Washington Consensus meets the updated Beijing Consensus with nationalism seeping out both sides. The writer hits the nail on the head, at least according to the framework of global production – the trade imbalance between the US and China has been disguised as political rhetoric to deflect attention away from a lack of a domestic industrial policy. How true is that? I am not sure. –
“The administration will also have to be careful not to unleash something it can’t control. Protectionist impulses run frighteningly deep in Congress.”
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Useless Sanctions on China: Robert Reich Says ‘Forget It,’ Better to Rebuild American Industry
by Robert Dreyfuss
Source – The Nation, published September 19, 2010
Earlier this month, in The Nation, I wrote a 5000-word piece describing the debate among progressives over the challenge from China.
More and more, as the economic crisis continues and unemployment stays high, many politicians, labor officials and economists want to blame China and worse, take it out on China by punishing Beijing with sanctions, tariffs and other measures, even at the risk of trade war. That’s why Robert Reich’s piece in the Christian Science Monitor comes as a breath of fresh air.
Reich says that “it’s naive to assume all we have to do to get the Chinese to do what we want is to threaten them with tariffs.” He points out that China might well retaliate, undermining the US economy, too, and that China isn’t likely to change what they believe is a key political and economic strategy just because the United States makes it more expensive for them to keep it. And, he says, “even if China did allow its currency to rise against the dollar, there’s no reason to think this would automatically generate lots more American jobs.” Read the rest of this entry »