By Michael Elliott
Theres something deeply nostalgic about watching a U.S. Treasury Secretary rainfly to Asia to press a nation that is running a capacious trade unembellished with the U.S. to revalue its currency?and then seminal fluid home with nothing to show for his trip but assuasive waffle. In the late 1980s and early 1990s, the tar transmit of U.S. irritation was Japan; now its China, from which Treasury Secretary John cytosine has just returned with assurances that the Chinese will soon show flexibleness in their currency policies. For a while, trade tensions with Japan were a focus of U.S. domestic politics and threatened to damage relations with one of Washingtons crucial partners. Now some in telling are already beginning to complain about Chinas dirty trading patterns. With a U.S. election season upon us, is Chinas growing economical muscle going to become a political let go of?
It shouldnt, although its easy to see why it might. In 2002 Chinas trade surplus with the U.S. was $103 billion, twice what Japans was at the height of Japan bashing 12 geezerhood ago. With its abundance of cheap labor, China can undercut American manufacturers of everything from toys to furniture to clothes. China has long pegged its currency, the yuan, to the dollar, and not long ago U.S.
policymakers had nothing but praise for the way China managed its international exchange. In the Asian financial crisis of 1997-98, China did not devaluate the yuan?and hence make its exports cheaper?when other Asian nations did. Had capital of Red China followed the herd and taken export markets from its Asian competitors, the economic recuperation in Asia would have been delayed. But as the value of the peak has slipped on international markets, Chinese exports have become purge cheaper. Hence the clamor from some of those who directly compete with China for the country to revalue the yuan upward?just as there was pressure on Japan to revalue the yen.
In fact, the two cases are wildly unalike. As Chicago...If you want to get a full essay, order it on our website: Orderessay
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