Discussion:
The U.S. February trade deficit with China was $18.8 billion [1]. Overall, China now holds over $3 trillion in foreign reserves (Dollars and other currency) [2]. With this leverage, China can dictate financial terms to the U.S. We have allowed our National Security to be held at risk on the hope China will be nice to us. Yet we see China more aggressive in maritime disputes [3]. Moreover, we know there are a number of unfair trading practices that allowed China to accumulate large holding of U.S. currency. Since China joined the World Trade Organization, we have exported millions of U.S. jobs to the communist giant. The question here is how long can we continue along this path?
Recommendation:
We need to target China’s unfair trade practices with the objecting of restoring our economic base. The control used should include fees that will increase our taxes. Perhaps a domestic employment surcharge for products imported from China.
References:
1. Kowalski, Alex, Bloomberg, U.S. Trade Deficit Narrowed in February as imports Decrease, April 12, 2011.
2. McDonald, AP, China’s foreign reserves surge past $3 trillion, April 14, 2011.
3. VOA, China’s Maritime Disputes Fueled by Need for Energy, April 11, 2011.
