U.S. elections exacerbate tough China relations

October 27, 2010

The most popular villain in U.S. midterm campaign ads might not be banks, bailouts or Bush, but rather Beijing. Both Republicans and Democrats are working hard to exploit voter economic angst by tying opponents to China. The smear effort bodes poorly for reducing trade tensions in 2011.

It’s old hat for candidates to accuse faraway nations, and political rivals for enabling them, for domestic economic woes. But the latest version of the blame game is notable for two reasons. First, it’s bipartisan. Democrats, backed by labor unions, typically attack Republicans over trade and jobs. This time is no different. In the Pennsylvania Senate race, Representative Joe Sestak is running an ad claiming Republican Pat Toomey wants to “bring jobs to China” and knocks him for praising China’s economic modernization.

Republicans, however, tend to be trade proponents. Yet in an important West Virginia House race, GOP challenger Spike Maynard is charging Democrat Representative Nick Rahall for voting to outsource green jobs to China. A similar cry from Republicans can be heard around the country.

The ads also break new ground in xenophobia. The red-hued Sestak ad employs a gong and a fortune cookie to make its point. The Maynard ad is just about as subtle, using stereotypical music and directly blaming China for high U.S. unemployment.

Then there’s the ugly “Chinese Professor” web ad from a conservative lobbying group. The YouTube sensation portrays Chinese college students in 2030 being lectured on America’s economic collapse. The gut punch line: “Of course, we owned most of their debt — so now they work for us.”

This is all apt to pile pressure on President Barack Obama to cut some sort of currency deal with China at the G20 meeting in South Korea next month. Hopes are running high China will agree to let the yuan steadily appreciate over the next three to five years. Failure could spur the Senate to pass the currency bill already approved by the House.

It would also embolden the next Congress to be more adversarial. It’s a telling sign that runaway favorite Ohio Senate candidate Rob Portman, America’s trade representative under President George W. Bush, already has slammed the Treasury Department for failing to tag China a currency manipulator. His future colleagues surely will take notice.


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Quoting you:
Then there’s the ugly “Chinese Professor” web ad from a conservative lobbying group. The YouTube sensation portrays Chinese college students in 2030 being lectured on America’s economic collapse. The gut punch line: “Of course, we owned most of their debt — so now they work for us.”

Just what part of that web ad is a lie? How do you spin the truth to the ad being wrong, or false. Every word spoken and translated is factual.
What does bother me are the following words used in your diatribe against truth.
“exploit,angst,smear,bodes poorly,accuse faraway nations,latest version of the blame game,A similar cry,xenophobia,red-hued,using stereotypical music,ugly “Chinese Professor”, currency manipulator.

I read your article and I think you are failing to understand the average person who looks for information now on the net is not a lamb in a herd of sheep. We now are more informed and can see the use of leading and negative words. Reuters is a news service Sir. Save your un-covert sheep herding for the real sheep. We are wise to leading words. This is from a 60 yr old retired machinist with only a high school diploma. But my 60+ years has opened my eyes to the people who are very self serving, self important ramblers.

Posted by RickinWNC | Report as abusive

The impact of erosion of any trade relation with China, will benefit US more in the long run.

Posted by Mott | Report as abusive

The xenophobia bit is interesting. Was there not a high degree of American dislike of China, and Japan and other Far Eastern nations in the not-so-distant past? Prior to world War II? Something about ‘yellow peril’? Is it not possible that this China-bashing is just a modern reincarnation of an old phobia/fear? Just wondering.

Posted by Gotthardbahn | Report as abusive

Wow, this commentary is so far off the mark that I scarcely know where to begin. In suggesting that China is a scapegoat for xenophobes, it seems that Mr. Pethokoukis is clueless to the extent of the damage done to the U.S. economy by our trade deficit, about half of which is due to China.

In the wake of the global economic collapse of late 2008, virtually all world leaders and economists agreed that the real underlying cause was global trade imbalances, providing the fuel for shady Wall Street machinations designed to funnel trade dollars back into the U.S. economy. While publicly agreeing at G20 meetings to work to reduce those imbalances, China (along with others) has actually done everything it can to maintain and grow its trade surplus with the world, especially the U.S. China is no dummy. It understands full well the value of a trade surplus and the hazards of a trade deficit.

To suggest that rising trade tensions with China are some sort of threat to the economy is preposterous. And to suggest that free trade has historically been a partisan issue, supported by Republicans and opposed by Democrats, demonstrates an ignorance of the facts. Both parties, to their discredit, have been unabashed free trade shills. It was the Democratic administration of Harry Truman that implemented the Global Agreement on Tariffs and Trade (GATT) in 1947, yielding to advocates of untested and flawed early-19th century free trade theories in the hopes of buying off another world war. (It’s no accident that even today, aside from China, the two biggest beneficiaries of this new trade regime are Germany and Japan.) It was the Democratic Clinton administration that granted China MFN (most favored nation) status, opening the door to “free” trade with China. (By the way, it’s a little known fact that the World Trade Organization actually enforces protectionism in favor of two thirds of its member states. But not the U.S., of course.)

