Blame it on China

Toughening Its Line, U.S. Warns China About Currency
By EDMUND L. ANDREWS
The New York Times
May 18, 2005
WASHINGTON - The Bush administration warned China on Tuesday that its currency policies were distorting world trade, and it brandished the threat of retaliation against the country's exports if Chinese leaders did not change course in the next year.

In language far harsher than it has used before, the Treasury Department declared that China's fixed exchange rate between its currency, the yuan, and the dollar posed a risk to its economy and the economies of much of the rest of the world.

The administration stopped short of accusing China of outright currency manipulation, a move demanded by American manufacturers who complain that the Chinese have artificially undervalued their currency to make exports cheaper in the United States.

But the new language marked a change in relations, which the administration has until now handled with painstaking delicacy.

"Current Chinese policies," the Treasury Department said in a report to Congress on Tuesday, "are highly distortionary and pose a risk to China's economy, its trading partners and global economic growth." [...]

Comment: Yup, it's all China's fault! We are meant to believe that the outsourcing and offshoring committed by American companies is irrelevant. We are supposed to forget all about the massive US trade deficit and the sky-high personal debt levels in the US. Above all, we must never even consider that the Bush administration's war on terror has done nothing but harm the US economy and the average US consumer as mountains of cash are dumped onto the military and arms manufacturers, even as ordinary Americans can't find jobs, must pay exorbitant medical insurance premiums, and watch helplessly as their financial nest eggs are obliterated by psychopathic corporations and their psychopathic pals in government.
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