A new book asks, "Are we becoming China's bitch?"
Posted By Isaac Stone Fish Friday, January 20, 2012 - 12:57 PM Share
The year 2012 will see a stream of new books in the patented Thomas Friedman "Oh My God the Chinese Are Eating Our Lunch with Environmentally Friendly Chopsticks" mold. Some will be more worthwhile than others. One book in particular, however, is sure to stand out, if only for the title: "Becoming China's Bitch: And Nine More Catastrophes We Must Avoid Right Now."
The author, Peter D. Kiernan, a former partner at Goldman Sachs, explains in the introduction that "it's not a book about China exactly. It's about how America got diverted and lost momentum, and a dragon leapt into the breach. It's also about getting our mojo back."
I spoke with him over the phone:
FP: When did you first realize we were in danger of becoming China's bitch?
PK: When it first occurred to me was in 2008, as a card-carrying member of a discredited class, everyone in Wall Street had to re-think everything. We had gone through a 30 plus year bull market. We now had to wrestle with the idea of who was going to fund the 42 percent of our government that has to be borrowed. Whenever you depend on one major source of finance, if it's too heavy in one area, it deserves a re-thinking.
We haven't really thought clearly about this as a nation. It was a part of this re-thinking everything. We have a much greater co-dependency on China than we'd like to acknowledge. The book is not solely about China, but Becoming China's Bitch is about the cost to our dithering.
FP: How is the 1 percent different from the 99 percent in their fear of becoming China's bitch?
PK: I don't spend a whole lot of time worrying about the one percent in the book or in my life. What I do spend the vast majority of my time focusing on is the 99 percent. We have developed a dependency, and that dependency allows us to be poor savers, roughly 5 percent saving rate in America, compared to 30 percent in China.
I literally believe that we have been opiated as a nation. I believe we've been diverted about issues. The debt ceiling has been raised 100 times since you started working here-it's no big deal. These are not problem solving conversations. These are skin rashes that have nothing to do with the problems. Occupy Wall Street is not the problem, but the symptom. Among them, we have worked ourselves into a co-dependency.
FP: What can we do to prevent becoming China's bitch? How do we make China our bitch?
PK: The title is deliberately provocative, I understand. It's meant to push people outside their comfort zone. We're inert. How do we snap people out of it? We helped create an export monster. We helped them because we developed an appetite for their goods. So we've kind of gotten in this dynamic of exports for finance-we will buy your cheap goods so we can stock our Wal-Mart shelves. They're moving up the value chain. And in exchange for that, we'll look for you to be our number one lender, and that, in pop psychology, you call a co-dependency-exports for finance. They're stuck with us, we're stuck with them. Stalemates, or co-dependencies like this, don't last forever.
EXPLORE:THUMBS, EAST ASIA, CHINA SHARE THIS ARTICLE: Share on facebookFacebook|Share on twitterTwitter|Share on redditReddit
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MARTY MARTEL 7:38 AM ET January 21, 2012 US has become China’s bitch by choice
Little could Nixon-Kissinger have envisioned that US will become China’s bitch when in their infinite wisdom, they decided to embrace China’s Communist dragon to counter Russia’s Soviet bear in 1972.
World history will record last forty years as the most momentous for the very fact that balance of power has started to shift from West to East because of West’s leader embracing China to counter Russia in 1972.
Afterall China was a pariah country in the world just like today’s North Korea until Nixon’s 1972 visit. All the West European and East Asian countries stayed away from China following the US lead until 1972 and embraced China after Nixon’s visit. While US would not give MFN status to Soviet Union (remember Jackson-Vanik amendment?) unless Russia shed Communism, it had no problem giving it to China’s Communist dictators with a capitalist mask. Trade with China expanded by leaps and bounds during 12 years of Republican rule beginning in 1981. After campaigning against butchers of Beijing in 1992 elections, even Bill Clinton became enthusiastic supporter of trade with China once he took lessons in foreign policy from Nixon in early 1993 during a special Whitehouse-arranged meeting. US also promoted China to a super power status by accepting it as a permanent UNSC member.
Had it not been for that Nixon embrace in 1972, China’s rise to super power status would have been far more slower with all the US, West European and East Asian markets closed to cheap Chinese products. Had it not been for that Nixon embrace, China’s technological progress would have been far slower in the absence of West’s technology transfers. Had it not been for that Nixon embrace, China’s military progress would have been far slower in the absence of huge forex reserves that China accumulated from the massive exports of cheap Chinese products and China used those forex reserves to acquire latest military technology.
Now China has US by the tail - US businesses are hooked to huge profits that cheap Chinese products generate for them as a walk through any Walmart, Home Depot, Sears and Macy’s filled with Chinese goods prove and US government is hooked to huge investments that China makes in US governmental securities from the sales of cheap Chinese products to US businesses.
China’s power is multiplying day by day and now there is NO power on earth capable to stop China.
Little could Mao or Deng have imagined that by wearing a capitalist mask, their followers will beat capitalists at their own game. Lenin used to say that ’capitalists will sell us the ropes with which we will hang them’. With West selling such proverbial ropes in the form of technology transfers, Chinese Communists have proven that Lenin saying quite prophetic.
BRAVEHEARTNJU 12:05 PM ET January 21, 2012 People often says, judge a book by its title, make sense ;)
Does a really good book need to use such a humiliating title to catch eye balls?
BEINGTHERE 9:19 PM ET January 22, 2012 But could we have sponsored two wars without China?
