The U.S. vs China

How can China hurt us?  Let us count the ways:

First and foremost, they hold most of our foreign debt, 19 percent or $1.17 trillion.  By buying U.S. treasuries, China keeps our interest rates low but it also gives China leverage over U.S. fiscal policy.

What would happen if China stopped buying U.S. treasures or, worst still, called the loans?

China also controls the supply of the world’s rare earth metals that are used in most of the high-tech products we take for granted like smart phones and hard drives.  More importantly, these materials are necessary components for building smart bombs and military radar.  It’s not that we don’t have any of these minerals.  It’s just that our government shut down our only rare earth mine and allowed the Chinese to buy the company that supplied them.

Lastly, China now has access to our most sensitive military technology.  That which wasn’t stolen was transferred overtly by previous administrations.  

China now has a military that is second to none, financed in large part by by the citizens of the United States who can’t seem to get enough of cheap Chinese goods.

So, to put it mildly, the United States now finds itself over a big, fat Chinese barrel, one that America not only produced, but presented to this communist country on a silver platter.  The outlook isn’t pretty.

So what do you call it when someone captures your children and is threatening to execute them one by one unless you pay, and keep paying, a ransom?

You call it extortion or blackmail.

What are your choices?

You can keep paying the blackmail until it bleeds you dry, allow your children to be executed or you can call in a negotiator who will use every means at his disposal to make the aggressor let them go.

That is tantamount to what is going on right now.  Trump is calling China’s bluff, but he needs the American people to stand with him, even if it means some short-term pain.

Trump likely will not get the support he needs from most members of Congress.  He most certainly will not get it from the international businessmen who have been selling this country off piece by piece in order to increase their bottom line.

It’s important to realize how we got into this mess.  It all started with Bill Clinton who won the presidency with tough talk accusing his predecessor of coddling dictators in the wake of the Tiananmem Square massacre.  Clinton vowed to change our China policy.  Indeed he did!

The new leader of the Democrat Party — the party that professes to care about human rights abuse — de-linked human rights from trade in order to give China Most Favored Nation trading status and later PNTR as a member of the World Trade Organization.  Furthermore, it was Bill Clinton who de-linked our defense and security considerations in order to give China access to our most sensitive technology.

Clinton ended the ban on high-level military contact that had been imposed by George H.W. Bush and allowed the sale of our advanced weapons and other strategic technology to China.

While Trump’s political opponents accused him of colluding with Russia, an accusation that in all likelihood will never be proven, Bill Clinton’s presidential campaign was financed, in part, by the Chinese through Yah Lin “Charlie” Trie and several dozen others who refused questioning and/or fled the country.

Before Bill Clinton became president, the U.S. held a distinct advantage in high tech weapons systems and missile technology.  That all changed after his  administration relaxed the rules and allowed China to began launching our satellites and even gave the Chinese access to our missile testing information, all while they were blatantly pirating our audio CD’s and video DVD’s.

But Clinton was not alone.  None of this could have been accomplished without the cooperation of congressional leaders from both political parties.  Thanks to all this bi-partisan cooperation American businessmen continue to have their factories in China underwritten by the tax dollars of American citizens.  They ship their raw materials to China to have their products manufactured and then shipped back to American consumers with little or no tariffs.  And they call this fair trade!  Meanwhile, our factories close and American industries disappear.

Now, thanks to these greedy politicians our trade deficit with China has gone from $50 billion in 1998 to $375 billion in 2017.

This may be our last best chance to stand up to China, but even with the support of the American people, our chance of success is slim indeed.

2 thoughts on “The U.S. vs China

  1. A tough subject to comment on. Likely the best course of action to reduce our trade imbalances is to be more forceful in negotiating trade which is what President Trump seems to be engaged in. Our national security and our way of life as free people are definitely at risk now and will get worse if we continue on the current path. Taking on the challenges of negotiation appears to be in the best hands if President Trump is involved and does his “Art of the Deal” best on our behalf. I won’t address the vast number of instances where the Clintons have subtly sabotaged our safety and national sovereignty because that would take extensive research over decades and would produce several volumes, all of which would be evidence for long-term convictions but by then the penalty would be of little purpose as the Clintons approach old age. All I’ll say is “MAGA.”


  2. There are some good points here, though I have a couple observations.

    Can China “call the loans?” I’d guess they could sell the debt. Not the same thing.

    I don’t think “international businessmen” have sold our country piece meal. They don’t own the country to sell. Instead, they have made money in China. That’s what business people do. But they shouldn’t be forced to transfer technology – Trump is right on that. But it’s important call it what it is, not what it’s not. And of course China shouldn’t have illegal tariffs, though I have little knowledge about that. Lots of talk about tariffs, illegal product dumping, etc., over the decades – a lot of it seems baseless.

    I agree with Warren that this subject is tough. Remember, we did big business with South Korea when it was undemocratic, we had a huge trade deficit with Japan due largely to its closed markets (Boo), we’d love to do more in Communist Vietnam … I’m not a fan of the Chinese system, but it’s not going away and it’s sure not going to change from trade tweaks. And it’s important that we do business with China just like everybody else – it’s a huge market, and we’ll be left behind if we judged the system and stepped back. I hate our trade deficit, but trade deficits aren’t the only positive measure of the advantages of engaging in trade.

    Shipping out raw material to another country, then importing back finished products, IS fair trade. Nothing wrong with it. You don’t like it, I don’t like it, but the international labor market is a vacuum. Businesses thrive by pursuing lower costs. Costs are lower in the third world. Americans and others use international cheap labor. American companies aren’t going to thrive if they forgo the cheap labor others are using. I’m not sure how to fix this or if it can be fixed.


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