One of the most memorable moments of the 2nd presidential debate was when President Obama scolded Mitt Romney for his business dealings with China. “You’re the last person who’ll get tough on China,” Obama zinged. As an unabashed Obama supporter, the line thrilled me- I was delighted that finally, the president was lashing out at Romney and forcing the Republican to play defense. But, sadly, the small voice in my head that cares about policy recoiled. For all of Mitt Romney’s sins, outsourcing jobs to China ranks pretty close to the bottom of the list. The transfer of manufacturing jobs from the United States to China, blamed so often for our economic decline, has actually been a net positive for both countries.
The unemployment crisis in the United States has many causes. There’s financial under-regulation for starters, but also a badly skewed tax code, absurdly lenient mortgage lending, and, more esoterically, the persistent lack of middle-class wage growth that has led so many Americans to make risky financial bets. In a perfect world, both presidential candidates would campaign exclusively on fixing these problems and restoring the American economy. But elections are won on politics, not policy, and a byproduct of that reality is cheap demagoguery on China.
Politics go both ways, of course. In China, the Communist Party attributes American complaints about currency manipulation as an unvarnished desire to hurt the country’s feelings. China’s leadership knows better, of course, but understands that maintaining a sense of national victimization is essential to keeping its grip on power. American politicians find it useful to remind struggling voters that there are factories full of Chinese workers doing their old jobs for a small fraction of the pay. And, whether or not half these factories are now located in Vietnam or the Philippines or Mexico or wherever, pointing a finger at China resonates far more deeply since China is seen as the United States’ primary rival on the international stage.…