Why conservative policies help China more than the United States
Does it seem to you like many of the things conservatives advocate end up bringing the country down? The budget cuts they demand hurt our schools and infrastructure — which ends up making us less competitive in the world. They’re against a national economic/industrial policy when every other G20 country has one — so we send our companies out to compete alone against national systems. Conservatives fight tooth and nail against growing a green energy industry here — surrendering the jobs and income of the future to others. What about trade and tax policies that send jobs, factories and whole industries out of the country? How many more ways can you think of where conservatives seem to be helping other countries, especially China, at our expense? Why is that?
Robert Kuttner has a post over at Huffington Post, American Policy Made in China, discussing the recent report of the U.S.-China Economic and Security Review Commission, which I wrote about last week.
The basic findings: China is a mercantilist and authoritarian state that is determined to appropriate not only U.S. jobs but also U.S. advanced technology through illegal subsidies, suppression of worker rights, and deals with U.S. industry that are one part lucrative carrot (cheap wages, state capital) and one part illegal stick (if you want to do business in China, take a Chinese partner and share your trade secrets). Even then, you must produce mainly for export back to the U.S., not for sale in China.
Kuttner points directly at American enablers of China’s extortions,
Worse still, U.S. industry has been happy to take these deals, which makes them a domestic ally of the China lobby. While our government periodically makes half-hearted complaints that the Chinese currency, the Renminbi, is seriously undervalued, American corporations like that just fine — because it makes their exports to the U.S. from Chinese factories even cheaper. The U.S. Chamber of Commerce, which fights industrial policy at home, lobbies fiercely against any pressure from Washington against Beijing’s mercantilism.
Later, Kuttner expands on this,
Because of the American reliance on Chinese capital to finance the U.S. public debt and American capital markets and because so many of our largest corporations have made their separate peace with the Chinese regime, we may have already reached a tipping point where Washington is unwilling to make more than token complaints that Beijing knows not to take seriously. Though China’s suppression of the value of its currency has been thoroughly documented, Treasury Secretary Geithner has repeatedly refused to formally cite China as a currency manipulator, which would compel the U.S. government to pursue sanctions.
We, The People Used To Have A Say
The people here used to have a say, so the people demanded and got good wages and worker protections. For a long time this experiment in democracy enabled a middle class and brought us all prosperity. But trade deals like NAFTA and China’s entry into the WTO, combined with tax policies that encourage offshoring, enabled the largest corporations to move factories across borders and escape these protections that democracy offered to America’s workers, making democracy a competitive disadvantage. Now the giant corporations can tell American workers to accept less or their jobs will be moved out of the country.
Lower wages to pay, fewer benefits to cover… That’s what the 1% get out of it. That’s what the 99% lost because of it.
Is It Just The Big Corps?
These giant corporations and Wall Street are making out like bandits, but what about the rest of us?
And is it just the giant corporations and Wall Street who are providing the funding for this conservative movement that pushes these pro-China policies? Or was there something to it, back when people were warning that the Supreme Court’s Citizens United ruling would allow companies from other countries like China to influence our politics? If I was China, I’d sure be liking the way things are pointing.
And I’d sure be doing what I could to keep things going that way. Is anybody looking into this? What firewalls still exist to keep another country from funding things that influence public opinion and our elections? Do we even still see ourselves as a country? I think other countries see themselves as countries, and see us as a country and competitor, so we have no choice but to start acting as a country again.
P.S. A Distinction
Kuttner says “American corporations” are happy with these pro-China policies we always seem to end up with. I would amend this to say some US corporations like this just fine but not all - not by a long shot. And that is an important distinction if we are going to fight this. for example, I don’t think American steel or solar-technology companies like China’s cheating one bit. I also think there are lots of executives at American companies who feel trapped because our tax and trade policies always seem to go in a direction that forces them into a terrible bind. They want to help American workers and our economy but the conservative policies that get enacted force them to do bad things if they want to stay competitive.
This post appears courtesy of Dave Johnson and the Campaign for America’s Future, where Dave is a fellow.Dave Johnson is a fellow at the Campaign for America's Future. He also blogs at Seeing the Forest.