hina has become a major financial and trade power.57 But it doesn’t act like other big economies. Instead, it follows a mercantilist policy, keeping its trade surplus artificially high. And in today’s depressed world, that policy is, to put it bluntly, predatory.

—Paul Krugman, Nobel Laureate Economist

Over the past decade, riding tall astride the Trojan Horse of free trade, a “predatory” China has stolen millions of American manufacturing jobs right from under our noses. If we had held on to those jobs, America’s unemployment rate would be well below 5% instead of near double digits, the U.S. government budget would be in balance, and our once-fair country would be facing a far brighter future than any we can currently envision. The obvious question is this: Why have we as a nation stood so passively by in the face of one of the greatest heists in global economic history: China’s theft of the American manufacturing base?

“Oh, but wait!,” you say, “China is taking America’s jobs fair and square using a cheap and well-disciplined labor force.” That, of course, is the spin of the China apologists who refuse to acknowledge even the existence of unfair trade practices.

In fact, when you carefully research the real sources of Chinese competitive advantage, it becomes crystal clear that more than half of China’s edge comes from a complex array of eight unfair trade practices, each of which is expressly forbidden under the normal rules of free trade. These exceedingly potent “Eight Weapons of Job Destruction” include:

An elaborate web of illegal export subsidies

A cleverly manipulated and grossly undervalued currency

The blatant counterfeiting, piracy, and outright theft of America’s intellectual property treasures

An incredibly short-sighted willingness by the Chinese Communist Party to trade massive environmental damage for a few more pennies of production cost advantage

Ultra-lax worker health and safety standards so far below international norms that they make brown lung, butchered limbs, and a dizzying array of cancers not just occupational hazards but virtual certainties

Unlawful tariffs, quotas, and other export restrictions on key raw materials from A to Z—antimony to zinc—as a strategic ploy to gain greater control over the world’s metallurgy and heavy industry

Predatory pricing and “dumping” practices designed to push foreign rivals out of key resource markets and then gouge consumers with monopoly pricing

China’s vaunted “Great Walls of Protectionism”—to keep all foreign competitors from setting up shop on Chinese soil

Make no mistake about it. These are real economic weapons with considerable firepower. The simultaneous firing of these weapons at America’s manufacturing base has already led to the shutdown of thousands of American factories and turned millions of American workers into collateral damage—all under the false flag of so-called “free trade.”

Why There Is Nothing “Free” about Free Trade with China

If you want to find out what free trade isn’t, try reading any one of the economic textbooks our kids are reading in college these days. Your eyes will roll, your head will spin, and your stomach will turn because these texts are so divorced from the reality of the global trading arena. It’s as if Gandhi had replaced Clausewitz and Sun Tzu in military strategy courses.

Indeed, despite abundant evidence to the contrary, these textbooks, continue to tout the virtues of free trade and the so-called “gains from trade” that we all should benefit from. But here’s what these unwitting propaganda tracts fail to acknowledge: While free trade is great in theory, it rarely exists in the real world. Such conditions are no more found on Earth than the airless, frictionless realm assumed by high-school physics texts.

In the case of China v. the United States, this seductive free trade theory is very much like a marriage: It doesn’t work if one country cheats on the other. Instead, when China systematically engages in the eight unfair trade practices described in this chapter, the “positive sum” game in which both countries are supposed to win quickly devolves into a “zero sum” game with one big prosperous winner and one big recessionary loser. In precisely this way, “free trade” between the Dragon and Uncle Sam has simply become a code word for “Death to the American Manufacturing Base!”

If They Build It, American Jobs Won’t Come!

Just why should we care about the loss of America’s manufacturing base? Haven’t we been told by pundits like The World Is Flat Thomas Friedman that America’s prosperous future lies in the rapid expansion of service sector jobs? And haven’t talking heads like Newsweek’s Fareed Zakaria and even the Atlantic’s James Fallows insisted over and over again that the migration of manufacturing jobs from America and Europe to low-wage countries like China and India is as inevitable as the tide rising and sun setting?

Yes, of course we have been force-fed this pabulum. But journalists like Fallows, Friedman, and Zakaria are, and excuse the pun here, flat-out wrong. What these misfiring pundits and others of their ilk have failed to grasp is one of the most fundamental principles of economics:

American workers can compete with their low-wage counterparts anywhere in the world as long as they are more productive—and the free trade playing field is level!

This has always been the American worker’s competitive edge: using superior machines, technologies, and innovative processes to boost productivity. Through the highest rates of productivity in the world, America’s blue-collar manufacturing workers have always been able to earn a decent wage and thereby finance their own versions of the American dream.

Instead, America’s blue collar dream of a white picket fence and kids in college has turned into a nightmarish phantasm because, no matter how much the American manufacturing workers of today produce, they can’t possibly defend themselves against China’s “Eight Weapons of Job Destruction.” In fact, while manufacturing once accounted for fully 25% of the American gross domestic product, today that share has shrunk to a mere 10%.

