Currency

What's Worse, The New York Times' Sinophobia or Sinophilia?

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From the blame-China files, comes this editorial in yesterday's paper pinning the world's economic problems to Beijing's currency policies:

Don't you be beggaring thy neighbor!

While the strategy is still working for China, it is exacerbating economic weakness around the globe. If China keeps it up, other countries are likely to use their last available weapon — protectionism — to stop the onslaught of artificially cheap Chinese goods. A trade war is easy to start and hard to contain. […]

As China has flooded the world with exports, it has edged out suppliers from other developing countries. This was bad enough when the world economy was growing briskly.

Now China's strategy is doing considerably more harm. In many countries, fiscal stimulus efforts have been weakened by inflows of cheap Chinese imports that have soaked up some of the money added by these government programs. […]

If China continues its beggar-thy-neighbor currency policy, it will make it even harder for countries and the global economy to revive. As overextended governments wind down their fiscal stimulus, many economies will have to rely on exports as a crucial source of demand while their consumers restructure their sorry personal finances.

This follows a New Year's shot across the bow from econo-columnist Paul Krugman:

China has become a major financial and trade power. But it doesn't act like other big economies. Instead, it follows a mercantilist policy, keeping its trade surplus artificially high. And in today's depressed world, that policy is, to put it bluntly, predatory. […]

[T]hat trade surplus drains much-needed demand away from a depressed world economy. My back-of-the-envelope calculations suggest that for the next couple of years Chinese mercantilism may end up reducing U.S. employment by around 1.4 million jobs.

It worked so well the last time around!

[O]ther countries are taking (modest) protectionist measures precisely because China refuses to let its currency rise. And more such measures are entirely appropriate. […]

[T]here's the claim that protectionism is always a bad thing, in any circumstances. If that's what you believe, however, you learned Econ 101 from the wrong people — because when unemployment is high and the government can't restore full employment, the usual rules don't apply.

Then, just when you're ready to imagine the entire NYT opinion section doing voice-overs for 1960s Jell-O commercials or body doubles for 1980s David Bowie videos, along comes authoritarian-apologist Thomas L. Friedman, doubling down on his offensive/idiotic claim that the Chinese political system is better than ours:

Oh baby, just you shut your mouse

I am reluctant to sell China short, not because I think it has no problems or corruption or bubbles, but because I think it has all those problems in spades — and some will blow up along the way (the most dangerous being pollution). But it also has a political class focused on addressing its real problems, as well as a mountain of savings with which to do so (unlike us).

Unlike Friedman, I've never read "The Herald Tribune over breakfast in Hong Kong harbor," let alone put that in the lede of a column (though I will take this opportunity to reiterate my complaint that the IHT really sucks œuf à la coque compared to its past glory now that it's basically The New York Times International), but hick intuition tells me that a regime that depends on restricting the freedom of its own people is by definition not addressing its "real problems," but rather putting them off for a day of unpredictable reckoning. Meanwhile, blaming another country for America's woes strikes me as, at the bare minimum, weak.

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  1. So Krugman wants us to believe that a country whose government pursues a policy that lowers the price we pay for goods made in that country is “predatory”.

    OK.

    1. He has a Nobel Prize.

    2. Robert Reich said on NPR once (in regard to personal savings) that what’s good for the individual is not what’s good for the nation.

  2. “The Yellow Danger”

    Well done. That pic is hilarious.

  3. Predatory of its own people maybe.

  4. Meanwhile, blaming another country for America’s woes strikes me as, at the bare minimum, weak.

    Xenophobia is fine and dandy when your guy is in charge and it can shift some of the blame off of him, Matt. It’s almost like you don’t understand the mongoloids at the NYT. You need to get more retarded, dude. Immerse yourself in the culture, like Jane Goodall.

    Live with the monkeys.

  5. If providing low priced goods is predatory, then what is providing gifts? I’m not going to hold my breath waiting for Krugman to denounce the Red Cross and others who will soon be sending all manner of absolutely free goods to Haiti.

    1. Well, gifts can actually be bad for a developing economy (though obviously not in an emergncy situation like Haiti right now). Bill Easterly has done a lot of work showing how providing African countries stuff like clothes and mosquito nets for free ends up throttling local entrepreneurs who might have produced the same stuff in country and created more sustainable growth in the process.

