Why China Hates U.S. Presidential Elections

In the third and final U.S. presidential debate on Monday, Mitt Romney once again vowed to declare China a currency manipulator on his first day in office. Most Chinese observers think this position is as extreme as it is unlikely, but ever since Romney first made that pledge a year ago, the reaction by policymakers in China has been a mix of frustration and exasperation. “The candidates find fault with China simply to win more votes,” wrote veteran Chinese journalist Ding Gang in the state-run People’s Daily Online. “There must be something wrong with the…[American] political system.”

A Chinese man adjusts the Chinese flag before a point press conference by Chinese Foreign Minister Yang Jiechi and US Secretary of State Hillary Clinton at the Great Hall of the People in Beijing on Sept. 5, 2012. (Feng Li / AFP / Getty Images)

Ding’s article, which ran with the headline “China-bashing: Shame on American Politics,” is an extreme example of the angst—even anger—that many Chinese feel when they listen to American presidential candidates talk tough on China. Most people in China, of course, don’t hate Americans. But Chinese policymakers do hate American elections—especially the effect they have on China’s image in the United States. This year has been especially bad, analysts say, as Beijing has been blamed for everything from the sluggish U.S. economy to America’s high unemployment rate. Coming at a time of declining economic growth in China and fierce competition over trade between the two countries has created considerable tension.

That tension is reflected in the polls. An October poll from the Pew Research Center found that 49 percent of American voters want the U.S. to get tough on China, an increase of nine percent from March of 2011. And only 42 percent of voters want the U.S. to build a strong relationship with China, compared to 53 percent in March of last year. Most of the American angst about China is economic as opposed to military, according to a September Pew poll, with the biggest concerns being the amount of American debt held by China and the loss of U.S. jobs.

Poll results reflect rising friction in China as well. A separate Pew Survey, for instance, found growing wariness and negative perceptions of America compared to two years ago. The percentage of Chinese respondents who characterize their country’s relationship with the U.S. as one of cooperation has dropped from 68 percent in 2010 to 39 percent today. More than a quarter of those surveyed said the relationship was hostile, compared to eight percent two years ago. Confidence in Ratings President Barack Obama also declined significantly, down to 38 percent compared to 52 percent in 2010.

One reason why Chinese leaders in particular dislike changes in Washington: they feel the need “to teach the new American president about the realities of the relationship,” said one Chinese source who requested anonymity because he wasn’t cleared to talk with media. These realities, in the Chinese view, include the need to avoid a trade war that, because of their interdependence, would undermine both economies. The learning curve for U.S. presidents can make for jittery moments. In April of 2001, for instance, not long after George W. Bush took office, a U.S. EP-3 spy plane collided with a Chinese jet fighter in mid-air over the South China Sea. The 24 crew members of the American plane subsequently landed on China’s Hainan Island. After 11 days of intense negotiations over apologetic language, they were released. But the incident turned out to be more protracted and more difficult to resolve than expected.

Outsourcing: WHY IT MATTERS

CHRISTOPHER S. RUGABER | Associated Press

The issue:

U.S. multinational companies have taken advantage of lower trade barriers over the past 15 years to shift jobs and production to lower-wage countries, a practice generally known as outsourcing. That’s cut costs for consumers and helped those companies grow, which can support employment in theUnited States. Still, it has also raised fears that the United States is permanently losing the kind of high-paying manufacturing jobs needed to support a healthy middle class.

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Where they stand:

President Barack Obama has proposed giving tax breaks to U.S. manufacturers that produce domestically or bring back jobs from overseas. He also wants U.S. companies to pay taxes on more of their overseas earnings. Currently, U.S. corporations don’t pay U.S. taxes on overseas profits unless they bring that cash back to the United States. Obama argues that this encourages outsourcing. Many Republicans say his proposal would raise taxes on U.S. companies and encourage them to move their headquarters overseas, so they would no longer be considered U.S. corporations.

