Yellen Trip to China: Biden Administration Presumption and Cluelessness on Display

It is hard to fathom what the US thinks it will accomplish by sending Janet Yellen to China to browbeat the Middle Kingdom into exporting less, particularly in the green energy sector, when China looks to be eating what the US thinks is its lunch. Other countries, most of all China, are not impressed by the US asking non-vassals for special breaks. However, we get some clues from a Wall Street Journal “exclusive” on the Treasury Secretary’s upcoming trip, based in part on an interview with Yellen.

Forgive us for painting with what might seem to be an overly broad brush. But given Yellen’s underwhelming chops (I first thought her dumbed-down speaking style was protective coloring; it’s since become evident that she actually thinks in bromides), working through the situation at anything other that a simplistic level risks giving the Administration more credit than it deserves.

As we’ll unpack in more detail, what is striking about the Journal article and other accounts is that the US is making a big demand, without offering anything in return. From the top of the Joural account:

The first time Janet Yellen went to China, she was impressed.

Then the top economist in Bill Clinton’s White House, she saw an economy booming with the support of Western-style market changes…..

Now, as Yellen prepares to travel to China this week as President Biden’s Treasury secretary, that optimism has given way to a sense of alarm. A cascade of inexpensive Chinese clean-energy goods is driving down prices on global markets, threatening to snuff out American efforts to nurture a domestic clean-energy industry. In meetings in Guangzhou and Beijing, Yellen is expected to tell her Chinese counterparts to stop relying on exports to prop up their underperforming economy and instead boost their own consumer market.

The Financial Times, which did not have the benefit of speaking to Yellen directly, presents a somewhat more moderate take:

Yellen said last week she would call China out for dumping green tech products on global markets. She is also expected to discuss expanding co-operation in combating money laundering and bolstering financial stability.

Now of course these statements may have a big dose of posturing for US audiences. But Chinese officials are no doubt paying attention.

Let’s look at some of the recent signaling.

The first thing to note is that the Administration regards this visit as important. The US instigated a Biden-Xi phone call yesterday. It was, the first since 2022 and the first direct communication since the Biden-flubbed meeting in San Francisco last November. Recall that session was perceived to have gone well, but Biden undermined progress by confirming he still regarded Xi as a dictator in a press conference immediately afterward. Many commentators depicted major reason for the conversation was to smooth the way for the Yellen visit, from April 4 to 9.

In fairness, the US is trying to patch things up on other fronts. Again from the Financial Times:

Later this week, US and Chinese military officers will meet in Honolulu, resurrecting a once-regular channel of communication that China halted after then US House Speaker Nancy Pelosi angered Beijing by visiting Taiwan in 2022.

Second, however, if you review the Chinese and American readouts of the Xi-Biden phone call, the Chinese depicted it as “candid and in-depth,” which means lots of friction. Xi’s readout depicted the relationship as hopefully getting past its nadir, but that not being a given: “the negative factors of the relationship have also been growing, and this requires attention from both sides.”

The Chinese readouts tend to come off as preachy and this was no exception. Xi’s sermon was that the US and China need to get along and the countries should “co-exist in peace”. The wee problem is that the US is still not willing to give up belief that it should be the dominant world power, which even worse has been maintained by not tolerating regional hegemons (see our efforts to weaken Iran and Russia). And absent a big bad economic crisis, the inertial path for China is to gain even more economic clout, which translates into more geopolitical influence.

Xi’s lecturing positioned as working from high-minded principles then moved to concrete beefs: the US giving lip service to the one-China policy while supporting the Taiwan independence movement, and now the US sanctioning more tech players. Xi said China would not allow the US to constrain China’s development. The Chinese readout records Biden as mouthing howlers, such as:

…its objective is not to change China’s system, its alliances are not targeted against China, the U.S. does not support “Taiwan independence,” and the U.S. does not seek conflict with China. The U.S. follows the one-China policy. It is in the interest of the world for China to succeed. The U.S. does not want to curtail China’s development, and does not seek “decoupling” from China.