      1. The emergency situation in Haiti is the result of a failed government. San Francisco or Tokyo can undergo 7.0 quakes without the kind of destruction and death tolls Haiti suffered.

  6. Is China Really Growing That Fast?

    http://www.investors.com/NewsA…..?id=517745

  7. I could see China as a problem in creating its own bubble or set of bubbles that will impact the US negatively. But that’s about it and there really isn’t much the US can do about that.

  8. hick intuition is hickdar…

    1. No. Hickdar is what goes off when you see a male mullet in the wild. Or reserve final judgement on a woman’s beauty until you get a chance to count her teeth.

  9. My back-of-the-envelope calculations suggest that for the next couple of years Chinese mercantilism may end up reducing U.S. employment by around 1.4 million jobs.

    More like backside calculation, as in, he pulled it out of his ass.

    1. No no no. I associate with economists, and they really do have an endless supply of face-down envelopes and, while eating, napkins.

  10. a regime that depends on restricting the freedom of its own people is by definition not addressing its “real problems,” but rather putting them off for a day of unpredictable reckoning.

    I’m glad I don’t live in such a country.

    1. +1

      Beat me to that comment.

  11. No shout out for M. P. Sheil?

    For shame, Reason! For shame!

    He was a racist old bastard, but The Purple Cloud is fantastic.

    With reviews like these…

    …delivered with a skill and artistry falling little short of actual majesty.
    -H. P. Lovecraft

    The most unutterably terrible book ever written.
    -Frank Belknap Long

  12. Even when it was the bears, i knew it was the Chinese.

  13. [T]here’s the claim that protectionism is always a bad thing, in any circumstances. If that’s what you believe, however, you learned Econ 101 from the wrong people ? because when unemployment is high and the government can’t restore full employment, the usual rules don’t apply.

    *throws flag*

    The government cannot “restore full employment”.

    Not no way.

    Not no how.

    1. It’s different this time!

      1. We have the right people in charge!

  14. The real problem with cheap chinese imports is that two hours later, your hungry again.

  15. So Krugman wants us to believe that a country whose government pursues a policy that lowers the price we pay for goods made in that country is “predatory”.

    They’re preying on SEIU and the AFL_CIO, dude!

  16. Live with the monkeys.

    You first, racist.

    1. joe, is that you?

    2. Damnit, I got beaten to the punch.

      Readers, P Brooks post was actually done before my post above.

      Sorry P.

      And let me take this opportunity to state again that threaded comments sucks monkey balls.

  17. My back-of-the-envelope calculations

    Was it a large envelope stuffed with cash from Norway?

  18. The government cannot “restore full employment”.

    1. Pesky feminist squirrels.

      1. I thought it was Chinese hackers.

  19. Should the alt-text on that last pic be “oh baby, just you shut your mousse? Or was that a gerbil joke?

    Also, it is just me, or does anyone else get the impression China’s doing what Japan did in the 1980’s – with subsidizing exports and buying US debt. They are basically stealing from their own citizens to pay for our stupidity. They’re like the enabling parent giving their crack head son some more spending cash.

    1. Reminds me of tech companies during the bubble like Lucent & all who would lend money to their customers so they would buy their products and make their sales numbers look good. They lend us, we buy junk, they get our money, to lend to us.

  20. Xenophobia is fine and dandy when your guy is in charge and it can shift some of the blame off of him, Matt. It’s almost like you don’t understand the mongoloids at the NYT. You need to get more retarded, dude. Immerse yourself in the culture, like Jane Goodall.

    Live with the monkeys.

    I recall in 2000 a thought experiment I conducted where I took Al Gore’s technocrat mumbo jumbo as the literal truth for an entire hour. The certitude I felt was indescribable. Overwhelming. I was going native and eating the lotus at the same time. It did irreparable damage to mind, but the warm comfort I felt, nothing less than a secular substitution for divine inspiration and immortality through being part of the cog, a delusion of human racial progress brought to us by Leviathan was so enticing that I can see why the Choad entity and Edward are so angry at us for denying their Truth.

    After the Obama wipe out of 2012 expect them to go all out suicide bomber on us.

    1. I admire your willingness to damage your own brain for entertainment, alan. I do this as well, but usually with illicit drugs, alcohol, and Battlefield Earth.

