U.S. Treasury Secretary Timothy Geithner says he has no immediate plans to resign, addressing media reports he is considering stepping down after the current round of debt ceiling negotiations.
He says the United States is facing a lot of challenges that he is going to help solve “for the foreseeable future.” He says he has never worked any other place but in public service.
Geithner was questioned Thursday about his plans by former U.S. President Bill Clinton at an event in Chicago.
Earlier Thursday, U.S. media outlets led by Bloomberg News reported that Geithner may leave his post once President Barack Obama reaches a deal with Congress to raise the U.S. debt ceiling.
The United States risks defaulting on its $14.3 trillion national debt unless Congress acts to raise the legal limit on the amount the U.S. government is allowed to borrow by August 2.
Geithner has warned the U.S. could face “catastrophic consequences” if lawmakers fail to raise the debt limit.
Talks between the White House and Republican lawmakers on the debt ceiling issue have been contentious. Negotiations stalled last week after Republican lawmakers walked out of the sessions chaired by Vice President Joe Biden. They said the White House was using the crisis to push for tax increases.
Republicans, who control the House of Representatives, say they will not raise the debt ceiling without deep spending cuts. Democrats say Republicans are holding the debt ceiling vote hostage to an ultra-conservative fiscal agenda the Republicans could never enact on their own.
Thursday, June 30, 2011
Obama to Hold Twitter Session on Economy
U.S. President Barack Obama is showing his embrace of new technology once again with plans to hold a Twitter "town hall" discussion next week.
The White House used the social networking website Thursday to announce the event. The meeting will be held next Wednesday and focus on the U.S. economy and jobs.
President Obama's economic policies have come under increased scrutiny in recent months as the nation's unemployment rate has edged higher, to more than 9 percent, and data on the economy continues to be mixed.
The White House Twitter account invited followers to submit questions using the hashtag #AskObama. The president will respond to the questions in a live webcast.
Questions posted soon after the announcement touched on jobs, student loans, immigration, and the divisive issue of tax cuts for the wealthy.
Obama has demonstrated a fondness for using social media to reach the public since his 2008 election campaign. Earlier this year, he participated in a town hall meeting hosted by Facebook.
Obama's personal Twitter feed, on which he has recently personally started to post on, is now being managed by his 2012 campaign staff and currently boasts 8.9 million followers.
The White House used the social networking website Thursday to announce the event. The meeting will be held next Wednesday and focus on the U.S. economy and jobs.
President Obama's economic policies have come under increased scrutiny in recent months as the nation's unemployment rate has edged higher, to more than 9 percent, and data on the economy continues to be mixed.
The White House Twitter account invited followers to submit questions using the hashtag #AskObama. The president will respond to the questions in a live webcast.
Questions posted soon after the announcement touched on jobs, student loans, immigration, and the divisive issue of tax cuts for the wealthy.
Obama has demonstrated a fondness for using social media to reach the public since his 2008 election campaign. Earlier this year, he participated in a town hall meeting hosted by Facebook.
Obama's personal Twitter feed, on which he has recently personally started to post on, is now being managed by his 2012 campaign staff and currently boasts 8.9 million followers.
Efforts Intensify to Avert US Debt Crisis
Photo: REUTERS
US President Barack Obama answers a question during a news conference at the White House, June 29, 2011 (file photo)
If President Obama hoped to spark a reaction from Congress on the urgency of U.S. debt negotiations, he appears to have succeeded. At the president's urging, Senate Majority Leader, Democrat Harry Reid canceled next week's scheduled Independence Day holiday recess.
Meanwhile, the chamber's top Republican, Minority Leader Mitch McConnell, urged a more immediate step. "I would like to invite the president to come to the Capitol today to meet with Senate Republicans," McConnell said.
McConnell said Obama should hear a direct Republican response to Wednesday's presidential news conference, where Obama urged greater flexibility from Republicans on ways to trim the federal budget deficit.
The White House declined the on-the-spot invitation. Press Secretary Jay Carney says the president is well-aware of the Republican stance on the budget, but he reaffirmed the president's commitment to continue negotiations.
The back-and-forth activity comes ahead of an August deadline to raise the federal borrowing limit or face a possible default on America's $14 trillion national debt. Republicans have insisted on trimming the federal budget deficit as a condition for raising the debt ceiling.
Members of both major political parties agree that federal spending must be cut. But Democrats say they favor limited cuts in domestic spending, combined with higher taxes on the wealthy. So far, Republicans have refused to consider raising taxes on any segment of society.
