May 10, 2007

Trade Winds or War?

The blame China crowd in the USA Congress has new strength now under Democratic Party leadership and a protectionist backlash against Chinese imports may be coming. At least that is the view of the oft-quoted Chief Economist for Morgan Stanley, Stephen Roach.

Sinomania! has been warning for years that if certain special interests and pandering politicians get their way, the siren call at the shopping mall will be "attention [insert major retailer here] shoppers -- all items at thrice the price!"

Rather than address the catastrophe that is the American educational system, the massive financial burden on businesses to pay for employee's health care needs (in the absence of a national health care system), along with all the other ills that plague America's economy, Congress prefers to find blame in the murky world of "foreign trade."

As Roach nices sums up: " Absolutely nothing is gained on either front by blaming China for problems such as these that originate at home. To the contrary, much could be lost – in the US, the global economy, and world financial markets – if Congress makes a major blunder on US trade policy. "

If this concerns you at all, watch the following politicians closely: in the Senate, Max Baucus, Charles Schumer, Lindsey Graham; in the House: just about any representative with manufacturing jobs and labor unions in his/her district.

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