China’s danger to the U.S. economy is real by its aggression toward America’s friends like India, Japan, South Korea, Taiwan, the Philippines and Vietnam.
Chinese ship ‘cuts’ Vietnamese maritime survey ship’s cables
Obama’s pivot to Asia’s strategy is a farce since China has been using both the carrot (China’s checkbook diplomacy) to sow disunity in Association of Southeast Nations (ASEAN) by buying out Cambodia and Laos with generous financial aid packages.
China’s one-on-one talks with Indonesia and Malaysia have resulted in getting these two countries to soften their stand against China in voicing their opposition against China’s illegal occupation of an island in the Paracel archipelago, which belongs to Vietnam, a member of ASEAN.
At the same time, China courts Thailand and Singapore to stay neutral in South China Sea’s disputes between China and the Philippines and Vietnam.
A Chinese marine surveillance vessel, foregound, cruises side by side with a Japan Coast Guard ship within Japan’s territorial waters near the Senkaku Islands on Sept. 24. (The Asahi Shimbun)
China today spent USD$250,000 to run ads on two major U.S. newspapers in an attempt to portray itself as the victim of Japan in the East China Sea dispute, concerning couple ‘rocks’ named Sensaku islands which belong to the Japan.
While China has been getting aggressive these past few years in both East and South China Sea areas against American’s friends, all Obama has offered these close friends and allies of ours is to neither mediate nor reason with China about its bullying role against its neighbors.
Obama also doesn’t take China to task for killing Tibetans, Uighurs, Falun Gongers, and other ethnic minorities in China.
Romney has promised he will get tough with China, and he also promises that he will protect America’s interests (our friends and allies as mentioned above) against China.
Asian-Americans are normally ‘quiet’ in America’s politics.
I urge all Asian-Americans to turn out en masse this upcoming Presidential – federal – state elections.
I urge all Asian-Americans to put aside their political affiliations, and vote for Romney as President of the United States.
I also urge all Asian-Americans to cast their vote for anybody who runs for public offices (federal and state levels) that has a proven record of championing for human rights and democracy causes, especially against Human rights violators like China, Cuba, N. Korea, and Vietnam.
A Tibetan in flames after self-immolating at a protest ahead of Chinese President Hu Jintao’s visit to India, in New Delhi, March 26, 2012, Manish Swarup/AP Photos
New poll suggests Romney is winning the China argument
In their effort to court undecided voters in industrial swing states like Ohio, Barack Obama and Mitt Romney have been going to great lengths to demonstrate their toughness on China, hurlingattack ad after attack ad at one another.
Romney has pledged to label China a currency manipulator on his first day in office and promisedto balance the budget by asking whether each federal program is so important that it’s worth borrowing money from China to finance it. Obama, availing himself of the power that comes with already being in office, announced a World Trade Organization complaint against China during a campaign stop in Ohio. Cracking down on China’s unfair trade practices is a loaded issue — encompassing jobs, the economy, U.S. foreign policy, and American power — and it may very well come up during tonight’s presidential debate.
So who’s making the better case? A new NBC News/Wall Street Journal poll, conducted between Sept. 26-30, indicates that the advantage goes to Romney. When asked who would do a better job “dealing with the economic challenges we face from China,” 45 percent of registered voters selected Romney while 37 percent selected Obama (the poll also shows Romney slashing Obama’s foreign-policy edge by more than half, from 47-32 in July to 46-40).
The NBC/WSJ survey hasn’t asked the China question before, but a Bloomberg poll of likely voters, conducted between Sept. 21-24, showed Obama and Romney tied at 43 percent when it came to who would do the best job of “dealing with China on trade” (50 percent of respondents in that survey were skeptical of Romney’s pledge to designate China as a currency manipulator). If Romney has indeed opened up a lead on Obama on China, that would be a significant development.
