Hell No! We Won't Send Our Tax Dollars to China

Taking candy from a baby: A consortium of Chinese and American companies goes to Washington and announces plans to build a $1.5 billion windmill farm in West Texas using $450 million in U.S. Stimulus funds, which will create 2,330 jobs - 2,000 of them in China.

The baby -- Washington -- doesn't cry or whine or spit in the consortium's face. That's what's really wrong with this story.

So accustomed to being bought and sold, Washington simply begins processing forms so it can hand over your tax dollars to create jobs in a turbine factory in the city of Shenyang, China at a subsidy of $193,133 each.

It's like these bureaucrats live in Wonderland. Or an America where the unemployment rate isn't 10.2 percent. Or where 40,000 American manufacturing facilities didn't disappear in the past decade. Or where banks didn't repossess nearly a quarter million American homes in the past three months.

We've got a message for Washington: Hell no! We're not giving tax dollars to China. What's wrong with these businesses and our government? It is the $787 billion American Recovery and Reinvestment Act of 2009. It's not the Chinese Recovery and Reinvestment Act.

It's bad enough that we've off-shored our factories and technology and jobs over the past 20 years. We're not off-shoring our Stimulus cash too. In fact, we're tired of serving as the schoolyard wimp of the world. We need our own industrial policy so we can stand up and compete in the world market manufacturing the likes of wind turbines. And we need it now.

China has an industrial policy. And it uses that policy to dominate. Here is how Keith Bradsher of the New York Times described China's policy to become a world leader in renewable energy, which of course, would include construction of wind turbine factories:

"Calling renewable energy a strategic industry, China is trying hard to make sure that its companies dominate globally. Just as Japan and South Korea made it hard for Detroit automakers to compete in those countries - giving their own automakers time to amass economies of scale in sheltered domestic markets - China is shielding its clean energy sector while it grows to a point where it can take on the world."

China protects its chosen industries in many ways. It provides low interest loans, some of which don't have to be repaid. It may give free land on which to construct buildings. And there are other perks that Bradsher described:

"When the Chinese government took bids this spring for 25 large contracts to supply wind turbines, every contract was won by one of seven domestic companies. All six multinationals that submitted bids were disqualified on various technical grounds, like not providing sufficiently detailed data. . . even as Chinese companies that had never built a turbine were approved. . ."

Later, Bradsher describes European disgust at the Chinese treatment:

"European wind turbine makers have stopped even bidding for some Chinese contracts after concluding that their bids would not be seriously considered, said Jorg Wuttke, the president of the European Union Chamber of Commerce in China."

China has a policy. It ruthlessly protects its own industries.

China was among the many countries that complained bitterly when the U.S. included "Buy American" provisions in the Stimulus Bill. In fact, Vice Commerce Minister Jiang Zengwei told a press conference in Beijing in February that China would not do such a thing, "We won't practice a 'Buy China' policy," he said. Four months later, that's exactly what China did, instituting its own, stricter "Buy China" policy as part of its economic stimulus program.

China did what China felt was necessary for its economy. And it ignored foreign criticism.

That's hardly the U.S. tactic. Wilting under criticism, Congress diminished the Buy American provisions before passing the Stimulus.

As a result, we've got a consortium -- U.S. Renewable Energy Group, Cielo Wind Power and A-Power Energy Generation Systems - so bold that it believes it can get nearly half a billion dollars in American Stimulus money for 2,000 Chinese wind turbine jobs. The consortium says it would import 240 Chinese turbines to Texas where 300 temporary construction jobs would be created and another 30 permanent jobs established.

The wind turbines could easily be made in the USA. Bradsher, of the Times, says the Chinese concede that while their turbines cost slightly less initially, they have higher repair costs. He wrote, "United Nations data from trading of carbon credits shows that the Chinese-brand turbines produce less electricity because they are more frequently out of action."

Really, is that what we want to buy with American tax dollars for a wind farm in West Texas?

If the United States put half the effort into supporting its renewable energy industry that China does, there'd be no way this consortium building windmills in Texas would be looking overseas for turbines.

China has a plan. In its strategy, it doesn't consider America first or the remainder of the world first. And that's what the USA must do. We need an industrial policy that makes no apologies for putting America and American workers first. And when that's the calculus, no American official would ever countenance a request to give $450 million in American taxpayers' dollars to a turbine factory in China. And no American consortium would consider making such a stupid request.

In the meantime: Hell no! They don't get our dough!

 

Comments

[condor101]

it's all one big game. Get in on it or keep working for The Man.
BRIC (Brazil, Russia, India, and China) is the present and future.
America is a wonderful country for importers and sellers.
300+ million suckers to pay for overpriced products.
hahahahahahahahaha
Thank you Congress!

