How much will taxpayers shoulder?

[Zenda]

"According to the IMF, the observed path of the exchange rate and reserve build up, coupled with information regarding intervention, suggest that the exchange rate was mainly determined by official action, prompting this [crawling peg] classification."

The IMF apparantly labeled China's currency policy as 'crawling peg'. The WTO and US Treasury Department call it a 'managed float'. I'm not quite sure, but that seems to be the same thing. Noone denied this, and China isn't the only country with a 'managed float'.

"While China has relaxed some capital market controls (see below), by and large, the RMB is not traded freely internationally."

Looks to me as if there are forces working against China's efforts. That's not surprising, in a world economy that is based on speculation. Every tendency will be countered if it goes too far or too fast.

"While any assessment of whether a currency is undervalued (and the extent of such undervaluation) is fraught with analytical difficulties, the lack of flexibility of the exchange rate and its alleged undervaluation is seen by some as providing an advantage to China's exports."

The first half of this sentence basically says what I have been saying, which is that you shouldn't tie too much conclusions to some apparant currency undervaluation. The second half acknowledges that some people don't follow that advice.

"Nonetheless, there remains the immediate issue concerning the ability of monetary policy to combat rising inflation. In this regard, a more flexible exchange rate regime could enable China to operate a more independent monetary policy, which would be better suited to ensuring a low and stable rate of inflation, and therefore contribute to a macroeconomic environment more conducive to sustained strong economic growth. A more flexible exchange rate and thus more independent monetary policy would complement structural reforms, especially those concerning the capital market, and obviate the need for price controls and other non-market measures to contain inflation. There are signs that China's exchange rate regime has become more flexible recently; in January 2008, the renminbi appreciated nearly 1.6% in relation to the U.S. dollar, the largest monthly increase since the July 2005 reform of the foreign exchange regime."

Here, the WTO states that more flexible counter-inflation methods would give China several economic benefits. Judging by recent results, the Chinese listened well to this advice. That seems to be the opposite of what you see in it, that the Chinese government is holding their currency down to gain benefit.

but note the backhand: that their exchange rate has improved recently means that it was in a position in need of reform beforehand.

So, improvement is always bad because it means things were worse before?

I think your read of the WTO document is wrong

You got a different interpretation of "complimented China", "expressed their appreciation", "commended China's" and "impressive example"?

You quoted the Treasury Department above, and as I pointed out then, your reading of it was at best selective, at worst completely backwards.

Then Reuters must have made the same mistakes, when they used a headline like U.S. Treasury says China not manipulating currency

... and if you think, for one split second, that I believe the standards of fairness in the world are to be determined somehow relative to the baseline of the United States' actions, then I'm afraid you really need to go back to what I've written about the Iraq war and other such topics.

If this is about my remark on starting wars, then you failed to see it was not about what you believe, but about the unfairness of the harsh reality out there.

[Jester]

There was a colossal post here, but I figured a more elegant way to put it would be to just link to the summary of what Paulson presented to congress earlier in the year.

Specifically on China:

China’s economic imbalances — domestic and external — continue to increase. Inflation has risen above 8 percent, which may be in part due to excessive creation of liquidity in view of China’s rigid management of the renminbi (RMB). China’s current account surplus increased by an estimated $111 billion in 2007 and is now roughly 11 percent of GDP. Official reserves increased by $462 billion in 2007 and by an additional $154 billion in the first quarter of 2008.

To address these challenges, China needs to intensify its efforts to rebalance its economy: boosting domestic demand and consumption-led growth; reforming its financial system; and achieving greater monetary policy autonomy through rapid RMB appreciation and greater flexibility of the foreign exchange regime.

Hence, Chinese exchange rate practices justifiably remain a focal point for the international community. The appreciation of the RMB increased against the U.S. dollar in the latter half of 2007 and early months of 2008. By mid-April 2008, the RMB had appreciated by 18.4 percent since the change in exchange rate policy on July 21, 2005. But the RMB’s appreciation against the yen has been more modest and the RMB has depreciated against the euro. China’s exchange rate practices constrain greater currency flexibility elsewhere in emerging Asia.

On balance, while the recent accelerated appreciation of the RMB against the dollar is welcome, the pace of appreciation needs to continue in order to address the continuing substantial undervaluation of the RMB and the risks China is creating for itself, the Asian region, and the world economy in which China is playing a greater role. Treasury has been reinforcing that message to Chinese authorities on a frequent basis both bilaterally and multilaterally and will continue to do so.

