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View Full Version : Democrat Plan and evening out the trade deficit



KazDog
02-19-2007, 02:09 PM
I know I said I have never started a political thread....I guess there is a first for everything.....

I was asked by someone here what the Democrats plan is to get the troops out of Iraq.....Well here is one for starters. It's still being debated.....

http://planforiraq.com/


Also, a legitimate story about how China fears Pelosi and the Democrats....It's about time we bring some equality to the trade deficit....Hopefully Congress can do more of this instead of sitting on their asses like the previous four years....

http://www.usnews.com/usnews/biztech/capitalcommerce/070216/why_the_pelosi_democrats_scare.htm

She scares the hell out of them." That's the way an American businessman, one with strong ties to the Chinese elite and a frequent traveler to Beijing, described to me how that nation's leadership views Speaker of the House Nancy Pelosi. But Madam Speaker shouldn't take it too personally. She probably serves as symbolic shorthand for the Democratic-controlled Congress that took power partly based on a promise to get tough on China. And it sure looks as if it intends to. Earlier this week, Pelosi and other Democratic House leaders called upon President Bush "to present to Congress within 90 days a comprehensive plan to eliminate the surging trade deficits with these 'Big Three' economies [China, Japan, and the European Union] by tearing down market access barriers and eliminating unfair trading practices that have existed for years–in some cases, decades." Also this week, Democratic Sens. Byron Dorgan of North Dakota and Sherrod Brown of Ohio, along with Republican Lindsey Graham of South Carolina, said they were introducing legislation that would strip China of its permanent normal trade status with the United States, subjecting the trade relationship to an annual review by Congress. Brown said in a statement:

U.S. trade policy has failed workers and small businesses across our country. As far as I am concerned, there is nothing normal about allowing our trading partners to use slave labor to compete with our workers. There is nothing normal about manipulating currency to make exports cheaper. There is nothing normal about mouthing concern for intellectual property in the midst of rampant piracy. And if this is indeed normal, then I certainly don't want it to be permanent.

Now there's some evidence that all these threats by Democrats are having an effect. China has been criticized for keeping its currency artificially low to boost exports. So far in 2007,though, the Chinese yuan is one of the fastest-appreciating Asian currencies, up about 0.6 percent. That may not sound like much, but it is pretty notable given that the yuan has risen by less than 5 percent since China ended a direct peg with the U.S. dollar in July 2005. Also back in 2005, Graham and Sen. Charles Schumer of New York cosponsored a bill that would have imposed a 27.5 percent tariff on Chinese imports.

Will there be a United States-China trade war? Protectionism is a major concern on Wall Street right now. In a recent analysis, Morgan Stanley chief economist Stephen Roach compared U.S. trade friction with China today vs. that with Japan in the 1980s–and found today's circumstances far more worrying. Two major take-aways here:

1) Roach notes that as of last year's third quarter, the U.S. current account deficit stood at 6.8 percent of gross domestic product–double the 3.5 percent shortfall hit in the fourth quarter of 1986 when the imbalance was at its worst back then. Japan accounted for 37 percent of the peak U.S. merchandise trade deficit in 1987, whereas the Chinese share is about 29 percent today. But because the trade deficit is much larger today, China's bilateral imbalance is currently about 1.9 percent of GDP–more than 50 percent larger than Japan's 1.2 percent share in 1986. "Consequently, on the basis of this simple calculation, the China factor appears to be considerably bigger than the Japan factor–stoking concerns of the protectionists who claim there is much more to fear from one trading partner today than was the case nearly 20 years ago."

2) In 1986, the pressures of globalization were hitting both business and labor. The profits share of national income of about 7 percent was well below the 10 percent level of a decade earlier, and the labor compensation share of about 58 percent was below the 60 percent level of earlier in the decade. Today, you have a far different situation, with profits at record highs and the share of income going to labor at 40-year lows. Roach concludes:

In essence, capital and labor are working very much at cross-purposes in the current climate, whereas back in the late 1980s they were both in the same boat. ... In the late 1980s, many of the once proud icons of corporate America were fighting for competitive survival at the same time that U.S. workers were feeling the heat of global competition. The pain was, in effect, balanced. Today, U.S. companies, as seen through the lens of corporate profitability, are thriving as never before while the American workforce is increasingly isolated in its competitive squeeze.