Prior to the signing of GATT in 1947, the U.S. employed sensible trade policy to build itself into the world’s preeminent industrial power. In the six short decades since, the U.S. has been transformed into the world’s skid row bum – it’s biggest debtor, literally begging the rest of the world for cash to keep us afloat. It’s a disgusting spectacle. It’s no mere coincidence that, since our last trade surplus in 1975, our cumulative trade deficit of over $10 trillion dollars closely matches the growth in our national debt.

Free trade is based on the theories of economist David Ricardo in the early 1800s, theories that have never taken account of the role of disparities in population density that drive global trade imbalances, making trade with badly overpopulated nations with bloated labor forces and low per capita consumption a sure-fire loser.

As a journalist, Mr. Pethokoukis should spend some time boning up on the causes and consequences of global trade imbalances before he starts accusing candidates of scapegoating and being xenophobes. We desperately need leaders with the courage to change the course of our failed trade policy.

Posted by Pete_Murphy | Report as abusive

30 years of borrowing, reckless spending and endless wars ain’t gonna help with china bashing alone. Structural problems need structural solution. Second, regardless how incompetent congressmen are, corporate America did the outsourcing, not the politicians.

Posted by bkhjon | Report as abusive

Why is it that every news analysis piece in the American press warns of the dangers of American protectionism, but never speaks of Chinese protectionism? Are we simply supposed to continue kowtowing to our mercantilist master because it’s good for Wal-Mart, Target, and other purveyors of cheap crap?

The simple fact is that China has waged economic war on the United States, and has done so with the full backing of US-based corporations and the United States Government. It is time for American citizens to stand up for America. Free and open trade is a good thing, but we should not participate with regimes whose sole aim is to destroy us by co-opting our own corporate masters.

Posted by JackMack | Report as abusive

Even though there is a lot of political fuel going on on this issue, it is backed by the fundamental reason that China is unfairly manipulating it’s currency to gain a competitive advantage not because they are more productive. I’m a manufacturer and don;t have any problem competing with anyone if we are competing in terms of productivity. Prices should reflect levels of productivity otherwise the consumer ends up buying junk products.

Posted by axiom321 | Report as abusive

So be it. This is the best way to deal headon with the Chinese leaderships. Let us bear in mind that the the power behind this Chinese policy, in matters to trade and public debts, are the aging and brilliant 80’s to 90
years old members of the Communist Central Committee, whoch had lonf foresen the outcome of exteending all kinds of alons, milions, billions, and to trilions,of dollars to the Unted States. For in the end, as they believe, while
drinking their morning cup of tea and ginseng roots, wil make the American society poor, and subservient to the Chinese Comunists.Its simple as that. Its’ happening and only time can tell when are they going to release those standing debts, in the world market, that will caause the collapsing wall street empre to pieces…

Posted by livefreenyc | Report as abusive

I think trade with China needs to be cut back. Given the poor quality and lack of quality control. Many of the importers are just Jobbers, with little recourse for faulty goods. The other day I saw packages of Pink Salmon(Yuk) that were caught in Alaska and printed as a product of China. I think if we care to be a third world country we should just continue worrying about China and their feelings. Maybe we could get foriegn aid.

Posted by fred5407 | Report as abusive

Is it really any suprise that we’re seeing xenophobia in political advertising right now? It’s merely a response to the current anti-everything, hate-filled political climate. You need look no further than the comment sections on other articles on this website to see the rabid attacks and fear mongering. A clear example being the amount of times Barney Frank has been called a queen/pervert (with no intervention by Reuters) as if his sexual preferences had any relevance to his politics.

Posted by gmmw | Report as abusive

We Americans have always been proselytizing to the people around the world on the merits of the sacred American democracy. But at this point, anyone from abroad, sensing the tremendous amount of xenophobia and unreasonableness going up to the midterm election, will easily conclude that American democracy is a sham.

Watching the campaign ads on the TV or listening to them on the radio, you get the feeling that both parties are casting cheap shots, and the audience is projected to be nothing more than a bunch of minions, who are to be manipulated. Unfortunately a lot of us are, sorry for the word, stupid, and prone to this kind of manipulation.

My question here is: In light of this, how are we supposed to sell our democracy abroad?

Posted by Philo33 | Report as abusive

The China/(3rd-world-slave-labor)-loving globalists should’ve thought about “tough China relations” before they let all U.S. jobs get exported there. Globalist propaganda stops being effective when people are jobless and homeless.

Posted by fwupow | Report as abusive

The American Dragon has a hundred heads and only two feet.
The Chinese Dragon has one head and a hundred feet.

Posted by the_halcyon | Report as abusive