[edejan]

How are they not going to get our dough? There's no one in Washington who has the best interests of this country and its people at heart. Or maybe there are a few, but too few to have any effect. This is the first I've heard of this plan and the MSM apparently is not covering it. So again, our country is being sold out from under us and we don't even get a heads up.
BTW, thanks for the info. I guess I can now contact all my "representatives" in another futile effort to get their attention.

[dadw5boys]

http://www.alibaba.com/trade/search/3i1p5tyfchms/vertical_wind_generator.html


nuf said.

[Mollabaji]

Hell be thankful for having a job fellow because it is China that has subsidized our entire economy by giving us loans in the billions. If the Chinese decide tomorrow to withdraw their funds (they have invested in this country buying American bonds), the entire country would have been bankrupt, and you would be begging on the streets. Stop anti-China nonsense and be grateful to them.

[gbrooks]

It's China who's subsidized our economy/wars. We're almost entirely on a consumer/military economy now. It's been going on for years and it certainly continues.

In my opinion, deals like this are a back-door way to pay them back without being forthcoming to the American people.

It's not the Chinese that we should be angry with, it's our own government.

[ATXReader]

I wanted to get solar on my home here in Austin, but I wasn't fast enough. The city owned utility has just announced that all the committed funds for solar are depleted until at least 2011, if at all. So myself and others representing over $4.5 million in petitions for solar rebates are being denined.

Here in Austin, Texas all the solar installation companies are getting wiped out. The city apparently doesn't have a few $million to continue our solar rebate program, but the city owned utility is planning massive assestments to build another wind farm in west Texas. Responding to local outcry about the refusal to commit additional funds for local solar, the mayor announced a "low-interest" financing (through additional future property taxes on a residence getting solar.) Its a total bait & switch though. Switching to the new "low-financing" no-rebate model, the payback on a solar array goes from 8 years up to 20+. No one but hippies are going to buy a 25 year system with a 20 year payback.www.kxan.com/dpp/news/Lights_out_on_solar_rebates

Oh, here's another nice little tid-bit they told us there might be additional solar rebate monies if the city got some "stimulus monies". Apparently, of the $250million that Texas got to encourage renewable energy jobs, $200 million went to Houston's utility to pay for smart meters that had already been installed. Umm, I don't think that's how a stimulus works.

.

[Ben6768]

I wish that the U.S. would not be mentioned in the same sentence as China.

What to they do in Germany, Australia, Italy, Canada, France, Switzerlan­d,Denmark, etc --- about defending and promoting manufacturing, and the good stable life and diversified economy that it produces for the country in particular ? This should be our reference point for an advanced society, the great America that we all dream of.
Why do we deny ourselves this good life and instead opt for a race to the botom ?????

We can vote for anything we want, plus there is the choice of an uprising. Why should we be content with the crumbs that fall off the table ? We want the best of everything, and want it NOW, with a new political party that will galvanise the people and lead the uprising.

We are counting on you, Leo. You are a real man.

[CologneCitizen]

I wish that the U.S. would not be mentioned in the same sentence as China.

Exactly.

Instead of a race to the bottom it should be the other way around. The structures in many European countries are in fact not that different from the USA. Except this one bottom line: A government to benefit the needs of the PEOPLE FIRST and NOT the corporations.

[Ben6768]

The American people are treated, by both existing political parties, as a pool of 300 million consumers and taxpayers.

The American people are not treated with love and respect, and policies and laws are not made for their benefit, instead for the benefits of corporations, or "business" in general .

[iridium53]

Oh, I think you're mistaken.
We will send American money to China.

Obama bailed out GM. Then punched up the GDP numbers by subsidizing car sales.

First thing GM did with the American money that Obama gave them?
They're building a plant in China.

But, I'm very much with you - let's restore American competitiveness.
Instead, however, Obama is following the policies that Bush and Paulson established - government support of executives of big corporations is number one on the Obama hit parade. Average, middle-class taxpayers aren't on the list.

[fightorleave2]

Good for you, Mr. Gerard, but your voice is whistling in the wind, or some such metaphor. No one running the ship is listening, or cares. It's just like the filthy, perversion of the Times story about Goldman Sachs. I can't read past the first page of 7. It just makes me sick to my stomach and I don't understand how supposedly good people tolerate the sheer criminality of the banks. The living people will one day rise up and take from the dead what is theirs.

[Username 1]

Since we seem to be ready for a trade policy, we need a basis to implement it.

The clearest way to prevent the race to the bottom seems to me to be to remove the unfair advantage gained through manipulated currencies and low environmental controls.

In other words, countries with high standards and fair competition should be subject to no barrers but countries with controlled exchange rates, low environmental controls, and absurdly low wages.

http://corporatestatesmen.net/images/LEVELISM.pdf

or else goodbye to US manufacturing.

[Viper]

Those are not even close to the trade disadvantages we have. All of Asia and Europe refund a VAT tax on imports (upto an 18% subsidy). The rest all have lower cost single payer healthcare which is not in the cost of their products, another upto 20% advantage.

