U.S. President Barack Obama recently signed an order imposing a 35% tariff on tire imports from China, accusing the East Asian giant of dumping their road rubber on the American market. ("Dumping" is the practice of selling goods for less than their actual cost of production. Flood a market with cheap goods, and the competition faces bankruptcy.)
China, manifesting outrage, quickly retaliated by announcing an investigation into American subsidizing and then dumping of auto and poultry products into their market.
The U.S. retorted China must stop undervaluing its currency, which makes it products in American stores irresistibly cheap, causing trade imbalances.
Miffed, China parried that the U.S. must cease relying so heavily on China to keep buying so much of their public debt, just so the American Government can spend so freely and tax so cheaply. "In fact," scowled China, "maybe it's time you start paying some of it back."
"Okay," slyly spoke America, "we'll pay you back . . . with our rapidly depreciating currency, made continually possible by your financing of our huge deficits. Go right ahead, stop financing our debt, and we'll gladly pay you back with our bottomed out currency -- pennies on the dollar is what you'll get, tough guy!"
China, caught off-guard, stammered, "Then, w-we'll, uh, we won't sell you anything, anymore. We'll dump, er, 'sell,' our stuff to somebody else."
"Who!?" America asked incredulously. "No other country on this planet is so willing to prop up your workforce at the expense of its own by turning its marketplace into one big dump."
"So, then, stop complaining! We give your people cheap stuff!"
"No, you stop complaining! We give your people millions of jobs!"
"You started it!"
"No, you did!"
"Paper Tiger!"
"Wannabe Japanese!"
"Deadbeat!"
"Shylock!"
And so it goes, today, tomorrow and for the foreseeable future, till one or the other economic giant changes course and starts to act honestly and play fairly . . . thereby risking another global-wide depression.
