The China Blame Game

by Seth Sandronsky

Dissident Voice

September 6, 2003



Scapegoat Alert.  There is American political hay to make partly blaming China for the U.S. jobs crisis, especially in manufacturing employment.


“The number of factory jobs decreased by 44,000 in August,” the Labor Dept. reported.  “Since July 2000, manufacturing employment has declined continuously, shedding nearly 16 percent of its jobs.”


Cut to the 2004 presidential primaries.  They are nearing as the job market worsens.


On that note, the Bush administration just sent John Snow, the treasury secretary, to speak with Chinese leaders about trade.  Also on the agenda was China’s currency, the renminbi.


Its value is pegged to that of the dollar.  Presumably, the renminbi is undervalued, making Chinese exports cheaper than U.S exports on the world market.


Snow’s trip in which he urged Chinese leaders to increase the renminbi’s value was part of an attempt to lessen the public’s rising anxiety with Bush’s economic policy.  In America, 8.9 million people were officially out of work last month.


Some 2.4 million manufacturing workers in the U.S. have become unemployed during the three years that Bush has been in the White House.  Yet ”better days” are ahead for them, the president said in Richfield, Ohio, on Labor Day.


Voters in Ohio, some of whom are manufacturing workers, are key to Bush’s 2004 presidential re-election. He barely took the state in the 2000 (s)election.


The president plans to appoint a top-level official in the Commerce Dept., with a special focus on the fall in manufacturing employment.  One can only imagine the GOP hysteria over such an appointment if it had come from a Democratic president.


On the so-called other side of the political aisle, Democratic presidential candidate Joe Lieberman, a Connecticut senator, has chided China’s cheap exports for harming America’s manufacturing workers.  In the U.S. mass media, he is called a “centrist.”


Lieberman has allies who blame foreign competition from China for American workers’ woes.  In all, 16 congressional members “petitioned the administration to deal with what they called Beijing's unfair currency manipulation,” The Guardian of London reported on Sept. 2.


Returning to Snow, he, on behalf of the president, wanted Chinese leaders to let their currency float—to let the market set the value for the renminbi. 


In this way, a fair market would emerge between exporters from China and America.


This assumption assumes what requires more explanation.  That is, how best to make markets more fair for the people most dependent on them, workers and their families.


For example, why not impose higher taxes on a U.S. corporation such as General Motors when it shifts factories to China?  Surely there would be widespread support from the  American public for this policy.


At any rate, Chinese leaders did not agree with Snow to revalue the renminbi.  They similarly stood their ground concerning monetary policy during the southeast Asian financial meltdown, which lessened its damage.


Downplayed by the anti-Chinese lobby in Washington is China’s trade surplus with America, $103 billion in 2002.  With some of that capital, China’s central bank purchased $41 billion in U.S. Treasury securities during the first six months of this year.


Chinese investment helps America to be the world’s biggest borrower and buyer.  Such foreign lending is key to the U.S. economy.


The political push for revaluation of the renminbi finds fertile ground in the ideological legacy of Cold War anti-communism.  For decades in America, China was evil.


But that was then.  Today for America, China is a crucial lender and a choice place for assembly plants, though the public image of the Chinese as a people to fear has not entirely disappeared.


Free of this false imagery, U.S. politicians and their wealthy campaign contributors know a profitable opportunity when they see it.  Their profits from joint ventures with Chinese capitalists flow partly from the labor-power of the nation’s peasants flocking to cities to work.


Wal-Mart, the world’s largest retailer, knows a thing or two about capitalizing on this situation, beyond selling Chinese-made goods in its stores across America.  Wal-Mart has also made many efforts to bar its U.S. employees from joining unions, as reported in the NY Times last Nov.


Some of America’s workers with and without paid work are being roused by leaders of both parties to see China as a cause for the U.S. jobs crisis. 


Capitalists and their political representatives from both nations are laughing all the way to the bank.


Tragically, workers’ political struggles in America are being misdirected away from the market system’s creation of poverty amid plenty to China. 


Such misdirection weakens workers’ solidarity between and within nations.


Snow certainly knows that the renminbi-peg to the dollar is essential to the U.S. remaining the motor of the global system, thanks to foreign lenders in China and elsewhere.  The domestic use of China to try and hoodwink some Americans about the flaws in the market system is a cynical ploy.


Seth Sandronsky is a member of Peace Action and co-editor with Because People Matter, Sacramento’s progressive paper. He can be reached at: ssandron@hotmail.com.


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