"Our problem is not that we are taxed too little. Our problem is we are spending way too much," said Republican Senator Jon Kyl of Arizona.
Republicans say tax hikes proposed by Democrats would punish small businesses that create jobs as well as America's struggling middle class.
Democrats largely have abandoned hope of raising federal income tax rates on anyone, wealthy or otherwise. Instead, they now advocate ending special tax breaks that benefit the well-to-do and certain corporate interests, such as the petroleum industry.
Democrats took to the Senate floor to criticize preferential tax treatment enjoyed by the richest Americans, such as accelerated tax deductions available to racehorse owners.
"Horse racing may have been called 'the sport of kings,' but that does not mean that the owners of horses, those millionaires and billionaires, need royal tax treatment," said Democratic Senator Jeff Merkley of Oregon.
New York Democratic Senator Charles Schumer took aim at interest deductions for purchasing luxury yachts. "The deduction Congress helped create for middle class families to realize the American dream of homeownership is helping millionaires and billionaires get a 35 percent discount on their yachts," Schumer said.
Republicans counter that even if such tax breaks were eliminated, the fiscal impact would be minimal - at most, a few billion dollars from a $1.6 trillion federal deficit. Democrats respond that the issue is one of fairness and shared sacrifice.
Senator Schumer says that if Democrats accept budget cuts to programs that benefit the poor and disadvantaged, Republicans must be willing to end tax breaks for the wealthy. "We will not get anywhere unless both sides compromise," Schumer added.
Republicans say Democratic attempts to preserve federal spending levels and raise tax revenues will hurt an already-struggling U.S. economy and make the debt crisis even more severe.
"Who really thinks that the answer to a $1.6 trillion deficit is more deficit spending? Where in the world does that idea come from?" asked Senator McConnell.
Allowing taxes to rise would violate a pledge many Republican lawmakers made when running for Congress. Similarly, allowing sweeping cuts to educational programs and America's social safety net would anger core constituencies of the Democratic Party. Both sides agree on the need to put the United States on a sustainable fiscal path. But with only weeks to go before the federal government reaches its borrowing limit, a bipartisan debt-reduction deal shows no sign of materializing.
Friday, February 18, 2011
G20 finance meeting opens
People watch French President Nicolas Sarkozy delivering a keynote speech through a TV screen at the G20 press center in Paris, France, Feb. 18, 2011. The 2-day G20 meeting of Finance Ministers and Central Bank Governors opened here on Friday.
Gallup shows U.S. jobless rate worsens in mid-February
WASHINGTON, Feb. 18-- The politically sensitive unemployment situation in the United States is not improving as shown in government statistics, at least from the perspective of an influential private organization's survey.
The U.S. unemployment rate rose to 10 percent in mid-February from 9.8 percent at the end of January, according to a Gallup poll published on Thursday.
At the same time, underemployment -- the jobless rate plus part- timers seeking full-time work -- surged in mid-February to 19.6 percent from 18.9 percent at the end of January, the study found.
The poll is not an official government study, and is separate from statistics kept by the U.S. Bureau of Labor Statistics, which found that unemployment dropped to 9 percent in January from 9.4 percent in the previous month.
The rise in Gallup's underemployment rate, which stands near last year's level of 19.8 percent, was largely a result of the sharp increase in the number of people working part time but seeking full-time work.
The surge in underemployment is "troubling," as current conditions in the job market have barely improved from this time a year ago, said Dennis Jacobe, chief economist at Gallup. Since then, some who were previously unemployed have obtained part-time jobs, which allowed them to re-enter the workforce, although they are still seeking full-time employment.
"This is not much to show for a year in which many macro- economic indicators showed improvement," Jacobe said.
Indeed, jobs remain key to jumpstarting the economy, and mid- February underemployment results suggest little or no progress is being made in that regard, he said.
The news comes at a time when the United States has been struggling with a flagging jobs picture for three years. In spite of the high jobless rate, a laundry list of factors spell good news for the U.S. economy: gross domestic product rose last quarter, corporations are seeing bumper profits and the stock market recently crossed the 12,000 mark for the first time since 2008.
Under normal circumstances, that might spur hiring and a rapid recovery from the worst recession in roughly 80 years. But this is no ordinary recovery, and jobs continue to remain elusive.
Economists are mixed on the reasons why companies are not hiring more in the face of what otherwise would seem to be an economic comeback.
