Phoney US job-saviors
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China Daily, October 13, 2011
The majority of the US Senate who voted for a protectionist bill aimed at the Chinese currency are manifesting their claimed commitment to protecting US jobs.
However, given the dire consequences that will result if the bill becomes law, it is hard to take seriously their self-proclaimed guardianship of US jobs.
If the world's largest economy wants to seek a real and lasting solution to its stubbornly high unemployment, which is an effect rather than a cause of its many domestic troubles, US politicians should stop promoting protectionism.
Instead, they should recognize that international trade and investment have been and remain major drivers of productivity, innovation and employment, particularly in this era of globalization.
In an attempt to find an easy fix for America's trade deficit and joblessness, the US Senate on Tuesday passed a bill, by a vote of 63-35, which calls for punitive tariffs on countries with allegedly misaligned currencies.
Though the bill will have to clear the House of Representatives and be signed by President Barack Obama to become law, the vehement opposition it immediately drew from China's commerce and foreign affairs ministries as well as the central bank shows how dangerous such naked protectionism would be.
If an all-out trade war breaks out because the United States uses this bill to press China to let its currency appreciate and China responds with countermeasures, it would not only be the two countries that suffer but also the world economy as well.
The international community should not hesitate to make clear its determination to keep at bay trade protectionism of any form.
The warning from the Chinese side that the US legislative move has seriously violated international regulations and sent the wrong signal in escalating trade protectionism is more than valid.
Those US lawmakers who supported the bill must have known that it will raise protectionist sentiments and may trigger a trade war.
Their eagerness to get tough with China on trade and currency issues does not mean they are the saviors of US jobs.
The fact that the Chinese currency has appreciated by some 30 percent against the US dollar since 2005, while the US trade deficit with China has kept ballooning, compellingly denies the argument that Chinese exporters have relied on an undervalued currency to compete.
More importantly, were these US politicians indeed serious about creating more US jobs, they would not be touting trade protectionism- which will eventually force US consumers to pay higher prices - as a panacea to the country's economic woes while largely refusing to consider tax hikes to finance a job-creation program at home.
It is such misguided saviors that are standing in the way of the US generating the jobs its citizens are clamoring for.
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