Monday, October 10, 2011

China's currency is not the issue - Janet Carmosky

Janet Carmosky
Trade sanctions in China will not create jobs in the USA, argues China-veteran Janet Carmosky in Forbes. She disassembles three of the most-used arguments in favor of trade sanctions.
Bad argument #3: China’s predatory currency rate has cost America jobs. 
Bad assumption: America is a passive participant in its own fate; if we lose it’s not because we’re not a good team, it’s because the other guys are cheating. 
Fact contradicting bad assumption: In this era and previous eras, every nation that succeeds in creating national wealth in strategic arenas does so by investing specifically and consistently in its national capacity and industrial base.  The United States has not been doing this. China has. The United States has left investment in the hands of a) the private sector, beholden to stockholders who tend to demand quarter on quarter improvement in financial performance. Major long term industrial initiatives call for patient stewardship over years if not decades;  b) elected officials who spend their resources on the short-term goal of getting re-elected.  There’s no upside to focusing on long term issues unless the voters understand and reward it. 
Real reason #3 why China sanctions won’t help create USA jobs:Our political system allows open debate and discourse toward a climate of critical thinking about serious issues.  First among them, declining national competitiveness.  We’re losing competitiveness not only to China, but to every nation that has a plan. Why don’t we have a plan? Because our electoral process and corporate reporting focus on pleasing us, the American voters, customers, citizens and investors. We have bought into the idea that the only time frame that matters is the short term. The jobs crisis? The root cause isn’t remotely related to currency valuations. It’s a lot deeper than that. It’s about the attention span of the American voter.  China is single party rule by the elites. Our political systems calls for an educated voter base – one with tolerance for complexity, stamina in understanding issues, ability to focus on the real game instead of the posturing of the Shake Weight salesmen. We can “hold China to account” all we want; let’s just be sure we hold ourselves and  – especially since our systems were specifically designed for this purpose -  our private and public sector leaders to account as well.
More in Forbes

Janet Carmosky is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch.
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