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Chinese manufacturers, the makers of the collective cheap garbage and detritus consumed by Western culture, are screaming because the government is allowing the Chinese currency (yuan) to appreciate a mere 6% against the dollar.

Serves them right.

In order to compete on the world market and help its manufacturers, China has for a long time artificially pegged its yuan to a certain exchange rate with the dollar, so that it goes up and down as the dollar does instead of just based on market forces. This has caused its exports to America to remain dirt-cheap, and has created a huge problem and trade deficit for the US. It has made manufacturing unprofitable in the US compared to China, and many of our factories and jobs have fled as a result. China has taken its enormous trade surplus with us and invested it in US Treasury bonds–IOU’s by the government that it must eventually repay. Just like a bank really owns your house as long as you have a mortgage on it, China is the US’s biggest creditor and can use that leverage in the future to enormous effect.

But cracks are appearing in China’s scheme to achieve world domination by manufacturing cheap garbage. Its economy is overheating and faces a meltdown if it continues its current rate of expansion. It also faces pressure from trading partners to loosen the Yuan-dollar peg or eliminate it altogether. Bowing to reality China has recently allowed the yuan to rise 6% against the dollar.

Suddenly, all these makers of cheap hats, toys, and other worthless gizmoes are having their only competitive advantage ripped from them. They can’t compete on brand name (can you name a single Chinese manufacturing company ala Nike, etc.?). They can’t compete on new or advanced technology. All they have to compete with is a dirt-cheap price on very low-margin products. Make that price increase even a little and profit goes to zero…hence why the manufacturers are screaming.

Our government has for too long tolerated this trade imbalance–although we as Americans have helped it along by buying all the cheap crap sold at Wal-mart. There’s always a day of reckoning though…and as China is being forced more and more to play on a level field with the rest of its partners it is becoming clear that China is still little more than a medieval backwater when it comes to technology and innovation–albeit one with a hell of a lot of money at its disposal.

As market forces re-assert themselves, and as manufacturing continues to become cheaper around the world, China had better find new and better ways to drive its economic growth engine, lest it slowly run out of gas. Designing high quality products instead of landfill filler would be a great start.

A couple of recent articles highlight the fact that the ideas of preserving our environment and of moving our culture from a wasteful to a sustainable one are gaining currency across the entire political spectrum.

This article in Newsweek discusses how both individuals and corporations are taking environmentalism in their own hands when confronted with overwhelming evidence of global warming and environmental degradation. In addition to highlighting some individual efforts, it discusses some changes going on in conservative Corporate America:

*Architects are beginning to incorporate eco-friendly considerations into their skyscraper designs. The best current example is the Hurst Corp. headquarters in Manhattan, which is totally infused with sunlight and which employs hyper-efficient use of energy. A new Bank of America tower planned for Manhattan will capture and use every drop of rainwater that falls on it, and will use methane from cafeteria scraps to help power the building.

*Wal-mart, condemned by many for its corporate practices, is going green. After bringing in Al Gore to consult for its executives, Wal-mart is pledging to reduce its carbon footprint by 20% in seven years. It will do so, for example through use of far more efficient packaging–the article states that reducing the packaging on just one line of toys will save $3.5 million in trucking costs and spare 5000 trees. It will also make far greater use of materials like organic cotton for clothing. If every business followed Wal-mart’s lead of reducing emissions by 20% the United States would meet the Kyoto Protocol despite the inexcusable dereliction of duty in Washington for failing to sign the treaty.

*Green technology has become the darling of venture capitalists, who are eager to get in on new technologies on the ground floor.

These changes are happening because they simply make common sense, and not just to liberals. Evangelicals are signing on because more and more are realizing that cherishing and preserving the environment is the good and Christian thing to do. The incontrovertible nature of the data on the global climate crisis is also winning over reasonable conservatives. “Al Gore can’t convince me, but his data can convince me,” mused one Republican in the Newsweek article.

The article notes that the US has a chance to become a leader in developing green technology and exporting it to the rest of the world. We could become that by spending $100 billion a year on it, the amount equal to what we’re throwing at Iraq right now. In doing so we would generate jobs, improve our standard of living, reduce our dependence on foreign oil, and greatly improve the dangerous trade deficits we’re running against the rest of the world. This is the kind of initiative that requires bold leadership from both Left and Right.

Separately, another article in today’s Washington Post discusses how environmentalists are allying themselves with hunters to protect natural preserves against the predations of drilling and oil companies. These two camps may come to blows on gun control, but they both understand the need to protect these fragile ecosystems and their ability to sustain themselves.

It’s easy to look to more drilling as a way of easing the nation’s energy problems, but such drilling will not significantly impact the overall imminent decline in petroleum availability nor will it resolve our energy problems in the long run. Insisting on drilling ever-more-expensive locations for smaller petroleum returns is like feeding a crack addict some more crack; it postpones but does not eliminate the day of reckoning. Sooner or later we have to move off petroleum. Until we do we will be held hostage by our addiction to foreign oil, because no amount of domestic production will ever eliminate that dependence. That’s all quite apart from the environmental incentives to stop burning fossil fuels. The logic of reducing our oil addiction becomes ever more evident to the entire political spectrum every time there is an increase in the price of gas at the pump.

Articles like these demonstrate that environmentalism has begun to rise above petty partisan bickering. It’s a problem that everyone faces, as Katrina attests, and is a problem that all must resolve. Environmentalism need not be in opposition to a strong economy, and can instead produce jobs and improve our lives. That’s a goal worth fighting for whether you’re on the Left or Right.