Some hold that small businesses, which contribute to more than 50 percent of private sector employment, are reluctant to hire.
Oddly, that is not because new workers are not needed. A recent Wells Fargo/Gallup Small Business Index survey found that 51 percent of small-business owners who employ people other than themselves hired new workers last year. But of those, 42 percent hired fewer new employees than they needed because they are uncertain of future sales or revenues.
Many economists said that while the economy will add jobs this year, it will not be enough to significantly reduce high levels of unemployment, although 2012 could see hiring on a more significant scale.
Some others were more optimistic, arguing that the jobless rate will come further down by year's end.
The U.S. unemployment rate rose to 10 percent in mid-February from 9.8 percent at the end of January, according to a Gallup poll published on Thursday.
At the same time, underemployment -- the jobless rate plus part- timers seeking full-time work -- surged in mid-February to 19.6 percent from 18.9 percent at the end of January, the study found.
The poll is not an official government study, and is separate from statistics kept by the U.S. Bureau of Labor Statistics, which found that unemployment dropped to 9 percent in January from 9.4 percent in the previous month.
The rise in Gallup's underemployment rate, which stands near last year's level of 19.8 percent, was largely a result of the sharp increase in the number of people working part time but seeking full-time work.
The surge in underemployment is "troubling," as current conditions in the job market have barely improved from this time a year ago, said Dennis Jacobe, chief economist at Gallup. Since then, some who were previously unemployed have obtained part-time jobs, which allowed them to re-enter the workforce, although they are still seeking full-time employment.
"This is not much to show for a year in which many macro- economic indicators showed improvement," Jacobe said.
Indeed, jobs remain key to jumpstarting the economy, and mid- February underemployment results suggest little or no progress is being made in that regard, he said.
The news comes at a time when the United States has been struggling with a flagging jobs picture for three years. In spite of the high jobless rate, a laundry list of factors spell good news for the U.S. economy: gross domestic product rose last quarter, corporations are seeing bumper profits and the stock market recently crossed the 12,000 mark for the first time since 2008.
Under normal circumstances, that might spur hiring and a rapid recovery from the worst recession in roughly 80 years. But this is no ordinary recovery, and jobs continue to remain elusive.
Economists are mixed on the reasons why companies are not hiring more in the face of what otherwise would seem to be an economic comeback.
Some hold that small businesses, which contribute to more than 50 percent of private sector employment, are reluctant to hire.
Oddly, that is not because new workers are not needed. A recent Wells Fargo/Gallup Small Business Index survey found that 51 percent of small-business owners who employ people other than themselves hired new workers last year. But of those, 42 percent hired fewer new employees than they needed because they are uncertain of future sales or revenues.
Many economists said that while the economy will add jobs this year, it will not be enough to significantly reduce high levels of unemployment, although 2012 could see hiring on a more significant scale.
Some others were more optimistic, arguing that the jobless rate will come further down by year's end.
Wednesday, January 19, 2011
Great benefit for U.S. from Sino-U.S. trade co-op (2)
Wide Prospect, Deep Cooperation
- To develop a win-win China-U.S. Commercial Relationship
The U.S. is the largest-scale developed country; China is the largest-scale developing country and the largest emerging market. The commercial cooperation between China and U.S. produces giant benefits. The gap in development between the two countries and win-win cooperation are the basis for the steady development of a China-U.S. commercial relationship. During the process of globalization, China and the U.S. have began to share many benefits. A win-win China-U.S. commercial relationship is good for the people of the two countries and will continue to cement and push the bilateral relationship.
There is an opportunity for cooperation on trade between China and the U.S. . China is currently accelerating in terms of industrialization and urbanization. The mode of development is being regulated. The long- term goal is to widen the domestic need. All those elements will cause giant investment need and consumption need. China has the highest number of exports and the second highest number of imports in the world and may become the largest domestic consumption market. That means better opportunities and more development opportunities for the U.S..
Gao Ruibin, president for Motorola, Inc. China said that Motorola have invested 1.5 billion dollars in research and development in China and they have 2700 people working on this. “The better China develops, the more chances for us. Motorola has an optimistic view on the China market and hopes to take part in the innovation in China.” Gao said. It is reported that many multinational enterprises such as GE, IBM and Coca Cola all take part in and support China's national stratagems such as the change in economic development, energy saving and carbon emission reduction.