The Chinese account also depicts the two leaders as discussing Ukraine and the state of the Koreas

The White House text depicts the call as “candid and constructive,” so the Administration seems marginally happier with communication. There was much less verbiage devoted to trying to find common ground and much more on the US asserting its interests, including impinging on Chinese sovereigity. That took place via Biden expressing “concerns” over China assisting Russia’s arms industry. The US and its EU and Asia friendlies sanctions against Russia are not legal. They were not approved by the UN. The US has no business sticking its nose into China’s trade and geostrategic relations with non-UN sanctioned states.

The White House readout includes:

The President emphasized that the United States will continue to take necessary actions to prevent advanced U.S. technologies from being used to undermine our national security…

It’s hard to square that position with what the Chinese report Biden as saying, that the US does not want a Cold War and the US does not want conflict with China.

Nevertheless, a Global Times story on the upcoming Yellen visit is almost chipper, so perhaps the lower-level communications are coming up with potential areas of agreement. From Experts urge US to approach China’s capacity issue objectively for positive results ahead of Yellen’s upcoming visit:

Yellen will discuss issues including what the US claims are China’s unfair trade practices and industrial overcapacity, bilateral cooperation on countering illicit finance and climate change, according to the [Treasury] press release…

Chinese analysts believe the US needs to stop using bilateral meetings to push for its unilateral agenda, as this will reduce the likelihood of positive results from the “positive” dialogue.

According to Reuters, a US Treasury official told reporters that Yellen during her upcoming China trip would “make clear the global economic consequences of Chinese industrial overcapacity undercutting manufacturers in the US and firms around the world.”

“The US should view China’s capacity issue from an objective point of view, as China’s production capacity is determined by global market demand, its efficiency and the scale of its vast domestic market,” Li Yong, a senior research fellow at the China Association of International Trade, told the Global Times on Wednesday.

Before we turn to the Journal account, which was clearly a planted story (the interview with Yellen was the inducement), notice that Global Times underscores what we inferred from the Journal account: that the US approaches these talks with China shamelessly pursuing its agenda, and not making a pretense of trying to achieve mutual benefit. So when Xi talks to Biden about win-win situations, he might as well be talking to a wall.

The Global Times account also indicates the Chinese think the US demands about Chinese “overcapacity” are top of its wish list, with “financial stability” also ranking high. Many think that amounts to getting China to agree not tank the Treasury markets.1

With that background, what do we learn from Treasury’s version to put its best spin forward via the Journal? Key sections:

The warning from Yellen is a sign that the Biden administration is moving toward raising Trump-era tariffs on some Chinese products, including electric vehicles. Such a move could reignite tensions between the world’s two largest economies, which have tried to stabilize relations in recent months.

The message will also mark an evolution for Yellen—and the end of a bygone era in U.S. economic thinking about China. Like other economists of her generation, Yellen, 77 years old, said the surge in Chinese exports at the start of the 21st century had seemed like a positive development, providing low-cost goods to global consumers. But the inexpensive exports also helped hollow out the U.S. manufacturing base in what became known as the China shock, leaving Americans out of work and fueling a political backlash to globalization.

Keep in mind the US whinge is not entirely off base. Michael Pettis has warned that the Chinese growth model is not sustainable by virtue of having unprecedented dependence on exports and investment, and sustaining it over such a long period is such a large economy. China had in recent years shifted to more reliance on investment and less on exports, but the combined total remained eyepopping. However, the investment boom had been directed heavily to real estate. That resulted in overinvestment and now a bubble unwind. China looked to be getting economically green at the gills from the deflationary impact of falling prices in such a big sector. However, the Chinese government pushed for and apparently succeeded at increasing investment in other areas, particularly the priority sector of green energy and other green technologies.2

And it is also true that over-investment results in falling returns on incremental projects, and if it produces overcapacity, can produce what in the 1800s was called “ruinous competition.”

But here, too much of the US complaining looks to result from self-inflicted wounds. We were the ones who chose to make China our factory and manufacturing waste dump. We were the ones who ceded capacity and know-how. And we are mad at China because they can make a good small EV for a price American consumers would find appealing and are beating us on cost in other key areas like solar panels and wind turbines. Despite Yellen having a venue where she can present evidence, I don’t see anything in the Journal that substantiates her assertion that the Chinese are competing unfairly.

In fact, if anything, the Journal provides evidence that goes the other way:

Chinese officials, for their part, are expected to criticize clean-energy subsidies in the U.S. after filing a complaint with the World Trade Organization last month challenging the Inflation Reduction Act. They have been critical of U.S. trade barriers and a push in Congress to ban social-media app TikTok, as well as U.S. steps to cut them off from advanced semiconductor technology.

