April 22nd, 2012

During Tuesday night’s debate in New Hampshire, moderator Karen Tumulty challenged Mitt Romney on his recent tough talk on China. Romney says China is a “currency manipulator” and argues that, by setting unfair prices and allowing the theft of American intellectual property, the Chinese government is cheating world markets and must be held accountable

Tumulty pointed out that candidates from George W. Bush to Barack Obama have campaigned as tough talkers to China but upon election take a “much more cautious approach.” Why, she asked, should voters expect anything different from a President Romney?

“I’m afraid that people who’ve looked at this in the past have been played like a fiddle by the Chinese,” Romney said. “And the Chinese are smiling all the way to the bank, taking our currency and taking our jobs and taking a lot of our future.  And I’m not willing to let that happen.” Romney went on to reiterate that he would sign an executive order on his first day in office “identifying China as a currency manipulator” and that he would take that case to the World Trade Organization.

On her radio show Wednesday morning, Laura Ingraham asked Romney whether the U.S. is already in a trade war with China.

“I don’t know that I’d use the term ‘trade war,’ but it’s a trade battle of some kind,” Romney said. “It’s a trade surrender, let me call it that….It’s just crazy for us to be fearful that somehow if we crack down on cheaters that that’s going to be a problem.”

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Reuters

Romney would squeeze China on currency manipulation-adviser

(Reuters) – Republican presidential candidate Mitt Romney is looking at ways to increase pressure on China over what he sees as currency manipulation and unfair subsidy practices, a Romney campaign adviser said on Tuesday.

“I think he wants to maximize the pressure,” Grant Aldonas, a former undersecretary of commerce for international trade, said at a symposium on the future of U.S. manufacturing. Aldonas served at the Commerce Department under Republican President George W. Bush.

Romney, the front-runner in the Republican race to challenge President Barack Obama for the White House in November, has promised if elected he would quickly label China a currency manipulator, something the Obama administration has six times declined to do.

That would set the stage, under Romney’s plan, for the United States to impose countervailing duties on Chinese goods to offset the advantage of what many consider to be China’s undervalued currency.

Last year, the Democratic-controlled Senate passed legislation to do essentially the same thing.

However, the measure has stalled in the Republican-controlled House of Representatives, where leaders say they fear it could start a trade war, and the Obama administration has not pushed for a House vote on the currency bill.

The U.S. Treasury Department on April 15 faces a semi-annual deadline to declare whether any country is manipulating its currency for an unfair trade advantage. The department, under both Democratic and Republican administrations, has not cited any country since 1994, when China was last named.

Asked if Romney was serious about declaring China a currency manipulator, Aldonas answered: “He is.”

Aldonas said he would convey a questioner’s suggestion back to the campaign that Romney prove his seriousness by urging House Ways and Mean Committee Chairman Dave Camp, a Michigan Republican, to take up the currency bill.

However, Aldonas said any currency legislation should also address broader subsidy practices that encourage Chinese companies to build excess production capacity that “spills into our market.”

“So, I’d love to see Dave Camp add something to that bill, which is not just currency but actually goes after the subsidies that bring the excess capacity on the market and actually affects our producers,” he said.

LOSS OF JOBS

White House economic adviser Gene Sperling, in a speech to the same group, did not directly address concerns about China’s currency practices but said there was “no question” that a surge in imports from China had contributed to the loss of millions of U.S. manufacturing jobs in the past decade.

Sperling said the Obama administration had brought cases against China at the World Trade Organization at twice the pace of George W. Bush’s administration and also used a trade provision, known as Section 421, for the first time to stop a surge of tire imports from China.

Immediately after the speech, Sperling declined to comment on whether the administration would take action to curb imports of auto parts from China, as 188 lawmakers urged Obama to do in a letter earlier this month.

But later he indicated the matter was under consideration.

“We take a congressional letter on a trade issue like this very seriously and we are carefully reviewing it,” Sperling said in a statement to Reuters.

The 188 lawmakers, mostly Democrats, accused China of using “predatory” pricing practices to grab an increasing share of the U.S. auto parts market.

“We cannot wait until further damage is done,” the group said in their letter. “Seventy-five percent of the jobs in the automotive sector are in auto parts, and these jobs are at risk in every state in the nation.”

(Reporting By Doug Palmer; editing by Todd Eastham and Eric Beech)

By Mark Bloome

For most citizens what has been going on in Washington D.C. over the raising of the debt ceiling and its effects on our economy has been difficult to understand.  This article attempts to examine the evidence and provide an easy to understand explanation.

