From China with Love

The Financial Times has put out a good article about a bill that is working through congress, which would apply a 27.5 percent tariff on all of China's exports to the United States. Although, as it looks now it will probably fail to pass due to large Republican and some Democratic opposition, it is still good to see that Congress is worrying about the US trade deficit with China.
The article also presented some good numbers like that US imports from China rose 37 percent in January and February, while during the same period US exports to China fell by 10 percent. The worst part of these numbers is that China's exports are not only growing in traditional areas like textiles and apparel, but in heavy industry areas like steel and chemicals. This is happening at the same time as the same industries are slowly dying out in America.
A major problem with controlling the trade deficit with China, is that since China has recently become a member of the World Trade Organization the US can't just slap on some tariffs. So the Congress and Senate are tying the tariffs in with Chinas unwillingness to stop pegging its currency to the US dollar. If the bill miraculously passes both houses then whatever China does, whether it frees its currency or not America should be better off in its economic war with China. So everyone keep your fingers crossed, but don't hold your breath over the passage of this bill.

In good news it seems that slowly the American military is waking up to the threat posed by the ever increasingly improved Chinese war machine.