China Cutting Taxes

Figures issued by the National Bureau of Statistics and the People's Bank of China respectively show that China's industrial and manufacturing sectors are continuing their meteoric rise at higher then predicted rates. China's industrial output for January and February grew 16.2 percent when compared to the previous year’s numbers.

The major sector of improvement was the automobile industry, which churned out 40.6 percent more automobiles in the first two months when compared to the same time last year. During the same period China's output of steel products and cement both rose by 21.3 percent.

In an even more interesting development China is cutting taxes to help encourage household spending. This is being done to try to ensure that China is not completely dependent on exports to grow its economy.

For the US this is not good news, because this is a national security measure more then a sign of any economic reform by the PRC. The decrease in reliance on exports is meant to try to eliminate China's dependence on the US. After the PRC develops a self sustaining economy it will have no use for America, and will be able to then move to stop financing the US debt. Without Chinese cash the US consumer will not be able to finance his massive debt, thus not be able to buy any more products and this will lead to the collapse of the American economy.

The US government should take a lesson from the Chinese and try to protect its own economy. This can be best and most fairly done by reducing trade with China until the PRC starts to follow free market rules, and stops using a communist planned and protected economic system.