Still, there are some caveats to these numbers. Democratic pollster Fred Yang pointed out on MSNBC today that Republicans in past elections have enjoyed even greater advantages on China. And while Romney has narrowed the gap with Obama in swing states such as Florida and Virginia, he’s still far behind the president in Ohio — a state where the Republican candidate’s message on China should have particular resonance (indeed, a recent Zogby poll commissioned, fittingly, byDeath by China Productions found that likely voters in Ohio trust Romney more than Obama to crack down on unfair Chinese trade practices). If Romney is in fact winning the China argument, it’s not yet clear that the achievement will translate into electoral success.
Even so, Obama would probably like to have that eight-point lead on China. After all, all he got for his tough line on Beijing is a lousy (if legally shaky) lawsuit.
It’s not ‘China bashing’ if it’s true
As the U.S. Presidential election campaign enters its final stages, both candidates are being criticized in the media for “bashing” China.
This is in response to Obama administration filings of anti-subsidy complaints against China with the World Trade Organization (WTO) and to Governor Romney’s strong criticism of Beijing’s currency manipulation that undervalues its yuan (or RMB) as a way of subsidizing exports and acting as a tariff on imports.
The best example is the Chicago Tribune. Recently, it flatly said that both candidates are “bashing” China and noted that “attacking China’s export-subsidy machine is guaranteed to win applause at campaign stops in Ohio and other Midwest industrial swing states, where resentment of Chinese competition in manufacturing runs deep.”
Now, from the tone of this, you’d expect that China is completely innocent of any trade rule violations and that the candidates are unreasonably and cynically beating on it as a scapegoat for the off-shoring, layoffs, and unemployment that have all skyrocketed in the mid-west over the past five years. Indeed, you might even think the candidates are in some measure motivated in their critique by racism.
After all, the terms “bash” and “bashing” imply anger, rage, violent emotion, and unreasonable hatred. If someone is a critic, he is legitimate, but a “basher” is emotional and unreasonable. The terms are usually applied to characterize criticism of Japan or China but are rarely if ever used with regard to non-Asian nations. When was the last time you read about “Germany bashing”? So the implied charge in the case of one labeled a “China basher” is that he/she is a racist.
Thus, the continuation of the Tribune’s commentary was surprising. It acknowledged that “China’s efforts to promote its export sector with cash grants, below-market loans, preferential tax treatment and free use of government-controlled property make a worthy target. ” In other words, some of China’s policies are indeed problematic. In fact, the Tribune went on to note that the sense of a need to create a “level playing field” with China “has a basis in reality.” It added that subsidies and regulations in a number of areas along with the power of state owned enterprises has prevented U.S. and other foreign companies from taking the lead in a wide range of Chinese markets. It further noted that theft of intellectual property in China, and China’s policy of keeping the yuan weak are enormously problematic.
So the Tribune appears largely to agree that China is doing all the things of which the two candidates have complained and against which the administration has filed complaints with the WTO. But if it agrees with them, why is the Tribune effectively pasting the racist label on the candidates?
In justification of its position, the Tribune makes four points that constitute the orthodox free trade case. First, it argues that even though it might help workers, any restriction or sanction on the free flow of Chinese goods into the U.S. market would be harmful to U.S. consumers. Second, it holds that the activities of getting imports from China unloaded, shipped, displayed, advertised, and sold create new U.S. jobs in place of the jobs that might be lost as a result of the displacement of U.S. produced goods by imports from China. Third, it asserts that any kind of trade sanction could lead to a ruinous trade war that could damage everyone, and fourth, it emphasizes that rather than trying to crack down on China’s questionable policies and practices, the U.S. government should focus on persuading the Chinese fully to open their markets.