In the 1980s, just as with China today, many in the United States were pushing Japan to strengthen its currency. How did that work out for Japan? As Will Hutton, China expert and author of the book The Writing on the Wall: Why We Must Embrace China as a Partner or Face It as an Enemy, told me in an interview late last year:

The more than 50 percent rise in the yen in the late 1980s was the single most important cause of Japan's near 15 years of economic stagnation that followed; if the yuan went up by 40 percent suddenly against the dollar, it would have a similarly devastating impact on China. . . . Such a rapid appreciation of the yuan over a short period could be a tipping point for a wave of unrest, which could threaten the regime's stability. The party leadership sees the demand for fast yuan appreciation as an act of economic warfare. In these terms, you can see why.

And would troubles in China affect America? Here is the scenario that Hutton sees:

China's stagnation would trigger a global slowdown, maybe even recession. ... The World Bank estimates that if China's growth rate fell by just 2 percent, up to 60 percent of China's bank loans would become nonperforming–so threatening both China's and, via Hong Kong, Asia's financial system. The flow of saving to finance the U.S.'s deficit would dry up, probably forcing U.S. interest rates up–so worsening the economic slowdown.

A scary scenario, no doubt–and one both Democrats and Republicans should do their best to avoid.

jcindaville
02-19-2007, 02:13 PM
:gives:

KazDog
02-19-2007, 02:18 PM
:gives:

You may, if these right wing Nazi's take away your rights to gambling, porn and having sex with other men....:dontknow: :red: :red:

KAZ

gbell
02-19-2007, 02:36 PM
I know I said I have never started a political thread....I guess there is a first for everything.....

And would troubles in China affect America? Here is the scenario that Hutton sees:

China's stagnation would trigger a global slowdown, maybe even recession. ... The World Bank estimates that if China's growth rate fell by just 2 percent, up to 60 percent of China's bank loans would become nonperforming–so threatening both China's and, via Hong Kong, Asia's financial system. The flow of saving to finance the U.S.'s deficit would dry up, probably forcing U.S. interest rates up–so worsening the economic slowdown.

A scary scenario, no doubt–and one both Democrats and Republicans should do their best to avoid.


The problem with pissing off the Asian markets is that for the last 20+ years, they have been the primary buyers of a gov't backed securites (bonds). If their economy is starved off due to high tariffs, they can sell the bonds to raise cash and force our interest rates sky high. Everything would come to a grinding halt if that happens from real estate to business spending. Been brewing for a LONG time. And I wonder if all the peeps who live at Best Buy with the flat/big screen tv's and gadgets will like the fact that their costs will double?

KazDog
02-19-2007, 02:54 PM
U.S. trade policy has failed workers and small businesses across our country. As far as I am concerned, there is nothing normal about allowing our trading partners to use slave labor to compete with our workers. There is nothing normal about manipulating currency to make exports cheaper. There is nothing normal about mouthing concern for intellectual property in the midst of rampant piracy. And if this is indeed normal, then I certainly don't want it to be permanent.

Now there's some evidence that all these threats by Democrats are having an effect. China has been criticized for keeping its currency artificially low to boost exports. So far in 2007,though, the Chinese yuan is one of the fastest-appreciating Asian currencies, up about 0.6 percent. That may not sound like much, but it is pretty notable given that the yuan has risen by less than 5 percent since China ended a direct peg with the U.S. dollar in July 2005. Also back in 2005, Graham and Sen. Charles Schumer of New York cosponsored a bill that would have imposed a 27.5 percent tariff on Chinese imports.


You are probably right Gbell it would impact the interest rates. Like most 'good' stories written, they give both sides of the outcome of this type of action....With that in mind, if China isn't at least pressured, the trade deficit and labor issues there will never change....This is a good start to at least making China react and change their current course with regards to the trade deficit with our country....

KAZ

gbell
02-19-2007, 03:14 PM
You are probably right Gbell it would impact the interest rates. Like most 'good' stories written, they give both sides of the outcome of this type of action....With that in mind, if China isn't at least pressured, the trade deficit and labor issues there will never change....This is a good start to at least making China react and change their current course with regards to the trade deficit with our country....