Now read that, and tell me that Paulson isn't saying that China's currency is undervalued because of government control. He *always* stops short of officially defining it as "manipulation", but that's a technical dodge for diplomatic reasons, not something we ought to be taking seriously as objective analysis. The US accuses *no* countries of manipulation, even ones (like China) where it is constantly insisting that they stop doing whatever it is (surely not manipulating!) to their currencies.

Or, if you'd rather a vociferous condemnation, you could always go to the US-China Economic and Security Review Commission, who just straight up accuse China of currency manipulation.

-Jester

[kandrathe]

Then Reuters must have made the same mistakes, when they used a headline like U.S. Treasury says China not manipulating currency.

The operative part being, "US Treasury says...". Reuters did the work of talking to well placed people within the government who disagree. Reuters also seem to grasp what you do not where they say, "The report raps the Chinese for maintaining a weak-currency policy and says such a posture is stunting economic growth for the world's fourth-largest economy."

[kandrathe]

Since your A seems to exist only in the minds of a few people, I'd say it's just B.

And, more importantly, a few people in Congress, including Mr. Prez elect Obama. I'd say its more that a few people like you and Mr. Paulsen are in denial.

Let's see, here is from Senator Obama's own web pages; Obama to Paulson: Defend American Workers and Businesses by Challenging China’s Currency Manipulation

So, its a funny situation where Jester and I are siding with Obama, and you are siding with Bush and Paulsen. Are you sure you are on the right side here? Or, maybe its just be they right or wrong, you side with the ones against the US, or is it a pro-communism thing? Whatever it is, I think you are blinded by it.

[kandrathe]

Or, if you'd rather a vociferous condemnation, you could always go to the US-China Economic and Security Review Commission, who just straight up accuse China of currency manipulation.

-Jester

I guess it might be no surprise that I agree with that report. It's actually the most surprisingly honest document I've seen our government produce since the 9-11 commission report.

[Zenda]

It's odd how you and Kandrathe can agree, when you refer to Paulson to proof your point while Kandrathe claims that this same Paulson is in denial. One of you must be reading things wrong.

...summary of what Paulson presented to congress earlier in the year.

Your link appears to be the former Treasury Department report and it doesn't say things much differently as in the most recent one. That's also what Reuters said:

"However, the Treasury's conclusion that China is not manipulating its currency 'is hardly a bombshell' given that is what it has found repeatedly, an aide to Senate Finance Committee Chairman Max Baucus, a Montana Democrat, said."

The purpose of the report is determine if US trading partners are undermining trade competitiveness. The conclusion is that there are none doing so.

"This report reviews developments in international economic and exchange rate policies, focusing on the second half of 2007,1 and is required under the Omnibus Trade and Competitiveness Act of 1988 (the 'Act')."

"In conclusion, Treasury has not found that either China or any other major trading partner of the United States met the requirements for designation under Section 3004 of the Act during the reporting period, July 2007 – December 2007."

The rest is recommendations for improvement, as in the last report. You can insist that they left out accusations for diplomatic reasons as much as you like, but the fact remains those accusations are not in the report.

Or, if you'd rather a vociferous condemnation, you could always go to the US-China Economic and Security Review Commission, who just straight up accuse China of currency manipulation.

So you finally found a document that somewhat supports your claim. I do wonder why this general thread assessment report is more reliable as the previous sources, in your view. I suppose you also agree with statements like the following?

"China is aggressively pursuing cyber warfare capabilities that may provide it with an asymmetric advantage against the United States. In a conflict situation, this advantage would reduce current U.S. conventional military dominance."

So the Chinese plan to use the Internet to combat the USA. They should stick with normal warfare ofcourse, because that's the kind of war the USA can win (or at least they think they can).

"The U.S.’ ability to promote its foreign policies around the world and to protect its interests may be challenged by rising Chinese influence."

Ofcourse, only the USA is allowed to protect its interests.

[Zenda]

Reuters also seem to grasp what you do not where they say, "The report raps the Chinese for maintaining a weak-currency policy and says such a posture is stunting economic growth for the world's fourth-largest economy."

Well, that quote says that a different, less restricting policy would benefit *China*, which is also what the WTO report said. Wasn't your argument that the Chinese gain unfair advantage?

So, its a funny situation where Jester and I are siding with Obama, and you are siding with Bush and Paulsen.

Why would I have to side with Obama? I already said in a previous thread that I would have voted for McCain, because Obama is too protectionistic on US economy. This information only strengthens my opinion.