Mitt Romney says he wants to make the United States a more attractive place to do business by cutting corporate taxes and reducing regulations. Romney also says he will discourage companies from moving operations to China by pushing that country to let its currency rise in value. That would make its exports more expensive.

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Why it matters:

With unemployment painfully high, it’s not surprising that fears over outsourcing, which first surfaced in the mid-2000s, have returned. Unemployment topped 8 percent for 43 months from February 2009 through August 2012, the longest stretch since the Great Depression. It dipped to 7.8 percent in September.

Also fueling fears is the decision by Apple and other high-tech companies to manufacture many of their goods in China. That suggests it isn’t just low-skilled jobs in industries such as textiles that are being lost.

According to Walter Isaacson’s biography of Steve Jobs, the late Apple founder told Obama in 2010 that there weren’t enough engineers in the U.S. to support its vast manufacturing operations. Jobs also argued that government regulation made it harder to set up factories in the U.S.

WTO hands Obama victory in U.S.-China steel case

Reuters/Reuters – A worker checks on coils of steel at a factory in Dalian, Liaoning province

GENEVA/WASHINGTON (Reuters) – The World Trade Organization barred China on Thursday from imposing duties on certain U.S. steel exports, siding with U.S. President Barack Obama in a dispute with Beijing over a type of steel made in two election battleground states.

The case involved duties imposed by China on “grain-oriented electrical steel,” which is used in the cores of high-efficiency transformers, electric motors and generators. The steel is made by AK Steel Corp of Ohio and ATI Allegheny Ludlum of Pennsylvania.

Although the specialty steel case is tiny compared with other trade disputes with Beijing, the WTO ruling gave Obama a timely win as he defends himself against accusations by his Republican opponent, Mitt Romney, that he is soft on China.

“Today we are again plainly stating that we will continue to take every step necessary to ensure that China plays by the rules and does not unfairly restrict exports of U.S. products,” Obama administration trade representative Ron Kirk said in a statement.

China’s Ministry of Commerce had no immediate comment on the ruling, which arrived late in the evening in Beijing.

When the Obama administration filed the case, the volume of specialty steel trade with China was in the range of $250 million. That pales in comparison with the auto and auto-parts trade at issue in the most recent case Washington filed against China in September. The volume of auto parts trade alone amounted to about $12 billion in 2011, according to the Alliance for American Manufacturing.

Obama blocks Chinese company from owning Oregon wind farm

AP

Citing national security risks, President Obama on Friday blocked a Chinese company from owning four wind farm projects in northern Oregon near a Navy base where the U.S. military flies unmanned drones and electronic-warfare planes on training missions.

It was the first time in 22 years that a U.S. president has blocked such a foreign business deal.

Obama’s decision was likely to be another irritant in the increasingly tense economic relationship between the U.S. and China. It also comes against an election-year backdrop of intense criticism from Republican presidential challenger Mitt Romney, who accuses Obama of not being tough enough with China.

In his decision, Obama ordered Ralls Corp., a company owned by Chinese nationals, to divest its interest in the wind farms it purchased earlier this year near the Naval Weapons Systems Training Facility in Boardman, Ore.

The case reached the president’s desk after the Committee on Foreign Investments in the United States, known as CFIUS, determined there was no way to address the national security risks posed by the Chinese company’s purchases. Only the president has final authority to prohibit a transaction.

A Label That Has Regained Its Luster

From left, John Kieselhorst, Dave Schiff and Scott Prindle, founders of Made.
Photo:Benjamin Rasmussen for The New York Times

REMEMBER the Chrysler K-car? Dave Schiff, a founder of Made Collection, a new flash-sale site that sells only American-made goods, hopes not.

When he was coming of age in the early ’80s, the phrase “Buy American” was epitomized by Chrysler’s boxy, style-challenged sedan, marketed as a star-spangled rebuke to the sleek imports of the day. In Mr. Schiff’s view, you bought one to satisfy a patriotic duty, not a sense of style. “ ‘Made in the U.S.A.’ came with baggage,” he said.

