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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (43282)	9/11/2002 2:06:25 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 281500

take a look at China, whose trade surplus is now running almost double last year, and still expanding these guys hold over $250B in TBonds Indeed they do... And probably will continue to do so until they have a SAFER place to invest that capital. The safety of US public debt has FAR MORE to do with our economic policies and financial transparency than it does with our foreign policy decisions. The Chinese invest that kind of money in US debt because they require the US economy to remain robust. And they need the US economy to remain robust so that they don't have some 200 million Chinese suddenly unemployed by US protectionist policies. That's the quid pro quo.. We'll let you sell here in the US if you buy our bonds. When they no longer need to sell us something to keep their people employed, happy, and with full stomachs, THAT'S when we have to worry. And we'd better hope that they are democratic and tolerant societies when they reach that point. It's VERY beneficial to have the Chinese selling us more stuff than they buy from them ON A POLITICAL LEVEL. It's moderates Chinese policy and places them in a position where they have a tremendous amount to lose from making the US an enemy (and it's not like we're asking for their "first-born"). But on the economic level, it disadvantages the US work force and depresses wages through unfair labor competition. It places the US in the role of a service economy relying upon the rest of the world for basic industrial goods. As in all things, there's a balance to be struck. But it's also imperative that the US must be able to exert its influence around the world so that more economies and political systems resemble our own. There are still too few democracies in the world, and in particular, the Middle East. And given the fact that the muslim world in incurring their version of our "baby boom", it's MORE imperative that we play a direct role in shaping the path those young muslims take in coming years. If anything, it presents a tremendous market for US goods if we create the proper economic and political environment. Btw, here's a better link to Sheihk Yamani's comments about the future of the oil markets. Who should we believe... him or you?: bbc.co.uk It seems the middle east will no longer be able to depend upon selling oil to develop the dysfunctional economies. They will have re-educate and retool to diversify into other industries. And they will have to learn to work at jobs that previously they imported labor to perform. Hawk