Wall Street Journal readers were quick to point out the hypocrisy of the Biden Administration threatening more tariffs after Biden, when campaigning, savaged Trump for his tariffs on China. And let us remember Biden has not rolled back any of the Trump tariffs. Why not offer some carrots to China in the form of tariff rollbacks, rather than more sticks, particularly since many economists and businessmen depict the China tariffs as having backfired?

And let’s finally turn to the elephant in the room: what gives the US the standing to tell China how to run its economy? Since when are we a model of sound capital allocation?

On top of that, US pressure on Japan to change its policies in the 1980s, particularly the very swift deregulation of its banks, which wound up super inflating an already big real estate bubble, led in short order to the mother of all slow moving depressions?

Another layer of our hypocrisy is that the US has never been concerned with the impact of our economic policies on other countries. We can’t even be bothered to be a responsible steward of the reserve currency. As Yellen’s predecessor, John Connolly, quipped, “The dollar is our currency but your problem.”

So if the Chinese are shrewd, they will likely deflect, make minimal concessions, and perhaps show a willingness to do thing that in practice will take forever to get done. While Chinea is a proud country that is tired of white people trying to push them around, passive aggressiveness is probably the best way to sap the energy of a bullying US.


1 This has long been an overblown concern. If China were to sell a lot of Treasury bonds, it would be selling dollars to buy renminbi. Since investment transactions greatly exceed the value of trade transactions, the likely effect would be to drive the renminbi much higher, greatly reducing China’s competitiveness in trade, something it does not want to happen. In addition, the losses on Treasury bonds that China has suffered over the long term due to the managed appreciation of the renmimbi is controversial within China. I doubt that China has been marking its holdings fully or even at all to market in light of US interest rate increases, as in recognizing interest rate losses. In that way it is emulating a lot of US banks. Selling bonds would crystalize those losses and again risk upset at home.

However, China could also wrong-foot planned reductions in its Treasury positions, to both its (in terms of sale prices) and US detriment, so a wee bit of coordination could be useful.

2 Forgive the high-level narrative, but data out of China is notoriously unreliable, so it seem a low-payoff proposition to attempt any more specificity. But readers who have good sources or anecdata please pipe up.

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  1. jsn

    “We were the ones who chose to make China our factory and manufacturing waste dump. We were the ones who ceded capacity and know-how. And we are mad at China because they can make a good small EV for a price American consumers would find appealing and are beating us on cost in other key areas like solar panels and wind turbines.”

    And we did these things while making public goods, housing, health care, education, edible food, all prohibitively expensive. Not only did we export the skill chains that go with manufacturing technology, we degraded the workforce into one that would be hard pressed to engage in relatively well paid manufacturing. So, China provides public goods, damn communists, which allow their people to be well sheltered, eat well and apparently be fairly healthy and energetic. We do the opposite. What do you suppose the knock on costs for producing comparable products in our political economy vs theirs would be? It seems really hard to argue China is dumping given rising living standards producing lower priced high quality goods.

    I get Pettis’ point about this being unsustainable. If The Party doesn’t want a Western style consumer economy because of the environmental implications, they’ll need to shift to services and cultural production where human needs are met socially and psychologically, but that seems a heavy lift for an engineering based leadership cadre.

    1. Socal Rhino

      Pettis also thinks the US has a real problem with excessive inequality. Might be helpful to jointly pursue policies that mitigate our respective issues.

    2. Keesa

      Americans didn’t export anything to China. China has outcompeted the West fair and square. China never ever allowed direct West participation in China’s economy, China’s joint-stock companies always were based on Chinese state enterprise with investments from the West in either: technologies, expertise, or market access. What it demonstrates is that West’s narrative that it were they who exported industries to China for cheap labor and have “uplifted” them to civilization is a blatantly false self-congratulating neoliberal crap much akin to “we wuz kangz” white pharaoh mythology

      1. Paris

        OMG never read so much (incomprehensible) BS. Any American company that set foot in China had to couple with a Chinese partner and share technology, my dear. Are you hiding under a stone for the past 30 years, or maybe you’re under 20?

