“China Emerges as a Scapegoat in Campaign Ads.” Of course it does. And why not? We all know the problem. Because of the strength of the Renminbi, Chinese workers are not able to purchase foreign-made products, leading to a gross imbalance in trade. Right? So, clearly, the answer is to strengthen the hand of Chinese working families. And the way to do this is to weaken the Renminbi, thus making foreign-made products relatively more affordable than domestic products.
Except that Chinese working families are already 86th in the world, according to the IMF, in per capita GDP. Which means that most Chinese working families are not even able to purchase their own products, much less ours. Weakening the Renminbi would not meaningfully strengthen their purchasing power. What it would do would be to weaken the Chinese currency relative to the currencies of other nations, thus making their products less attractive to our domestic consumers. In other words, it would hurt Chinese working famlies, which are already, as we noted, 86th in the world.
So, why aren’t Republican and Blue Dog “Democrats” raising their voices on behalf of Chinese working families? Why aren’t they demanding a higher Chinese minimum wage law, a shorter working day, better benefits, more vacations, all of which would surely bring the Renminbi more into line with European and North American currencies?
The answer is simple. Strengthening the Chinese working family’s purchasing power would conflict directly with Republican and Blue Dog “Democrat” policy recommendations at home. Their aim is not to strengthen working families. Their aim is to strengthen the hand of the wealthiest investors. By weakening the Renminbi, they help the already bloated upper one percent of US investors. And while this will do little or nothing to help average working families, it will do miracles for the wealthiest among us.
Moreover, by weakening the Renminbi we make the Chinese themselves responsible for rising prices of Chinese goods here in the US. In other words, its a win-win formula for domestic capital. Without actually strengthening the hand of working families in America and weakening the already pathetically weak hands of working families in China, Republicans and blue dog “Democrats” can claim that they are “pro-labor.” Its a ruse, or what we in Wisconsin used to call a “hornswaggle.” The rich are made to benefit by tricking the poor. That’s why its a win-win.
Of course politicians are blaming China. Otherwise they would have to face and openly admit to their own hostility to working families both here and there. The alternative would be to demand that the Chinese strengthen their protections of independent labor unions, establish significantly higher minimum wage and pension laws, and significantly strengthen their regulation of private business. But, while that would definitely help working families here and there, I guess it would hurt the wealthiest 1% of the investment community.
Which is what in fact lies behind the most recent round of China-bashing.