>>>
back to politics and
foreign policy
.
china
is an easy target for
mitt romney
as he tries to woo voters who are frustrated over the
unemployment rate
and slow recovery here at home. here is
romney
in ohio last month.
>>
well, on day one i will label
china
a currency manipulator and that will allow me to apply tariffs where they steal our intellectual property and kill jobs.
>>
james is a national correspondent for "the atlantic" magazine and author of "
china
airborne" and has lived there for many years off and on. and vijay is a correspondent for "the economist" and author of "need, speed and greed." both have spent a lot of
time in china
. thanks so much. what is your take, because you come at this not from a political perspective, of what
mitt romney
says about what he would do about
china
and about what we really need to do about
china
. i think you think there's a disconnect.
>>
two things are
almost certainly
true. one is if governor
romney
becomes president
romney
, he will not do what he's saying on the campaign trail, just because almost every candidate runs against
china
being tougher on them but when they get in office it's more or less the same policy. second, the bigger problem for america may be
china
's troubles in the next year or two rather than its just unstoppable success because you know the economy there is having lots of strains,
political system
is under strain. it's a little bit different from the way he's portraying it.
>>
vijay, the slowdown in their
growth rate
, they still are growing faster than we are, but the phenomenal
growth rate
has slowed considerably and that becomes a problem eventually for us.
>>
it does. the world will be envious of a 6%
growth rate
which is considered a slowdown in
china
. but they have a lot of people to keep fed. so for them it's a real crisis. i think coming to the point about
romney
, not only will he find it difficult to implement, for example, branding them a currency manipulator on day one. that's something he said many, many times. if you actually look at what's happened to chinese exports, the account surplus used to be 10% gdp at its peak, less than 3% last year. currency has appreciated 30% in real trade weighted terms. in other words, the actual facts don't support the assertion. a lot of that has to do with the fact we're at the end of cheap
china
.
china
wages are going up, regulatory burden is increasing. it's becoming a
middle income
country, not just the
sweat shop
to the world.
china
itself is grappling with the transition from being again a
sweat shop
economy to being more of an innovation economy. that's a very difficult transition. that's part of what's the challenge in
china
.
>>
similarly, the
obama campaign
, let's do a little fact-checking on that. this is their new ad out today attacking the
romney
campaign for outsourcing.
>>
what a president believes matters.
mitt romney
's companies were pioneers in outsourcing u.s. jobs to low wage countries. he supports
tax breaks
for companies that ship jobs overseas.
president obama
believes in in-sourcing. he fought to save the u.s.
auto industry
and favors
tax cuts
for companies that bring jobs home. outsourcing versus in-sourcing. it matters.
>>
so we're talking about the whole
bain
attack. they think it's working. the polls seem to indicate it's working. but the reality of that?
>>
certainly if you look at the
bain
record during
romney
's time there, it had big successes and some failures. i think this is sensible for the
obama campaign
to promote. also, it's true that during the last year or two of
president obama
's watch, manufacturing has had some kind of recovery in the
united states
. whether or not he can take direct credit for that is a whole more complex issue. but this is the natural, anybody in the president's position would be making this ad.
>>
is it fair to attack -- is it accurate to attack
mitt romney
for outsourcing from his days at
private equity
? i know that's a complicated question.
>>
there's a couple things that the ad is problematic. one, there's a decision between offshoring where you send factories overseas, and outsourcing which can be to an i.t. company down the road. so the ad conflates those two things. the second thing is during the time when he ran
bain
, they did make investments in companies that were good at outsourcing but take a broader perspective. if the u.s. were to pass a law saying we don't want any offshoring or outsourcing, what would actually happen is that
american companies
would become less competitive. versus foreign competitors. this is not a realistic proposition.
>>
the stronger point they made in some
bain
ads is that
romney
got a lot of profit even when the companies were failing. i think that probably is powerful.
>>
to be continued, i hope you will come back. thanks a lot.
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