WHY WE ARE IN DEBT

For decades members of both political parties have voted to spend more dollars than the income the government receives. In general, the Democrats spent on programs to help the middle-class workers and the Republicans spent on programs that support corporate and upper-income earners.

The unspoken rule of elected officials was, and remains to spend in order to get the most money into their states or districts so they had a better change of getting re-elected.  Elected officials are less inclined to worry about the future because there was little incentive to do so. Under both Democratic and Republican leadership, the deficit has grown exponentially.  Recently the deficit has gone way up.  There are several reasons for this:

·       The Chinese Communist Government has enacted several tactics and policies in attempt to gut-out the American economy. By devaluing their currency, they are enticing the U.S. (and other countries) to send manufacturing jobs to China. As a result, America no longer has the same manufacturing base as a decade ago.  Manufacturing is the foundation of our economy and our foundation has been razed.  Now, the house of the American economy is unstable and not able to recover from the hollowing out of American manufacturing businesses.

o   The reduction in manufacturing and jobs has caused our taxable business profits and taxable incomes from American workers to decline significantly.  Less money coming in from taxes + more money going out through wars and bail-outs = higher deficits.

·       The wars in Iraq and Afghanistan, which some put the cost at over one Trillion two hundred billion $1,200,000,000,000.  Through the purchase of Iranian oil, China has been able to keep money coming into Iran thereby allowing them to finance turmoil in the middle-east and overseas.

·       The bailouts of the large businesses and big banks due to these institutions’ reckless practices of taking very high risks. According to Bloomberg News, over twelve trillion dollars—yep that is TRILLION — were used either to prop up or lend to banks and other businesses such as AIG.  This was not China’s doing but our own. (http://www.pbs.org/wnet/need-to-know/economy/the-true-cost-of-the-bank-bailout/3309/)

WHY WE CANNOT RECOVER

It will be a tough road for the United States over the next couple years because China has done many things to make the USA weak, such as currency devaluation (see “My Dog Song Buys a Bone” at TAPamerica.org). Also, the Communist Government of China has been giving free or very low-cost land and very low interest rate loans to Chinese business to spur production and boost their economy. Free land and low interest rates make it cheaper to produce Chinese goods.  In addition, Chinese workers work long hours for low pay and have little to no benefits.

Further through cyber-spying and theft of intellectual property sanctioned by the Chinese government, have made the costs for Chinese goods cheap.  Thus through most of the above the Chinese have been able to sell lots of cheap goods to Americans.  These practices on behalf of the Chinese economy have caused lots of our businesses to reduce their size, go broke, and/or have their goods made in China.  Our American workers have lost their jobs.  This is why it will be difficult to recover from the recession we are currently facing.  No jobs, no profits, no taxes to run the government.

TRADE DEFICIT MADE EASY

Because China sells us more goods than we sell them, they have what is called a “trade surplus.”  As a simple example: say we spend a hundred dollars on Chinese goods and they only spend $25 on USA made goods.  So they have an extra $75 in dollars.  They take these extra $75 dollars and buy USA Treasuries.  Currently they own over 1.2 trillion dollars in USA treasuries.  Needless to say they want to protect their investment and want to make sure that the U.S. government follows safe and conservative practices.

China wants the USA to cut military spending in order to make the USA militarily weak.  In the meantime China is building offensive weapons, such as nuclear submarines, special missiles designed to attack our aircraft carriers, and their own stealth fighters in order to flex their military muscles to intimidate the USA.

TREASURY BILLS AND TREASURY NOTES

When the USA wants to borrow money to pay for its overspending, it issues treasury notes and bills.  These are IOU’s from the USA government to who borrows the money and because they are considered one of the safest investments (which is what the ratings are all about) they pay low interest rates.

U.S. CREDIT RATINGS

The USA S&P ratings, Moody ratings etc are just like your credit ratings.  How much you earn, how much you owe and how likely you are to pay your debts.  So when the USA credit ratings go down, we have to pay higher interest rates to borrow money.  Our taxes pay for these higher rates.

Our government is frozen in inadequate actions.  The solutions presented in D.C. will not help and in fact, the cut backs in USA spending are likely to cause more unemployment and lower tax revenues.  The USA cannot increase federal spending at this time. Thus we continue the downward spiral of our great country as we are forced to reduce spending on what is needed to sustain ourselves as number one.

TAP America believes that we as citizens need to take a stand. If you want to help yourself and your fellow citizens, take our motto to heart:

“BUY AMERICAN, THE COUNTRY AND JOBS WE SAVE WILL BE OUR OWN.”

