic and military giants.
China wasn't alone in warning about rising protectionist tendencies in the United States. In comments filed yesterday with the WTO, the European Union urged the United States to strike "a better balance" between security concerns and avoiding "unnecessary and costly burdens" to legitimate business.
Responding to the criticism, U.S. Trade Representative Rob Portman said the Bush administration is "cognizant of the potential for protectionism in the U.S. and we are actively communicating the real world benefits of trade at home." But he pointed out that United States hardly has a monopoly on anti-trade tactics.
"Economic isolationism . . . is not just a phenomenon in the United States," Mr. Portman said in a statement released in Washington.
The recent furor over the proposed takeover of several East Coast ports by Dubai Ports World of the United Arab Emirates has caused concern that the United States may be turning increasingly inward as it wages a global war on terrorism.
In the United States, critics blame China for stealing U.S. jobs and pushing the trade deficit to record levels by keeping the value of its currency, the yuan, artificially low. Last July, China raised the value of the yuan by 2.1 per cent and introduced a system to gradually move the currency away from its peg to the U.S. dollar. But the currency has barely moved since.
In Beijing, Republican Senator Lindsey Graham said the next couple of months could be a defining period in U.S.-China relations.
"Our goal is to let the Chinese government realize that the politics of this issue is about to get out of hand," warned Mr. Graham, co-author of a bill with Democrat Charles Schumer that would slap a 27.5-per-cent tariff on all Chinese imports. He said the senators are stressing to leaders in Beijing that "if you think the relations between our two countries are good, you're misreading the tea leaves back home [in the U.S.]. They're not good, and they're getting worse."
Mr. Graham and Mr. Schumer have said they want to push for a vote on the widely popular legislation as early as this month. The senators were slated to meet yesterday with Zhou Xiaochuan, governor of the People's Bank of China.
The Congressional vote could be the first dust-up in the prelude to next month's U.S. visit by Chinese President Hu Jintao. The White House confirmed yesterday that Mr. Hu would meet U.S. President George W. Bush on April 20.
That's just five days after the U.S. Treasury Department is slated to release a report on whether to officially brand China a currency manipulator -- the first step in imposing sanctions.
Although largely drowned out by the politicians, U.S. business leaders have appealed for calm in the escalating dispute. Caterpillar Inc. chairman Jim Owens warned Congress not to be seduced by tariffs and other retaliatory measures against the Chinese.
.......................1982.....1992.....2001.....2002
China GDP.........221 .....454..... 1,167.....1,232
US................3,227.....6,239 .....10,057.....10,039
In 1946 our GDP was $222 billion. It took us 27 years to get to $1,307. It took China about 10 with generous help from "free traders" in the white house and Congress and the American taxpayer. So who really is winning?
Aren't you the financial genius? Why don't you enlighten us?
Not that I don't trust you, but how about a link to the info you're posting?
No, are you a bigot?
Are you involved with international trade or finance?
Yes I participate in trade with other countries and I have bank accounts in other countries.
Do you make a significant amount of your income through the trade imbalance with China?
Probably less than most. I have no debt. If you have any debt it is finance by the sale of foreign securities. However I have imported and exported to the UK, Egypt, Indonesia, China, India and Chechosovoica. I also served and fought in the US military to preserve the freedom of US citizens. That includes the right to free trade. I have already lived through part of the era of protected trade. When you provide my products made by a US company in the US at the same price I will trade with you. However when you provide me with a union I can't afford and tariffs that would put me out of business I will trade elsewhere.
How do you make your living?
You want me to admit that trade helps grow GDP? Okay.
That's not what I meant. I'm talking about people in Washington who have an interest in "good relations" with China and therefore want to help China achieve higher economic growth at our expense. Some of these folks also get lucrative jobs after they retire with think-tanks funded by foreign countries. You and I have no such interest and thus we see this issue clearly for what it is.
" How do you make your living?"
I handle storage management for a large credit corporation. And no, I'm not a bigot. You're trying to defuse my question by using the word bigot thinking that it's going to shut me up. Try using the "R" word next time it usually works for the other race-baiters on the forum.
On the other hand, thank you for the honesty of your answers.
I don't know. What was America's GDP before the WTO was created?
In the 1800's China's GDP was 30% of the worlds GDP. By the 1950's it had decresed to 2%. It has been rising every since.
"We have been set up with the express intent of bleeding the U.S."
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>..........
correct, much like the Dubai ports deal, American's can be fooled alot but we have very good gut instincts on the BS of Globalism and misnamed "free trade".
I think the problem is more with jobs than with industrial production output. Much of our growth in industrial production has been in items produced almost entirely by machinery: chemicals, construction materials, electric power, etc. The issue is that we're losing a lot of skilled & uskilled manufacturing jobs to China, which IS hurting some sectors of the middle class. I'm not one of these eternal alarmists who've been saying "we're losing our middle class" for the last fourty years (LOL), but manufacturing people have been hurt by China and there hasn't been enough offset to help our middle class from China buying products from our strongest industries: technology, software, and entertainment products.
Don't worry about the %, look at the total $$$ amount.
I think the problem is more with jobs than with industrial production output.
Yes, higher productivity means we make more stuff with fewer workers. You think that's bad?
Well aware of that and you should examine the reasons. If you produce 2 million cars in the US but can only sell 500 thousand in the US you either have to export them, put factories in other countries if that is too expensive or go broke. They have a much larger market. Westinghouse is selling out its nuclear technology. The US decided they couldn't use it here and Westinghouse should go broke. Our GDP gets larger every year, not smaller. You still have the option not to trade with them.
Energy stocks are hot today; oil is up $1.83 per barrel as of 30 minutes ago. Something must be heating up with Iran. The fundamentals for oil are not that good without Iran in the picture, so this is probably Iran again. I'm trying to find out what happened.
Higher productivity is of course good, but when we run a $200 billion trade deficit with China that shifts jobs to China from America. They have to start buying more stuff from us (and paying for it...lol.)
They do business only in the US?
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