"The Chinese government will continue the trade policies of maintaining a basic balance between imports and exports to further deepen the opening up, reform and innovation of China and will make it easier for domestic and foreign investors by creating a more open and optimized investment environment for them. Foreign enterprises including those from the United States, will share the growing market pie with Chinese enterprises, “an official with China's Ministry of Commerce said.
Experts say that the great achievements of Sino-U.S. economic and trade cooperation are the result of much hard work. The United States should adhere to the concept of free trade and oppose protectionism in all forms of trade and investment.
It should re-evaluate and relax export control measures against China as soon as possible and properly carry out a foreign investment review to reduce unnecessary constraints and promote the investment and cooperation.
Experts also suggest that the United States and China should continue to strengthen macroeconomic policy coordination so as to jointly promote the balanced and sustainable development of the world economy.
Now is a critical period for the deepening development of Sino-U.S. economic and trade relations. The healthy development of China-U.S. economic and trade relations will help to promote stable economic growth and the global economic recovery. And only from a strategic and long-term perspective and through the continued promoting of Sino-U.S. economic and trade ties, can greater improvements to the lives of the people from both counties and even the world be achieved.
At a new historical start, we are full of confidence in the future of economic and trade cooperation between China and the United States.
Related:
Chinese president proposes four points to advance China-U.S. ties
BEIJING, Jan. 17 (Xinhua) -- Chinese President Hu Jintao on Monday proposed four points to further advance China-U.S. ties.
"We both stand to gain from a sound China-U.S. relationship, and lose from confrontation," said Hu, who is to pay a state visit to the United States from Tuesday to Friday, in a written interview with reporters from Wall Street Journal and Washington Post on Monday. Full story
WASHINGTON, Jan. 12 (Xinhua) -- The economic relationship between the United States and China "provides tremendous benefits" to both nations, U.S. Treasury Secretary Tim Geithner said on Wednesday.
"China presents enormous economic opportunities for the United States and for the world," said Geithner at the Johns Hopkins University in Washington ahead of China's President Hu Jintao's State visit to the U.S. next week. Full story
Around 90 percent of Chinese think China-U.S. ties important: surveyBEIJING, Jan. 16 (Xinhua) -- Around 90 percent of the Chinese general public consider China-United States ties important, according to a recent survey.
The China Daily newspaper and the Horizon Research Consultancy Group conducted the 1,443-respondent survey in seven major Chinese cities, including Beijing, Shanghai and Guangzhou, from Dec. 20 to Dec. 30, 2010. Full story
Great benefit for U.S. from Sino-U.S. trade co-op (1)
BEIJING, Jan. 17 -- China Daily on Monday issued an commentary on Sino-U.S. trade cooperation. Following is the full text.
Chinese market "cash cow" of the U.S.
Since the beginning of the new year, American companies one after the other have proposed their new policies of investing in China. General Electric Company (GE) will invest more than 2 billion U.S. dollars to sharpen its research and development in China with several new innovation centers and joint ventures; P&G has announced that they will in five years add another 1 billion U.S. dollars in China; Ford Motor Company said they would further expand their production this year; Caterpillar Inc will build new joint ventures to boost their spare parts business in China; Starbucks has confirmed that their coffee shops in China will reach as many as 1,500 by 2015; The Carlyle Group will raise money specially to be used in China.
Intel China is no exception. According to Ge Jun, Executive Director of Intel China, the Chinese government is pushing the integration of the “three nets” (namely, telecom, computer and cable TV networks) and the development of Internet of Things (IoT). This undoubtedly will provide new opportunities to the U.S. IT industry. Since Intel's settlement in China in 1985, China has become its second largest market outside of its homeland.
According to statistics from China's Ministry of Commerce, by the end of 2010, the U.S. had invested in more than 59,000 projects in China with a total of 65.22 billion U.S. dollars. China is becoming a “money spinner” to U.S. companies. A survey by the Chinese American Chamber of Commerce said that 71% of the U.S.-funded ventures made profits in 2009 and 46% of them gained a higher profit ratio in China than they did in any other country.
Since joining the World Trade Organization (WTO) 10 years ago, all the 100 service institutes China pledged to open have accepted U.S. investment. In areas such as accounting, banking, insurance, security and commerce, U.S. companies are making big money and are running very well.
Currently, China is the second largest trade partner and the top growing export market of the U.S.. According to Chinese Customs, the volume of Sino-U.S. trade in 2010 was 385.34 billion U.S. dollars with a nearly 30% annual increase. In 2010, China's import volume from the U.S. was 102.04 billion U.S. dollars with an increase of 31.7% year–on-year.
