Trade between China and USA

[RedStarOverChina]

I put this thread under theory forum because I wanted to get theoretical about this hot topic. I hope we do not mix the element of political struggle in our discussion, please keep it strictly about economics.

I'm interested in economics so I pay alot of attention to the news regarding this issue. Often I find the American public opinion very unreasonable tho occasionally I see cool-headed reporters who spoke without bias.

Anyhow, here's my take on it:

*It is an overly simplistic (merchantilist) view that American public share on the issue of trade deficit. I do agree that globalization should be established on the basis of equality between partners. That can be achieved with a tiny bit of protectionism in the case of US. Because of the high price of oil today, the US economy absolutely NEEDS the cheap products from China to fulfill their domestic needs without overspending Yankee dollars. The trade deficit is a natural event considering today's US economy's decreasing competitiveness.

Journalist NICHOLAS D. KRISTOF expressed his view in his article The China Scapegoat:

There are plenty of legitimate reasons to be angry with China's leaders, but its trade success and exchange rate policy are not among them. The country that is distorting global capital flows and destabilizing the world economy is not China but the U.S. American fiscal recklessness is a genuine international problem, while blaming Chinese for making shoes efficiently amounts to a protectionist assault on the global trade system.


*Jobs are not simply "lost" thro trading. With the cheap products from all parts of the world, the American public benefits greatly. They save billions of dollars every year which they can invest into other parts of economics. With the money saved from buying cheap products they would invest them in other US industries or spend it to educate themselves so they can have better paid, less labor intensive jobs. (by investing money in other sectors of US economy, the economy would enjoy greater prosperity thus creating better jobs) So in the end, all the labor-intensive jobs goes to China, while Americans enjoy less labor-intensive and better paid jobs. It's a natural process that intense labor should go to less developed nations; not the end of the world.


*It is wrong for the US to bow to the pressure of the US manufacturing industry and force China to raise its currency. According to NICHOLAS D. KRISTOF,
China's pegged exchange rate has brought stability to Asia, and the Chinese boom has tugged Japan out of recession and increased prosperity worldwide. In recent years, China has supplied almost one-third of the growth in the global economy (measured by purchasing power), compared with the 13 percent that came from the U.S.

Moreover, the U.S. has a history of offering Asia economic advice that proves awful. U.S. pressure helped produce Japan's disastrous bubble economy and aggravated the 1997-98 Asian financial crisis. So when American officials urge an adjustment in the yuan exchange rate, the Chinese should keep a hand on their wallets.



*For the Americans, it would have disastrous effect if China were to raise its currency. As some of us may know, China bought a huge amount of bonds from the United States. If RMB(Chinese currency) should be revalued, the American government would literally have "hell to pay". (Suppose I lend you 1 dollar RMB. Two years later, 1 dollar RMB's value has doubled. Now you have to pay me the equivalent of 2 dollars because of deflation)

To conclude it all, the USA government should be careful of what it asks for.

[More Fire for the People]

China should stop being so interested in our money and be more interested in their workers.

They should setup fair trade, not free trade and ensure that their workers have a wage higher than atleast 40 yuan a day.

It also concerns me that the Chinese economy is reflecting more and more a co-existances of market socialism and corporatism.

[RedStarOverChina]

Like I said... I wanted to keep this strictly about economic theories.

The first 2 sentense of urs is so machanic I felt like it was chanted by machines.

I dont know if a Markey socialism could exist but corporatism is awakening in China.

Now, how about reading my article and thinkn about it, instead of chanting slogens?


Sorry if I sound rude but Im frustrated because people dont wanna learn. They just want to chant slogens at u. And i'm sick of it.

[bunk]

China disgusts me. They are as bad as the US

[More Fire for the People]

Well, for one my post may sound like a machine because I aim for semi-descent grammar and spelling.

Two, economic and social life are inseperable.

Three, I did talk about the economy,
Free trade is damaging China buy forcing low quality of work and capitalism.

Fair trade would open up markets and allow foreign resources to be aquired, but through humane and socialist means.

Low wages exist because American investors pay their workers low wages, if these jobs did not exist the Chinese could work in worker-owned business and work towards bettering China.

Market socialism is Socialism with Chinese Characteristics.
It is a combination of heavy nationalization of major industries (far more than the extent of social democracy) and the allowance of people-owned business to handle non-major industries and services (akin to co-ops).

It is very similar to Titoism.

These cheap products come at an un-ethical and un-socialist price.

