Earlier today, Greenspan warned that sanctions against China and their low cost imports could backfire, costing Americans jobs and creating less competition in the marktplace. China has kept the Yuan at a steady exchange rate to the dollar for almost a decade, making Chinese goods less expensive.
Greenspan is reminding the Senate that we are living in a Global economy where one nation’s actions can affect everybody. It’s funny how many seem to forget that. And it has become a common belief that China will grow into our greatest economic ally, or our greatest competitor. I think we need to remain on good terms with them, but remembering that we can’t let them have a free lunch.
However the Senate Finance Committee decides to act, they should have a moderate hand. Our economy can’t afford a significant backlash. China’s future is bright, and we should try to bask in such a glow.