        1. CA

          “Any American company that set foot in China had to couple with a Chinese partner and share technology, my dear…”

          This is of course incorrect, and unfortunately insulting.

      2. CA

        “Americans didn’t export anything to China…”

        The writer is referring to Western proprietary technology. China built its own satellite positioning system, and space station and moon rover and launching rockets, and even its own electric vehicles and components… and there will be much more Chinese designed and built technology coming.

        Simply read through the and publication families, and notice the Chinese research and development being done.

        1. Yves Smith Post author

          Not entirely true. As we wrote, the US developed flat panel LED technology but Silicon Valley refused to invest in manufacture. The Apple iPhone depends os 12 core technologies, all US-created.

          1. CA

            “As we wrote, the US developed flat panel LED technology but Silicon Valley refused to invest in manufacture. The Apple iPhone depends on 12 core technologies, all US-created.”

            — Yves Smith

            [ Now, I understand. Thank you so much for explaining. ]

  2. Emma

    Couldn’t China use its dollar reserves to invest in other countries and denominate the return to in the local currency? Or forgive certain IMF/WorldBank loans for firm geostrategic allies (Argentina really choked that, but lots of governments in the works with post-Covid debt overhang.

    If it looks like the US will confiscated the money sooner or later, might as well try to buy some friends with it.

    1. Louis Fyne

      Yes, that is actually what is happening to an extent.

      US sends China USD for widgets. After paying its employees and suppliers, China Inc. has excess USD, some of which gets sent to developing countries. In the developing countries those dollars are used to refinance existing debt and/or fund infrastructure-resources projects.

      When in the past, those USD were sent straight back to the US government via US treasury debt purchases.

      1. Susan the other

        Sort of the release valve to decrease inflation pressures on the dollar gradually. How does it all work? Before the “BRICS” the US was creating new money to buy back all the dollars that were circulating as the international currency and those dollars were exponentiating as the world became more productive to the extent that the dollar couldn’t find new investments fast enough to maintain the value of the dollar? That excess of dollars was (imo) was a result of the sloppy practices of modern industry which extracts and pollutes without giving back and restoring the environment. As it looks now, John Connolly was wrong because it is our problem. And it is now driven by financialization which is itself driven by priorities like debt service. So why don’t we all just create new protocols now that the world is up to speed and devise ways to give back and clean up our messes? Simply cutting back on all the overproduction used to create the profit to pay down debt and invest in the next extraction mess won’t fix things. But China could lead the way to new industries focused on environmental reclamation instead of financial profit. So would that be a form of deflation-export or would it create stability? Or are they the same thing?

  3. JonnyJames

    It looks like this is a classic case of imperial hubris and delusion of the declining empire. As Yves points out: the US actively de-industrialized and offshored production to China for short term, short-sighed profits. Now the US “wants its cake and eat it too”.

    And, to China’s credit, they have used their opportunities wisely and have had one of the most spectacular economic development, lifting 100s of millions of people out of poverty etc.

    US policy is so inconsistent and irrational on the surface. The JB regime National Defense Strategy names China as the #1 enemy of the US. JB’s “gaffes”: If I recall, he has called Xi Jin Ping a “dictator” and other such names more than once.

    The US has imposed so-called sanctions on China, like many other countries. Unilateral sanctions are economic warfare and illegal, but the US/UK/Israel often ignore their own laws or agreements.

    China has been very calm and diplomatic, as usual, in the face of hostile and bellicose rhetoric from the Obama/DT/Biden regimes. (Pivot to Asia, Containment of China etc. Pelosi visit to Taiwan, military exercises on China’s back door etc.)

    As Michael Hudson has pointed out, the US cannot compete because overhead costs are much too high: housing, health care, energy, insurance etc. The previous post of the discussion by profs Desai, Dunford and Hudson explained a lot about China’s economy and finance.

    So, instead of critically analyzing the structural problems in the US economy, the US simply blames the foreigners for its problems – how predictable and convenient.

    Intelligence and honesty are two different things: Yellen is not stupid, but is she honest enough to see the reality and accept it?

  4. Es s Ce Tera

    “And let’s finally turn to the elephant in the room: what gives the US the standing to tell China how to run its economy?”

    I would like it very much if they asked Yellen this very question.

