The Chinese press has issued a fairly blistering condemnation of the USA, holding us responsible for the financial crisis and contending that we have plundered the worlds wealth by the hegemony of the dollar. While it’s unquestioningly true that the dollar has been, and continues to be, the “reserve currency” for the world it’s quite unlikely that it will remain so for much longer. First the Europeans are dead set on changing the world economic system to their liking and, to that end; they’ve been seeking allies in China. European leaders like Sarkozy and even Merkel of Germany may have reached a meeting of the minds with China and hope to dominate the Washington discussions of a new global financial system. Clearly the worlds markets are in freefall at the moment, and the emerging markets are now close enough to default to scare the pants off their European Creditors. A run on a bank can be dealt with but a run on countrys assets gets to be a bit sticky. The Chinese are annoyed because as they have become an economic powerhouse it would seem that the worlds markets have come to something of a stop. The Chinese are all dressed up but have no place to go! The Chinese have emerged as a powerhouse of production and manufacturing but everyone is broke and has no need of their products.
While not the official position of the Chinese Government the following article, found on the front page of a Chinese paper, is telling because nothing happens by accident in china. The paper points an accusatory finger at the USA and seems to be suggesting that the USA be defanged if not excluded from screwing up the new global financial markets that are expected to grow from this crisis. I dare say the accusations are nothing new but if Senator Obama becomes President this Anti American philosophy will be familiar to Obama who will be the most left leaning person ever elected President in our history. There is solidarity between the African American and Minority experience taught by colleges and the foreign policy they advocate. Really it’s an extension: White Male Christian Capitalists have exploited people of color and women to build a closed economic system that always favors white males at the expense of all others. The same holds true on an international level; America has exploited the world with its economic power and needs to take a back seat in the world so that economic justice can have a chance. This is essentially what the Chinese paper is saying and it’s essentially the doctrine of multiculturalism in a nut shell. We’ve never had a President who was a true believer in it until about a week from now! Check out this from Reuters and be sure to visit this URL for the full story.
U.S. has plundered world wealth with dollar: China paper
Fri Oct 24, 2008 6:14am EDT
BEIJING (Reuters) – The United States has plundered global wealth by exploiting the dollar’s dominance, and the world urgently needs other currencies to take its place, a leading Chinese state newspaper said on Friday.
The front-page commentary in the overseas edition of the People’s Daily said that Asian and European countries should banish the U.S. dollar from their direct trade relations for a start, relying only on their own currencies.
A meeting between Asian and European leaders, starting on Friday in Beijing, presented the perfect opportunity to begin building a new international financial order, the newspaper said.
The People’s Daily is the official newspaper of China’s ruling Communist Party. The Chinese-language overseas edition is a small circulation offshoot of the main paper.
Its pronouncements do not necessarily directly voice leadership views. But the commentary, as well as recent comments, amount to a growing chorus of Chinese disdain for Washington’s economic policies and global financial dominance in the wake of the credit crisis.
“The grim reality has led people, amidst the panic, to realize that the United States has used the U.S. dollar’s hegemony to plunder the world’s wealth,” said the commentator, Shi Jianxun, a professor at Shanghai’s Tongji University.
Shi, who has before been strident in his criticism of the U.S., said other countries had lost vast amounts of wealth because of the financial crisis, while Washington’s sole concern had been protecting its own interests.
“The U.S. dollar is losing people’s confidence. The world, acting democratically and lawfully through a global financial organization, urgently needs to change the international monetary system based on U.S. global economic leadership and U.S. dollar dominance,” he wrote.
European and Asian leaders have been meeting in preparation for the upcoming Washington Summit on the Economy this November and I suspect the Europeans and the Asians may have agreed on far more of how the financial world should work in the future than we might find to our tastes. I won’t say that the Lame Duck President Bush will get steamrolled, as a lame duck there’s no need to steamroll Bush, and I don’t think President Elect Obama would disagree with, or stand in the way of, implementing a world consensus.
Were John McCain elected I don’t think his economic team would be terribly receptive to the overtures about to be made by France and Germany and even China. It would be interesting to see how a possible McCain Presidency would play out amid the backdrop of this financial crisis but the odds of McCain winning seem to fade more each day.
Consider this from the Seattle Times:
Wen’s remarks were delivered at the close of the two-day Asia-Europe Meeting in Beijing, where leaders of 43 nations issued a statement calling for new rules to guide the global economy and on the International Monetary Fund to take a leading role to aid crisis-stricken countries.
While short on details, the statement calls on the IMF and similar institutions to help stabilize struggling banks and shore up flagging stock markets. “Leaders agreed that the IMF should play a critical role in assisting countries seriously affected by the crisis, upon their request,” it said.
They also agreed to “undertake effective and comprehensive reform of the international monetary and financial systems,” the statement said.
Participants said the statement would provide the basis of a joint Asian-European approach at a Nov. 15 summit on the crisis in Washington involving the world’s 20 largest economies.
The document is one of the strongest endorsements yet for the Washington-based IMF, long known as the international lender of last resort, to take a leading role in the crisis.
French President Nicolas Sarkozy said the Beijing summit had raised expectations for solid results at the Washington summit.
Beijing participants “have all expressed their willingness for the Washington summit to be a place where we make some decisions, and we have all understood that it would not be possible to simply meet and have a discussion, we need to turn it into a decision-making forum,” Sarkozy said.
German Chancellor Angela Merkel called for the IMF to become a “guard for the stability of the international finance system,” and said there was unanimous agreement that it needed to take on a supervisory role.
The IMF, whose loans normally include strict provisions, is discussing loan packages with close to a dozen countries from Iceland to Pakistan, and is examining ways to speed up the process.