An open letter to Wen Jiabao

Okay, so it’s kind of a peculiar thing for a small town journalist in northern New York to address directly the second most powerful man in the world.

But maybe it will help, Premier Wen, if you get a taste of the mood on the “American street.”

First, we love trading with you.  It helps us a lot that we can get a vast array of products that are made more cheaply and efficiently by companies operating in China.

It’s also a great thing that the Chinese people are accelerating toward full membership in the world community, with a vast middle class, and a growing range of freedoms.

At present, there is almost no reservoir of ill-will in America for China’s government or its citizens.

In many ways — and this is kind of weird — Americans are more comfortable with communist China than with democratic-capitalist Europe.

For the world’s two biggest superpowers to screw up a relationship this healthy, a relationship that has benefited both our nations enormously, would be tragic, maybe one of the great blunders in modern history

But the second thing you need to understand is that we are screwing it up.

By continuing to manipulate international trade unfairly, China is contributing enormously to the impoverishment of many of the countries, including the US, that you rely on to buy your goods.

According to various estimates, your decision to artificially devalue your currency costs between one and three million American jobs.

A small slice of those jobs vanished from our corner of New York state, where factory closings have gutted once prosperous towns.

In the short term, that may seem like a win for China.  After all, your people are hungry for jobs, too. Using an unfair trading scheme that puts hundreds of thousands of your people to work must seem, on its face, like a great idea.

But one of the things we respect about Chinese culture is that your leadership tends to take the long view.

If you take our jobs not by competing fairly — through innovation, efficiency and smart business practices — but by gaming international currency markets, that’s hardly a sustainable prosperity, right?

And what good is it if you continue to build all those factories, while the consumers of your goods here in America are cast deeper into recession and poverty?

Already, the growth of China’s economy is slowing, not because your people are less ambitious or productive, but because economies in Europe and the US are teetering.

Surely, it won’t do your workers much good if the world tumbles into a depression?

The last thing our two nations need is a trade war.  But legislation now being considered by the US Congress, flirting with tariffs and sanctions, will only be the beginning unless China adopts a more sustainable trade policy.

This isn’t about “giving” jobs to the US.

Even without using currency manipulation to benefit your exports, Chinese factories will have plenty of advantages that will help them compete, including fewer regulations and lower labor costs.

What’s more, if our economies can achieve a better balance, markets on both sides of the Pacific will continue to grow, meaning more jobs, more consumers with cash in their pockets to spend.

But if your formula for China’s rise relies on using dirty tricks that contribute inevitably to America’s decline, it’s impossible to imagine a future with the kind of stability and prosperity that we both want.

Tags: economy, globalization