    1. Jams O'Donnell

      Probably ‘desperation’ is the correct answer to that question. Maybe throw in a dash of ‘entitlement’ and ‘arrogance’, but they are not strictly necessary.

    2. CA

      “And let’s finally turn to the elephant in the room: what gives the US the standing to tell China how to run its economy?”

      I would like it very much if they asked Yellen this very question.

      [ As for standing on the running of foreign economies, the US just vetoed a UN resolution offered by China that would honor a right to economic development for all countries. As for the acceptance of development rights of foreign economies, Janet Yellen recently travelled through Africa trying to convince national leaders to abandon the use of Chinese made telecommunication equipment.

      The point being that the US has decided it can determine the development paths of other countries. ]

    3. Passing by...

      In 2001 I recall a conversation with my neighbor who was a very intelligent professional, (since retired ), and a technical manager in a international manufacturing company. He was VERY startled by the outcomes of the 1999 WTO agreement that allowing the Chinese to demand that companies moving to China to manufacture had to share their company secrets.

      He also pointed our that the Chinese had prepared so well for the negotiations they had regional contests all over China for the selection of individual candidates that had preceded for ten years prior.

      He correctly predicted our current situation of de-industrialization, where Americans could, as NPR encouraged, find more meaningful jobs like Walmart greeters and professional dog walkers. (I’m not trying to demean the two other professions. I understand the latter can pay especially well, due to the plethora of dogs vs children).

      As he presented this I too was startled by the stupidity of our strategy. I asked him what was the expected outcome of the US negotiators. He thought that our negotiators actually believed that within two years the US would take control of the Chinese banking system.

      We both broke down in laughter.

  5. David in Friday Harbor

    I just loved reading the Global Times analysis of the Xi-Biden call. They quote Prof. Li Haidong of China Foreign Affairs University:

    The US sometimes pretends to be a gentleman in its diplomatic rhetoric but acts like a villain, and this two-faced nature is apparent to many countries, including China.

    C’mon, man! This simply doesn’t end well for the average American, completely dependent as we are on imported goods for the necessities of daily life…

    1. steppenwolf fetchit

      Up to several decades ago we used to make our own necessities of daily life. What happened between several decades ago and today that leaves us completely dependent on imported goods for the necessities of daily life? And how would we reverse that process over the next few decades so as to make ourselves end up being less than completely dependent on imported goods for the necessities of daily life?

      A good first step might be realizing and accepting that what leadership-type people like to think of as American hegemony is going, going, soon to be gone. And that America should start thinking about achieving modest National survival before that becomes an impossible dream too.

      America needs a cheaper dream. And if an overwhelming majority of Americans decide to agree with that, they might figure out how to reconquer “the” government and make it “our” government again, and “exterminate” the people who have lead America to where we now find ourselves.

      MAOKA. Make America O K Again.

      1. Jams O'Donnell

        You are right, but I can’t see how it is going to happen, outside of quite radical social breakdown. After all, when that CIA person opined that they would be successful when everything the public believed, was a lie, I think he meant it. I also think he was ‘reasonably’ successful.

      2. fireminer

        Even when there had been people warning about the end of the British Empire before and after WWI, it took many more years after WWII for the British ruling class to fully digest that fact. And it only happened under the watch of a working class that had been strengthened by both labour actions and the war itself. I don’t see the same thing happening in the US right now. If it even happens, then it will be on an extended timeline.

        1. steppenwolf fetchit

          Many years ago Charles Walters Jr. once quoted the National Farm Organization’s resident thinker-in-residence ( named Butch Swaim) as having said . . . ” Before there can be a revolution, there first has to be a revolution between the ears”.

          Such a revolution between the ears would take years of work to get spreaded around. It could be started by people who are familiar with the work of Charles Walters, National Organization For Raw Materials, etc., as well as the still -living legacy opponents of the so-called “Free Trade” concept and all the agreements and organizations based upon that concept.

          If a huge enough critical tipping point mass-load of people could achieve that ” revolution between the ears”, perhaps they could then figure out how to conquer the government and make it exclusively theirs and use that power to abrogate and abolish all Free Trade Agreements and withdraw from all Free Trade Organizations and Treaties. Then we would at least have reconquered the our-own-soveriegnty and freedom to re-protectionize our society and begin to restore a survival economy behind our big beautiful Wall of Protection. It would take us several decades from that point to restore a Survival Economy and a Survival Society within America’s own borders.

