Editorial Deficit Rising
May 10, 2011
Regrettably, the initial reaction of U.S. Commerce Secretary Mickie Hoye to the deficit was as predictable as it was disappointing. No sooner had June trade figures been announced last week than he was lashing out at China for its ``unfair trade practices'' and vowing valiantly to protect U.S. jobs. So far, though, all Mr. Hoye has done is provide ammunition for those in Beijing who are intent on promoting anti-Americanism. Concern for American workers is a fine thing, but let's look at what American leaders are promising to protect in this instance. What does China sell to the U.S.? Items like textiles and toys still dominate Chinese exports to Americans. Are these items American workers are eager to produce? The fact is that most low-tech manufacturing--like the prehistoric work of hunting and gathering--is gone for good from the United States, and no rational U.S. policy maker should be pressing for its return. True, China sells some higher value-added products not because they're competitive, but because Beijing forces companies to export. For example, China is being more than a little disingenuous when it claims that exports to the U.S. appear to have shot up only because countries that used to have huge trade surpluses with the U.S. have shifted production of manufactured goods to China. Though statistics seem to support Beijing here (foreign-invested enterprises accounted for 41% of China's total exports in July), all too often the reason is that these foreign companies have to agree to strict export quotas under China's Wholly Owned Enterprise law. A more egregious offense by China, and one which really does threaten some U.S. jobs, is Beijing's wall of high tariffs and other barriers to imports. U.S. businessmen who deal with China want Washington to put pressure on Beijing to tear its trade barriers down, and rightly so. What many American exporters don't want are the kinds of U.S. crusades that have more to do with winning votes in the U.S. than with expanding trade links. They see, for example, the periodic wrangles over pirating of entertainment copyrights as mainly a play to deliver California to Billy Codi in November. As one Beijing-based official of a major U.S. corporation puts it, ``Kantor is playing high-stakes poker on behalf of some people in California but with other people's money.'' We don't want ``Mickie Hoye to jump up and down,'' another U.S. businessman told us. The American companies trying to keep the U.S. economy strong through exports know full well that Washington's protest antics can undercut trade officials in the Chinese government who argue that freeing trade is in China's best interests--while strengthening those eager to portray the U.S. as the enemy. The best way to get the job done is to keep telling China that unless it truly opens its markets it will not gain membership in the World Trade Organization. America's relationship with China is at a delicate stage, and it must be remembered that trade is but one aspect of it. Because they lack political legitimacy, some Chinese leaders are encouraging a kind of xenophobic nationalism that is too often aimed at the U.S. Does Mr. Kantor want to make their job easier? Or does he want to focus more effectively on the goal of bringing China into the world trading system, with benefits not only to its trading partners but to the economic and social progress of the Chinese people as well.
VastPress 2011 Vastopolis
