Why Obama sucks up to China

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China's VP Xi and Obama


Yesterday, Obama played host to the vice president (and heir apparent) of the People’s Republic of China.
Christi Parsons reports for the Los Angeles Times, Feb. 14, 2012, that Obama greeted Xi Jinping in the Oval Office on Tuesday morning, a venue where U.S. presidents usually receive only America’s closest friends. For that matter, no previous China vice-president has received a 19-gun salute or an Oval Office meeting with the U.S. president.
In a joint appearance before their meeting, Obama told reporters that the U.S. relationship with China is based on “mutual interest and mutual respect,” and that the United States welcomes China’s “peaceful rise.”
If that sounds just a tad obsequious, here are the reasons why:

1. China is keeping the addicted-to-debt U.S. government afloat.

China is a major creditor nation and the largest foreign holder of U.S. public debt (U.S. treasury notes and bonds) at $1132.6 billion as of November 2011.

2. American consumers are addicted to “Made in China”.

Ever since relations between the U.S. and China were normalized in 1979, our bilateral trade has been in China’s favor, and the trade deficits for America grow ever larger every year.
The gap between US imports from China and what we sold China rose to $273.1 billion in 2010, the largest trade imbalance we’ve ever recorded with a single country. While US exports to China grew by a third last year to an all-time high of $91.9 billion, imports worth $364.9 billion travelled in the other direction, an increase of 23.1%.
But, but, we are told that things are improving! U.S. exports to China in 2011 for the first time eclipsed $100 billion!!!
Alas, if we look at what America is exporting to China, the picture darkens.
In a report for the Heritage Foundation’s The Foundry blog, Dr. Derek Scissors shows us why:

Top 10 U.S. Exports to China, 2011

Category Value ($ billion)
Waste and Scrap 11.5
Soybeans 10.5
Aircraft 6.4
Autos 5.3
Semiconductors and related products 5.2
Organic chemicals 3.6
Plastics materials 3.1
Cotton 2.6
Meat and poultry 2.2
Computer equipment 2.0
Sub-total 52.4
All U.S. exports 103.9

Source: https://censtats.census.gov/cgi-bin/naic3_6/naicCty.pl
Dr. Scissors comments;
The leading item is waste and scrap, which certainly does not fit comparative advantage. The performance of agriculture, led by soybeans, does make sense given the huge American lead over the PRC in arable land per person. Aircraft and plastics materials also fit, though the volumes would be higher if the Chinese market were fully open. Autos may be a surprise given recent disputes—the U.S. sends completed cars to China, which sends parts back.
It is reasonable that semiconductors and computer equipment are on the list, but it is seemingly not reasonable that the totals are so low. This becomes stark in comparison to Chinese exports. Including printed circuit assemblies, China exports more semiconductors and related products to the U.S. than the reverse. Computers are far worse: The PRC sends many times the value of computers and equipment to the U.S. than the reverse.
Now let’s look at what China is selling us.

Top 10 Chinese Exports To the U.S., 2011

Category Value ($ billion)
Computers 45.4
Communications equipment 40.0
Computer equipment 21.8
Toys and sporting goods 21.7
Women’s and girl’s clothing 19.1
Audio-visual equipment 16.2
Shoes 16.1
Furniture 15.7
Semiconductors and related products 13.6
Plastic products 8.7
Sub-total 218.3
All U.S. exports 399.3

Source: https://censtats.census.gov/cgi-bin/naic3_6/naicCty.pl
Dr. Scissors asks the billion dollar question:
“Why isn’t the more advanced economy sending technology products to the less advanced economy?
Typically, more economically developed countries use less developed countries as suppliers of raw materials and agricultural products, while the more developed countries supply high-tech goods to the less developed countries. The top 10 US exports to and imports from China are a profile of the typical trade relationship between a less and more economically developed country. It’s just that America is in the role of the less developed partner.
But then, why pay for that which you can steal? (h/t Jay)
https://www.nytimes.com/2012/02/15/world/asia/chinese-official-to-hear-trade-theft-tale.html?_r=1&hpw
In 2010, China became the world’s second largest economy. Last year, the World Bank said that if current trends continue, China will overtake the United States to become the world’s largest economy in 2030.The Standard Chartered Bank in a 2011 report suggested that China may become the world’s largest economy even sooner, by 2020.
But both the World Bank and SCB are outdone by the Organization for Economic Co-operation and Development (OECD).
Using purchasing power parity conversions, the OECD estimates China will overtake the United States in just three years — by 2015. [Source: Wikipedia]
Xi Jiping will be around when that happens. He is expected to take over China’s presidency and is set to lead China until 2023.

UPDATE:

More sucking up: Defense Secretary Leon E. Panetta yesterday welcomed Chinese Vice President Xi Jinping to the Pentagon with full military honors for what was the first ceremony of its kind for a visiting vice president. [Read more, here]
~Eowyn

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0 responses to “Why Obama sucks up to China

  1. I know right? But when a politician does an ad about it…they call him Racist! Go figure.

     
  2. Thank you, Dr. Eowyn, for this most informative post! This is tragic for the United States, to be literally “owned” by another country. As to “mutual” interests, et al., I am not surprised, given that China is still a Communist country and given Obama’s history and activities.

     
  3. this is a chilling article. It makes me sick. Our Country should not be in this shape. The communists,aka democrats some on republican,New World Order supporters,-between EPA have America paralyzed. Drill here,Drill now,get our manufacturing back on track,agriculture,mining-all of it. There are many politicians that are flat out guilty of treason,they know who they are. Let the speedy trials begin. The hell with all these ridiculous rules,regulations. Anyone remember SB 510?? Food Safety B.S. As far as I am concerned the 111th and 112th Congress is NULL and VOID along with aka obama. The nice thing now, they have all reared their ugly heads,including the head of the snake. You can bet,Justice will come.

     
  4. under obamas incompetent leadership he has turned the usa into a third world economy. no more obama if he is allowed to continue as he has in the past we won’t have to worry about the prce of gas or oil most of us will be riding in a donkey cart.

     
  5. Actuality they were filming a new episode of ‘Undercover Boss’…

     

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