The difficulty with these points, often repeated by orthodox neo-classical economic commentators, is that they are superficial, internally inconsistent, and at odds with the realities of the trading world. Take the matter of possible harm to consumers arising from any increase in the prices of goods resulting from some restriction on imports. This ignores a couple of important facts. One is that most consumers are also workers. Cheap imports are of little consolation if they have lost their jobs and income. Lost jobs put downward pressure on all wages, not just those in the particular industries that suffer from import penetration. Of course, the exception to this is a situation of full employment which is assumed by the usual econometric models and writers like those of the Tribune. But full employment is not the normal circumstance for most economies. Certainly it is not now the circumstance of the U.S. economy and it is most certainly not true of the economy of the city where the Tribune resides — Chicago. In situations of high unemployment, the loss of jobs and general downward pressure on wages may far exceed the savings to consumers of slightly lower import prices.
The notion that imports create unloading, shipping, and marketing jobs is also misleading. Think about it this way. Toyota makes a car in Japan and ships it in a Japanese vessel to San Francisco where it is unloaded by American longshoremen and driven by American truckers to a showroom in an American city where it is advertised, marketed, sold, and serviced by Americans. So there certainly are a number of American jobs associated with this import from Japan.
But now suppose that Toyota makes a car in Tennessee with parts made in America and with the assembly done by Americans. Then the car is driven by an American trucker to an American showroom where it is marketed, serviced, sold, and advertised by Americans. In this second case, more U.S. jobs are created than in the first case. Why? Because the vast bulk of the selling, overland shipping, marketing, and servicing has to be done in the United States whether the product is made there or imported. So the truth is that imports do not create net new U.S. jobs or jobs in any country unless they are products that cannot be made or made competitively in that country.
As for the dangers of trade wars, they are much exaggerated. The whole point of the WTO is to have a set of rules and adjudication of the rules. It is inevitable that there will be trade disputes. A main mission of the WTO is to deal with them so that they don’t become trade wars. So far the record of the WTO is pretty good on this score.
With regard to prying open the Chinese market, the Tribune calls for that as an alternative to the trade actions called for by the two candidates. This is an old story and it seems to keep selling. I only wish that those who sell it would once in their lives have to serve as trade negotiators. One of the main reasons for complaining about and sanctioning violation of trade rules is to gain leverage precisely for the purposes of opening the market. These negotiations are not pit a pat. Important and powerful interests are involved and they don’t give up easily unless faced with consequences as well as opportunities. Countries don’t open their markets just because someone from Washington says that would be a good idea. A successful market opening negotiation requires sticks as well as carrots.
Neither Obama nor Romney is a “China basher”. The Tribune owes them both an apology.
Foreign Policy
The Secret to U.S. Growth in the 21st Century: More Asians
What makes a country prosperous and strong in the long run? Four things: land, people, institutions, and culture. Most discussions these days focus on patching up America creaky institutions (health care, the Senate filibuster, etc.), but we should also be thinking about our plan for the long term. Here’s a plan.
For most of its history, America was the “Alternative Europe.” Political and religious dissidents who were dissatisfied with the ruling regimes in their homelands, oppressed ethnic minorities, and poor people who couldn’t get a good job — all made their way to the United States. Here they found a place where their beliefs, their ethnicity, and their parents’ socioeconomic status mattered far less than in the Old Country. America itself benefited greatly from the inflow, gaining a huge labor force, a constant supply of entrepreneurs and creative free thinkers, and a diverse ethnic makeup that helped us avoid the kind of brutal ethnic violence and fragmentation that plagued the European subcontinent.
We also benefited from the strong relationships we built with European countries — first Britain and France, then Germany and others. Our shared heritage helped facilitate trade and investment, which made our East Coast a center of global commerce. And it helped the U.S. to play an essential stabilizing role in the World Wars and the Cold War, which saved Europe from endemic warfare and from domination by totalitarian regimes.
In other words, “Alternative Europe” was a winning strategy for us. But that strategy is mostly played out. Europe today is rich, peaceful, and liberal, with higher economic mobility and ultra-low fertility. The United States still needs people — to start new companies, to keep our pension systems funded, and to keep our domestic market large in order to attract investment. But we’re not going to get our new people from Europe.
