Having recently returned from a trip to China, I have a clear understanding why China is extremely competitive economically. It is not just the balance of trade and its currency games. It is the structure of its society and the fact that it doesn’t have to spend so much time in the messy political situation that we have known as democracy.
It also became clear to me why Secretary Clinton is spending so much time in Asia (two weeks) and President Obama is going to India and Indonesia. China is becoming an economic superpower, and our allies and friends in the region are a bit nervous. Secretary Clinton has had a busy agenda, including Australia, Cambodia, Malaysia, New Zealand, Vietnam and Papua New Guinea (home to new oil exploration). Only at the last moment was China’s Hainan Island added for a visit with a high-ranking member of the Chinese government. It was clearly added to calm down the fears of the Chinese government that is nervous about the United States shoring up its contacts in the region.
President Obama’s trip is for annual meetings of the G-20 and the Asian Pacific Economic Conference, or APEC. However, he rescheduled the promised trip to Indonesia and India. Despite the right wing’s view that the president is returning to his homeland of Muslim roots, the trip to Jakarta is important for political and economic reasons. As the world’s fourth most populous country, an emerging democracy and a Muslim country, it is also an important potential trading partner. It should be lost on no one that a Muslim democracy in a country that has the fourth largest population can counterbalance China.
The president also made India a major stop. During my own travels there, it became clear that India is the other emerging power in Asia, and there is no love lost between India and China. When I was last in India a year ago, a group of very earnest businessmen tried to impress on me that the next big war that was going to be fought was between India and China. Indeed, Indian troops guard the border between Bhutan and China, and both countries are mindful of the invasion of Tibet by China. India regards China as a threat and something to keep watch over.
The president has been hounded about how expensive the trip was, and there has been inaccurate information about the costs. More than 200 CEOs went on the India portion of the trip, and there have been great results in a short period of time. Boeing racked up big gains with the Indian government purchasing 10 C-17s, producing 22,000 jobs and a deal of $2.7 billion with Spice Jet for more planes. Other CEOs attended, including representatives from PepsiCo and General Electric.
This makes smart business sense as India will have a GDP that is expected to grow 8 percent though 2015, and the increased GDP will mean more demand for goods and services from the United States. We are the second largest importer of goods to India. The biggest imports impact California and Texas economies with the largest imports being machinery, aircraft and fertilizer. In addition, the U.S. makes more than $1 billion a year educating Indian students.
The people furious at the president for this “lavish” trip need to understand what is at stake here. It is not just the jobs and trade that this is producing. It is also the need to keep tabs on the emerging economic and military power that China has become.
Obama spoke about China possessing the world’s fastest super computer at his press conference this week. It did not meet with headlines, although when the former Soviet Union put up the Sputnik satellite in 1957 it changed how America did things. Schools changed overnight science and math became a major focus of what was taught.
We are too busy playing gotcha politics to worry about how we are getting beaten by emerging economies, especially China. Politics used to stop at the water’s edge, unless of course the politician is Obama. Then, it seems, that our interests as a country go out the window in the service of advancing political agendas by Obama’s foes. We need to stop this and realize what our real problems are and that means paying attention to what is happening in the rest of the world.