Subscribe to our free daily newsletters
. Military Space News .




Subscribe to our free daily newsletters



SUPERPOWERS
Outside View: Facing up to China

disclaimer: image is for illustration purposes only
by Peter Morici
College Park, Md. (UPI) Nov 16, 2010
In 1876, Europeans visiting the Philadelphia Centennial Exposition were astonished by American industrial prowess. In two generations, the United States had progressed from a simple agrarian society to challenge the most advanced European economies.

Now, China confronts America in a historic test transcending commerce.

Americans believe individuals, each defining their own lives, best chart the progress of the nation. Governments draw legitimacy from collective approval -- citizens are the sovereign.

Markets and democracy define America. Our institutions cultivate competition among individuals and ideas that shape our common material and civic lives.

Recently, Democrats and moderate Republicans lost sight of those fundamentals and imposed healthcare reforms, bailouts and huge deficits voters simply don't want. They were soundly defeated in midterm elections.

Markets and democracy are mutually reinforcing. Markets work best when personal freedoms are protected and democracy best safeguards those liberties. Free markets give individuals a strong interest in securing democracy.

Since World War II, the United States has worked with allies in Europe and elsewhere to build international institutions that promote open markets, human rights and democracy.

China is no champion of those values.

The Communist Party imposes an authoritarian regime and assumes parental authority over its citizens. It prefers state capitalism to private enterprise and embraces market reforms only as needed to participate in global commerce on terms unfairly tilted to China's advantage. Unless compelled by necessity, it won't adopt market reforms that could instigate popular sentiment for democracy.

China is no 19th-century America.

Nineteenth-century America made pioneering contributions to steam, railroad, telegraph and electrical technologies. Wages were higher than in Europe and attracted skilled immigrants. Considerable resource wealth powered development.

China accomplishes growth with appropriated technology and cheap labor and is desperately dependent on imported oil and resources. It compensates for shortcomings by compelling Western companies to transfer knowhow and with an undervalued currency that subsidizes exports and suppresses the real wages of industrial workers. Its middle class prosperity is built on exploited factory labor.

During the Cold War, U.S. moderates advocated engagement with the Soviet Union. They believed, through our example, its citizens would see the power of individual liberty and compel change. Subsequently, Washington adopted that strategy toward China.

That is folly.

The Soviet Union collapsed, not because it bought into Jeffersonian ideas but because its economy failed.

China's economy is succeeding. Don't look for its leaders to call for free elections anytime soon.

To sustain the Communist Party, Beijing has a strong interest in selling its brand of authoritarian capitalism to others and redefining international institutions that promote open global markets and human rights.

To secure oil and other resources and enhance global influence, China is investing abroad, building a blue-water navy and modernizing its army.

Through mercantilism, China has accomplished huge trade surpluses and breakneck growth, imposed on the United States huge trade deficits and high unemployment and made American free market prescriptions for the global economy appear foolish and outdated.

Through diplomacy, the United States has failed to persuade China to abandon currency and other mercantilist policies that harm the U.S. economy.

At the International Monetary Fund and Group of 20 meetings, German and other key Western allies abandoned the United States, leaving it to fend for itself.

America stands on a lonely perch and the time for talk is over.

Washington must respond to Chinese mercantilism with actions, not words.

China's purchases of dollars and foreign securities to maintain undervalued yuan come to 35 percent of exports. Washington should impose proportionate tax on purchases of yuan used to buy Chinese goods or invest in China and intervene in currency markets to push up the value of the yuan.

Washington should place limits on Chinese technology sales and investments in the United States that mirror the restrictions China imposes on imports and foreign investments.

Across the board and without exception, the United States should decisively answer Chinese protectionism.

Failure to act aids China's success. It is appeasement and courts disaster.

(Peter Morici is a professor at the Smith School of Business, University of Maryland, and former chief economist at the U.S. International Trade Commission.)

(United Press International's "Outside View" commentaries are written by outside contributors who specialize in a variety of important issues. The views expressed do not necessarily reflect those of United Press International. In the interests of creating an open forum, original submissions are invited.)



Share This Article With Planet Earth
del.icio.usdel.icio.us DiggDigg RedditReddit
YahooMyWebYahooMyWeb GoogleGoogle FacebookFacebook



Related Links
Learn about the Superpowers of the 21st Century at SpaceWar.com
Learn about nuclear weapons doctrine and defense at SpaceWar.com



Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News


SUPERPOWERS
Diplomatic thaws do not mask Japan's waning clout: analysts
Yokohama, Japan (AFP) Nov 15, 2010
While Japan witnessed a thaw in sometimes frosty ties with China and Russia at weekend summits, its diplomatic power is waning in parallel to the erosion of its economic might, analysts say. Prime Minister Naoto Kan, who took office in June, assumed his highest-profile international role to date when he chaired this year's Asia-Pacific Economic Cooperation summit in Yokohama at the weekend. ... read more







SUPERPOWERS
NATO leaders to avoid citing Iran as missile threat

Russia says open to missile defence cooperation with NATO

Boeing Submits Proposal For Next Generation Aegis Missile Contract

Northrop Grumman Enters Competition For Next-Gen Aegis Missile

SUPERPOWERS
Iran holds war games, set to launch S300s

Pakistan to arm fighter jets with Chinese missiles

Iran 'successfully' test fires upgraded Soviet-era missile

Pentagon says vapor trail from an aircraft, not a missile

SUPERPOWERS
US drone strike kills four militants in Pakistan: officials

Kestrel Supports Project NANKEEN In Afghanistan

Multi-Purpose UAVs To Get NG STARLite Radars

US drone strikes kill nine militants in Pakistan

SUPERPOWERS
Codan Receives JITC Certification For 2110 HF Manpack

Northrop Grumman Bids for Marine Corps Common Aviation CnC

DSP Satellite System Celebrates 40 Years

ManTech Awarded US Army Contract To Provide ECCS In Afghanistan

SUPERPOWERS
UK MoD Selects Wearable Shooter-Detection System For Field Trials

Nations move to ban cluster bombs

Cubic To Provide Advanced Instrumentation For US Test Ranges

UK Army Air Corps Acquires Australian Aircrewman Simulator

SUPERPOWERS
S.Korea may send envoy to win defence contract in Brazil

Thousands of Dutch military face axe: ministry

Russia wants fair trial of suspected arms dealer: minister

Leaks cost Argentina access to U.S. data

SUPERPOWERS
US fears defense cuts in Europe could weaken NATO

NATO seeks to allay Russian suspicions at summit

Outside View: Facing up to China

Obama to hold first meeting with Georgia's Saakashvili

SUPERPOWERS
Boeing Installing Beam Control System On HEL Laser Demonstrator

Maritime Laser System Shows Higher Lethality At Longer Ranges

Northrop Grumman To Increase Efficiency For Next-Gen Military Laser Technology

Boeing Receives Task Order For Design Of Free Electron Laser Lab Demonstrator


The content herein, unless otherwise known to be public domain, are Copyright 1995-2010 - SpaceDaily. AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement