NPR - China

[Superman]

Those communists at NPR reported some interesting treasonous propaganda this morning about China. Their lies suggested that China saves 30-40% of its GNP, as opposed to our savings rate which they suggested is around 0%.

They said China's trade surplus with us will be something like $200 billion this year. Traitors.

The said China is essentially underwriting the Iraq conflict.

They also happened to mention that China is notorious at ignoring the rules. Like respecting intellectual property. They said the Dubya Administration is resisting suggestions that we impost tariffs to try to punish China. I think this was an obvious ploy to try to appear objective since frankly that sounds like a good decision by the Dubya Administration to me.

What they didn't say is that America's usual method of extortion as a way of maintaining discipline among other nations will not work with China. Another obvious attempt at appearing objective and Administration-friendly.

In fact, the whole report had a decidedly objective tone. Clearly these NPR folks, pretending to be objective, pretending to set aside obvious opportunities to hammer the current "administration," pretending to objectively suggest that China is a sleeping grizzly bear, are just deliberately undermining America. Liberal bastards. You won't hear this kind of treason on Fox News. Right, Mul?

[gaijindabe]

Objective? Please. Se how they brought up the savings rate, balance of trade, Iraq and the favorite bug-a-boo of all UN lovnicks - "ignoring the rules".

Looks to me like they did a pretty good job of bring up the S.O.S. and trying to smear the present administration with it.

Otherwise, Supe - please elaborate on this "America's usual method of extortion as a way of maintaining discipline among other nations...."

[IROC]

I heard the same report and didn't come away with the feeling that there was any "smearing of the present administration". Just some disconcerting facts.

I thought the story was pretty objective.

Mike

[jyl]

I did not hear the NPR story, but what you described is consistent with what is well-known about China:

- China's savings rate is very high (appx 50%) while the US savings rate is zero to negative.

- The high Chinese savings rate is typical for an emerging economy. The Chinese economy is growing very fast (3-4X US growth) and China has not yet fully developed a culture of consumer spending. Japan went through a similar phase some decades ago.

- The low US savings rate is partially because US consumers have relied on growing home values to boost their personal assets, and spending >100% of their income (>100% because they've also been relying on withdrawing equity from their homes). When home values cease rising and start falling, US consumers will have to start saving money from their income, and reduce their spending, which will hurt retail sales and the economy overall.

- As precedent we can look at the UK, where the housing boom ended 1 year ago; UK consumer spending has dramatically decelerated and UK GDP growth has also fallen sharply. Denmark went through a similar thing. We are likely to experience the same thing.

- China is the major buyer of US Treasuries (done to keep their currency value low vs the US dollar). China and other foreign buyers have been the the main reason why the US has been able to finance its huge budget deficit (including the Iraq war) without tax increases or higher long-term interest rates.

- As a result, China and other foreign governments are major creditors for the US and a growing percentage of the US federal tax revenue goes to paying interest to those foreign governments. This effectively makes the US dependent on China and other foreign creditors. Thus the US has little "leverage" with China, whether on trade, North Korea, protection of intellectual property, or other issue.

I am not trying to bash China. They have >1BN people who want and need to achieve a better life and are willing to work hard and sacrifice to do it. Our problems are largely of our own making, in my opinion.

[Superman]

Originally posted by IROC
I heard the same report and didn't come away with the feeling that there was any "smearing of the present administration". Just some disconcerting facts.

I thought the story was pretty objective.

Mike

I was being facetious, of course. This was my point. It was an objective report. Gai, the bit about the "ignoring the rules" I think comes from Washington. This so-called "administration" is taking steps to discuss this trade balance with China. It's not something I made up, or NPR made up. It's something your "president" is actively trying to deal with, and for good reason.

In fact, I thought NPR was quite kind to Dubya by pointing out that he is resisting suggestions to impose tariffs. He says he doesn't want to take actions that drastic. Another kindness. In reality, trying to force China into a consumer-drive economy instead of an export-driven economy would be nice, but we're not going to muscle China into anything. Our usual modus operandi is not going to fly in this instance. The extortion remark was entirely mine.

You guys who think NPR is leftist, you apparently think everything is leftist if it reports truth. If it reports what you don't care to hear. Frankly, NPR handled the "administration" angle on this important and current story with velvet gloves. The reason you guys don't know that Dubya is grappling with the China trade problem is because it's too much of an embarrassment for Fox News.

[Nathans_Dad]

What's the saying about a blind squirrel again? I certainly think NPR is leftward leaning, but that doesn't mean every story is not objective. The one about China I thought was very good, although their expert commentator did poo-poo the idea of raising tariffs, saying that it might send China's economy into a tailspin and take the world economy with it. Big game of chicken...right?

[Tim Hancock]

Supe, I stated on the other thread that I listen to NPR twice daily and they do lean left at times but many of the stories have no lean at all. So what?

Kinda funny that when I was growing up in the 70's & 80's, I thought highly of Japanese products, while my parents thought of Japanese stuff as junk. In my early adult life, I thought of Chinese stuff as junk. I will bet my kids will end up thinking Chinese stuff is the best. Crazy what can happen in 20-30 yrs.

[Shaun @ Tru6]

Other than negative ROI on money borrowed from China to pay for Iraq, the biggest issue we face with China is that bush handed them the doctrine of the pre-emtive strike. That is, any superpower can invade another country simply by believing it to be a credible threat.

China's economy will dwarf ours in a few years, as will its military.

What do you think will happen when the dragon gets hungry? Which begs the quetion, "What does the will of 1.3 billion people who need to work, be fed, etc. look like?"

[Superman]

True, Tim. I can accept that some NPR stories are satisfying to my liberal mind, but that the China story was largely just objective. I've not listened to much NPr lately, and am enjoying getting reaquainted.

I may be more like your parents. I recall when "transistor radios" came out, many of which were made in Japan. They were junk indeed, though small, inexpensive and convenient. And yes, I expect the quality of Chinese products to rise over time.

In fact, I thought the story this morning was amusing simply because we're going to get our head bit off if we try to muscle China around. I do not share NPR's fear of upsetting world markets near as much as I fear upsetting the Chinese strategists themselves. I am in the construction industry, and frankly it looks like they already have the power to upset the construction industry in my country with their materials-buying clout. The prices of steel and concrete have been going through the roof since way before Katrina. Because of China's infrastructure build-up.

We're about to get a good old fashioned economic ass-kickin'.

[Shaun @ Tru6]

Originally posted by Superman
And yes, I expect the quality of Chinese products to rise over time.

In terms of girls and women's t-shirts, Chinese and Vietnamese products are higher quality than those made in Georgia and California.

[CamB]

Our problems are largely of our own making, in my opinion.

With respect to China buying up your debt cheaply which pays for govt and private spending, its a bit hard to find anyone else to blame!