Times have changed. Even as the “Made in the U.S.A.” label has grown scarce, thanks to the offshore manufacturing in apparel and other industries, it has acquired cachet as a signifier of old-school craftsmanship, even luxury.

The movement has come far enough that Mr. Schiff, a former advertising executive from Miami, believed the time was right to start a Gilt-like shopping site for the Americana set, selling items like shuttle-loom jeans, lace baby dolls and a 19th-century-style baseball made of leather sourced from a Chicago tannery.

“The old ‘Buy American’ is get something lousy and pay more,” said Mr. Schiff, 45. Now “it’s a premium product.”

Style bloggers were among the early adopters. “ ‘Made in U.S.A.’ has gone through a rebranding of sorts,” said Michael Williams, whose popular men’s style blog, A Continuous Lean, has become an online clubhouse for devotees of American-made heritage labels like Red Wing Shoes and Filson.

But the embrace of domestic goods has also moved beyond scruffy D.J. types in Brooklyn who plunk down $275 for a pair of hand-sewn dungarees sewn from Cone denim from the company’s White Oak plant in North Carolina. The adherents now include “urban creatives, high-net-worth individuals, locavores, liberals, conservatives,” said Mr. Williams, who also represents some of these heritage brands as a marketing consultant.

In other words, Americana chic has gone mainstream. Just visit the nearest mall. Club Monaco unveiled a Made in the USA collection last year, in collaboration with Mr. Williams. J. Crew cashes in on Americana chic by selling domestically manufactured Alden shoes, Levi’s Vintage Clothing jeans and Billykirk leather goods. Joseph Abboud’s home page trumpets its collections as “Made in the New America.”

The newfound pride also extends to American cities and smaller communities. Made in Brooklyn is a phenomenon so self-aware, there are stores like By Brooklyn that specialize in products made in the borough. Similarly, an old shoe-polish brand called Shinola has recently been revived to make upscale watches, bicycles and other crafted goods in Detroit and is being promoted as “Made in Detroit.”

Romney Adviser Explains Willingness to Break With GOP on China

by Sarah Huisenga

Updated: June 1, 2012 | 4:27 p.m.
June 1, 2012 | 4:12 p.m.

Mitt Romney’s willingness to confront China over issues like currency manipulation, intellectual property theft, and discouraging foreign competition is part of the presumptive GOP nominee’s “innovative approach” to fixing the economy that differs from both Democrats and Republicans, his top policy adviser says.

In an interview airing Friday evening on Bloomberg TV’s Political Capital With Al Hunt, Romney policy director Lanhee Chen said that his boss is interested in trying more than “just traditional Republican policies” to boost the country’s economy.

“I think we talk about the importance of pro-growth tax policy and pro-growth regulatory policy,” Chen said in the interview. “If you look at trade policy, as an example, here’s a place where Governor Romney is really calling for a different approach.”

Chen said a Romney administration would take “robust steps to make sure that China is a player on the international stage that plays by the rules.”

Romney’s position and previous statements toward China’s trade policy have troubled some Republicans, including former Secretary of State Henry Kissinger. Chen said that Romney had been in touch with Kissinger, but that “the bottom line is, Governor Romney is going to do what it takes to get our economy going, including confronting China.”

Asked what a Romney administration would do to help homeowners with underwater mortgages, Chen said that it would not support a “short-term approach.” He argued that the programs put in place by President Obama, like the Home Affordable Modification Program, have not helped large numbers of home owners as expected. Instead of such government programs, Chen argued that the answer is to grow the economy.

“Ultimately that’s what’s going to get the housing market going again,” he said in the interview, “and going to get home values rising again and going to help people who, frankly, currently [are] underwater in their mortgages.”

In talking about financial regulations, Chen reasserted Romney’s desire to get rid of the Dodd-Frank law, and disputed the assertion that repealing the law would lead to “a dog-eat-dog kind of situation where there’s absolutely no regulation.”

