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Stephen S. Roach is managing director and chief economist of the global financial services firm Morgan Stanley and oversees the firm's team of economists, located in New York, London, Frankfurt, Paris, Tokyo and Hong Kong. He has written extensively about the emergence of China as an economic power and recently was designated as chairman of Morgan Stanley Asia.Growing resentment over China and its trade and monetary policies could lead to moves in Congress to slap it with a variety of punishments. The idea is to protect American workers and companies from an emerging economic giant powered by a cheap workforce. But will the remedies being considered do anything to truly benefit Americans?
Stephen Roach, managing director and chief economist of Morgan Stanley, is warning Congress that various schemes to punish China will end up doing far more harm to the American economy than anything done by existing Chinese policies. "The real risk is that Washington-led China bashing could trigger a host of unintended consequences -- not only taxing American consumers and U.S. multinational corporations, but also triggering currency and real interest rate pressures that could tip the U.S. economy into recession," Roach told a House subcommittee. But the damage could be even longer term than that, pushing China and Japan more closely together and cutting the United States out of "the world's most rapidly growing region."
However, Roach argues that the gravest tragedy of adopting protectionist policies might be simple wrongheadedness. What ails America's economy is not an artificially propped-up yuan or the gaping trade deficit with China, but deeper structural problems right here at home, "especially skill-set disadvantages of American workers and an extraordinary shortfall of domestic saving," he warns. "Absolutely nothing is gained on either front by blaming China for problems such as these."
POSTED BY: madmilker (May 23, 2007 10:00 AM)
Its "we the people" that count and they have been put down by the Wall Street rich and Corporate greed and nincompoops in D. C. that would sell their soul for a one week vacation in Disney World.
Put this Globalization thing on "hold" and start "thinking".................
WHAT IS GOOD FOR "WE THE PEOPLE" OF THE UNITED STATES OF AMERICA.
POSTED BY: Disgusted (May 23, 2007 10:25 AM)
How much more of this deceit do we have to listen to? NAFTA was a big lie that was supposed to open more trade and increase security for American workers. Instead we have seen American companies rush south of the border to build new factories and send our jobs there. Trade with China was supposed to make American workers more secure but we watched American factories and jobs sent there as well. The excuse that skilled American workers can't be found and we need more green cards is another lie. Top American college graduates find it difficult to even get interviews with American companies who simply don't want to pay the expected American wage and lust only for cheap foreign labor. Our education system is being blamed but the truth is that most of our jobs are being given to third world workers who can barely read. Economic treason has a price. It's only a matter of time before China and the West face off over the earth's remaining resources.
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