Then there is the make it here or it will not be sold here policies of all of Asia and Brazil.

Then there is China's 22.5% tarrif on our goods... we charge them just 2.5%.

Then there are countries like China which require that companies doing business there give them a 50% interest to the communist government.

Then there are the southern states here that built the foreign plants here for foreign companies (32 billion).. who get zero percent loans in their home country and we then complain about having to rescue GM! Duh...

Enironmental or currency manipulation are not even close to be the problems.. they are misdirections... from the fact that no one does free trade but us.. and we are getting killed.

The problem with having 700 foreign bases in 165 countries is that our Congress has forgotten who they represent and that goes doubly for the repugs

Regards

[therealredstateblues]

faved good post viper

[Ben6768]

Very good Viper !!!

Lets hear more from you on the vital issue of manufacturing.
I wish we had a party that we could vote for if we want to save U.S. manufacturing.

Obama has not said A WORD about industrial policy yet. Maybe he does not know such a thing even exists !

The only hope for U.S. manufacturing : a new political party. They will have my vote !

Cheers

[Realization]

Ok, Leo. Why not provide an easy for people to protest this in an organized manner? You need a call to action in here.

[tompoe]

I agree. Where's the petition? This is the stuff of Washington protests. Let's stop this bad habit in its tracks. Keep our jobs at home, and when we're flush with full employment, let's help China. Not before!

[brady61995]

the american consumer drives the trade deficit by demanding cheap goods. its like gas. if americans stopped buying chinese good the chinese economy would come to a severe slow down. if we stopped buying gas for a week big gas would choke on thier supply and lower the price. the story of 2300 jobs 2000 of them in china shows why we need to reform every part of our system and stop these projects from even being thought of.

[Realization]

One point of foreign industrial policies like those in Japan, Korea, and China is that they don't give the domestic consumer the choice. Foreign products they (government and industry) don't want to compete in their sandbox are either not allowed in or priced out of the market by all sorts of means. Control of distribution systems does wonders for domestic makers.

Our system has needed to be rejiggered to match foreign protectionism for over 40 years. Getting exchange rates right would be a start. Not nearly enough, though. Doesn't get to questions of protection, subsidies, targeting, tech theft, access to tech, etc.

We need an industrial policy and a trade policy that scraps the MFN idea (works against open markets) and uses a form of mirror image.

Letting the Chinese have any USG money except in return for tech (they don't nave it now) and on favorable terms is outright dumb. DOE putting money into an electric car operation that will produce in Finland is equally stupid.

The U.S. needs to get away from false ideas about free markets and start taking care of ourselves like others do.

[therealredstateblues]

right on as usual realization

[greyhound2]

Whoops. That's 50 cents per hour, not $5.

[greyhound2]

In 1996, Bill Clinton accepted a $33 million campaign contribution in his re-election bid. China wanted a pay-off for its donation in changeing its status to "Most Favored Trading" which would allow China to import into the US duty free. At that time, there were those who expressed concern about accepting money from a foreign government. Two weeks before Clinton left office, he signed that bill and the landslide of Chinese imports began.

The response to the trade imbalance has been that Americans need to get more competitive. How do you compete with $5 per hour, or $20 a week in pay? You couldn't exist for four hours in the US on $20. Our comparative advantage in innovation and technology? Why bother, China just downloads that information from US computers for free and puts it to work. China cheats and people who live in other parts of the world are considered "non-Chinese" and are irrevelant. We have gotten along without the Chinese for hundreds of years and we don't need them now.

[KC the SuperDog]

WELL SAID Greyhound2. You make a very good point that most don't realize...... we cant' compete with BRIC countries, Brazil, Russia, India, China because they have no labor laws (no / low benefits, safety, etc.), use inferior and often harmful products (lead paint) and manufacturing processes (pollution).

This is true for manufacturing as well as services. IBM off-shored over 10,000 in the first 90 days of 2009, the work was there, needed to be done - GREED said, make more profit and move the work to 3rd world countries.

Let's also make sure that the US Government does not give stimulus work to companies like IBM who betray their own American workers for the sake of short-term profits.

[TracerTong]

I think this illustrates a problem with libertarian market ideology in a Global Economy. The Free Market is fantastic when everyone is playing on a more or less level field. When a sovereign nation like China interferes and controls its industries to artificially deflate costs, any profit minded CEO would be insane not to take advantage of that.

We cannot stop China from doing what it is doing. We can make it unprofitable for a company to take advantage of Chinese markets.

[vascopyjama]

It's either that or we default on our debt when China asks for their money. My guess is that one day we will default anyway.

[Ben6768]

As long as we have military superiority we can default and tear up the piece of paper. The moment that China has military parity with the U.S. we will be put to slavery directly.