[RedStarOverChina]

Originally posted by Josh of [email protected] 30 2005, 02:16 PM
China disgusts me. They are as bad as the US


Thanx for the resourceful contribution, Josh. :wacko:


Since when did I claim China is socialist? In my article I argued from the theoretical point view that USA should not try to pressure China to revalue its currency for the good of world economy. It has little or nothing to do with what u said. Thats why i suggested u read my article first.

[bolshevik butcher]

China's worse, in economic terms that is, the labour laws are appaling, all the unions are run by the government.

[RedStarOverChina]

Yes, and your mother is ugly.

Now can we PLEASE get back to the topic??????????? I BEG OF YOU!

[bunk]

Economically i think China and the US rely on each other. If one of them collapsed so mgiht the other, same goes for war.

[redstar2000]

RedStarOverChina, I'm not sure what "theoretical point" you're trying to make here.

This journalist may have certain ideas about the consequences of "free trade" between the U.S. and China...but at least some of his assumptions are clearly wrong.

For example...


Jobs are not simply "lost" thru trading. With the cheap products from all parts of the world, the American public benefits greatly. They save billions of dollars every year which they can invest into other parts of economics. With the money saved from buying cheap products they would invest them in other US industries or spend it to educate themselves so they can have better paid, less labor intensive jobs. (by investing money in other sectors of US economy, the economy would enjoy greater prosperity thus creating better jobs) So in the end, all the labor-intensive jobs goes to China, while Americans enjoy less labor-intensive and better paid jobs. It's a natural process that intense labor should go to less developed nations; not the end of the world.

That is not what happens at all.

When American manufacturing jobs move abroad (to China for example), American workers are compelled to accept low-paying jobs in the service sector. Consequently, they must purchase the cheap products imported from China...they cannot afford anything better.

Nor do they "invest" in other parts of the American economy or in their own education. Every dollar that a service worker earns is needed just to stay alive!

Education in America is now basically financed through student loans. And capital investment comes from "dollar rich" countries like Saudi Arabia, Japan, and...er, um...China!

Not yet? Well, count on it. Chinese corporations will, sooner or later, begin investing in American business.

Perhaps they'll begin by buying U.S. Treasury Bonds. :lol:

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[RedStarOverChina]

If China stops exporting to US, US will import the products with the approximately the same from from south Asia, like Greenspan said. So US manufacturing sector is destined to die.

My form of free trade is not the same with the one modern globalists suggest (for Marxists the purpose of globalization is to improve the livingstandard of the people by bring the cheapest product from around the world. And I believe this is what the trading is accomplishing).

Now I have not examined the woes of American working class very much but I dont know if trading with China caused all this.

I once read a report on the loss of US manufacturing jobs. Darn i wish I could find the source again cause I dont remember the year it came up, but it went like this: while US experienced 7% of the manufaturing job in a number of years, China lost a staggering 14% of the manufacturing jobs during the same period of time! How can that be?

The truth is that every country loses manufacturing jobs in its development. It always "loses" those jobs to countries less developed. If u see the different sectors of industries in developed countries, the manufacturing industry is only a small portion of the economy. Manufacturing industry will inevitably be replaced with the service industry.

[RedStarOverChina]

The service industry is not necessarily low paying, u know. Cuba's economy is the proof of that.

[redstar2000]

Originally posted by RedStarOverChina
If China stops exporting to US, US will import the products with the approximately the same from south Asia, like Greenspan said. So US manufacturing sector is destined to die.

Well, if ***ALAN GREENSPAN*** said it, then it must be true.

:lol:


...while US experienced 7% [loss] of the manufacturing job in a number of years, China lost a staggering 14% of the manufacturing jobs! How can that be?

If those numbers are accurate, the most probable explanation is that China is shutting down state-owned industries faster than privately owned industries are being established.

Also, when Taiwanese and other foreign companies open factories in China, they are more modern and employ fewer workers.


The truth is that every country loses manufacturing jobs in its development. It always loses those jobs to countries less developed. If you see the different sectors of industries in developed countries, the manufacturing industry is only a small portion of the economy. Manufacturing industry will inevitably be replaced with the service industry.

Cheery fellow, aren't you! I guess I'd better get my application into McDonald's before it's too late. :o


The service industry is not necessarily low paying, you know. Cuba's economy is the proof of that.

:lol:

Service work in Cuba pays shit like everyplace else...but it provides access to foreign currency which is worth much more than ordinary Cuban currency. If you manage to make E50 or C$50 in a month of work in the tourist industry in Cuba, that's like P1,000 -- you're not rich but you're far better off than most Cubans.

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[pandora]

Originally posted by [email protected] 31 2005, 06:21 AM
The service industry is not necessarily low paying, u know. Cuba's economy is the proof of that.
Excuse me capitalist swine, let me wipe your behind.