Only then will we bring manufacturing jobs back to America and revitalize our great country.

By Stephanie Adams

Why should I (a middle-aged, middle income, mother of 3 who owns a small business) care about buying American made products and services? Why should any of us care about buying local? Well, for me, the answer is simple: I want myself, my children, my community, and my country to have health, security and prosperity.

I own a local business in a small town. When a huge multi-department grocery, retail, drug, housewares, garden, fabric, and hardware national corporate store moved into our town, one-by-one several small locally-owned businesses went out of business. The historic downtown corner hardware store was the hardest to see go. Additionally, most of these big corporate businesses sell products made from cheap overseas labor and then ship them half way around the world unnecessarily polluting the environment and compromising the world’s environmental health.

Do we have a choice here? The answer is: YES. If we purchase locally made, grown, or sold products, we support the true American spirit of opportunity for people, not corporations. We can provide more local jobs, and, therefore more money, right where we live. This also cuts down on long shipping distances necessary to bring vast quantities of cheaply made overseas products to a convenient local location. More money stays in the local economy, providing better funding for schools, libraries and other local services.

So, what about arguments against buying locally? Some may say we are denying these poorer overseas populations the resources American companies could bring them.

Dependency theorists (Vaughn, 1978; Walterstein, 1979; Delcroix & Ragin, 1981; Bergesen, 1983) found that “Multinational investments …actually creates few jobs, inhibits the growth of local industries, and pushes developing countries to produce goods for export rather than food and other products for local consumption.” These issues combined with poor working conditions, bring dependency and further poverty to these countries, not to mention the resulting inevitable poverty that will come to our communities and country.

Some believe that buying overseas products and food from big box stores helps them save money. This might seem like a really good financial idea, but it is only a short-term benefit with drastic long-term consequences. Can buying products made overseas from big corporations really affect your overall and long-term financial prosperity? Really, the only people who will not be affected by this continually escalating practice are the extremely wealthy that make up a very small percent of Americans who own most of American wealth and currently control our government through their high-paid lobbyists. The mega wealthy are cleverly ensuring their place in power through strategic methods. The only real power we have to change this greedy and selfish practice is with our consumer dollar. We are heading toward two very distinct classes in this country: the mega wealthy and the poor…which we will all eventually become, if this continues.

There is hope…take just a moment in your busy day to pay attention to the real choices you have. When you go to “vote with your dollar”, what are you voting for? What are you supporting? Make it a habit to ask yourself the following questions:

1. Can you buy that product, service or food item locally grown or made?
   Remember, this supports the local economy and the environment by reducing shipping distance.
2. If not, can you buy that product made in, or food item grown in, America?
   The prosperity, freedom, opportunity, and the country you save, will be your own.
3. If not, can you buy that service, product or food item from a locally owned business? Mega corporations sell cheap products at the expense of our community, our country and our environment.

Sometimes we don’t have a reasonable choice and we end up having to buy something from overseas. At this time, it can be difficult to find local and American-made groceries and products. Shop local businesses and farmer’s markets first. If we all just paid a little more attention, it would make a very big difference. Each dollar going back into our economy sends a message to Wall Street and to Washington that we are taking back our country citizen by citizen and dollar by dollar.

By Mark Bloome, Founder of TAP America

For many years I ran a successful business and then went into the field of Investment.  What we knew is that the key to our success was sales and top-line growth.  If we did not have revenue coming in, no mater how hard we worked at cutting costs, we still could not turn a profit.

American jobs are the national equivalent to ‘sales’ as jobs are what make our economy strong; They are the gasoline in our engine.  The rich, middle classes, and the poor, the government and private sector all depend on jobs and job creation for survival.  Without jobs there are no profits for the rich, no taxes to pay for welfare for the poor, and obviously no income for the workers.  Without jobs there are insufficient tax revenues for government to maintain our military, our roads, police and fire protection and the many services government provides with our taxes.

Government cannot provide jobs at this time because the political realities of the United States are that we cannot increase our deficits, this is true both politically and from an international economic point of view.  From the international point of view, increased deficits would mean the end of the American dollar being the international reserve currency also known as the anchor currency.  A reserve currency, or anchor currency, is a currency that is held in significant quantities by many governments and institutions as part of their foreign exchange reserves. It also the international pricing currency for products  such as oil, gold, etc.   The end of the USA dollar as the world reserve currency would mean that our interest rates would go up, making it harder and more expensive to buy a home or a car, which are mainstays of our American economy.

