Sunday, June 1, 2008

Trade with China

I recently received this viral email from a friend:

"Are we Americans as dumb as we appear --- or --- is it that we just do not think? While the Chinese, knowingly and intentionally, export inferior and even toxic products and dangerous toys and goods to be sold in American markets, the media wrings its hands and criticizes the Bush Administration for perceived errors. Yet 70% of Americans believe that the trading privileges afforded to the Chinese should be suspended. Well, duh..why do you need the government to suspend trading privileges? SIMPLY DO IT YOURSELF, AMERICA!! Simply look on the bottom of ev ery product you buy, and if it says 'Made in China' or 'PRC' (and that now includes Ho ng Kong), simply choose another product, or none at all. You will be amazed at how dependent you are on Chinese products, and you will be equally amazed at what you can do without. Who needs plastic eggs to celebrate Easter? If you must have eggs, use real ones and benefit some American farmer. Easter is just an example, the point is.. do not wait for the government to act. Just go ahead and assume control on your own. THINK ABOUT THIS If 200 million Americans refuse to buy just $20 each of Chinese goods, that's a billion dollar trade imbalance resolved in our!! The downside? Some American businesses will feel a temporary pinch from having foreign stockp iles of inventory. Wahhhhhhhhhhhh The solution ? Let's give them fair warning and send our own message. Most of the people who have been reading about this matter are planning on implementing this on June 4, and continue it until July 4. That is only one month of trading losses, but it will hit the Chinese for 1/12th of the total, or 8%, of their American exports. Then they will at least have to ask themselves if the benefits of their arrogance and lawlessness were worth it. Remember, June 4 to July 4. EVEN BETTER. . . START NOW.Send this to everybody you know.Show them we are Americans and NOBODY can take us for granted.If we can't live without cheap Chinese goods for one month out of our lives, WE DESERVE WHAT WE GET!Pass it on, America"

It is hard to know where to start with this. First, China is full of poor people. Buying things from China helps make them less poor. Poor people in China are much worse off, on average, than poor people in the US. Thus, buying goods from China is doing good.

Second, why should we care more about people who live outside some arbitrary political boundary called the US border than about people who live inside it? This seems to me, to be blunt, just morally wrong.

Third, it is certainly true that there is much to dislike in China's treatment of Tibet and in their domestic policy. At the same time, there is much to dislike in the way France behaves as well, and I suspect that the same author is not suggesting that we boycott the French, or the Russians, or basically every country in Africa or any other country whose policy leaves something to be desired. We should beware of glass houses here as well. Our own foreign policy is nothing to be particularly proud of.

Fourth, trade is good. Makes people better off. Comparative advantage, etc.