Monday, June 21, 2004

Commission chairman Roger Robinson put it politely: 'A number of the current trends in US-China relations have negative implications for our long-term economic and national security interests, and therefore that US policies in these areas are in need of urgent attention and course corrections.'

Asia Times Online - News from greater China; Hong Kong and Taiwan

Interesting. This comment is also noteworthy.

It is not Beijing's fault that foolish policies in Washington have created a consumer boom that is drawing in imports more than stimulating domestic production. Beijing did not create currency policies that allow Americans both as individuals and as a nation to live on debt.

So despite all that bluster from the commission, Congress is highly unlikely to act in the aggressive and assertive way the commission suggests, unless Beijing does something silly like disband the Hong Kong government or attack Taiwan, almost certainly not.

Simply put, there are too many companies in the US, from Wal-Mart onwards, making a lot of money by selling Chinese products. They are hardly likely to call for protective tariffs when they are designing, ordering and importing their products from China. Indeed, they will lobby and have lobbied strongly and successfully against any restrictions on outsourcing. And no one is going to stifle credit or increase taxes when there are closely contested and highly partisan elections in the offing.

The US import to export ratio with China is 5:1

Update : AltMoney tribe discussion

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