China Wednesday denied it is a "currency manipulator" and warned US presidential candidates not to engage in "election politics" when dealing with the world's second largest economy.
"We hope the US Republican and Democratic candidates will get rid of the impact of election politics and do more things conducive to China-US mutual trust and cooperation," Chinese foreign ministry spokesman Hong Lei told reporters Wednesday.
In the second presidential debate Tuesday night, Republican presidential nominee Mitt Romney repeated the rhetoric he has made throughout his campaign trail, saying he would declare China a "currency manipulator" once he is elected, attacking US President Barack Obama for his "soft policy" on China.
Obama fiercely pounded back by questioning the former Massachusetts Governor's record of making money by investing in Chinese companies, including ones "that are building surveillance equipment for China to spy on its own folks."
"Governor, you're the last person who's going to get tough on China," Obama said.
Romney did not shy away from the issue of his own foreign investments. He then challenged the president. "Have you looked at your pension?" he said, adding that Obama also has investments in China.
"The fact that both candidates are investing in Chinese companies demonstrates that close trade ties between China and the US serve the interests of both countries," Niu Xinchun, a US studies expert at the China Institute of Contemporary International Relations, told the Global Times. Full stroy
Republican presidential candidate Mitt Romney reaffirmed that he would label China a currency manipulator on his first day in office, if he was elected.
Meanwhile, President Barack Obama, the Democratic candidate, seized the opportunity to showcase his "success" in regards to China, saying that the yuan had appreciated during his time in office "because we have pushed them hard, put unprecedented trade pressure on China, and that will help create jobs here."
Romney even asserted that Apple gadgets are made in China because of unfair exchange rates, and he believes that manufacturing jobs will return to America as long as the playing field is level.
Although the yuan gained by nearly 30 percent since 2005, U.S. politicians have not stopped taking jabs at China's currency regime. This is because they know that even more aggressive appreciation of the yuan will do little to help restore domestic jobs, but shifting the blame to China will effectively allow them to gloss over their inability to put their economy back on track.
Moreover, Romney needs to understand that Apple products being assembled in China is not something that China should take pride in or even appreciate. Foreign companies are able to outsource manufacturing jobs to China because of the country's hard-working and low-paid workforce. This outsourcing maximizes the companies' profit margins, but leaves China with meager profits and massive pollution problems.
It seems Obama takes a more objective view on the dilemma facing the U.S. manufacturing industry, as he admitted that some low-paid and low-tier jobs will never return to America.
Romney's willful attacks on China and unfair trade rules do not necessarily mean that the billionaire, a veteran investor who used to profit handsomely from doing business with China, does not know the root of problem -- he said only said so to further his campaign.
The presidential campaign reflects an alarming scenario in which China-bashing has become a ritual. This ritual, however, negatively impacts China-U.S. relations and leaves Americans with the impression that China is responsible for their country's decline.
Romney has no reason to say that America's lack of competitiveness in the manufacturing sector is due to an un-level playing field. As the world's sole superpower, the United States is the main architect of world rules in most arenas, ranging from trade to military. It could file cases with the World Trade Organization if it finds that the situation is spinning out of control, and it can also stymie emerging Chinese companies in the name of national security concerns that are based on groundless accusations.
U.S. politicians need to paint a truer picture for their constituents. This picture should embrace China's rise and acknowledge that engaging with China will amplify win-win results, but scapegoating, isolating and vilifying China will hurt both sides. The economic interests of the world's top two economies are far too intertwined for these economic powers to handle a break up.
It is an embarrassing truth that past U.S. presidents have often toned down their tough talk on China after taking office, showing that they know the results of their tough talk going into effect would be disastrous.
Therefore, the presidential candidates should be mindful of going too far in bashing China, if they feel they must do so in order to win votes, because the specificity of their promises will leave them few options but to follow through.