KAZ

Well the other question remains; is it supply or demand? If people weren't eating up every gizmo out there, every flat screen out there, and anything else that leads to a trade deficit, there wouldn't be one. So should the gov't now regulate what people can or can't by? ( I know BC will throw in his shot about gambling, etc) If we weren't to get involved in how Iraq deals with their sectarian violence, surely the connect could be made that the US has no right to tell China how to conduct business. And if tariffs were thrown on all imports, prices would skyrocket, and could lead to China putting their own tariffs on US products (if there are any left!)

longnex
02-19-2007, 03:16 PM
Well the other question remains; is it supply or demand? If people weren't eating up every gizmo out there, every flat screen out there, and anything else that leads to a trade deficit, there wouldn't be one. So should the gov't now regulate what people can or can't by? ( I know BC will throw in his shot about gambling, etc) If we weren't to get involved in how Iraq deals with their sectarian violence, surely the connect could be made that the US has no right to tell China how to conduct business. And if tariffs were thrown on all imports, prices would skyrocket, and could lead to China putting their own tariffs on US products (if there are any left!)
gbell you better watch your politics to sports posts. I believe its 7/3.

gbell
02-19-2007, 03:24 PM
gbell you better watch your politics to sports posts. I believe its 7/3.

I have yet to ask if that is responses or threads started!!!:red:

KazDog
02-19-2007, 03:41 PM
Well the other question remains; is it supply or demand? If people weren't eating up every gizmo out there, every flat screen out there, and anything else that leads to a trade deficit, there wouldn't be one. So should the gov't now regulate what people can or can't by? ( I know BC will throw in his shot about gambling, etc) If we weren't to get involved in how Iraq deals with their sectarian violence, surely the connect could be made that the US has no right to tell China how to conduct business. And if tariffs were thrown on all imports, prices would skyrocket, and could lead to China putting their own tariffs on US products (if there are any left!)

1st....The Biden plan states clearly to allow all the various factions in Iraq a piece of the pie. With everyone getting a fair share, they may not be so eager to fight amongst one another...

2nd...We don't have a right to tell China how to conduct business. However, unless they are threatened into changing some of their business philosophies, the problems with trade deficit will only escalate. I think the problem is more about why the EU, China and Japan are not importing our products. We have plenty to sell and unless there is pressure being applied, the international community will turn its back on our country.

KAZ

kbsooner21
02-19-2007, 03:45 PM
Good luck with that plan Dems

KazDog
02-19-2007, 03:50 PM
It's a lot better plan than throwing more troops into the fire just to get killed by people who don't want us there.....This plan solves the problem by allowing everyone of the waring parties a piece of ownership to the country. If everyone benefits from a prosperous Iraq, they wouldn't have a need to fight or argue. The plan is in its infancy, buts it's a better thought than this stupid war......It's called compromise

KAZ

kbsooner21
02-19-2007, 04:08 PM
Step #1 of the plan.

How exactly are they going to go about "giving Irag's major groups breathing room in their own regions?"

KazDog
02-19-2007, 04:13 PM
Read the plan you tool....I supplied a link. It explains exactly how...

KAZ

kbsooner21
02-19-2007, 04:15 PM
Read the plan you tool....I supplied a link. It explains exactly how...

KAZ
I did you horse's ass :red: my point is all 3 groups are living amongst each other are they not?

KazDog
02-19-2007, 04:18 PM
Yes they are....But if each group has an equal share and a vested interest in seeing Iraq grow and become prorerous, they will not be so concerned with fighting and bickering. It's not a fool proof plan, but it's not a bad one either. You may very well see this plan get implemented, once that horses ass is out of office....Biden will more than likely use this plan to launch his nomination for presidency

kbsooner21
02-19-2007, 04:19 PM
Yes they are....But if each group has an equal share and a vested interest in seeing Iraq grow and become prorerous, they will not be so concerned with fighting and bickering. It's not a fool proof plan, but it's not a bad one either. You may very well see this plan get implemented, once that horses ass is out of office....Biden will more than likely use this plan to launch to nomination for presidency
So you think these grown adults are just going to smile and grin and nod their head as you kick them out of their homes and tell them to go to their appropriate corner??

KazDog
02-19-2007, 04:23 PM
No.....but giving everyone an equal opportunity there, and not having one faction rule over all the others, you will see a lot less unrest. Why fight and get nothing when you can join together and make more for your own people? They will be much more happy to have us out of there and try this, than to continue to tear up the country with civil unrest....It makes sense KB!

jcindaville
02-19-2007, 04:25 PM
:gives:

KazDog
02-19-2007, 04:27 PM
JC....Don't be a tool!

You may learns sumthangs everys once in whale....

kbsooner21
02-19-2007, 04:47 PM
No.....but giving everyone an equal opportunity there, and not having one faction rule over all the others, you will see a lot less unrest. Why fight and get nothing when you can join together and make more for your own people? They will be much more happy to have us out of there and try this, than to continue to tear up the country with civil unrest....It makes sense KB!
Okay, since we've ruled out #1 having any chance of working, onto #2. "Secure the support of the Sunnis -- who have no oil -- by guaranteeing them a proportionate share of oil revenue."

