Wednesday, April 06, 2005

Command Currency: Senators Try To Hold Back The Tide

Congress weighs currency action....basically wants economic war with China.

Sens. Charles Schumer, D-N.Y., and Lindsey Graham, R-S.C., introduced an amendment Wednesday to a State Department appropriations bill that would slap a 27.5% tariff on Chinese imports if China doesn't revalue its currency within 180 days.

Lawmakers have expressed growing frustration over China's refusal to weaken the yuan's peg to the dollar. They contend that the tie has left the yuan significantly undervalued, putting U.S. manufacturers and workers at a disadvantage and contributing to the sharp rise in China's trade surplus with the United States.

"We think there is no more broad-based and serious violation of the spirit and rules of international trade than a purposefully undervalued currency," Schumer said in a statement. "When those conditions are violated, the system must respond or else the actions of one nation will upset the whole global balance."

OK. Lesson today: when trade war fails in objectives, what happens next? History is very clear about this. To paraphrase Clauswitz: "War is trade by other means". Saddam wanted to trade oil for only euros and we invaded his country. The Japanese and Germans justified WWII because of trade/currency/debt issues that couldn't be peacefully resolved.

Since we have a fool in the White House and America has made many silly choices, ask Walmart, we now are spiralling down the chute to destruction. The Chinese ride us like we are a wild mustang in the rodeo, desperately trying to throw our rider who simply holds on with a lose and relaxed demeanor. Bush doesn't give a hoot about these things so in frustration, some legislators want to force the issue.

Of course, there is a gigantic fly in the ointment the size of Godzilla: we can't put a single sanction on China or we will see our currency collapse and our debts called as the Chinese presents us with a $700 billion bill due now or rather, they dump our IOUs on the world market even as we must raise $600 billion this year alone to keep our government from collapsing. This is beyond serious, this is the Iceberg in the North Atlantic. We are the USS Titanic.

Culture of Life News is all for living and totally against nuclear warfare. We also don't want a world wide depression.

Greenspan, is everything nice in the neighborhood? "Won't you be mine, won't you be mine, won't you be my neighbor?"

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