According to the World Trade Organization (WTO), China has passed the United States to become the world’s second largest exporter.  Only Germany exports more goods per year.

 One could ask how an impoverished nation like China, struggling to feed and employ its more than 1 billion inhabitants, could export $1.2 trillion worth of goods in 2007, and at a 26% improvement from the previous year.

 The answer is that China’s ruling regime has made a very deliberate and ruthless practice of building their nation’s manufacturing juggernaut.  In complete disregard of humane labor and environmental standards, they have raced to build massive factories across a host of industries.  While air pollution has become a serious problem in the major cities, and industrial runoff has fouled food and water supplies, Beijing has also steadfastly undervalued the nation’s currency—even though such a practice passes inflationary costs on to their citizens. 

 The result of this reckless, “produce-at-all-costs” mentality is a one-sided trading relationship.  Unfortunately, this slipshod approach has led to numerous unsafe products, with fatally tainted blood thinning medication being just the latest in a string of items ranging from lead-painted toys to poisoned dog food.

China’s currency manipulation, like its rampant subsidies and dumping of artificially devalued products, violates accepted rules of world trade.  Beijing’s continuation of these market-distorting practices is beginning to pose serious questions for the stability of world trade.  As the WTO noted, a further slowdown in global trade “could cut trade much more sharply.”

While it’s clear that China’s reckless production has harmed in its workers (who are prohibited from organizing for better labor conditions), the fallout has made its way to the United States.  The EPA estimates that one-fourth of all California air pollution is traceable to China.  And an EPI report found that the rising U.S. trade deficit with China, which clocked in at a stunning $256 billion in 2007, has cost the U.S. more than 1.8 million jobs since 2001.

Beijing is accomplishing its goal, though.  It is cheating its way to the top of the manufacturing pile, and damn the consequences.

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This entry was posted on Friday, April 18th, 2008 at 5:57 pm and is filed under Holding China Accountable. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.