China’s Porcelain Empire
by Justin Raimondo
Antiwar.com, 2009-07-10

Fragile – and not a threat to us

In Obama's China trip, a stark contrast with the past
White House says U.S.-China relations are 'at an all-time high'
By Andrew Higgins and Anne E. Kornblut
Washington Post, 2009-11-17

[Nothing special about this article,
it is just a good summary of the US/China relation as of November 2009.]

China’s Economic Power Unsettles the Neighbors
New York Times, 2009-12-10


China's $2.4 trillion grip on the global economy
By Robert J. Samuelson
Washington Post Opinion, 2010-01-25

Defying Global Slump, China Has Labor Shortage
New York Times, 2010-02-27

China's commerce minister: U.S. has the most to lose in a trade war
By John Pomfret
Washington Post, 2010-03-22


China’s commerce minister warned the United States on Sunday that
if it launches a “trade war” against China
by levying punitive tariffs on Chinese imports,
the United States will suffer the most.

Chen Deming also said
the U.S. government’s “obsession” with China’s exchange rate
could not be seriously addressed
until it stopped blocking the export of high-tech products,
such as supercomputers and satellites, to China.
“If some congressmen insist on labeling China as a currency manipulator
and slap punitive tariffs on Chinese products,
then the [Chinese] government will find it impossible not to react,”
Chen said in an interview with The Washington Post.

“If the United States uses the exchange rate
to start a new trade war,
China will be hurt.
But the American people and U.S. companies
will be hurt even more.”


Chen said
if the U.S. actions were geared toward decreasing America’s trade imbalance
by limiting imports,
it wouldn’t work.
Perhaps imports from China would decrease,
but that wouldn’t mean that Americans
would start producing goods such as telephones and televisions again.

“That production isn’t going to return to America,
that’s just not practical,”

he said.
“Globalization has changed all that.”


[“That production isn’t going to return to America,
that’s just not practical,
Globalization has changed all that.”

Blaming globalization is a bit too general, in my opinion.
The fact is that
it is specific American policies
that have made America so manifestly noncompetitive in the global economy.
A leading example of those policies that have destroyed American competitiveness
is the astronomical healthcare costs
that American companies must pay for their workers,
astronomical vis-à-vis those paid in the countries that have taken our jobs.
Companies are reporting that their healthcare bills per employee
run from $15,000 up, and up, and up.
And this latest Democratic extravaganza,
with its removal of the ability of insurance companies
to try to limit what employees can charge to their insurance,
will exacerbate the problem.
How can all those Democratic congressman (and women)
fail to recognize this basic fact?
What kind of alternate reality world do they live in,
where they can keep enacting policies that run up the nation’s healthcare bill,
and not realize the harm this does to American competitiveness?
Nancy Pelosi and her team bill their bill
as providing “Affordable healthcare.”
Affordable to whom?
Not to the nation, not when it destroys
our jobs, our competitiveness, and our balance of trade.
What insanity!

The late, great President Nixon [37]’s warning that
America was risking becoming a “pitiful, helpless giant
is sadly coming closer and closer to being realized,
thanks in part to the inability of the Democrats in power
to rein in America’s entitlements.]

For rising China, an identity crisis
By Sebastian Mallaby
Washington Post Op-Ed, 2010-03-26

China's industrial policy is bigger concern than yuan, U.S. executives say
By John Pomfret
Washington Post, 2010-05-07


U.S. officials, senators and some economists have predicted that
if China allows the value of the yuan to rise,
it will mean
a smaller trade deficit with China, more American exports and
more jobs for American workers.

Fat chance on both counts, according to the American Chamber delegation.

It might make good economic sense
for China to stop subsidizing its exports with a distorted exchange rate,
but it’s silly to think that
the United States is going to be a major beneficiary from such a move,
the delegation and other business groups are arguing.


For one, the stuff China sells us
has been imported by the United States from other countries for decades.
So if we don’t buy it from China, we’ll buy it from someone else.
Take TVs.
Twenty years ago, they all said “Made in Japan” on the back.
Now they say “Made in China.”
If China allows the yuan to appreciate,
it’s not like TV manufacturing is going to move back to the United States
and RCA Victor will rise anew.
Americans will just buy them from someplace else.

[Note how this view,
which the Washington Post reporter seems to imply
is that of the American Chamber of Commerce team,
is identical to
that of China’s commerce minister, Chen Deming, in his March 2010 interview.]


“The Chinese government is more than happy to keep the focus on the currency
because it’s not the real problem,”
said a member of [the American Chamber of Commerce] team.
“The real problem is China’s industrial policy
and our inability to deal with it.”