When we buy goods made overseas, our money goes to other nations to provide jobs and fund their governments.  One country that has been under increased scrutiny is China, since they have been devaluing their currency in order to gain economic advantage in the American market and weaken our country  both economically and militarily. (see my article, “What Is Currency Manipulation”)

China recently launched its first aircraft carrier and have invested tens of millions of dollars into developing a special missile to sink aircraft carriers from extremely long distances.  When we purchase goods made from other countries, we must consider the possibility that  we are paying for weapons that are designed  to attack and could  be used against the United States.

When we buy American, we are helping our country, our neighbors, and ourselves.

“Buy American, the job and country we save will be our own.”

By: Richard L. Tso

Our country is one of the most culturally diverse in the world, with our population representing every other nation around the globe. When immigrants come to America, they not only seek a better life for themselves but for their families and future generations, not only economically, but politically and spiritually.

Many people come to our country for the opportunity to create something out of nothing, to work hard with grease on their jeans in the hopes of saving money and buying a car or a home. To these individuals, blood, sweat and tears are the only things standing in the way of accomplishing their dreams. These entrepreneurs are the backbone of our society and propel our nation’s economy forward. With entrepreneurship comes innovation and these new ideas spark investment, success and continued opportunity.

My family immigrated to America from China and Taiwan and as a first-generation, born in U.S.A., American-Chinese man, I have witnessed the many hardships that my family has encountered in order to build a better life for my brother, sister and me. As a child, my father was a refugee in mainland China and escaped to Taiwan with nothing. In the refugee camps, he befriended a handful of others just like him, who fled the communist regime in China.

From nothing, my father worked his way up, put himself through law school and served as a judge in Taiwan. When he moved to America, he started his life all over again.

In Seattle, my father’s first job was working as a washer at the iconic Elephant Carwash on the corner of Battery and 6^th near Denny Way. Since he spoke very little English, this was the only job that he could do in order to make a wage. For several years, he saved up his money, learned English and began taking classes to become a chef at a local school.

Growing up, I never knew this story. All I knew was that I had to wake up early every Saturday, pull myself out of bed and drag myself down to my parent’s hole-in-the-wall restaurant to wait tables at the crack of dawn. As I greeted the town regulars, and scribbled down breakfast orders on my pad, I never realized that my parent’s small business started from nothing, nor the amount of work and love it took to provide for our family.

Looking back at my childhood, I realize that the entrepreneurial gene always existed in me too. Both my parents owned several businesses, from restaurants to clothing stores, to retail gift shops. I have always desired the creative freedom to build something with my own two hands and watch it either flourish or wilt. It didn’t matter, as long as I worked hard and believed in what I was doing.

According to the U.S. Small Business Administration, small businesses represent 99.7 percent of all employer firms and employ just over half of all private sector employees. Small business have generated 64 percent of net new jobs over the last 15 years and pay 44 percent of total U.S. private payroll.

There are so many stories like this, stories of people coming to America and starting their own businesses in the hopes of living the American dream. As a nation, we must support this. Recent reports indicate that if each American spent an extra $6.41 on U.S. made goods each week, that this alone would create almost 1 Million new jobs. This works out to just under a buck a day.

When you go our shopping for your daily groceries, clothing or home improvement tools, start locally, buy American and keep our jobs here. Even if it means shelling out a couple extra dollars, supporting small businesses is the only way we can get our nation up and running again.

My family, and millions of others around the country, will thank you.

Step 1: Put Down that Remote Control

By Stephanie Adams

Why move?  Most of us already know about the health benefits of exercise and the importance of stress reduction.  However, there is so much in our world today that discourages movement: remote controls, cars, TVs and computers in every room, and sophisticated mobile devices that can serve as entertainment, connection and business devices.  Walking is hardly necessary and there are so many devices of convenience that make indoor and outdoor work minimal in terms of physical effort.  Children don’t really need to move their bodies to play because they can simulate physical movement as a character on a TV show or electronic game.  Well, this might be “normal”, but is it “natural”?

So, why should we move our bodies?  The body was meant to move.  If we don’t move it, we lose it. Muscles atrophy (shrink), bones and joints become weak and brittle and unable to bear the body’s weight, and we begin to feel pain and immobility with the slightest effort.  It happens very gradually over time, when we don’t move the body as it was meant to move.  This is not a natural process of getting older when we are just 30, 40, or 50 years old.  This is a result of lack of movement.

