January 18, 2011

US-China Summit: China Policy in Disarray

WASHINGTON, DC -- On the 20th anniversary of the fist Gulf War crisis Chinese President Hu Jintao arrived today for a state visit. Chinese flags fluttered across the cold American capital as the usual China gatekeepers pontificated in print and airwaves about the need for China to be "responsible" and the importance of the stale policy concerns of Washington toward Beijing.

America's China policy is bereft of innovation and woefully outdated. Now defined by both State and Treasury Departments neither Tim Geithner nor Hillary Clinton offer anything new. Geithner continues to stress currency an issue where he knows the USA has no high ground (the USA is as much a currency "manipulator" as China or Japan or the EU) and Geithner knows full well the USA will never get China to budge on Yuan appreciation. As for State Hillary Clinton trotted out human rights concerns that sounded like leftovers from her time at the UN Conference on Women in Beijing. China's human rights record hinders investment she says. Really? Yet China remains the world's top destination for foreign direct investment.

The reason the unacknowledged anniversary of Gulf War I is important is because both nations are dependent on the steady flow of Persian Gulf oil - China even more so than the USA. In January 1991 China came out in full support of Kuwait and the rhetoric behind the air strikes against Saddam Hussein. Only a few months earlier in July 1990 Beijing established relations with Saudi Arabia and the quest was on for oil contracts Chinese leaders knew the country would soon need. By 1993 China became a net oil importer. Around the same time US oil imports grew faster as domestic production peaked and began a steady decline. Yet there is no talk of "peak oil" or the resource competition underway between our two nations - the world's top two energy users and polluters.

Meanwhile in the background the Pentagon and its friends in the Anglo-American media beat the war drums with scary stories about missile gaps (China's "carrier killer" missiles may make our 12 Navy aircraft carrier groups obsolete!) and Chinese planes that might achieve 1980s level technology.

So can we expect more of the same stupid discourse on China in the 2012 election cycle? Unless something different emerges from this week's meetings I fear we will again kick China policy and our need for cooperation further down the road to mutual destruction.

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