Can we borrow some optimism: From the Chinese, too?

Published 5 years ago -  - 5y ago 44

“The uncertain condition of their property discouraged the subjects of Theodosius from engaging in those useful and laborious undertakings which require an immediate expense, and promise a slow and distant advantage. The frequent examples of ruin and desolation tempted them not to spare the remains of a patrimony which might, every hour, become the prey of the rapacious Goth. And the mad prodigality which prevails in the confusion of a shipwreck or a siege may serve to explain the progress of luxury amidst the misfortunes and terrors of a sinking nation.” Edward Gibbon, Decline and Fall of the Roman Empire,Chapter 27

“When you gave me that money, you said I wouldn’t have to repay it ’til the future. This isn’t the future. It’s the lousy, stinking now!” Homer Simpson, No Loan Again, Naturally, Season 20

How could it be that Americans, the world’s greatest businessmen, could let themselves get beaten at their own game? And by the Chinese, of all people, who were supposed to be Mao-worshipping anti-capitalists? Yet the facts are undeniable. The Economic Policy Institute calculates that in the seven years since President Bill Clinton successfully pushed for China’s admission into the World Trade Organization, the United States lost 2.4 million jobs due to its trade deficit with the Chinese. Thanks to that trade imbalance, China now sits atop a 2.85 trillion stockpile of foreign currency reserves – the largest in the world.

It’s like they can’t lose. And we can’t win.

Even when we think we have the Chinese right where we want them, they somehow manage to turn the tables on us. In March of 2000, Bill Clinton gloated about how granting China most favored nation status and maneuvering it into the WTO could reap only benefits for the US and impose strict rules on the Chinese that would work to our benefit. At a press conference in the East Room, Clinton said:

“Congress should pass permanent normal trade relations with China this spring. I will say again: This requires us to take no further action on our part to lower tariffs or open markets. All the concessions are being made by China in return for entering an open trading system.”

Yes, those hapless Chinese didn’t see it coming – or so we thought. In fact, since China entered the WTO the following year, the U.S. trade deficit with China has increased by 18% every year.

Even a proposed trade agreement between the US and South Korea camouflages hidden threats for the American economy and even more benefits for China. The Korea Free Trade Agreement, which Obama backs as a means to reviving the US economy, aims to do so by reducing trade barriers between the US and Korea. While many question the actual impact such an agreement will have, citing the disastrous consequences of NAFTA on American industry, especially textiles, the proposed agreement contains an overlooked provision with unforeseen consequences. In addition to eliminating most tariffs on Korean-made imports, the agreement would allow up to 65 percent of Korean products to be sourced from China.

The US is playing Wile E. Coyote to the Chinese Roadrunner.

How does one nation lose its mojo while another seems unable to do anything wrong? That sort of thing clearly reflects a nation’s sense of optimism for the future. While the Chinese enjoy an invigorating sense of optimism and direction, the US appears to itself and the rest of the world as a floundering has-been. We know not who we are or where we are going. Recent polls bear this out: 65% of Americans see their country headed in the wrong direction.

A great deal of this may be explained with the different views the people of China and the people of America have of their pasts, which, as Edmund Burke once observed, determines our confidence (or lack thereof) in the future. While the Chinese are re-discovering Confucius and his teachings on social harmony and ethics, to the point where the First Teacher now has a new statue in Tiananmen Square, Americans routinely disown the unenlightened views of their Founding Fathers, Confederate generals, and even the European discoverer of North America, Christopher Columbus, that despicable man who made America’s history possible.

And what does it say about a nation whose greatest hope is that it can import enough young foreigners whose vitality can hopefully transfuse it with new energy and purpose? That’s what President Obama seemed to be saying in his recent State of the Union address when he called on Congress to grant a pathway to citizenship to “hundreds of thousands of students excelling in our schools who are not American citizens.” It “makes no sense,” said the president, that these “children of undocumented workers” must “live every day with the threat of deportation.” It is they, and apparently only they, who “can staff our research labs, start new businesses, and further enrich this nation.”

While we look for someone to save us, whether the Chinese, who could and should lend us another few billion, or immigrants, any immigrants, to do the jobs we won’t do, including reproduce, our only consolation is to spend our borrowed money like there’s no tomorrow. And so the cycle continues, of regretting yesterday and dreading tomorrow while mismanaging our lives in ways that will hobble our ability to even have a tomorrow.

“Published originally at : republication allowed with this notice and hyperlink intact.”

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