Looking back, we can be clearer about the surge of U.S. exports to China. According to U.S. Department of Commerce statistics, from 2001 to 2008, U.S. goods exports to China rose from 19.2 billion to 71.5 billion dollars , an increase of 272 percent, while U.S. exports to other countries and regions increased by only 72 percent during the same period. In the service trade, the U.S. has retained a surplus of service exports to China. In 2009, the U.S. had a trade surplus of 7.43 billion U.S. dollars, about four times that of 2001.
By enjoying a rapid increase in U.S. exports to China, the U.S. has gained the dividends from China's economic growth. All the states have benefited in real terms, making China appear on the top five export markets list in 40 states out of 50. Over the past 10 years, there has been a 330 percent increase in U.S. machinery and agricultural produce exports to China, far beyond the increase of 29 percent in its exports to other regions of the world. China has become the largest single overseas market of U.S.-produced soybean and cotton as well as an important export market for cars, airplanes and other machinery products. A report from the United States-China Business Council (USCBC) in 2010 said, “China continues to be an important export destination for U.S. manufacturers and farm owners during the global economic recession.” Zhou Shijian, a senior researcher with the Center for U.S.-China Relations (CUSCR), Tsinghua University, also acknowledged that without a surge in exports to China, the U.S. President Barack Obama's ambitious plan of doubling U.S. exports over the next five years seems hard to achieve.
The U.S. benefits from trade and economic cooperation with China – from consumers' interests to job opportunities.
U.S. beneficiary of Sino-U.S. trade cooperation
Besides direct benefits from exports to and investment in China, cooperation with China is also a boon for the U.S. macro economy, as is demonstrated by U.S. consumers' interests.
Statistics show, of all China-made products entering the U.S. market, daily consumer goods such as clothes, shoes, socks, toys, suitcases and electronic products account for about 75 percent. These quality products with low prices have greatly improved Americans' lives, expanding their choices while shopping and bringing real benefits, especially for low-income groups. It has also led to a relatively low inflation rate for the U.S. economy faced with pressures of fiscal and trade deficits.
According to a research by the U.S. company Morgan Stanley, each American could save more than 300 U.S. dollars in their expenses by purchasing goods from China in 2009. According to a study by the U.S.-China Business Council, the gross domestic product (GDP) in the U.S. should have risen another 0.7 percent by 2010 due to its increasing investment in trade to China, while the prices should have fallen by 0.8 percent. Adding the two research results, the disposable income of each U.S. household should rise 1,000 U.S. dollars every year. “Goods from China meet the demand of American consumers and will help stabilize the U.S. market price, reduce the risk of inflation and maintain economic stability,” said Liu Haiquan, head of the Comprehensive Department of China's Ministry of Commerce.
Sino-U.S. economic and trade cooperation have also effectively increased U.S. jobs. U.S. Secretary of Commerce Gary Locke said in a speech given to the U.S.-China Business Council in January last year, “If we just boosted our exports to Asia by one percent, that would support another hundred thousand (10 million)new jobs in the United States.” Accordingly, U.S. exports to China from 2001 to 2008 provided the country with 2.57 million new job opportunities. Direct investment from Chinese companies to the U.S. has also increased dramatically in recent years, making positive contributions to local employment. Some Chinese giants such as COSCO, CNPC, Lenovo, have brought a lot of employment opportunities as well as economic and social benefits to local residents in the U.S.. The Haier Group created thousands of new jobs for Camden City since its establishment of industrial parks in South Carolina in 1999. In every ten Camden families, you can find at least one person working as a Haier employee. The city thus developed into a “hometown” of household appliances with an annual output of more than 20 million products. The WanXiang Group had nearly 30 projects invested in the U.S., creating nearly 5,000 new jobs. In the year 2009, when many U.S. enterprises cut jobs, the WanXiang Group created a number of new jobs for Illinois through their new investment projects.
Sino-U.S. economic and trade cooperation is the result of the increasingly international nature of the globalised trade market. The United States could use this to their own benefit, combining their advantages in financing, technology and management with China's abundant labor resources.
Therefore, the international competitiveness of U.S. products and U.S. enterprises could be improved and the U.S. industries' share in the international market could be expanded. At the same time, the move creates the conditions for U.S. industries' transfer to high value-added sectors. Take computer manufacturing for example, China produced 150 million computers in 2008, with almost all the chips used in the central processors imported from U.S. enterprises such as Intel or Advanced Micro Devices.