Just two hundred years ago, we still had to walk, ride horses, dig wells, milk cows, build, chop wood, carry water, sweep, and vigorously scrub, rinse and squeeze the water out of our clothes and then hang them to dry.  This would seem like a very hard life to any of us now.  Getting enough food to feed our family, most often, took physical effort.  Today, we can even have groceries delivered.  We used to need to be outdoors more to survive and we got more fresh air and sunlight as a result.  But, that was then, and this is now.

So, today, it is “normal” not to move much, unless you are an “exerciser”.  Those devoted to fitness or exercise are a small portion of the American population.  You don’t need to join a health club to move your body.  There are many simple options to get moving.  You could choose to simply clean your own house instead of hiring someone to do that, or go for a walk around the block, or park a bit further away?  What if you planted a garden this spring to grow your own fresh food?  What if you simply got down on the floor to play with your children or grandchildren, or took them to the park and instead of sitting on the bench interacted and engaged with them?  You could simply go outside to help your child practice or condition for a sport.   If not now, then when?

If you haven’t moved your body much in a long time, it will take small steps to feel comfortable with movement again.  Just 5 minutes a day of simple and easy movement…ANY movement.  Maybe, add a minute every month.  By the end of the year, you would be up to 17 minutes a day!

DOG SONG BUYS A BONE MADE IN AMERICA, NOT ONE MADE IN CHINA

By Mark Bloome, Founder of TAP America

Dog Song wanted a bone.  So off to the bone store I went, to fetch my poor dog a bone.

I decided to shop around first at the Made in China bone store, and then made in the USA bone store.

In I went and found that for one dollar I could get 8 Chinese bones. At the USA bone store the price of bones was $1 for 4 USA bones.

Wow Chinese bones were cheaper!  Being an American I asked Mr. USA bone storeowner how come his bones were so expensive.

He sat me down and said, “Son, I have a sad story to tell you, if you would give me a few minutes to explain.”

“First off many of the Chinese bones came from diseased cows as in China they have little to no health standards, so it is cheaper to take bones from sick cattle, then from healthy all- American cows.”

But he said the Chinese government, wants the people who sell USA bones to go out of business so that the only thing people can buy are diseased bones made in China.

[Dog Song crooked her neck and looked at me funny]

Mr. USA bone storeowner continued. “Here is what the Chinese government does, it manipulates its currency. “  Song and I jumped up and said we do not understand such fancy words as “manipulate its currency.” [For a dog Song is real smart, and also real cute so she gets away with things]

Mr. USA storeowner continued, “It is like this Song” [by this time he was talking to the dog as I guess he thought Song was smarter then I and she cocked her ears and wagged her tail while listening and of course I am not good at either tail wagging or ear cocking]  “Currency is money.”  “In the USA it is called the dollar, in Mexico the peso, in China their currency is called the Renminbi.  The Chinese government always has their currency on sale” he said.  Song and I both said, “Explain more.”

Song walked over to Mr. USA put her head on his lap and we both listened.

“Currencies” he said, “ are just like stocks or gold, they are bought and sold based on what the market will pay for them; this is called the ‘exchange rate’.”  Mr. USA looked down at Song and she wagged her tail, and sort of growled and whispered to me, “exchange rate, that just a fancy word for the selling price, like how many dollars it will cost to buy one of them China dollars called the Renminbi.”  Then I told her to quiet down and listen.

So Mr. USA said to Song, “Pretend you have one dollar and want to buy some Renminbi that is you exchange one dollar and you get some Chinese Renminbi back.  Now China can take in one dollar and sell or exchange you 8 Renminbi because it has altered its currency to undercut the rest of the world.  But if they played fair, they would take one dollar and sell or exchange 4 Renminbi.  But if you now have 8 Renminbi you can go to the Chinese store and buy 8 bones and if you go the USA store like mine you only buy 4 bones.

Mr. USA continued,  “Well pretty soon the rancher, who made his living selling bones to dogs, cannot stay in business.  He has to fire his cowboys, and he cannot pay off his mortgage and he has to give up.”

“Now here comes a even worse part,” said Mr. USA, “the Chinese government takes the dollar you gave for the China bones, and invests it in making super weapons and engaging in cyber warfare. Strong evidence suggests that the Chinese government is responsible for a number of recent cyber attacks against the U.S. Department of the Defense and other federal agencies.”

“In fact, ending China’s currency manipulation could help create at least 1.5 million  U.S. jobs over the next few years.”

“So Song” Mr. USA said, “if you want to protect your owner and your country, think about buying local USA goods.”  His face grew serious and in a thoughtful voice full of feeling, said,  “After all the job you save and the country we save will be our own.”