It's actually the most surprisingly honest document I've seen our government produce since the 9-11 commission report.

You're joking, right?

[Jester]

It's odd how you and Kandrathe can agree, when you refer to Paulson to proof your point while Kandrathe claims that this same Paulson is in denial. One of you must be reading things wrong.

Kandrathe is claiming that Paulson is being a lily liver by not calling the Chinese out directly on their currency manipulation. I am saying that he is doing it indirectly, but not pushing the envelope as far as he might for diplomatic reasons. We're both saying that everything we've read so far says the same thing: that China is holding down the Yuan, whatever you want to call that, "manipulation" or otherwise.

"However, the Treasury's conclusion that China is not manipulating its currency 'is hardly a bombshell' given that is what it has found repeatedly, an aide to Senate Finance Committee Chairman Max Baucus, a Montana Democrat, said."

... you're reading Senator Baucus' comments backwards. He doesn't mean that China isn't manipulating its currency. He means that it isn't surprising that Paulson hasn't said so, because he's soft on China, and isn't doing enough in the face of what Baucus thinks is obviously protectionistic manipulation. Give him a lookup, he's probably the most aggressive member of the Senate on this issue.

The purpose of the report is determine if US trading partners are undermining trade competitiveness. The conclusion is that there are none doing so.

... while they simulaneously push the Chinese government as hard as they can in negotiations to let the Yuan appreciate. This is diplomatic language, not factual analysis. The Chinese are notorious for being skittish about direct confrontation, and Paulson calling them out directly would hinder, not help, his attempts to get the Chinese to let the Yuan float up.

The rest is recommendations for improvement, as in the last report. You can insist that they left out accusations for diplomatic reasons as much as you like, but the fact remains those accusations are not in the report.

The fact remains that what Kandrathen and I have been claiming China is doing, that report also claims they're doing, right in the passage I just quoted you. The only difference is whether the word "manipulation" appears or not. It appears the Treasury has their own internal definition of what "manipulation" is; I don't. If the Chinese are using capital controls to hold the Yuan down, they're manipulating their currency.

The obvious political issue here is that, if Paulson *did* call it manipulation, it would trigger section 3004, enabling Congress to pass protectionistic legislation in retaliation. Since Paulson doesn't want that (and I think I might be with him on that point), he is not calling a spade a spade. I am not under such pressures, and can call it like I see it.

So you finally found a document that somewhat supports your claim. I do wonder why this general thread assessment report is more reliable as the previous sources, in your view. I suppose you also agree with statements like the following?

*Finally*? Every document that's been linked in this accursedly long thread has said exactly the same thing: China is holding the Yuan down! Some are very bold about it, and accuse them of direct protectionism. Others are sympathetic, and think that China is doing it for good reasons, but doing it nonetheless. Yet others are trying to walk a fine line, suggesting that they revalue upwards and get rid of currency controls, but stop short of making direct accusations. But everyone is in agreement on the main point: the Yuan is being held down by China!

-Jester

Afterthought: Hey, an economist who disagrees! At Stanford, no less. http://www.stanford.edu/~mckinnon/

[kandrathe]

"However, the Treasury's conclusion that China is not manipulating its currency 'is hardly a bombshell' given that is what it has found repeatedly, an aide to Senate Finance Committee Chairman Max Baucus, a Montana Democrat, said."

sigh. And, again you only quoted what sounds good to your position. It is no surprise that Treasury (e.g. Paulsen) has yet again denied that China has done anything wrong. It is no surprise to me either, since they've been with their head in the sand for a decade. You omitted the very next sentence, which clarifies what the aide to Max Baucus meant, But no matter what the report says, China still does not have "an exchange rate that reflects market forces, ensures balanced growth and is appropriate for China's economy today ... And that's dangerous for China, America and the global economy," the aide said.

The purpose of the report is determine if US trading partners are undermining trade competitiveness. The conclusion is that there are none doing so.

The conclusion is wrong, and so says the US Congress as they are even now amending the Treasury act to remove the provision that Paulsen cites, that being that the "currency manipulation" is for the narrowly defined purposes of "competitive advantage". We don't agree, and now you are in the minority position since Congress and the new President will do something about China's unfair currency manipulation.

So you finally found a document that somewhat supports your claim. I do wonder why this general thread assessment report is more reliable as the previous sources, in your view. I suppose you also agree with statements like the following?