          Free Trade is the New Slavery.
          Protectionism is the New Abolition.
          ” America has Stood Up!” ( someday maybe . . . )

          We can’t even begin if we don’t even get started.

    2. John

      what are these necessities that are imported from china? i am sure there must be some.Perhaps I buy too few goods and too infrequently to notice. am I overstating it? yes, but you choose to be a consumer.It is not in your DNA.

      the US runs around the world telling everyone to do as it wishes. if there is reciprocity, if it not evident. the world is changing and the US has been the catalyst. the Ukraine project was a pipe dream from the get go. there was no planning but wishful thinking. contingencies were waved aside if even discussed. unless you have been asleep you know the rest. the result is to supercharge the BRICS+. to strip the emperor of even his drawers. to show the global majority or if you prefer the global south the true lay of the land. the result has been the inception of a massive global geopolitical realignment. it will be working itself out for the next generation or two, but that is contingent on the massive climactic realignment which may assert its prior claims.

      1. Jams O'Donnell

        “what are these necessities that are imported from china?”

        Well for a start, the vast majority of tools, including electrical hand-tools, which may have a US or Japanese badge, but are manufactured you-know-where. I don’t actually know, but just from browsing experience I would guess that a good 80% of Amazon’s stock is sourced from there. Then there are batteries for EV’s, too.

        1. steppenwolf fetchit

          Whenever I bought a garden tool, I tried to buy an American one if there was one and if it was a good one. If there wasn’t one, then I would buy it from France or Finland ( Fiskars) or Britain ( and some British tools are so good I would buy them preferentially). Or Taiwan or Mexico or Korea or etc.

          Recently, when I was in a garden supply store to get something, I just for the fun of it looked at all the different things that bore the Fiskars brand. They all said in the tiniest possible letters ” made in China for Fiskars”. I wonder if all the resultingly layed-off Fiskars workers were able to find other work in Finnland at Finnish wages. If not, they probably at least have Finnish quality survival-welfare and support to keep them from sleeping under bridges. But would they get enough money from survival-welfare to afford such things as might still be made in Finnland which would have to be sold for a Finnish price in order to support Finnish wages and social conditions?

          Forcey FreeTrade is a race to the black hole at the bottom of the bottom.

          1. steppenwolf fetchit

            Even if its only a little bit, we have to have that little bit for the things we have to have that little bit for.

  6. Amfortas the Hippie

    i was hanging things on people’s doors for extra money in austin when Bill Clinton, et alia, were singing from the rooftops about china being in wto and having most favored nation status(dont hear that phrase much anymore,lol)
    i remember yelling at the radio while driving to the next culdesac that this would kill us workers and manufacturing…this after i had been proved right(via Perot) about the nafta debacle, etc etc).
    the clintons only did one thing for me….make me want to study economics.
    because i knew they were f&&king me, but i didnt really grok fully just how, or how much or how hard.
    the more i have learned, the more i have learned to loathe them and their movement and heirs….and yellin fits into that category.
    as does scranton joe.

    1. steppenwolf fetchit

      How much internal reverse-development can America withstand before America becomes an under-developed nation? And once America has become an officially under-developed nation, would America, too, be considered to have a “right to economic development”?

      What if an underdeveloped America simply decided to assert that right? What if America cancelled all its Forcey FreeTrade Agreements, withdrew from all Forcey FreeTrade Organizations, etc. and re-protectionised itself to restore its own Survival Industries at a Survival Level?

      National Survivalism in One Country.

  7. Kouros

    “So if the Chinese are shrewd, they will likely deflect, make minimal concessions, and perhaps show a willingness to do things that in practice will take forever to get done. While China is a proud country that is tired of white people trying to push them around, passive aggressiveness is probably the best way to sap the energy of a bullying US.”

    After all there are western examples on temporization:
    -The Oslo Accords, which were supposed to a Palestinian state and insted there are over 800,000 settles in the West Bank.
    -The Minsk Accords which were supposed to give some level of autonomy to ethnic Russians in Donbass…

    1. CA

      The Chinese have experienced the very long-lived Chinese Exclusion Act of 1882, after Chinese workers contributed so much to building the Transcontinental Railroad.  Then, after a respite for battling the increasingly brutal Japanese who had invaded China in 1931, discrimination against China returned as the McCarthy period took hold.  President Nixon offered a respite in 1972, but what remained of that began to be undone and reversed by the pivot to Asia of the Obama-Clinton period.

