This week, there seems to be a sudden surge in the amount of disdain for China and its marketing policies. Earlier this week, Obama announced a case he filed with the WTO against China's subsidy of their car industry. Romney also jumped on the bandwagon of China-bashing by saying that he would label China a currency manipulator, and would crack down on Chinese market manipulation.
All this is well and good, but there are a few snags. First of all, aside from Obama filing a request for an investigation, this is all talk. And politicians have been complaining about China for years. Never mind that we made them who they are today. We outsourced for free trade boons to our economy, and then got lazy with our own manufacturing and development while China carved out an ever-growing portion of our economy, and now our energy sector as well.
Secondly, what a President or presidential candidate says to rally support on the campaign trail is one thing. But when you're sitting behind that desk, and have to somehow pull back China's influence without ruining our relationship with a country that had the foresight to buy up our debt, it's not so simple as a talking point. What happens when we agitate that relationship? Will China suddenly become more aggressive in demanding they get paid back? Will they spark a trade war with us that will cost US companies even more? There are a lot of bleak outcomes to engaging in this kind of talk with China.
But that's not to say that we shouldn't. Instead, as I've said, we should make changes here at home that will make competing with China possible. For one thing, instead of calling them out for subsidizing their industry, why don't we subsidize ours? We tried it with the stimulus, and many companies have done well by it. We can do that, legally and effectively, and start fighting back against the wave of cheap Chinese imports. The other option is to reinstate trade tariffs to hike the price on Chinese products. Fair Trade is the name of the game, since Free Trade got us into this mess in the first place.
Granted, there are issues with this. For one thing, it could lead to inflation, as the cost of items goes up to reflect the rise in tariffs. It could also piss off China, which will then seek action against us anyway. Or, it could cause stagnation in our markets, as people stop buying those cheap Chinese products because they're not so cheap anymore. Any number of these things could happen.
But what the President's move, and Romney's remarks are getting at is that the problem is getting too big to ignore. Before long, nothing made in America will be able to compete globally or domestically. Cars, power grid technology, health and wellness products, etc. will all be produced cheaply in China and imported by the US. We've been a consumer nation for decades, and now we're behind. Do we really want to be beholden to China forever as our supplier of all goods? I don't want that, and so we have to address it now.