“Governor Romney has made clear that we do need some regulation of derivatives trading, that we do need to have some kind of consumer protections in place, that we do need to look seriously at things we can do to ensure that the financial-services industry is regulated in a reasonable way,” Chen said. “But Dodd-Frank is really not the answer. And so I think we have to resist the temptation to caricature what a post-Dodd-Frank world looks like.”

He also said that Romney would seek to replace the so-called Volcker Rule, one part of Dodd-Frank that restricts the ability of banks to make certain kinds of speculative investments that do not benefit their customers.

Copyright 2012 by National Journal Group Inc. • The Watergate 600 New Hampshire Ave., NW Washington, DC 20037
NationalJournal.com is an Atlantic Media publication.

Obama Takes Fresh Aim at China, Touts “Insourcing”

 

By Laura MacInnis | Reuters

MILWAUKEE (Reuters) – President Barack Obama kept up his attack on Chinese trade practices during a campaign-style visit on Wednesday to a Midwest factory, where his call to bring jobs back home was intended to resonate with voters in an election year.

The day after meeting China’s leader-in-waiting, Vice President Xi Jinping, at the White House, Obama cited America’s chief rival a number of times in a speech to promote the potential of “insourcing” jobs back to America from overseas.

“I will not stand by when our competitors don’t play by the rules,” he told workers at Master Lock, a company he lauded in his State of the Union address last month for having moved back about 100 union jobs from China since mid-2010.

“That’s why I directed my administration to create a Trade Enforcement Unit with one job: investigating unfair trade practices in countries like China,” he said in prepared remarks.

Obama took a firm line over trade on Tuesday during his Oval Office meeting with Xi, who is in line to assume the Chinese presidency in March 2013.

This tough stance should appeal to voters in election battleground states like Wisconsin, where Beijing is often blamed for killing American jobs.

Republican presidential hopeful Mitt Romney, a former private equity executive, accuses Obama of being too soft on China and lacking the executive or other leadership experience to steer the U.S. economy toward lasting recovery.

Master Lock, a unit of Fortune Brands Home & Security, is the world’s largest manufacturer of padlocks and related products to secure homes, cars and bicycles. Its story is a positive one for Obama, who must tout his economic leadership to secure another White House term.

The firm says its Milwaukee plant is running at full capacity for the first time in 15 years – an example the White House is eager to replicate as the November 6 election nears.

“They’re deciding that if the cost of doing business here is no longer much different than the cost of doing business in countries like China, they’d rather place their bets on America,” said Obama.

It was his first stop in a three day campaign-style swing when the Democrat will raise funds in California and stop at aircraft manufacturer Boeing in Washington state.

How to cope with a rising China – and compete against cheap Chinese exports – is one of the toughest challenges for Obama to navigate as the election approaches, particularly as opinion polls showing rising U.S. voter frustration with the Asian economic powerhouse.

(Reporting By Laura MacInnis; Editing by Peter Cooney and Cynthia Osterman)

Obama to Draw an Economic Line in State of Union

A signer interpreted President Obama’s campaign speech on Thursday at the Apollo Theater in New York. His third State of the Union address, before a joint session of Congress, is set for Tuesday.

By NYT JACKIE CALMES   Published: January 21, 2012

WASHINGTON — President Obama will use his election-year State of the Union address on Tuesday to define the role for government in helping to promote a prosperous and equitable society as an American tradition, hoping to draw a stark contrast between the parties in a time of deep economic uncertainty.

In a video preview e-mailed to more than 10 million supporters on Saturday, as South Carolina Republicans went to the polls to help pick an alternative to him, Mr. Obama promised a “blueprint for an economy that’s built to last,” with the government assisting the private sector and individuals to ensure “an America where everybody gets a fair shot, everyone does their fair share and everybody plays by the same set of rules.”

Mr. Obama has honed that message for months as he has attacked Republicans in Congress and on the presidential campaign trail, contrasting it with what he has described as Republicans’ “go it alone” free-market views.