China is now subcontracting to Central America, because the "selfish" Chinese workers want $3 a day for a 12-18 hour shift, and in Nicaragua they only get a $1.50. It's a race to the bottom.

Of course they have to shut the state factories, because working people to death isn't very Revolutionary.

A woman was literally worked to death at a factory that made Disney toys that worked 18-19 hour shifts seven days a week from 8 am to 3am. She died of exhaustion. Her death sparked an investigation. The state can't sanction those kind of hours for women without reprissals.

I'm very saddened by the whole thing. The service economy is a joke, it's just shipping dollars out of the people and to the bougouis at a more rapid rate, by increasing people's love of consumption.

When I was a teenager, there were many free zones, places you could just hang out and be a human being without buying anything. This is becoming rarer and rarer. You can not be a part of the society of humans without buying now in the first world. I'm tired of the whole thing. Think it's time to just farm and relax. I don't want what they sell. But housing, telephone, and food are hard to avoid.

Bus is expensive too. We all have all this mysterious debt from just breathing walking around. Taxes at the poverty level. There should be few taxes for people on the poverty line. Taxes for those earning less than $10,000 a year is ridiculous! YOu can not afford shelter at that rate.

Manufacturing anywhere raises the buying power, raises inflation, and the factory moves. What needs to happen is people need to buy less.

People in the service industry in Cuba are not making any more than in Aruba, in fact less, but the economy is controlled under Castro, so they have more spending power. If he did not regulate the economy their spending power would go out the window.

Also the service industry encourages prostitution, both direct and indirect and pedantric idolation of the rich bougoius for tips. People pretend they don't but you can see when people service the rich that they try to dress and behave like them, even though they can't afford it. Imprinting the capitalist seed to further spend.

[Holocaustpulp]

If the Chinese currency is no longer pegged to the US dollar, the US debt will be minimized, or at least wont plunge further downward any longer. Protectionism here serves as a medium to capitalism - it is the instance where, because capitalism is self-destructive, protectionist policies help to save industries and end the domination of a single player. The move by Bush to impose new interim quotas on key Chinese textiles only serves to protect the industry, for not only the US but also the whole world is losing out to the Chinese behemoth. The capitalist irrationality without protectionism would crumble to bits and pieces if it weren't saved by checks on the "Free market".

- HP

[RedStarOverChina]

Despite what Greenspan says, wouldnt u think it make sense?


Service work in Cuba pays shit like everyplace else...but it provides access to foreign currency which is worth much more than ordinary Cuban currency. If you manage to make E50 or C$50 in a month of work in the tourist industry in Cuba, that's like P1,000 -- you're not rich but you're far better off than most Cubans.

I'd beg to differ. I went to Cuba and investigated the issue a little. Form what i know, an average Cuban makes 300-500 pesos a month.

A person in the tourist industry earns a salary lower than that, but their tips does more than make up for that. For example, a tour guide working together with a bus driver would transport about 20-50 passengers to a hotel on an average day. After we arrived in the hotel I tipped them 5 dollars canadian. If, say, 20 passengers each tip them 5 dollars Canadian, they make 100 dollars Canadian, which is equal to about 80 dollars Cuban convertible dollars, which is equal to about 1600 pesos. and that's all in a day's work.

the same goes for people like bartenders. I sat in the bar everyday evening for 2 weeks. In the end I tipped the bartenders about 30 dollars Canadian. So I would assume that bartenders make less than tour guides and bus drivers, but still it would be a considerable amount of money. Otherwise Cuban teachers wouldnt give up their respected teaching career to be bartenders and tour guides.


If those numbers are accurate, the most probable explanation is that China is shutting down state-owned industries faster than privately owned industries are being established.

Lets not resort to speculation here. if that were the case then right now China wouldnt be in a situation of extreme labor shortage.

[RedStarOverChina]

Excuse me capitalist swine, let me wipe your behind.

Dear Pandora:

Fuck off. After reading ur first sentence I have decided not to waste my precious time reading the rest of ur crap. Anyone who would wipe the behind of a "capitalist swine" does not deserve my attention.

Respectfully,
RSOC

P.S. I know a real capitalist who would prefer to have someone giving him a blow-job. Are u willing to consider?

Email him at: [email protected]

[RedStarOverChina]

If the Chinese currency is no longer pegged to the US dollar, the US debt will be minimized,

Thats not true as I was arguing in my first article. Because if that happens:

1. America will spend the same amount, if not more money importing the same amount of mass produced goods.

2. China already owns alot of US debt. If RMB is to rise, that mean US will have alot more to pay China because the value of Chinese currency rose:

(Suppose I lend you 1 dollar RMB. Two years later, 1 dollar RMB's value has doubled. Now you have to pay me the equivalent of 2 dollars because of deflation)


Cheery fellow, aren't you! I guess I'd better get my application into McDonald's before it's too late.