      After all there are western examples on temporization:

      -The Oslo Accords, which were supposed to lead to a Palestinian state and instead there are over 800,000 settlers in the West Bank.
      The point of the 800,000 West Bank settlers was obviously to make a Palestinian state impossible.

      -The Minsk Accords which were supposed to give some level of autonomy to ethnic Russians in Donbass.
      German and French leaders covered over the continual violation of the Minsk Accords.

  8. Yaiyen

    I think what USA is doing is blackmail China, Yellen going to China is like asking China have you have enough. The question is will China capitulate one thing is sure, if they do, it will not be enough because USA corporations want it all

    1. CA

      “I think what USA is doing is blackmailing China…”

      March 28, 2024

      Bidenomics Is Making China Angry. That’s OK.
      By Paul Krugman

      [ Though Chinese investment has allowed for the last 45 years of stunning Chinese development, what Krugman, what Yellen, what Pettis are after is slashing Chinese investment. China however will not be undermining the foundation of its advanced development. ]

  9. Paris

    I can’t stand the helmet-haired old lady, I think she’s as senile as her boss. I do hope she gets a good 4$$ wiping by the Chinese, that would be so fun to read about.

  10. Joe Well

    77 years old and no wisdom to show for all those years.

    Yellen is a shining ornament of the US gerontocracy.

    1. Randall Flagg

      >77 years old and no wisdom to show for all those years.

      12 (substitute any age for 77) words that perfectly sum up all the “leaders” that we have at the top levels of our government. Senate, the House, President. Quite sad really

    2. ChrisPacific

      Her main qualification at the time was that she was a better option than Larry Summers.

      As bad as she is, this is still true.

      1. The Rev Kev

        You think that “lightbulb” Larry would think it a great idea to steal those frozen Russian assets and send them to the Ukraine? Because Yellen thinks that that is a great idea. idjut!

  11. Jason

    Yellen: Please keep buying our Treasuries, but you must stop selling the manufactured products to us that finances your buying of our Treasuries.

    China: …

  12. B Popolo

    The US would benefit from a new trade agreement with China, one where they come here this time, bringing some of their higher end manufacturing with them.

    Employ and teach Americans, and sell their cars etc at a significant discount to the bloated boats everyone else is foisting on us.

    American finance is degraded beyond belief. These people are not going to invest in anything more substantial than the next software application.

    The US government really shouldn’t be investing in manufacturing for profit.

    The deficit is already stretched, interest rates should remain well above zero to help savers and to fund conservative institutions like pension plans, schools, and cultural institutions.

    The purpose of government finance is investing in fully public infrastructure and health, education, and welfare.

    Bring the Chinese home.

    1. Glen

      There is merit in what you say here. Climate change and other global emergencies should be a compelling reason for the world’s governments to be working together. China’s industrial might could go a long way in help all the rest of the world to move forward. Nor should China’s lead in technology be anything other than a spur to America to do better. And the on-going failures on America’s effort’s to war it’s way to dominance in Ukraine and the middle east are failing or have failed; serious further pursuit of this goal would be to turn America and the West into a TINA neoliberalcon Oceania.

      I’m not sure America’s elites can admit that unipolar is gone and work together with it’s peers. Yellen being sent over there to berate China into doing what America wants show a profound misunderstanding of our situation. Yellen and her cohorts spend much of their career destroying the American middle class. Maybe her experience of “creation” is a new policy which allows the Fed to turn on a lending windows potentially creating trillions to be spent. Industrial policy doesn’t work like that – it requires trained, skilled and motivated workers. We had them, it was called the blue collar middle class, but it’s mostly gone now, and nobody at Yellen’s level of governance knows how to make more.

      As to American finance, it seems to exist to extract wealth from the middle and lower classes and funnel it upwards. Since America no longer has a significant industrial base, it seems that they will now concentrate of extracting maximum profit from American housing, education, food, water; everything Americans need to avoid living under a blue tarp next to the freeway. They want further privatization of public infrastructure in order to extract more. This is the exact opposite of what should be done to revive America. Do we really need to focus on making more rich billionaires?