Beijing tries to push beyond 'Made in China' status to find name-brand innovation
By John Pomfret
Washington Post, 2010-05-25

What Is a College Degree Worth in China?
New York Times Room for Debate Blog, 2010-12-03

China’s Army of Graduates Struggles for Jobs
New York Times, 2010-12-12

In 1998, when Jiang Zemin, then the president,
announced plans to bolster higher education,
Chinese universities and colleges produced 830,000 graduates a year.
Last May, that number was more than six million and rising.

It is a remarkable achievement, yet for a government fixated on stability such figures are also a cause for concern. The economy, despite its robust growth, does not generate enough good professional jobs to absorb the influx of highly educated young adults. And many of them bear the inflated expectations of their parents, who emptied their bank accounts to buy them the good life that a higher education is presumed to guarantee.

“College essentially provided them with nothing,” said Zhang Ming, a political scientist and vocal critic of China’s education system. “For many young graduates, it’s all about survival. If there was ever an economic crisis, they could be a source of instability.”

In a kind of cruel reversal, China’s old migrant class — uneducated villagers who flocked to factory towns to make goods for export — are now in high demand, with spot labor shortages and tighter government oversight driving up blue-collar wages.

But the supply of those trained in accounting, finance and computer programming now seems limitless, and their value has plunged. Between 2003 and 2009, the average starting salary for migrant laborers grew by nearly 80 percent; during the same period, starting pay for college graduates stayed the same, although their wages actually decreased if inflation is taken into account.

Chinese sociologists have come up with a new term for educated young people who move in search of work like Ms. Liu: the ant tribe. It is a reference to their immense numbers — at least 100,000 in Beijing alone — and to the fact that they often settle into crowded neighborhoods, toiling for wages that would give even low-paid factory workers pause.

“Like ants, they gather in colonies, sometimes underground in basements, and work long and hard,” said Zhou Xiaozheng, a sociology professor at Renmin University in Beijing.



More Western nations match China's financing strategy to win contracts
By John Pomfret
Washington Post, 2011-01-12


The consensus about China formed during the Clinton administration,
as long as the United States was patient with China
it would ultimately adopt
Western political values and business practices,

is ‘crumbling,’
said Daniel Rosen, a longtime China specialist
and principal at the Rhodium Group, a New York-based consultancy.

Wisconsin firm learns ups and downs of doing business in China
By Howard Schneider
Washington Post, 2011-01-17


U.S. officials involved in the negotiations leading to
China’s accession to the WTO in 2001 and supporters of its membership
said at the time that
U.S. exports would benefit dramatically,
and that has been the case.
American companies sold upwards of $90 billion worth of goods to China last year,
compared with $19 billion in 2001,
a larger increase than with any other nation.

Similarly, China’s low-cost manufacturing has helped hold down prices for apparel, household electronics and other items, benefiting lower-income families in the United States and elsewhere.

But analysts and business officials say the relationship has evolved in ways that have foiled some of the initial ambitions. China has complied with many of the explicit promises it made to lower tariffs and other barriers but has failed to adhere, as many hoped it would, to the broader spirit of free trade.

“Some aspects of it were oversold,” said Pieter Bottelier, a China expert at the Johns Hopkins School of Advanced International Studies.

The economic relationship has become less balanced, not more. The U.S. trade deficit with China ballooned from about $83 billion to a peak of $268 billion in 2008, as a surge in consumer spending boosted Chinese exports to the United States. Meanwhile, American firms found it easier to produce goods for the Chinese market in China rather than make them in the United States and export them.


China’s 10-Year Ascent to Trading Powerhouse
New York Times, 2011-12-09


After negotiating for 15 years to be admitted to GATT and then to the W.T.O., China was finally let in after agreeing to accept the W.T.O.’s broad free trade rules. But as all new members do, Beijing also had to negotiate a lengthy document, known as an accession agreement. It spelled out thousands of details tailored to the specifics of the economy of China, which then was still very much a developing country.

The agreement required China to lower its tariffs to levels below those of many other developing countries. But compared with most industrialized countries, China was allowed to impose considerably higher tariffs — tariffs China has retained even as its economy has subsequently grown to No. 2 in the world.

The clearest example of W.T.O. ascendance China-style may be in automobiles. Even though China’s auto manufacturing industry and car market are now both the world’s largest, China continues to shelter them behind the highest trade barriers of any large industrial economy.

It retains a prohibitive tariff of 25 percent on imported cars, for example, which helps explain why imports represent only 4 percent of the light vehicles sold in China.


China also collects a 17 percent value-added tax
on almost everything sold in the country,
whether imported or domestically produced.
But like many European nations,
China uses a W.T.O. provision that allows the tax
to be fully refunded to China’s export producers,
who often pass along the saving to foreign buyers.

What’s more, China limits foreign manufacturers
to no more than 50 percent ownership of car assembly plants in China.
That special rule,
which China managed to negotiate for its W.T.O. accession agreement
when its auto industry seemed tiny and vulnerable,
has forced multinationals to
set up numerous joint ventures in China and to
transfer a wide range of technology to those Chinese partners.


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