China is now the largest holder of U.S. Treasury bonds. According to statistics released by the U.S. Department of the Treasury, as of October 2010, the balance of U.S. Treasury bonds held by China reached 906.8 billion U.S. dollars. During the global financial crisis, China did not trim its holdings of U.S. treasury bonds, but increased them. The move is important for the United States if it is to maintain a stable and mobile financial market, ease its credit crunch and promote trade financing, beneficial for the country's goals in macroeconomic regulation. A report released by the U.S. Congressional Research Service Bureau in July 2009 pointed out that if China did not purchase U.S. bonds on a large scale, U.S. interest rates would increase by 0.5 percentage points. Accordingly, the U.S. can save itself 61.6 billion U.S. dollars on bond interest payments.
China has a huge favorable balance of trade? The exchange rate of RMB is undervalued? Be rational when listening to discordant voices from the U.S..
To be rational over biased views
Though having gained huge profit from Sino-U.S. economic and trade relations, the U.S. has been questioning China's favorable balance of trade and the undervaluation of the RMB exchange rate. What are the true facts?
Based on past statistics, China has only had favorable balance of trade for a short time, and it usually accounted for less than 3% of GDP. Only until 2005 did the favorable balance of trade increase. Despite this, the figure was much smaller than that of major trading nations such as Japan and Germany. For example, since 1952, Germany has had 58 years of favorable balance of trade, which was up to 8% of GDP at its highest. Some Gulf countries have also had a favorable balance of trade for a long time because of a lack of resources. Differences over statistics calculation have also led to the overrated unfavorable balance of trade of U.S. to China.
The fact that China has had a favorable balance of trade against the U.S. does not harm the interests of the U.S.. Not only did China profit from it, but U.S. companies also did, because of from the added value of imported products from China.
American think-tank CATO Research Institute pointed out in its report in 2010 that the international division of labor between China and the U.S. is like a “smile curve” –the U.S. has dominated the prophase manufacturing process such as high-profiting trade marks and concept designs, and final phase service including logistics, marketing and market developing; while China has only undertaken low added value middle-phase manufacturing. The U.S. is the bigger beneficiary from Sino-U.S. trade according to the profitability ratio. The added value of the products which China has made only accounts for 1/3 to 1/2 of the total export volume to the U.S..
According to the Economist, an iPod tagged “made in China” is sold in developed countries (“America”) at 299 U.S. dollars, of which “Only 4 dollars stays in China with the firms that assemble the devices, …160 dollars goes to American companies that design, transport and retail iPods.”
The foreign exchange rate is another hot issue in Sino-U.S. economic cooperation. Some Americans believe the currency value of Chinese RMB is severely underestimated, and the underestimation is the main cause of imbalance of bilateral trade. They hope that with the RMB's appreciation and the U.S. dollar's depreciation, U.S. exports and the economy will be boosted.
But in fact, RMB exchange rates have increased by about 25% since the reform of the exchange rate regime in 2005. RMB has increased to a larger extent compared to the U.S. dollar, euro, Japanese yen and sterling. It is totally groundless to assume US's trade deficit against China has anything to do with RMB's value being underestimated. China's foreign trade surplus surged from 2005 to 2008, during which time the RMB had appreciated by 21.2% against the U.S. dollar, said He Weiwen, dean of Sino-U.S. Commerce Research Center at University of International Business and Economics. Why does this phenomenon exist if the RMB is underestimated?
There are other cacophonies. The U.S. has repeatedly heckled China with anti-dump and anti-subsidy investigations, protection of IPR and China's policies of independent innovation. Many more frictions in bilateral commercial ties have occurred lately. If such problems are not solved, they will have a direct impact on the interests of U.S. companies and U.S. people, as well as hindering the economy of “made in China”.
An example is the special protection of tires, launched in 2009 against China. What was the consequence, then? According to data from the U.S., the price of U.S.-imported tires increased by 30% in the first half of 2010, whereas the jobs offered by its tire industry dropped by 10% in the first five months of the year.
Meanwhile the U.S. controls exports to China in the high technology industry. The control causes U.S. enterprises to lose many opportunities, because China has to import the products from other countries. According to data from China, the value of high technology products imports grew from 64 billion to 309. 9 billion dollars during 2001-2009 and the average growth per year was 48 percent. However the proportion of U.S. products fell from 18.3 percent to 7.5 percent. If the U.S. keep the level at 18.3 percent, it can increase the value of exports to China to 33.5 billion dollars from 2009 .
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