  13. spud

    the immense damage done to america and the world by the people who came into power in 1993, cannot be understated.

    really we are at the point now that what bill clinton did has sunk america, its simply to big a mess to reverse.

    i am afraid the simpletons will rely on nukes to reverse the incredible damage wrought by their own insane policies.

    never let it be said that fascists are not clever and cunning. but as far as smart is concerned. why not have larry moe and curly run things.

    “There were two events in late 2001 that shook the axis of the world.

    The world was preoccupied with the immediate aftermath of 9/11. But exactly three months later, on 11 December, the World Trade Organization (WTO) was at the centre of an event that was to cast as strong a shadow over the 21st century, changing more people’s lives and livelihoods around the world than the attacks on America.

    Container ships are the juggernauts of global trade. In the five years after China joined the WTO, the number of containers on ships coming in and out of China doubled from 40 million to more than 80 million. By 2011, a decade after the country became a WTO member, the number of containers going in and out of China had more than trebled to 129 million.

    Last year it was 245 million, and while about half of the containers going into China were empty, nearly all those leaving China were full of exports.”


    The High Cost of the China-WTO DealAdministration’s own analysis suggests spiraling deficits, job losses
    Report By Robert E. Scott February 1, 2000
    Issue Brief #137
    The High Cost of the China-WTO Deal
    Administration’s own analysis suggests spiraling deficits, job losses
    by Robert E. Scott…)

    “No one can predict the future. But the Clinton Administration is confidently forecasting that the huge U.S. trade deficit with China will improve if Congress accords China permanent normal trade relations (PNTR) in order to accommodate Beijing’s membership in the World Trade Organization (WTO). President Clinton claims that the recently signed trade agreement with China “creates a win-win result for both countries” (Clinton 2000, 9). He argues that exports to China “now support hundreds of thousands of American jobs,” and that “these figures can grow substantially with the new access to the Chinese market the WTO agreement creates” (Clinton 2000, 10). Others in the White House, such as Kenneth Liberthal, the special advisor to the president and senior director for Asia affairs at the National Security Council, echo Clinton’s assessment:

    “Let’s be clear as to why a trade deficit might decrease in the short term. China exports far more to the U.S. than it imports [from] the U.S….It will not grow as much as it would have grown without this agreement and over time clearly it will shrink with this agreement.”1

    These claims are misleading. The Administration has proposed to facilitate China’s entry into the WTO at a time when the U.S. already has a massive trade deficit with China. In 1999, the U.S. imported approximately $81 billion in goods from China and exported $13 billion – a six-to-one ratio of imports to exports that represents the most unbalanced relationship in the history of U.S. trade. 2 While exports generated about 170,000 jobs in the United States in 1999, imports eliminated almost 1.1 million domestic job opportunities, for a net loss of 880,000 high-wage manufacturing jobs. 3

    China’s entry into the WTO, under PNTR with the U.S., will lock this relationship into place, setting the stage for rapidly rising trade deficits in the future that would severely depress employment in manufacturing, the sector most directly affected by trade. China’s accession to the WTO would also increase income inequality in the U.S. 4

    Despite the Administration’s rhetoric, its own analysis suggests that, after China enters the WTO, the U.S. trade deficit with China will expand, not contract. The contradiction between the Administration’s claims and its own economic analysis makes it impossible to take seriously its economic argument for giving China permanent trade concessions.”

    (Sir James Goldsmith discusses his strong opinions on General Agreement on Tariff & Trade (GATT).
    Sir James Goldsmith discusses the ramifications of free-trade agreements that were about to take place in 1994 (GATT))

  14. WillD

    You have to give the Chinese credit for putting up with the vast amounts of s**t from the US. It’s always the same, the US never listens, it is incapable of even beginning to understand other points of view, and still thinks it can ‘persuade’ (read bully/coerce) China to do its bidding.

    As Xi has said many times, the Americans say one thing and always do the opposite. They lie by default.

    Yellen’s visit will accomplish nothing.

  15. AnObserver

    When Yellen talks about financial stability and money laundering with China she is saying she wants to limit the extent of US and vassal countries investment in China because she needs this capital in the US.

    So basically she is asking China to cripple itself because the US is asking it to.

    Delusional thinking I tell you.


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