CapitalistMarks

China, year of the tiger.

Posted on 01. Feb, 2010 by scott in economic daydreaming, political munglings

As if America didn’t have  enough problems.

Recession, a still messed up financial sector, overbearing majorities in the House and Senate, two wars, unprecedented unemployment, ongoing political bickering, nutty ideologues on TV & radio, a celebrity President, fearful climate change (?), porous borders, huge deficits, ballooning national debt, rapidly increasing cable rates, Big Macs, french fries and the disappearance, and fall,  of  Tiger.

And thus, speaking of Tigers, on to China . . . a problem that is a growing economic and political threat and one that we are not doing enough about.

China continues to own nearly $1 trillion of American debt (including  $800 billion of Treasury notes), has increasing influence around the Globe, possesses $2.5 trillion of walking around money and is using it to ‘buy’ into future resources that we both need, with a military that is rapidly narrowing the tech gap with the U.S., has a very Communist political system that prohibits real freedom (say goodbye to Google, Shanghai),  can exercise nearly instant and complete control of their seemingly ‘free market’ economic system, and finally, relishes political and economic power that grants them greater clout in the UN and around the world.

On top of that it is the Chinese year of the Tiger.

Seems like everything is going their way.

Should we be worried?

You bet’cha (as Sarah Palin would say from her modest home in Wasilla).

The signs are all over.

Recently, the President confirmed sales of modern Aircraft, weapons and defensive hardware to Taiwan.

China didn’t like that and announced a halt to military exchanges with the U.S. — exchanges that would help lessen the tension and open a mutually beneficial dialogue.

They didn’t care about the benefits — something more was at stake.

Chinese leaders are acting like petulant children who won’t share their candy.  They have always taken such an approach.

This time it is different though . . . they don’t seem to care what ‘our’ leaders think about them and they don’t really expect change.  Its all about politics and public relations and the rest of the world is their audience (excluding America).

In their own minds they deserve better–or they just don’t care what we think.  In their opinion the American markets for Chinese goods is shrinking . . . so the leaders in China find us less appealing . . . and other global markets are being targeted.

Heck, the President put off a meeting with the Dali Lama just to please them and they were still somewhat less than civil.

What more do they want?

Chinese leadership is increasingly independent of the U.S., and, at the same time,  best buddies with Venezuela, Russia and even Iraq.

How does that old saying go?  The enemy of your enemy is my friend.

Our leadership needs to beware.

At stake is the once inevitable globalization of our Democratic system — our economic model as well.  China’s recent success has third world and developing nations thinking that the option of democracy and American free-market economics isn’t as attractive as once believed.  China’s model is the new answer.

How would the world look with only two systems?  Ours and theirs.  And, since the majority of nations and populations are in the third world or developing category that are now inclining toward them — we could end up as the minority.  Odd man out.

Not good.

We have to counter with wise policies to end recession and reignite our economy.  We also have to come up with quick ideas to rebuild our demonstrably better political system.

Not going to be easy.

Obama has to lead — not ’shine.’

Congress has to act — not react.

The FED, the Treasury, Congress, and the President have to monitor the recession and start raising interest rates and taxes as soon as a recovery is evident.  Political change is as important as economic change.  And both need to bring a clearly ‘better’ result.  Soon.

Democrats and republicans alike should have enough confidence in themselves and their parties to push for a constitutional amendment that would create term limits on all elected offices.

Further the government, from Washington D.C. to Wasilla, Alaska, should follow-suit .

If we follow this plan we can be back in the global ‘driver’s seat’ in about four years.

American should, and can, return to greatness.

Level-headed economic policy (including debt reduction) and term limits are two good places to start.

2010-2014 can by our years of the tiger-beater (and maybe Tiger Woods will back us up too!).

thanks for the photo to flickr’s law_kevin

Tags: china, china versus U.S. political systems, economy