Back to u, RS2K. It is true that in developed countries the manufacturing industry will get smaller while the service industry gets bigger. For example:
France:
secondary industry(manufacturing): 33% Service: 62%

Canada:
Secondary industry: 21% Service: 74%

US:
Secondary industry: 23% Service: 73%

And even Japan(an export-based economy)
Secondary Industy: 33% Service: 60 %

This figure came out in 2001. Right now the manufacturing portion of the economy would be much smaller.

[pandora]

Originally posted by [email protected] 1 2005, 04:35 AM

Lets not resort to speculation here. if that were the case then right now China wouldnt be in a situation of extreme labor shortage.
The main labor shortage is that they can not get people to work for low enough wages, there are surely enough articles on that situation for even someone with your limited attention span to pursue.

As far as your asine comments...
Well, I think sexist intolerance, and reference that I as a female comrade give your friend a blowjob more than shows the truth of amount of social justice that lies in your heart towards the female gender.

Of course in reference to the tourist industry I was making references to the sex industry which now employees a hundred million women, children, and yes men. The increases in prostitution have forced drastic action on Castro's parts several times now, something you have not considered in your statements showing your lack of forethought.

Furthermore, you continually ignore the reference to the woman in the factory in your beloved private Chinese factory system making Disney toys who died of exhaustion from 8am-3am shifts seven days a week with out stop for 12 cents an hour.

Nor, am I ignorant to the way CAFTA if it succeeds will further spread so called "Free Trade Zones" where women are seperated from their children for 12-17 hours at a time and can still barely feed them.

If this is your idea of progress, you my friend, are primative!

Oh so sorry I forgot to go run in hide when you told me to "fuck off" :lol:
Sweetheart, as an ex-New Yorker I could do much better than that in eloquence, but chose to refrain from such pedantric activities. Try a thesurus, I know 7 year olds who can curse better than you!

Cheers Pandora ;)

[RedStarOverChina]

oh dont flatter urself. I didnt bother to check ur profile and ur sex is indifferent to me.

[redstar2000]

RSOC, insofar as you have apparently converted to "Greenspan-ism", I think your "theoretical" arguments are out of place in this forum.

This thread moved to Opposing Ideologies.

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[RedStarOverChina]

Shit. I knew I shouldnt have talked about macroeconomics. No wonder everyone is so ignorant on the issue. Anyone who talks about it is considered a capitalist! It's like talking about communes under McCarthist America!

Who argued in favor of Greenspanism??????? If i say "love thine neighbours" are u gonna restrict me for being a christian??? HOly crap this is some McCarthist shit!

[redstar2000]

YOU quoted Greenspan and, when challenged, YOU said "he was right".

If I quoted, for example, Joe McCarthy and, when challenged, insisted that Tailgunner Joe "was right", then how could I express "outrage" if others concluded that I had "converted to McCarthyism"?

You evidently hold the view that shifting manufacturing jobs to low-wage countries is "a good thing" and even "inevitable"...and that working people in the U.S. should be "happy" to flip burgers, mix drinks, or "suck dicks" for a living.

You and your buddy Greenspan can stick it where the sun don't shine! :angry:

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[RedStarOverChina]

If China stops exporting to US, US will import the products with the approximately the same [price] from south Asia, like Greenspan said.

YOU quoted Greenspan and, when challenged, YOU said "he was right".
And he was.

Oh, the horror! :blink:

According to ur philosophy, because De Galle is such a prick, he is wrong at whatever he says! Right?
"China is a big country, inhabitted by many Chinese"--De Galle
Oh thats just a huge capitalist lie. China is inhabitted by Bohemians!


If I quoted, for example, Joe McCarthy and, when challenged, insisted that Tailgunner Joe "was right", then how could I express "outrage" if others concluded that I had "converted to McCarthyism"?
Ironically enough, u are following his teachings right now.


You evidently hold the view that shifting manufacturing jobs to low-wage countries is "a good thing" and even "inevitable"...and that working people in the U.S. should be "happy" to flip burgers, mix drinks, or "suck dicks" for a living.
A heck of a communist u r, suggesting americans to

"suck dicks" for a living


You evidently hold the view that shifting manufacturing jobs to low-wage countries is "a good thing" and even "inevitable"...and that working people in the U.S. should be "happy" to flip burgers, mix drinks, or "suck dicks" for a living.

Now u r denouncing against the hard working american people who produce over 70% of America's wealth? What a u, a primitivist?