October 30, 2003

China Bashing III

The Wall Street Journal covers the fine art of China-bashing:

WSJ.com - The Fine Art of China-Bashing: Commerce Secretary Donald Evans said in Beijing Tuesday that U.S. patience is "running thin" with China's "unfair" trade practices and that Washington "will not tolerate a stacked deck." President Bush last week urged the Chinese to allow the yuan to move with the market, implying that China was keeping the currency artificially weak to gain a trade advantage. Both Mr. Snow and U.S. Trade Representative Robert Zoellick went to China recently to make the same case.

The U.S. aim, administration officials say, is to get China to budge at least a little on the currency -- perhaps by revaluing the yuan if not letting it float -- and to push ahead on reforms to which Beijing committed itself when it joined the World Trade Organization nearly two years ago. High on the list of irritants are discriminatory regulations, rampant piracy of American software and movies, and barriers that keep U.S. banks and other service companies out of China....

But the administration's strategy carries plenty of risk. If the Chinese don't take dramatic steps -- and few expect they will -- Congress may feel all the more compelled to push forward on legislation that would violate WTO rules and wreak havoc on U.S. companies that rely heavily on Chinese imports. Brink Lindsay, head of trade policy at the Cato Institute, is blunt: "The administration has decided to play politics with the China issue to create the appearance that it is doing something about the soft-job picture. And it will come back to haunt them."

Posted by DeLong at October 30, 2003 09:33 PM | TrackBack

Comments

the usa was not too concerned about non-us patents and copyrights in the 19th and early 20th C, why are you bleating now? I am sure that most americans think that edison invented the light bulb.

Posted by: big al on October 31, 2003 03:23 AM

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Couple of questions? Who is the "you" who is bleating? I haven't even practiced a good bleat in a couple of months. I'm not ready yet. Any supporting data or argument for the implication that the US was a patent villian a century ago? Any supporting data that anyone injured by such villiany is still around to suffer for it today?

While we beat on China (or not, depending on whether you listen to Evans or Mankiw), Japan has skipped nicely through Treasury's review of fx manipulation, apparently because fx rate fluctuations is all that is needed to prove no manipulation. At least, that is what I took away from Snow's testimony. Meanwhile, the BoJ has reported spending Y2.7 trln on fx intervention in October, the second largest month ever, just behind September.

Posted by: K Harris on October 31, 2003 04:08 AM

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I thought we could only have one evil enemy at a time...

Posted by: praktike on October 31, 2003 07:18 AM

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It would really be helpful to me, and maybe others, if some of the economists would explain the technical abbreviations once in a while. I am currently puzzling over fx from the prior, and PCE from another. Thanks.

Posted by: Masaccio on October 31, 2003 10:37 AM

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fx should be Foreign eXchange.

PCE Private Consumption Expenditure.

DSW

Posted by: Antoni Jaume on October 31, 2003 01:38 PM

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So, Japan has a free floating rate and China has a rate pegged to the dollar. Why can't I tell the difference? We might as well bash all of Asia [save Australia] on currency. There is marked currency intervention through Asia.

Posted by: anne on October 31, 2003 02:02 PM

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Thanks, Antoni.

Posted by: Masaccio on October 31, 2003 03:40 PM

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Kudos Brink Lindsay

The article helps me understand why Brad has such a high opinion of Brink Lindsay. His point isn't subtle so it doesn't provide more evidence that he is smart (if any were needed) but it does show intellectual coherence and courage for someone at the Cato institute to be so blunt criticising a Republican administration for pandering to nationalistic populism.

I should admit that the quote is the first words of Lindsay that I have ever read.

Posted by: Robert on October 31, 2003 04:46 PM

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