Nothing is free, including free trade.




China's Path to World Power
By Patrick J. Buchanan

For decades, before a heedless congregation, some of us have preached the old Hamiltonian gospel.

Great nations do not have trade partners. They have trade competitors and rivals. Trade surpluses are superior to trade deficits. Tariffs on foreign goods are preferable to taxes on U.S. producers. Manufacturing, not finance, is the muscle of the nation.

Economic independence is vital to political independence.

Following Hamiltonian precepts, the United States grew from 13 rural and agricultural colonies into the greatest industrial power in all history, producing 42 percent of the world's manufactured goods. We were the awe and envy of mankind, the self-sufficient republic, maker of half of the armaments produced by all the nations in World War II.

That is the America we grew up inthat has now vanished.

Chrysler, Ford, perhaps GM, may be dying. Manufacturing has sunk to 10 percent of U.S. employment, a level unseen since before the Civil War. Europeans and Asians are to assemble in Washington this week to impose upon the United States a New World Economic Order like the one we imposed on them at Bretton Woods in 1944.

Such are the fruits of free-trade ideology.

Across the Pacific, a nation that studied how America rose, and watched as America declined, chose a different path. China adopted and pursued a China First policy of economic nationalism.

In July, Charles McMillion of MBG Services testified to the U.S-China Economic and Security Review Commission on China's progress. [PDF]

Beijing began its astonishing rise by devaluing its currency 45 percent in 1994, slashing the prices of exports in half and making imports twice as expensive. As America threw open her market and invited China to come in and capture it, China had erected a Great Wall around her own.

Results: China's worldwide trade surplus in manufactures, $31 billion in 2001, hit $401 billion in 2007, a 1,300 percent increase, and may reach $500 billion in 2008. China has shoved Germany aside to become the world's greatest exporter and now leads the world in the export of manufactured goods to Japan and the European Union, as well as the United States.

While running trade deficits with Asian neighbors like Taiwan, to tie them politically to Beijing, China is running record trade surpluses with the European Union and the United States, making America and the West as dependent upon China for our manufactures as we are on OPEC for our oil.

Chinese auto production has quintupled since 2001. She now produces more cars than Germany and may exceed the United States in 2009. While Chinese auto exports are still heavily in parts, finished cars are coming soon to a dealer near you. The Chinese will likely run the sword through the last standing member of America's Big Three.

Before 2004, China's manufacturing trade surplus with America was largely in textiles and apparel. But, since then, China's rocketing trade surplus in electronics, computers and parts has far exceeded her surplus in textiles and apparel.

China's trade surplus in computers and components rose from $8.1 billion in 2001 to $73.5 billion in 2007. In cellular phones and parts, her worldwide trade surplus grew from $3 billion in 2003 to $50 billion in 2007, and may reach $60 billion by year's end.

China still imports commercial airliners. But she now has a large and growing trade surplus in airplane parts. This follows the pattern in textiles, computers and autos. First, the Chinese learn by assembling parts in factories in China. Then, China begins to produce the parts. Then, China produces the finished products and goes out to capture the world market, while protecting her own by keeping her currency cheap.

On items the Commerce Department categorizes as advanced technology products, America began running a trade deficit for the first time early in the George W. Bush years. China now exports to us four times as much, in dollar value, in ATP items as we sell to Beijing.

As America mothballs the shuttle, relying on Russian rockets to get our astronauts back up to a space station we built, China is putting men into space and heading for the moon.

Since America ushered China into the World Trade Organization in 2002, Beijing's growth rate has been four times that of the United States, accelerating from an average 10 percent of gross domestic product to 12 percent in 2007.

With her immense trade surpluses, China's reserves have surged from $200 billion in 2002 to $2 trillion. Awash in dollars, Beijing now waits patiently, writes McMillion, to cherry-pick the crown jewels of America's industrial empire"patents, talents, natural resources, brands"at fire-sale prices in the global crash.

As America [and Europe] plunges into recession and our industry hollows out, while China is still growing at 9 percent, as the 20th century's greatest creditor nation now borrows from Beijing to pay for booster shots for its sick economy, may we hear once again the Bush-Clinton refrain about how the terrible danger we all face is from "protectionism."



F.uck an eye for an eye. You take my eye, and I will kill you, and all those you care about. That is our policy.

http://vdare.com/buchanan/081110_china.htm

F.uck an eye for an eye. You take my eye, and I will kill you, and all those you care about. That is our policy.

US is not a victim of China's development. US, as a developed country, has to develop those industries at the top, many manufacturing industries are not suitable for US already. No matter there is China or not, those industries were moved out or would be moved out. China just took the chance.

What I can say is that US should not complain but many developing countries should Since China took their opportunities.

China's development cannot be duplicated for some reasons:
1. Scale. China is big
2. Foundation. Even today many only praise reform, but actually China had very good foundation that was laid down before the reform. From social to economical development and also infrastructure.
3. China has Hong Kong and Taiwan, which needed to move some industry out. Mainland was their convenient choice.
4. China has a walk-the-talk government and Chinese are united.
5. China is strong enough to avoid wars even before the reform.

The West has lost its manufacturing sector not because of 'inevibility' but because of specific actions. The West made the decision to lower its trade barriers, thus allowing companies to engage in labor arbitrage and send production overseas. If the West had not lowered trade barriers, all of our manufacturing would still be intact, whether the yuan was undervalued by 400% or 400,000%. The lowering of trade barriers was nothing short of treason. Here we are now, with an "economy" running on a financial pyramid scheme and fast food.

F.uck an eye for an eye. You take my eye, and I will kill you, and all those you care about. That is our policy.

"The West has lost its manufacturing sector not because of 'inevibility' but because of specific actions."

