Thursday, April 20, 2006

The China Conundrum

Face it. Corporations and Government have pimped out most of America's manufacturing ability to China. That has left us with a HUGE trade deficit with China. And whats China doing with that money? Inflating oil prices, strengthening their military, supporting unfriendly governments like Venezuela and Iran, persecuting their own citizens for trying to excercise free speech, hiring US lobbying firms, and supplying vacations to China to our elected officials.

Our leader say that this is free market economics in action. I call it screwing over America and strengthing a government that murders it own people in mass, supports unfriendly extremist governments, and artificially keeps its currency valued low so that its citizens can't buy American made goods.

In fact we are now so dependent on China that we have no real bargaining position with them. Our federal deficit is in large part money owed to China via loans and bonds, our currencies valuation is dependent on China not dumping the 200 billion dollars that constitutes our trade deficit, and our citizens are dependent on the cheap lower quality goods produced in China.

Allow me to sum that up real quick like. China can crash the bond market and massively devalue our currency at will. And afterwards it could then revalue its currency so that Americans can't afford jack. Will it? Not as long as we play nice. We'll have a trade war long before we'll have a real war. And a trade war would cost many elected officials their jobs.

We need to start thinking long term before the US ceases to be the economic super power.
We need to kill the corporate tax breaks that encourages exportation of American jobs abroad, implement tariffs until China revalues its currency, limit congressional trips to China, and limit the amount of money that China and other countries with terrible human rights records spend on lobbyists. Here's an idea. How about we give Mexico favored nation trading status and help strengthen their economy to help stem the tide of illegal immigration?

But there is good news. Help is on the way. Due to the fact that the issues that brought about the Tianamen square protests and subsequent massacre were never resolved, rampant govt. corruption, land reclamation from the workers by the govt to build new factories, and constant abuse of workers the mood of the chinese people is souring. In 2003 there were 50,000 protests , 75,000 in 2004, and 85,000 in 2005. The economic benefits of China's new economy doesn't stretch far beyond the cities. And thats not where the majority of China's population lie.

In fact many cities have made it illeagal for for migrant country workers to actually move to the city permantly. Migrant country workers have no rights in the cities. And I do mean none. As in no guarantee of even being paid for their work ever. Migrant workers are effectively contract workers that get paid room and board with their actualy salary being paid once the job is completed. Then the job is completed a day late, or they're fired for being 1 minute late, or for getting sick, falling asleep on the job because they work 20 hour days, or getting injured and presto they don't get paid.

China's government rose to power on the backs of the working people and they may not choose to shoulder that burden much longer. But the lesson of Tianamen square lingers because what many don't know or remember is that it wasn't just protesters that were killed, but also the parents that came looking for their children and the paramedics, doctors, and nurses that came to treat the wounded. (see June 4th) And lessons like that aren't soon forgotten.

And because I believe that the chinese people will tire of the status quo long before our "leaders" I have two things to say 1: Buy American. 2: Power to the Chinese people.