By Jodie Allen, Thomas Jefferson Street blog
It has come to the attention of a growing number of expert observers that the good old USA may have seen its best days on the world stage. But these critics may be overlooking a potential way for America to continue to play at least a major supporting part--if not an especially decorous one--in the world economic drama.
The nation now cast in the role of Eve Harrington to America's Margo Channing is, of course, China. China's economic strength continues to make headlines. Most recently: its overtake of Germany as the world's largest goods exporter last year; its fast rebound to a 10.7 percent growth rate in the 2009 fourth quarter; its projected ascent this year to the No. 2 position among world economies, displacing Japan.
It's gotten so that even the normally chest-thumping American public is feeling a bit insecure. A Pew Research Center/Council on Foreign Relations poll conducted last fall found 4 in 10 (41 percent) among the public saying the United States plays a less important and powerful role as a world leader today than it did 10 years ago--the highest proportion ever recorded in a Pew Research survey across the years. More to the point, by a 44 percent-27 percent margin, Americans now name China as the world's leading economic power rather than the United States. As recently as February 2008, 41 percent still saw the United States as the top economic power compared with 30 percent who named China.
Add to this the mounting worry about the exporting of American jobs--not just among displaced workers but now even among mainstream economists--and you can see why Mike Mokrzycki of the ABC News Polling Unit sums up his organization's new survey thusly: " 'The 'American Century' was sooo last century, as many Americans see it." The ABC survey shows the public evenly split, 41 percent-40 percent, on whether it will be a Chinese or American century in terms of economic power, and giving a slight 43 percent-38 percent edge to China when it comes to a dominant role in world affairs.
But perhaps there is some room for optimism on the trade front. True, the shrinking of the U.S. trade deficit over much of last year mostly reflected the restricted diet of foreign imports forced upon U.S. consumers by the recession, and its recent resurgence has been viewed as a positive sign of a rebound. But another little-noticed factor was apparently also at work.
As the Wall Street Journal noted in reporting the resurgence of the trade deficit last November, while the U.S. shortfall with most other major trading partners increased, the deficit with China actually declined. The Journal didn't analyze the components of the shrinkage, but an intriguing table in a recent, little-noticed report to Congress by the U.S.-China Economic and Security Review Commission points to one interesting trend.
The report itself focuses on data in the chart showing a 454 percent surge in Chinese exports of computer equipment to the United States over the 2000-2008 period and an even larger 800 percent rise in communications equipment exports as clear evidence that "China's industrial policy clearly aims to promote the manufacturing of higher-technology products, replacing lower value-added and labor-intensive products."
No doubt. But the report draws no attention to the components of a relatively recent surge in U.S. exports to China, perhaps the result of growing American concern about its mammoth trade imbalance with the Middle Kingdom. Between 2004 and 2008, these exports more than doubled from $34.7 billion to $71.5 billion, far short of the $337.8 billion the U.S. imported from China in 2008, but still a step in the right direction.
And while electronic components as well as oilseeds and grain continue to rank among the top three categories of exported goods, the fastest growing and now No. 1 export category is--"Scrap and Trash."
According to data provided by the U.S. International Trade Commission, Chinese imports of U.S. cast-offs (scrap metal, waste paper, and the like) surged by an eye-popping 916 percent over the 2000-2008 period, with most of that expansion occurring after 2004.
Perhaps not many observers will judge this a suitably glamorous role for America to assume on the global stage. But one might take comfort in the thought that if there is one thing that Americans still excel at producing, it's trash.
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