by Joey Khalil
One key issue during the last presidential debate, and a reoccurring theme between both candidates on the campaign trail, is “getting tough on China.”
Mitt Romney has said multiple times throughout the campaign, “On Day One, I will label China a currency manipulator, which will allow me as president to be able to put in place, if necessary, tariffs where I believe that they are taking unfair advantage of our manufacturers.”
“China is both an adversary but also a potential partner in the international community if it’s following the rules. My attitude coming into office is that we are going to insist that China plays by the same rules as everybody else,” Obama said Monday night.
With the election just a few weeks away the candidates are making a last minute push to sway undecided voters. One demographic that grows every year in the U.S. that candidates don’t have to worry about is the population of Chinese students at American universities. There are nearly 160,000 Chinese students, a forty-three percent increase in the past year, according to the Washington Post.
Edith Zhou, a Chinese graduate student at Michigan State, says she is somewhat skeptical about the campaign messages of both candidates regarding China.
“I think both candidates mention China because they want to get people’s attention in the debate,” Zhou said, “ I don’t believe that they think like that and would consider stopping trade to China.”
Zhou says that both candidates need to appear tough on China’s trading practices in order to also appear focused on the economy, which she believes is the most important issue to voters.
“The economy is so big in the election and during the debates [both candidates] need to catch everyone’s eye,” Zhou said.
The rhetoric toward China has focused mainly on the trade deficit and policies of currency deflation.
“China has been known to artificially bring down the value of its currency,” said finance major Nicholas Bigham, “what happens as a result is that the dollar becomes more valuable against it and we’re able to buy more Chinese goods at cheaper costs. Why wouldn’t we buy a whole bunch of Chinese exports?”
Bigham says the same logic applies for the entire international community.
“The problem is artificially changing the value of your currency to make your own exports look more attractive isn’t exactly accepted as fair trading practice in the global trading market,” Bigham said.
Zhou says some economic factors that China is accused of manipulating are simply a part of China’s economic comparative advantage.
“If the candidates mean we have cheaper resources and cheaper labor, that accusation is just unfair to me. Every country has its own advantage and, I mean, those are just our advantages,” Zhou said.
A number of news organizations have since fact-checked claims made by both candidates on the trade relationship with China.
The L. A. Times reported “During the 2008 campaign, Obama said he would ‘use all diplomatic means’ to deal with China’s currency, but under Obama, the Treasury Department has not formally labeled China a currency manipulator, a designation the United States has not placed on the country since 1994.”
Obama’s promise to address China’s reported a currency manipulation is subject to interpretation, according to financial experts.
Since 2005, the value of China’s currency has, under pressure from the United States, steadily risen. The exception is a small lapse during the 2008 financial crisis. According to Bloomberg, Obama’s statement that China’s currency is at its most advantageous point for the U.S. exporters since 1993 is accurate.
According to Chinahearsay.com, an independent fact-checking website specializing in claims on China, the specific example Mitt Romney cited relating to China’s stealing American intellectual property, was somewhat true.
Mitt Romney labeled China a ‘cheater,’ saying, “by stealing our intellectual property; our designs, our patents, our technology. There’s even an Apple store in China that’s a counterfeit Apple store, selling counterfeit goods.”
According to Chinahearsay.com, the goods sold from the store to which Romney is referring are actually legitimate Apple products, however the store is not an authorized Apple reseller.