Chinese Factory Employees Kidnap American Boss
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  • lukelea

    For an even more extreme example read SHOWDOWN AT CHANGSHA by John C. Alley.

    He was threatened with imprisonment and barely managed to get out of the inner province in which he had located his factory when he decided to shut it down.

    It is easy to forget there is no rule of law in China. Extortion is a way of life.

  • Jim__L

    So no one here actually believes in the Great China Market anymore?

    We granted China MFN status because we expected to sell them lots of our goods. (Instead, we got Wal-Mart collaborating with them to sell us lots of their goods.) Still, there was still hope that Chinese workers, once affluent, would have more money to spend and make the Great China Market a reality.

    Now, are we simply abandoning the country, once it looks like labor is cheaper elsewhere? If MFN could lead to advantages for our export market, then we should be sticking with China, to the point that their workers become more affluent; if it wasn’t a good idea, we should be striking down MFN.

    This is a policy cluster-fail.

    • Corlyss

      We can’t do anything tough with China for two reasons:
      1. This administration doesn’t believe in toughness with anyone but Republicans.
      2. The Chinese own our debt.
      It’s a stork-frog conundrum.

      • Jim__L

        If the Chinese expect that debt to be repaid, doesn’t that give us leverage? If you owe the bank $200 and you can’t pay, you have a problem. If you owe the bank $2T and you can’t pay, the bank has a problem.

        • Corlyss

          That’s the theory.

          All the Chinese would have to do is stop buying our paper. Instant financial collapse. It’s the Mutually Assured Destruction scenario. There’s been as much discussion of the options as there were about nuclear face-offs, brinksmanship, and disarmament in the 50s and 60s.

          • Jim__L

            I thought the Chinese had stopped buying our paper, or so much of it, and the Fed was picking up the slack by buying it — effectively printing money to finance our debt.

          • Corlyss

            No, the Chinese have not stopped buying our bonds. They buy to depress the value of their currency. The Fed is buying additional bonds that it authorized as QE.

          • Jim__L

            It’s ironic that we keep branding the Chinese “currency manipulators” when one way they do so is financing our debts…

            I can’t help but wonder how much healthier our export sector might be if we had a balanced budget.

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