My question is this, you think the Shiite's, who have control over the oil and don't like the Sunni's to being with, are just going to happily give 20% of their profits over to the Sunni's expecting nothing in return?

KazDog
02-19-2007, 05:27 PM
Okay, since we've ruled out #1 having any chance of working, onto #2. "Secure the support of the Sunnis -- who have no oil -- by guaranteeing them a proportionate share of oil revenue."

My question is this, you think the Shiite's, who have control over the oil and don't like the Sunni's to being with, are just going to happily give 20% of their profits over to the Sunni's expecting nothing in return?


Yes....If the Shiite's believe they can become more powerful in the region and become more prosperous, why wouldn't they? 20% is not 100%. You reject this plan because it's from a Democrat. Has it been offered up to them? How do you know they won't embrace it? If it means an autonomous Iraq, I believe they would be more than happy to have us gone from there.....

The plan would maintain a unified Iraq by decentralizing it and giving Kurds, Shiites and Sunnis breathing room in their own regions - as provided for in the Iraqi constitution. The central government would be responsible for common interests, like border security and the distribution of oil revenues. We would secure support from the Sunnis - who have no oil -- by guaranteeing them a proportionate share (about 20 percent) of oil revenues. We would increase economic aid, ask the oil-rich Arab Gulf states to fund it and tie all assistance to the protection of minority rights and the creation of a jobs program. We would convene a regional conference to enlist the support of Iraq's neighbors and create a Contact Group of the major powers to enforce their commitments. And we would ask our military to draw up plans to responsibly withdraw most U.S. forces from Iraq by the end of 2007 - enough time for the political settlement to take hold.

jcindaville
02-19-2007, 05:28 PM
JC....Don't be a tool!

You may learns sumthangs everys once in whale....


but i am good at it:red:

kbsooner21
02-19-2007, 05:31 PM
Yes....If the Shiite's believe they can become more powerful in the region and become more prosperous, why wouldn't they? 20% is not 100%. You reject this plan because it's from a Democrat. Has it been offered up to them? How do you know they won't embrace it? If it means an autonomous Iraq, I believe they would be more than happy to have us gone from there.....



Totally false! I don't believe this plan would work, I don't care if George Bush himself drew it up. How are the Shiite's going to believe they will get more power in the region when they are TOLD to give up 20% of their oil revenues??

gbell
02-19-2007, 05:33 PM
I would wonder who would be in charge of "enforcing" this, and what repercussions would exist if it doesn't go according to plan. If the American public and Congress is constantly complaining about...

KazDog
02-19-2007, 05:38 PM
Totally false! I don't believe this plan would work, I don't care if George Bush himself drew it up. How are the Shiite's going to believe they will get more power in the region when they are TOLD to give up 20% of their oil revenues??

Come on KB, you can't be that backwards.....The country is totally decimated from this war and the previous war by Bush Sr. We and the UN have had economic sanctions placed on their country for years now. If the Shiites agree to give up 20%, how can they not want to embrace this. Sanctions would be lifted as well as embargos. They will have free trade. That country could have been wealthy beyond their own dreams had it not been for a dictator who used up a great deal of the wealth for his own benefit. Iraq will be far better off and we will convince the Shiites that they will be as well, if this plan is implemented. Of course the other Arab countries will have a hand at convincing them as well. I don't think it's going to be that difficult and YOU ARE NOT EVEN GIVING THEM A CHANCE TO SAY NO!.....

gbell
02-19-2007, 05:41 PM
. Of course the other Arab countries will have a hand at convincing them as well. I don't think it's going to be that difficult .

The biggest obstacle I see would be Iran. They certainly don't want a stable Middle East. They would continue to "stir the pot" to make sure this would never happen I think.

KazDog
02-19-2007, 05:46 PM
The biggest obstacle I see would be Iran. They certainly don't want a stable Middle East. They would continue to "stir the pot" to make sure this would never happen I think.

I agree with you about that....But they are only one faction of a large Arab region. The Saudi's, Syrian's have all said they'd help out. Although I'm not sure which is the lesser of two evils for Iran.....Having an autonomous Iraq as we pull out of the country or having the civil unrest with us being in their backyard....That's something only the Iranian's could answer...