REDUCES U.S. TO A DOMINO

Opinion Piece by David B. Axelrod

Excuse me, but I wonder how it was that we all blinked. How could we all have missed this? We have a tremendous trade imbalance with the People’s Republic of China. Give or take a few ifs, ands and Thai Bats our own Dow Jones drops like chou sticks and we still don’t see our future? There are certainly enough real consequences to nearly the U.S. running up nearly 100 billion dollars of trade deficits to China and yet it seems we didn’t just blink, we put on blinkers. Take the most populous nation in the world, the fastest expanding market, China. Hand it Hong Kong, which adds billions more into the trade imbalance we could previously pretend was not money going to the PRC. Hong Kong, by the way, is safely among the top five financial cities of the world.

Add to the picture a further great deception called Taiwan which may sell us electronics but in fact manufactures the items in PRC. So many items we've come to expect and need come from PRC we can't keep up with them all.

It is worth noting as well that one of the most popular books among the new generation of Mainland Chinese business practitioners is still How to Have a Thick Face and a Dark Heart. That "self-help" business guide—written, ironically, by a Taiwanese woman now living in the U.S.—applies some wonderfully Machiavellian/ancient Chinese principles of battle to the business world. Most prominent among those tenets is advice to "draw your opponent upstairs with ministrations of friendship, then take away the stairs. "We have been elevated by promises of great market opportunities in China though few if any major corporations are running in the black in China. It is hard to make a profit, given extensive corruption and a general failure of the rule of law. Now we see our front and back stairs removed by the drain our trade with China places on our own economy. Add to all this a growing instability among many of China's banks and we, in the U.S., are faced with a have a dangerous economic situation.

Of course it would nonsense to attribute the our stock market’s tumble or even the cooling of our economy to our dangerous dealings with PRC. But it would be blind to ignore how great PRC’s powers are over us. We would, for instance, have to ignore the billions the Central Government in PRC already have placed in reserve on the chance they might have to "stabilize" their own economy (think, plan, attack). Those same reserves could also be used to destabilize other currencies. We would have to ignore the fact that China, for all the myths about the democratizing effects engaging with the capitalist economies of the world, continues to wage capitalism like a war. Since Deng Xiao Ping declared how sweet and glorious it would be for people to grow rich for their country, PRC continues to restrict its citizens with draconian regulations that forbid everything from freedom to associate, to publish, to speak, to practice religion, to even decide the number of their progeny. Could it be possible that PRC would like to deny us our freedoms as well? Short of world domination, it would make sense that PRC would be happy to hold the power.

Let’s call the recent market tumble what it very likely was. Let’s try on the idea at least. China just fired a subtle salvo at us using their newest weapon, the balance of trade deficit, and by all indications, we raised the white flag of surrender. They own us now. Just watch how they roll their little rope ladder up and down while we dash up and down like monkey clowns.

(Note: The U.S. Department of State’s official cant on China, not to mention Tibet, is that we should not impose our standards of freedom on someone else’s nation. Well, excuse me, throw out the U.N. articles on human rights. A happy slave is still a slave.)