Not correct, losing manufacturing is inevitable just like UK lost out to the US earlier in the 20th century.....Just not economical without the kind of scale and low cost to be economically competitive anymore.

"The West made the decision to lower its trade barriers, thus allowing companies to engage in labor arbitrage and send production overseas."

Not really. What the west really wanted is the access to the vast emerging consumer markets of China with the desired end results of a net trade surplus. In other words, it didn't open its market for free; rather it wanted to gain from it. But, it had to open its market in return for access to our market... This is exactly what it did across the world....However, no other markets was able to take advantage of this mutual opening as China and japan did and in fact turned it against the US resulting in humongous trade surplus for themselves.....Trust me, if mexico, latin america could, they would do it too, but too bad there is only one China and one japan ....


"If the West had not lowered trade barriers, all of our manufacturing would still be intact, whether the yuan was undervalued by 400% or 400,000%. The lowering of trade barriers was nothing short of treason. Here we are now, with an "economy" running on a financial pyramid scheme and fast food. "


Not true. It's not a one way street, without lowering trade barrier, US won't be able to access China's emerging consumer either.....Without doing that, domestic consumption alone won't absorb the productivity gain and the economy and business world will stagnate.....Again, it's inevitable that trade will flourish simply because the business world's instinctive pursuit of profit


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Not true. It's not a one way street, without lowering trade barrier, US won't be able to access China's emerging consumer either.....Without doing that, domestic consumption alone won't absorb the productivity gain and the economy and business world will stagnate.....Again, it's inevitable that trade will flourish simply because the business world's instinctive pursuit of profit

The US is not accessing China's emerging consumer market. Huge multinational corporations are accessing China's emerging consumer market, with zero benefit to the United States as a nation. The free trade policy followed by the US/West over the past few decades has been a humongous boon for huge multinational corporations but a complete and utter disaster for the US as a nation. It is quite simple what the real trade taking place here is. The West is trading its living standards and economic future in exchange for increasing corporate profits. National policy is supposed to be made according to national interests, not corporate interests. Corporations do not vote in elections, and elected officials should be carrying out policies that are for the best of the people that voted for them. By pushing through "free trade" with Asia these politicians are not merely not doing their jobs, they are committing treason.

F.uck an eye for an eye. You take my eye, and I will kill you, and all those you care about. That is our policy.

I agree with that assessment partially. However, it is meant for the multi-nationals' domiciles to benefit from its profits as well, at least its employees and shareholders. It is more or less inevitable that lots of manufacuring has been transfered to emerging markets which it's simply more economical and profitable to do so. Imagine if you were to make all the toys in the States; either you have to export those jobs or you will have the mexicans account for half of US population so pick your poison.

And I don't quite agree that the standard of living for westerners have suffered; in fact, there has been positive GDP growth which translates into higher disposable income until very recently. The West has also obviously benefited from the lower cost of goods and the ensuing "deflation export" from China as well, which more or less led to what phucked it up: its credit policy, nationally and on an individaul level.




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Is it really astonishing for anyone that the nation with the largest population also exports the most ?

And these must be new 2008 numbers, 07 it looked like this:


1 World $ 13,890,000,000,000 2006 est.

2 Germany $ 1,354,000,000,000 2007 est.

3 European Union $ 1,330,000,000,000 2005

4 China $ 1,220,000,000,000 2007 est.

5 United States $ 1,148,000,000,000 2007 est.


Trade surplus:


1 China $ 371,800,000,000 2007 est.

2 Germany $ 254,500,000,000 2007 est.

3 Japan $ 210,500,000,000 2007 est.

4 Saudi Arabia $ 86,620,000,000 2007 est.

5 Russia $ 78,310,000,000 2007 est.

(note: Saudi Arabia and Russia mainly archive a surplus through oil and gas sales, not through industrial products)

We had to expect this, and I dont see my country declining so much with a constant + 5 - 10 % export growth. (Sep 08 showed a 6,9 increase compared to 07)





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A German Soldier doesnt die, he goes to hell and regroups !

Are you telling me the rest of EU exports next to nothing after Germany is taken out based on your numbers?

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^^Pretty much. UK and Spain both have deficits of $150bn+, France is now up to like $80bn+, Italy is nearing $50bn plus. Netherlands is running a $60bn surplus but I imagine that's mostly North Sea gas. And yeah, UK is running a nearly 200bn deficit even AFTER you count in all the $$$ it gets from its North Sea oil and gas revenues. lol. EU 27 trade deficit with China alone is increasing by $15million an hour. lol

F.uck an eye for an eye. You take my eye, and I will kill you, and all those you care about. That is our policy.

I agree with the article of course the only point is that they are wrong to talk about protectionism and justify it.

It's not a question of protectionism, it's just to stop a crazy current reverse protectionism due to the currencies which are totally disconected from reality.

We just ask for fair trade, not protectionism.

This point is important to talk to the free trader ideologists...

Also, the writer of the article is wrong to complain about a new Breton Wood. The current system is just the reason of all this sh!t.

And Germans export over-priced sh1t buckets they call cars.

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Don't worry, the BMW and other Mercedes have been sold to the Americans at credit... which credit have been sold to the German banks in return.

Some more bilions to German LBBW bank today...

Good, thats what they deserve for selling that junk.

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I guess it depends on what you value total wealth or real wealth



Surely making many products cheaper for western consumers to buy have risen the standard of living for many, ofcourse those that lost their jobs due to outsorucing may not belong to the winners


Relative Wealth becomes important mostly in foreign policy and power politics and for sure if a resurgent regime in CHina becomes aggressive then the loss in relative power migth also mean a loss in real wealth

The Federal Reserve Scam!

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