I don't want to diverge the topic. The people doing the analysis for the DOD have far better credentials than I do on military matters. I think it is a concern that China is funneling most of its new wealth into an State run investment apparatus to buy all the worlds resources. You probably didn't know this, but of the 1400 some Chinese companies on their stock exchange, over 1000 are owned by the government. I don't think it is a bad thing for the US to carefully consider how it is funneling technology, wealth and power to an adversary.

[Thecla]

Just a few general comments on China, since I happen to be in Shanghai at the moment (where Christmas shopping at the Walmart's, and elsewhere, is in full swing, and where I bought my very own Chinese WoW mouse, not that I play it anymore---unfortunately they only had DII action figures and no Diablo mice, if such things exist anyway).

Of course China is manipulating the Yuan to its own advantage, but economics isn't about fairness, it's about capability; and since China holds about 2 trillion dollars in US foreign currency reserves (while the US, with a little assistance from Dubya, throws away a trillion here and a trillion there) it has a lot of capability.

People are surprisingly unconcerned here about the global financial crisis. They figure that the domestic Chinese market, which has a huge amount of room left, can pick up the slack (8% planned growth instead of 10%) while the US runs through what might be a deep recession. Shanghai is far from typical, but people in China are really cheerful and optimistic about the future. With a large number of well-educated young people, an almost endless supply of dirt-cheap labor, new buildings, trains, factories, computer and internet technology, and eveything else, China is on a rapidly upward trajectory, while the West is going down --- or, at best, holding somewhat level.

The US won't go away, but China is a mindboggling explosive place right now.

[Zenda]

Afterthought: Hey, an economist who disagrees! At Stanford, no less. http://www.stanford.edu/~mckinnon/

I'm not so sure who he disagrees with, since his current research seems to focus on the appreciation of the dollar towards the Japanese yen. So I decided to ask him. We'll have to wait a bit for the answer, ofcourse.

"Thursday, December 18 2008, ...


Dear professor McKinnon,

Your work was brought to my attention during a forum discussion regarding (supposed) Chinese currency undervaluation policy. Since none of us is really qualified to judge in such matters, I was hoping you could enlighten us.

This is the URL to the part of the discussion where you were referenced:
http://www.lurkerlounge.com/forums/index.p...ndpost&p=158849

Our discussion started with someone quoting from another source "... constituted evidence that countries—including China—were manipulating their currency's value for competitive trade advantage. When such a finding is made, U.S. law requires the Treasury Secretary to undertake negotiations to end such manipulation. Current evidence indicates that China is engaged in just such a manipulation of the yuan for competitive gain."

At that point, I disagreed with the accusation towards China. Later, reports from the US Treasury Department and World Trade Organization were referenced (both from 2008), and while I thought those made the same conclusion as I did, my discussion partners claim otherwise. Because you are undoubtly more knowledgeable on these matters as we are, I was hoping you could share us your opinion.

I would be grateful for any reply.

Yours sincerely, ..."

..

economics isn't about fairness, it's about capability

That's a nice way of saying it. Wish I had come up with this :)

Anyway, regardless of how professor McKinnon will answer, this discussion on fairness reminds me of this bully we had in class when I was 12.

One day, he picked me as a victim, and I had to show up for a fight after school. He was a little shorter as me (I've always been a bit long and skinny), but heavier and stronger as most larger kids in school (Well, certainly stronger as me). So I had the choice of fleeing and become labeled a coward, or go and loose a fight. I chose the fight, and decided to try to do him some pain as well, hoping he'd think twice next time (I was young and didn't know that's not how things usually work). Over a dozen kids came watching. When we started, I immediately punched him in the stomach, without thinking. Being used to cowering victims, this obviously surprised him. He started screaming and whining. Then he said I "didn't fight fair" and ran off home.

He never troubled me again, nor other kids from what I can remember.

[Jester]

Well, I don't know that we really needed to solicit his opinion, since it is already online in a series of papers, which I presumed you would search for, rather than ask him directly. But hey, if you hear anything, it would certainly be interesting. I suspect anything a Stanford professor has to say on the topic will overpower anything that's been said here by a gigantic margin. However, his opinion is clearly not the only one being proffered in academic circles; I pointed it out because it was one of the few I could find in a quick search that was in agreement with your position, although not for any reason you've given here.

-Jester

Afterthought: I have no idea what that anecdote is supposed to suggest here. That the US punch China in the gut? That would contradict your argument. What else? I have no idea. Or are you just weaving yarns for our amusement?

