China and the Chest Thumpers
The latest blame China bill, unveiled last week in the Senate, is not as bad as earlier proposals...
The senators behind the bill — Democrats Max Baucus and Charles Schumer and Republicans Charles Grassley and Lindsey Graham — bristle at being labeled protectionist, in part because they generally agree that free trade is superior to trade constraints...
Disclaimer: these are still the call girls and boys of the Establishment, and it's their corner.
...There’s also no telling how China would react to mounting protectionism. Weak Asian demand at a recent auction of Treasury debt is one of the reasons behind the latest increase in American interest rates. Rates could rise even more if China retaliated against pressure from the United States by further curtailing its demand for dollar-based assets.
American policy makers are betting that China won’t shun the dollar because doing so would induce losses in its vast dollar-denominated reserves. But when protectionist skirmishing starts, economic logic often breaks down. That’s why it’s better not to make threats in the first place.
It would be better if Congress focused on the problems from globalization that it could actually solve rather than blaming China for America’s economic ills. The problem of American business competitiveness — and Americans’ economic anxiety — would be best addressed by health care reform. The problem of growing income inequality could be ameliorated with a more progressive tax code.
It would also be more constructive if the United States took responsibility for its part in international imbalances. An undervalued yuan is only one aspect, allowing China to sell its goods cheaply and amass huge savings in the process. Another is the United States’ federal budget deficits — which result in large part from serial tax cuts — requiring America to borrow from China and other foreign lenders.
To help restore balance, China should change its currency practices and the United States should change its tax policy. Talks between the two nations need to acknowledge those twin imperatives. That would be a lot wiser than legislation that is based on the false notion of America as an innocent victim, unable to shoulder responsibility for its own problems.
You can bet there is Somebody from Chuckie's office trying to spank Someone for being too pouty in public. But the Pravda boys and girls can't help it. They've got a sweet racket too, and economic wars have this nasty habit of morphing into shooting wars. That would be really bad for business- if it was in their streets or mushrooming over their heads at a million degrees Centigrade.
Still, Chuckie and pals may not be worried much at all about this. Health care reform? No, there is no chance the medical profession is going to allow real health care reform to take place if it cuts their profits. After all, the system works much better if only the Right People go to medical school, and if they graduate with staggering debt, working virtually every waking hour not to heal people, but to pay off the debt and live the good life their social peers expect.
Then there's the other suggestion, that might effect the corpulent felines playing the United Mice of Amerika. Go as far as removing all the tax breaks that ensure the cats at the top stay on top of the food chain, and nothing like a real meritocracy evolves here? Ah, the Gray Lady makes a joke.
Who ever said there was no humor on the Editiorial pages?
Easy solutions. Some people just like to talk dirty, and others just get off on hearing it.