Be Careful What You Wish For

I have a thing about reading my email messages and gleaning material for columns from them. That is the case this week.

I received a message with pictures from one of my buddies. I’m almost certain that you’ve seen it too. It concerned a huge container ship named the Emma Maersk. Maersk Line, a Danish company, owns the Emma Maersk, but it is apparently used exclusively for shipment of goods from Mainland China to the United States.

After listing all of the statistics on the size, speed and capacity of the Emma Maersk, the very last paragraph relates that the ship only carries cargo one way, and always returns to Asia empty. And of course there is the usual lament that we are purchasing all our goods from China while manufacturing here at home is languishing and disappearing.


As usual, the message ends with a proposal that we boycott all goods coming over from China–there is another message out in the Ethernet that shows how to identify foreign goods by the beginning numbers on the bar code–and buy only American products.

I am going to take issue with that inflammatory paragraph. Yes, we are buying a lot of goods from China (and Bangladesh, and India, and Japan, and Korea, etc.) and the quality and safety of those products is becoming a real concern. That being the case, the selective bad products have a way of seeking their own boycott. We don’t buy what we don’t trust. The plan that is being fostered is to boycott all products.

However, I don’t have the same view of our deficit spending on foreign goods, especially those we buy from China. What do you suppose most of that money we send to china is used for? If you think it is used to build the infrastructure of China, you’re wrong.

Most of the money we spend on Chinese goods is used to buy United States Treasury notes. That’s right, China is financing our reckless spending. In fact, China practically owns the United States government. If they ever decide to quit buying our T-bills (and there is a lot of pressure building to do just that) we could go bankrupt in short order.

I don’t like the fact that China is our largest investor in federal bonds, but I like the alternatives a heck of a lot less. As long as we continue to purchase from them, we at least have some support for our dollar. If we were ever successful in boycotting Chinese products, all they would have to do is threaten to cash in some of those bonds, and we would have to relent. Otherwise, our current economic troubles would look infinitesimal in comparison with the turmoil we would have as a result of our boycott.

So, the fact that the Emma Maersk is going back to China empty isn’t all that bad. After all, it doesn’t take a huge container ship to float all those bonds to China. All the goods that come this way are being sold to finance our way of life for us.

I believe the saying is, “Be careful what you wish for.” And I know, the grammar is wrong, but that's the way the saying goes.