For the last few decades, we’ve been importing our new population from Mexico, but that too looks to be at an end. Net immigration from Mexico has fallen to zero, thanks in large part to a healthy Mexican economy (good), lower Mexican fertility (good), the housing bust (bad), and nativist sentiment against “illegal” immigrants in states like Arizona (very, very bad).
America’s birth rate is not as low as Europe, but we still need immigrants to ensure a healthily expanding labor pool. Where are we going to get our new Americans? Asia and Africa. Asia is especially important, and encouraging large-scale immigration from Asia will have benefits far beyond the simple economics of immigration. The United States’ geopolitical strategy for the emerging Asian Century must be to position ourselves as the Alternative Asia, the way we were once the Alternative Europe.
ALT-ASIA
East Asia, South Asia, and Southeast Asia together have over half the world’s population, but Asians make up only 5% of the United States. If our ethnic makeup was a portfolio of stocks, we would be severely underweight Asia.
Asia is important not just because it is huge, but because it is growing rapidly. Trade with these countries will be incredibly important to the American economy this century. One way to facilitate trade and investment is ethnic ties — witness the way the Chinese diaspora has invested in China, or the way Indian-American entrepreneurs have forged links between Silicon Valley and India. We need much more of this.
Geopolitics, too, will be centered on Asia. Already, conflicts over the South China Sea, the East China Sea, and Central Asia fill the news. The United States could be involved in stabilizing these conflicts and making sure they don’t disrupt the global economy. In the 20th Century, we stabilized Asia through overwhelming military force, but this is no longer possible or desirable; instead, many believe, the U.S. should be an “offshore balancer,” helping to mediate disputes and organize coalitions of Asian nations to keep the peace. But in order to do this we need to build credibility and trust with the nations of Asia, and having large Asian populations in our own country seems like a good way to do this. Allowing young, disaffected Asians to migrate here should also reduce the domestic pressures that fuel unrest and conflict.
Furthermore, I believe that the cultural benefits of Asian immigration will be just as big as the economic and political benefits. Adding diversity to our melting pot will speed up America’s inevitable and necessary transition from a “nation of all European races” to a “nation of all races.” The sooner that happens — the sooner people realize that America’s multi-racialization is a done deal — the quicker our political debate can shed its current ethnic overtones and go back to being about the issues.
50 MILLION MORE, PLEASE
Asians want to come to America. According to the most recent Gallup survey, the United States is the desired destination for 22 million Chinese people, 10 million Indians, 8 million Bangladeshis, 5 million Filipinos, and 3 million people from Vietnam. These are the kind of numbers we need to keep our economy young and growing.
Surprisingly, 5 million Japanese people would also move here, given the chance. Having lived in Japan, I don’t find this surprising. Although Japan is in many ways a freer country than the U.S. — you can drink alcohol outside, for example, or shoot fireworks from your roof — many Japanese workers feel oppressed by their stifling corporate culture. America should be a home not just for people seeking a job, but a refuge for free thinkers and iconoclasts seeking to escape the invisible fetters of tradition. These people tend to be entrepreneurs, innovators, and agents of positive change here in America.
But we need to act now, because the window of opportunity for large-scale Asian immigration will not stay open for much longer. Asian nations are getting rich, which means better opportunities in their home countries. They are also aging rapidly. In China and much of East and Southeast Asia, fertility is at or below European levels. We probably have only two more decades in which to transplant large numbers of Asians to our shores. (This is in contrast to Africa, whose high fertility levels will make sure it remains a plentiful source of immigrants for at least another century.) Fortunately, we are on the right track; in 2010, America received an estimated 430,000 immigrants from Asia, outnumbering even Hispanics. But with 60 million Asians clamoring at our gates, we could stand to admit a lot more.
This, then, is the “Alternative Asia Plan.” America began as a nation of Europeans and Africans; it is now a nation of Europeans, Africans, and Latin Americans. It must become a nation of Asians as well. Failing to do this would mean shutting ourselves off from the master narrative of the 21st Century.
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