[Zenda]

I pointed it out because it was one of the few I could find in a quick search that was in agreement with your position

Now you're confusing me. The only time China is mentioned is here:

He applied this analysis to developing countries and to the former communist states of Eastern Europe and East Asia-with a particular interest in why the Chinese seemed to be more successful in getting the order of liberalization "right".

I interpreted this as a slightly sarcastic remark on how China seems to make progress towards a real floating currency, but 'accidently' uses methods that favor local economy more then other methods. That's not entirely in disagreement with the WTO, though. They too want China to use different methods. But the sarcasme shows, imo, that Professor McKinnon suspects that China chooses the current path of development on purpose, well being aware of all implications.

So I'd say he appears to side with you and Kandrathe, by saying that China does indeed manipulate their monetairy development process for certain benefits, and that he doesn't like them for it. Saying that they strive for undervalued currency because that is favorable for their export is something else, though. Not quite sure what he will say to that, but if he does support it, I'll admit having been wrong about this. Anyway, I never considered him to be on my side from the start.

[Jester]

So I'd say he appears to side with you and Kandrathe, by saying that China does indeed manipulate their monetairy development process for certain benefits, and that he doesn't like them for it. Saying that they strive for undervalued currency because that is favorable for their export is something else, though. Not quite sure what he will say to that, but if he does support it, I'll admit having been wrong about this. Anyway, I never considered him to be on my side from the start.

Well, I didn't just read the guy's bio and leave it at that.

For instance, this recent paper: http://www.stanford.edu/~mckinnon/papers/C...n_Aug-12-08.pdf

His position appears to be that the trade imbalance between the China and the US is a savings phenomenon, and not a monetary one, and that the undervaluation of the Yuan is a myth. I would argue that this is contrary to widely held opinions about the Yuan, but I suppose not impossible, and also that the savings difference between China and the US is influenced by the relative purchasing power of their consumers. By feeding the US habit for borrowing, and suppressing their own domestic ability to import US goods, while preventing capital from flowing freely, they're doing more or less what the US is saying: protecting exports.

-Jester

[kandrathe]

Now you're confusing me. The only time China is mentioned is here:

He applied this analysis to developing countries and to the former communist states of Eastern Europe and East Asia-with a particular interest in why the Chinese seemed to be more successful in getting the order of liberalization "right".

I interpreted this as a slightly sarcastic remark on how China seems to make progress towards a real floating currency, but 'accidently' uses methods that favor local economy more then other methods. That's not entirely in disagreement with the WTO, though. They too want China to use different methods. But the sarcasme shows, imo, that Professor McKinnon suspects that China chooses the current path of development on purpose, well being aware of all implications.

So I'd say he appears to side with you and Kandrathe, by saying that China does indeed manipulate their monetairy development process for certain benefits, and that he doesn't like them for it. Saying that they strive for undervalued currency because that is favorable for their export is something else, though. Not quite sure what he will say to that, but if he does support it, I'll admit having been wrong about this. Anyway, I never considered him to be on my side from the start.

Japan is another matter. They are being the bankers for our ballooning deficit. Bank Of Japan's 2007 Statistics.

[Zenda]

Afterthought: I have no idea what that anecdote is supposed to suggest here. That the US punch China in the gut? That would contradict your argument. What else? I have no idea. Or are you just weaving yarns for our amusement?

I wasn't expecting you'd be needing an explanation to why I was reminded of that episode, but here you go...

The kid always expected to win, especially from me. So, when I surprised him with my lucky punch he was propably too startled to realize he still could have beaten me easily. Then, to save his face in front of the crowd, he accused me of unfair fighting. You see, he always thought it was fair to win because he was stronger as his victims, but loosing apparantly implied that I cheated somehow. Ironically, that might have helped me to get away with it. Maybe he decided quickly (and too fast) that accusing me of unfair fighting would be better as risking another hit.

Now, I could give more hints, but that would really spoil things ;)

For instance, this recent paper: http://www.stanford.edu/~mckinnon/papers/C...n_Aug-12-08.pdf

It's getting too late to read all of that, but on first glance it does seem to be 'on my side'. So I guess you are right, and asking McKinnon is not as useful as I hoped. What can I say? Thank you for giving me another usable reference? :wub:

[Jester]

It's getting too late to read all of that, but on first glance it does seem to be 'on my side'. So I guess you are right, and asking McKinnon is not as useful as I hoped. What can I say? Thank you for giving me another usable reference? :wub:

You're welcome. Now maybe try and find someone sensible who opposes your views. There are a lot of them, you might start with the footnotes from those papers of McKinnon's.

