POREG VIEW: This New York Times despatch show cases the manifestation of shadow boxing between the US and China in matters trade and currency. There is a sense of frustration in Washington on the assertive posturing by Beijing. But it is unprepared to go the full hog lest it throws up new issues. Also disturbs the back channels.
Hence while announcing plans to a complaint that China is illegally subsidizing its clean-energy industries, the Obama administration has decided to delay its semi-annual report on foreign-exchange rates. The report was due Friday Oct 15. It is eagerly awaited to know whether China is indeed a currency manipulator, as alleged.
Not every one is impressed by President Obama moves vis-à-vis China particularly on currency issue, which will dominate the G-20 meeting in Seoul next month. The growing frustration at the White House is echoed by New York Democrat Senator, Schumer, saying that the Obama administration is treating ‘the symptom, but not the disease’.
That there is a bi-partisan on Chinese planks in American parliament goes without saying. Only last month the House of Representatives voted overwhelmingly to threaten China with tariffs on a broad range of Chinese exports to the United States.
So, with Congress backing assured, President Obama could put his best foot and fist forward. But he is not.
On the other hand he waited till the United Steelworkers, America’s largest industrial union filed a complaint that Chinese export subsidies were against the WTO norms and that it has undermined the interests of America’s energy sector. The issue involved as much jobs as clean energy sources.
Significantly, the workers union has cited China’s restrictions on the export of rare earth minerals to Japan after a public spat over fishing rights in the common sea. These minerals go into making of everything from Japanese mobile phones to hybrid gasoline-electric cars like the Toyota Prius.
Why the free-market economies are so taken in by the state–led, export–powered growth which keeps people at bay. A 21st cenytury Soduku!
