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United States And China: Trade War

Updated on October 23, 2011
Overloaded Cargo Ships With Goods From China
Overloaded Cargo Ships With Goods From China | Source

The following is more of a blog post than anything else it contains facts that are impossible to ignore and also some of my opinions based on those facts.

Long ago China and the United States signed an agreement that allowed free trade between the two nations. The United States up until recently has followed that agreement in good faith however China never really has.

Since putting pen to paper China has continued to do the following that have shown that the free trade agreement that was signed is not worth the paper it was printed on:

Creating national laws that companies outside China cannot do business in China

These laws stop Chinese companies and assets from being purchased by non-chinese companies. Which means if a Chinese company wants to sell their business to a company from the USA they that is against the law. If a US business wants to open business in China this is also against the law.

The only thing that is allowed is for a US business to enter into a partnership with an already established Chinese business. But what happens is the US company ends up paying their partner millions possibly making almost nothing, just breaking even or losing money (sometimes for years) just in the hopes that one day when there are more Chinese middle class buyers thay may make money.

This violates the free trade agreement that was signed to create an open market between the two nations. The United States has enacted no such laws, Chinese businesses have bought up business after business that used to be american owned. They have established their own businesses on american soil and all unhindered by the United States government. Some have even applied for money support programs for business start ups and succeeded in getting funding. Funding I might add is coming from US citizen tax payer money.

ARTIFICIALLY FIXING CHINA'S CURRENCY (YUAN)

For years the western worlds currencies have been allowed to free float this allowed for fairness in trade. But the Chinese government has not allowed their currency to free float and in have always pegged it low against the dollar. This has constantly allowed them to export goods at extremely low prices into the states and made it impossible for US companies that hire US workers to compete. This has always destabilized the US economy and led to the shedding of millions of US jobs and the bankruptcy of many businesses including big name businesses.

Further to this point the trade imbalance between the US is china is so bad that over the past few years China has exported more than 4 times as many goods into the United States as the United States has into China.

THE BOTTOM LINE

If the free trade agreement signed by the United States and China is not being adhered to by China than that agreement is null and void and should scraped. To be following the agreement China would need to open their economy up as the United States has done companies are to be allowed to buy, trade and sell to one another without interference. The Yuan like any other currency around the world needs to be allowed to free float.

If China won't play by the same rules as every other trading partner than any country trading with them should be allowed to do the same thing. Apply heavy tax tarriffs to any Chinese goods entering their nation. Enact laws that make China based companies doing business in their nation to work only with established businesses.

Continuing the allow a foreign nation to take advantage of the american people is wrong and it is up to the U.S. government to protect it's people. This has not been happening in this respect for years. To any american reading this I would urge you to write your member of congress to let them know what you want done about it.

I know also over the past couple decades the amount of foreign born residents of the United States has increased exponentially. To any new immigrants in the U.S. please keep in mind you came to the United States for a reason. You should be against anyone taking advantage of your country. It is now your home and you are a U.S. citizen. Will you allow another nation to take advantage of your new home? Will you allow them to take away what you have gained? Think about it.

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