-Jester

Well, here's a gold mine:http://www.ssc.wisc.edu/~mchinn/RMB.html

Everything you ever wanted to hear from economists on the topic. I'm sure there are agrees and disagrees in there. Browsing through, one thing does appear to be a fairly broad consensus, which is that no matter what the Chinese do to the Yuan, the biggest issue with US trade deficits is oil, and that even a total revaluation would only cut the total US trade deficit by a little, not by a lot.

[Vandiablo]

Just a few general comments on China, since I happen to be in Shanghai at the moment (where Christmas shopping at the Walmart's...)

Wow, you're in China right now???

Couldja pick something up at their WalMart for me please?? About a dozen would be good. Just put them in a shipping container. Better make that two dozen, so that a dozen will make it all the way. I'm not sure yet what I'll do with them. I think while I'm waiting for them to arrive I'll start a pharmaceutical company, and when they get here I'll have them start making generics. I'll go to the grocery store and get some baking soda so I'll be ready.

Hopefully if you get two dozen, they already come with buckets and some water bottles.

Oh! Maybe send some "heavy metal" paint, too, so they can make some toys.

-V

ps. Good to see ya! Here, have a bamboo calendar!

[Vandiablo]

You see, he always thought it was fair to win because he was stronger as his victims, but loosing apparantly implied that I cheated somehow.

So the U.S. is a bully, and China's actions are a well-deserved punch in the stomach?

I hope you live to see interesting times. The U.S. has made mistakes, especially during this administration, especially regarding security matters, and especially in the Mideast. Historically speaking, though, I disagree with you. My feeling is that you haven't seen many U.S. administrations.

China is "winning" and the U.S. is crying "unfair" because it is "losing"?? The real losers here are mainly Chinese workers. The bully is not the U.S. The bully is the Chinese leadership that takes the labor and keeps almost all the wealth.

It is not that manufacturing work (or telephone support) is "beneath" us, it's that most of us in the U.S. believe that people's time, no matter their training level, is more valuable than peanuts per day. (a phrase meaning "very cheap")

It is a great disconnect that consumers in the U.S. just buy the cheapest stuff (even if it really is low quality) without regard to long term effects. Most people don't care because they're not directly in manufacturing and it's someone else's problem.

Businesses in the U.S. are often faced with paying more for labor than their competitors and possibly going out of business, or shipping the jobs out to where people will work for peanuts. Companies like WalMart that try to circumvent labor laws exacerbate this process.

It is not the fault of the laborers on either side that this disparity exists. In the case of Chinese goods, it is the Chinese leadership taking most of the value-added from labor and only paying laborers enough to survive. There's your bully -- they bully their workers.

So when you have a story about bullies, I'm thinking more about a Chinese worker and his "manager".

Now a few caveats...

Of course, some of the blame also must go to the first people to buy from sweatshops. The money they "made", if there is a Hell, ought to be enough to send them there. ("The love of money....")

From what I hear, in recent years, China is a little better about giving to labor, and it is more likely that you are paying sweatshops if your product is made further south, e.g., Vietnam or Thailand. Or so I hear.

I feel that relations with China reveal one of the great hypocrisies of the Bush administration. They "un-signed" Kyoto because there would not be a "level playing field" with developing countries with regard to air pollution, but at the same time they were perfectly willing to accept exploitive Chinese labor practices that prevent a "level playing field" for trade. (Is this the paragraph where Occhi tells me I'm wrong?)

-V

[eppie]

It is a great disconnect that consumers in the U.S. just buy the cheapest stuff (even if it really is low quality) without regard to long term effects. Most people don't care because they're not directly in manufacturing and it's someone else's problem.
-V

Indeed, and that is the whole point isn't it. We can keep blaming China, but if we don't buy their stuff the people don't have to fabricate it in poor conditions.
And as the guy who buys up the stuff a junkie steals from people's houses is responsible and will go to prison when cought, the people who buy the stuff are to blame.
Our economies are (were) so good because we could get loads of useful cheap stuff from poor countries and nobody ever complained. Companies like wallmart thrive on these situations (yes owned by those god loving real americans that wont sell your album if it has a naked person on the cover).

I think I have to agree with Zenda here.
Of course I also understand that the US, just like any other country will try to do everything in its own interest, but the non-fair thing seems to pop up now because China is getting such a strong economy (10 years ago we didn't see working conditions in China as such a bad thing). In that sense the bully comparison works for me.