      1. Shit. I’ve watched more than one Uwe Boll movie. Fucking top that.

        1. So have I…and I’ve watched Invasion of the Blood Farmers AND Glitter.

          Top THAT.

          1. What.Is.WRONG.With.You!?

          2. Surf Nazis Must Die…while drunk on Mad Dog 20/20. I win.

            1. I think Warty’s penchant for getting assfucked by strangers in public restrooms beats that.

              1. If it was just his ass they were interest in, the whole situation would be less disturbing. [shudder]

          3. Well, an ex-gf had me go see Gigli, and we sat through 30 minutes of it. Also, I watched all of Alexander. That might not top yours, but it definitely ties it.

    2. The certitude I felt was indescribable.

      Damn that sounds nice.

    3. Truly, we are pioneers. One day I’m going to go back to that great well spring of delusion. I have a dozen old columns that Gore wrote for Omni in the 80’s that I have been saving for one last trip before I die like Aldous Huxley did when he consumed acid before slipping into the great unknown.

      Not that I’m planning to go any time soon, but those columns will be there, waiting for me.

    4. “After the Obama wipe out of 2012 expect them to go all out suicide bomber on us.”

      Obama will be reelected in 2012.

      And various nuts will begin call him the antichrist a new due to the fact that he seemed “dead” but has now risen once more.

      It’s related to some Nostradumbass thing or one of those other bullshit doomsday/antichrist predictions.

      1. Yesterday, I had an errand to run downtown. I over heard a group of public employees talking about how they wish they could have Bush back. I haven’t even gone so far as to say that! Though, ‘worst first year of a presidency. ever.’ has come to mind. Sure, they are his apostles, will they betray him thrice? Maybe, it is too early to say.

  21. The government could create full employment by issuing everybody a spoon, and paying them a dollar a day to gouge the earth with it.

    1. And being gov’t employees, 1/2 would find reasons their spoons are inoperable, and the other 1/2 would hide in a cave and play video games.

  22. Can we please dispense with the term “double down”? It’s already well past its sell-by date and it’s only been around a short time.

    Leave it for the blackjack table.

    1. You can try, but at the end of the day there will be pushback.

      1. Sigh…

        I guess it is what it is.

  23. a regime that depends on restricting the freedom of its own people is by definition not addressing its “real problems,”

    You’re not thinking ChiCom-y enough to read the Times. Too-free people are the “real problem,” always.

  24. China don’t fret me none.

    1. Me neither. The richer the Chinese are, the happier I am for them (and for me, since I’ve got a fair chunk of the portfolio in China right now).

  25. “hick intuition tells me that a regime that depends on restricting the freedom of its own people is by definition not addressing its “real problems,” but rather putting them off for a day of unpredictable reckoning. Meanwhile, blaming another country for America’s woes strikes me as, at the bare minimum, weak”

    spot on there mate

  26. Okay.

    Hah! Folded like a cheap lawn chair.

  27. Dammit all I can’t find the link. I saw a story a few days ago from some hedge fund billionaire predicting a collapse of China’s economy in the next few years.

  28. Thomas Friedman strikes me as a kind of perverse canary-in-the-coal mine on any big trend. When he shows up, the party’s already over. Kind of like petfood.com and the internet bubble.

    By that reckoning, China’s toast in the next few years.

  29. [T]here’s the claim that protectionism is always a bad thing, in any circumstances. If that’s what you believe, however, you learned Econ 101 from the wrong people ? because when unemployment is high and the government can’t restore full employment, the usual rules don’t apply.

    Krugman doesn’t fucking know shite about economics, as this quote amply illustrates.

  30. Meanwhile, blaming another country for America’s woes strikes me as, at the bare minimum, weak.

    If you believe that if one country does well, another must do poorly, then it’s not a weak argument. Krugman is firmly in that camp.

  31. But isn’t it possible for one nation to be at least partially responsible for another nation’s woes? Isn’t a fact that U.S. protectionist agricultural policies work hardships on other nations? Not to mention our compulsion to export our “drug war” to other nations, notably Mexico and Columbia? The idea that a nation is responsible for all its problems is a bit moralistic. It’s just that usually we cause other people problems, rather than the other way around. But it is possible.

    1. “It’s just that usually we cause other people problems, rather than the other way around.”

      Not really. The US is currently subsidizing a large chunk of the world for health care and defense. I call that causing us problems because they are too big of pussies to actually contribute.

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