In Kiernan's vernacular, the title does suck. But I like his reference to our country's having become "opiated." In my lifetime the U.S. has elected leaders with foreign and domestic policy strategies that are diminishing us. Our sponsoring two wars within one decade point to a country trying to strut its power. And this as we financed them, and other debits, through China's "generosity."
It's not just the new drum beats for a conflict with Iran that also display this deterioration of values, including discipline, but also if you have listened to the rhetoric of the people who are campaigning to preside over our country for the next four years, none of them have a clear vision of what those next four years will look like. If they dance around with that vision, it runs the gamut from amassing more debt for "innovative" programs or actually "recapturing America." Which America is this. Does this mean we go backward?
BLOGSTER 12:56 PM ET January 21, 2012 China's bitch?
Excuse me, but I was under the impression that the U.S. political class was Israel's bitch. I love america and feel sad about what's happening.
SPOOD 1:57 PM ET January 23, 2012 You have to get your policy hacks straight
We are the "bitch" BOTH of them. Just kidding
People seem to get a lot of nodding heads claiming so either way. The idea is inherently silly on both accounts. Its a great way to appeal to the far left academics (aka discredited communist hacks who kept their jobs) and get tenure.
China is poised for one of the largest economic collapses since the fall of the USSR. Their economic/political polices are both off the rails and opaque. Mismanagement seems to be catching up to them in small ways that are just now becoming obvious.
UMBRARCHIST 2:30 PM ET January 21, 2012 Accounting for History
Double-entry accounting was invented in Italy 700 years ago.
What Western country has mad accounting mandatory in the schools? A high school teacher in Sweden who said he was a socialist told me that he objected to the idea of accounting being mandatory because the math would make Capitalism seem logical.
Our economic philosophy wants workers to be ignorant so they are easier to rip off. The workers in China have been more desperate than those in the US. Do you think they are suggesting mandatory accounting in China?
So import junk from China designed to depreciate. Yeah, Ultrabooks.
JORDAN HAMEL 6:28 PM ET January 21, 2012 Peter Kiernan is just like everyone else...
...who notices that 42% of our government has to be borrowed to be funded and yet no where even second guesses whether or not we really need a government that is that underfunded? Maybe it should lose weight....when companies are overweight they die..Kodak...Walmart is as profitable as ever...pretty much has nothing to do with our over-financed government....it has everything to do with the fact that my generation is much smaller than the $$$ spendin' baby boomers running congress who spend to make sure they stay in office and there aren't enough of us paying taxes to match our "committed" gov. spending...
Oh, but that would mean a vote for someone who also thought we shouldn't over spend by 42%.....Ron Paul?
JDIP2184 8:48 PM ET January 21, 2012 Misleading
Comparing the United States savings rate to that of the Chinese is extremely misleading and I'm surprised the interviewer didn't push back on the author when he dropped the 5% to 30% statistic. Last time I checked China does not have a social security system and workers there frequently have to support not only their children financially but also parents and other relatives who are incapable of working. A high savings rate is essential in this type of system because there are simply not enough safety nets in place to support people if they suffer a financial setback. While I agree that it is imperative for the United States to ween itself of its dependence on Chinese capital, the idea that the U.S. is going to become the "bitch" of an authoritarian state with zero moral compass, a rapidly aging population and rampant government corruption in an increasingly high-tech and democratic world is simply ignorant fear-mongering. If you want to write a book about America's over reliance on China that is completely legitimate and in many ways important, but by framing it in such a crass and heavy-handed manner you not only undermine your premise but also perpetuate stereotypes that in no way benefit the national dialogue.
BEINGTHERE 8:59 PM ET January 22, 2012 Other than the title, the book may be worth buying
Kiernan's title and its concept is sexist and borders on juvenile, but it is attention-getting. If the book doesn't sell, maybe he can write hip-hop songs.
KEYBASHER 10:42 AM ET January 23, 2012 Change is coming to China
When a one-party state hosts an Olympics, ten years later that state circles the drain if it isn't already down it. To wit:
1936: Berlin Olympics / Garmisch-Partenkirchen Winter Olympics
1946: Allied Occupation
1980: Moscow Olympics
1990: Collapse of Communism
1984: Sarajevo Winter Olympics
1994: Yugoslav Civil War
2008: Beijing Olympics
2018: ?
Remember, you read it here first. Let’s hope China manages a smooth regime change – for once in their history!
SOCALMAVERICK 6:26 PM ET January 23, 2012 O please.
Did Thomas Friedman forget that we're already Israel's Bitch and that the fifth column "AIPAC" drafts our foreign policies.
Thomas Friedman knows that unlike the US president, the Israeli Prime Mister words get 100% of US Congress & Senate ears and commitment.
Every politician in the federal government of the US must pass an "I love Israel first and foremost" test before they have any chance of getting "elected" to office.
WILLIEJOE 12:05 AM ET January 24, 2012 China & Us
If you take advice from a fool twice-who is the greater fool? Goldman already took us once and we should listen to one of them again? As for the alleged subject of the book-China is a mercantilist culture and acts as such- we're a finance capital and technology power and never bothered to address the social and economic problems of being post industrial and that is now biting us in the ass. It's our problem to solve a fact the Goldmans' of the world would like us to ignore.
DEEVE 7:21 PM ET February 11, 2012 Walmart
Just because we get alot of stuff from China to sell at walmart doesn't mean anything bad will happen. I happen to have a healthy walmart gift card balance to use up so I hope they don't go out of business.
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