US-China trade war looms

[AGENDA21]

American senators could vote this week to slap tariffs of 27.5 per cent on all Chinese goods, amid a rising clamour of protectionist anger on Capitol Hill.

The sponsors of the so-called Schumer-Graham Bill were in Beijing last week - Chuck Schumer's first official trip overseas in 25 years - to press home the message that China's cheap currency gives it an unfair advantage over the Americans. Schumer, a Democrat who represents New York, and his Republican co-sponsor, Lindsey Graham of South Carolina, have been promised a vote on the measure by the end of March.

Beijing announced a revaluation of the yuan last year, but so far it has only been allowed to appreciate against the dollar within tight limits - too slowly for Schumer, who said in Shanghai on Friday: 'We are not going to give up until we've seen a plan .'

The US ran a trade deficit of more than $200bn with China last year, as shoppers sucked in low-cost consumer goods from the fast-growing economy. Like Japan in the Eighties, China is the target of protectionist rhetoric.

http://observer.guardian.co.uk/business/story/0,,1739428,00.html?gusrc=rss

[fasttense]

1. What, you mean we haven't been in a trade war before now?

Of course we have and China won. That's why all our good paying jobs have moved over there along with our manufacturing base. We already had the Trade War with China and the United States Lost.

[entanglement]

2. From the article

"Chinese premier Wen Jiabao made it clear that he has no intention of acceding to US politicians' demands. 'It is unfair to make China a scapegoat for structural problems facing the US economy,' he said."

[rman]

3. Trade war between the US and US corporations

Many Chinese goods are produced by US corporations in China - or perhaps the US corporations will be exempt from these tariffs?

If they can pay lip service to "free trade" -and- impose tariffs at the same time, anything is possible.