Not coincidentally, as China has systematically hollowed out the American manufacturing base, its economy has grown at the astonishing rate of 10% annually. In contrast, over the past decade, the U.S. economy has expanded at a rate of only 2.4%. Note that this paltry 2.4% growth rate during the 2000s is fully 25% below America’s historical growth rate of 3.2% between 1946 and 1999.

“Wait, wait,” you say, “a mere 0.8% drop in America’s annual GDP growth rate over the past decade can’t have made that much of a difference.” But here’s the rub. That 0.8% difference equates to a failure to create almost 1 million jobs a year and, cumulatively, over 10 million jobs over the last decade. Not coincidentally, that’s almost the exact number of jobs we need to get the American economy back to full employment and producing at its full potential output.

If We Build It, American Jobs Will Come!

Now here’s the bigger manufacturing base picture: It’s not just these raw job loss numbers over the past decade of over 10 million jobs that make manufacturing so important to the American economy. A strong and vibrant manufacturing base is also critical to long-term prosperity for at least four reasons.

For starters, manufacturing jobs create a lot more jobs downstream than service sector jobs. In fact, for every dollar of final manufacturing output, America creates almost a dollar and a half in related services such as construction, finance, retail, and transportation.

Manufacturing jobs also pay more on average—a lot more—particularly for female and minority workers. This higher blue-collar purchasing power provides a critical stimulus for the rest of the economy. It’s not for nothing that when factories close, the retail centers, doctor’s offices, hotels, and restaurants that grew up around them die with them. When factories leave, city and state tax revenues fall as well, and government jobs and services must be cut.

Most importantly, a strong manufacturing base is critical to spurring the technological innovation that America needs to power its economy over the longer term. The sobering fact here is that U.S.-based manufacturers account for fully two-thirds of all private research and development in America. When these manufacturers leave for China, they take their research and development expenditures with them—and America’s ability to innovate!

A fourth and final reason America must staunchly defend its manufacturing base has to do with the critical relationship between large, finished goods manufacturers like Boeing, Caterpillar, and General Motors and the rest of America’s manufacturing supply chain. Keeping the factories of these heavy industries in America is important because a whole host of other companies large and small depend on their business.

For example, big companies like AC Delco headquartered in Kokomo, Indiana and Cummins Engines headquartered in Columbus, Indiana supply products like auto parts and diesel engines to firms like GM and Ford. Thousands of medium-sized and smaller companies in hundreds of cities across America likewise contribute generic components like high-pressure hoses and electrical cables, as well as build customized inputs like injection-molded plastic and precision-milled parts.

Now here’s the problem: When a firm like DuPont or Medtronic offshores its production to China, it usually takes all the supply chain business with it. This is not just for logistical reasons. It’s also because of protectionism: China forces the Western firms that offshore to China to use Chinese domestic content and thereby to help develop Chinese domestic suppliers on Chinese soil. In fact, interviewing a Shanghai manager at a major American supplier of aircraft assemblies, we learned this firsthand: The firm routinely brings in U.S. engineers to educate underperforming Chinese suppliers on how to improve the quality of precision subcomponents. Through this process, the firm is able to replace U.S. partners it has worked with for years.

So from now on, whenever you see a big company like 3M, Cisco, or Ford offshoring another plant to China, please understand that the loss of jobs is not confined to the company in question. Rather, in this twenty-first century version of “trickle down economics,” initial job losses ripple through the rest of North America’s manufacturing base, then through all of our service sectors, and finally, once-vibrant manufacturing hubs like Warren, Ohio, and Windsor, Ontario, become new ghost towns.

For all these reasons, it should be crystal clear why manufacturing jobs are so critical to long-term prosperity not just in America but in Europe and Japan and the rest of the world. It should be equally clear why China’s hammer blow to America’s manufacturing bases has made it so difficult for the United States to create enough jobs to significantly cut its unemployment rate. For even though a desperate White House has thrown a massive stimulus at America’s flagging economy, our unemployment lines continue to stretch for miles. Just why do you think this is so, Mr. President?

Well, here’s one reason: Trying to jumpstart our economy with a massive stimulus in the absence of a vibrant manufacturing base has been like trying to start a car without spark plugs or gain traction on slick tires. It just can’t be done. Sadder yet, a great portion of that stimulus money leaks right out of our economy and stimulates Guangzhou and Shanghai rather than Gary and Pittsburgh. Indeed, the false Keynesian vision of a virtuous cycle of spending just won’t play in Peoria when so much of what we buy isn’t made here and our biggest trading deficit partner never reciprocates.

How Does China Cheat? Let Us Count the Ways

Let’s turn now to a more detailed analysis of China’s Eight Weapons of Job Destruction. And let’s start with China’s elaborate web of illegal export subsidies.

#1: The Export Subsidies’ Dagger to the Heart

On the face of it, the term export subsidies seems pretty innocuous. But to understand just how such subsidies represent a real dagger to the heart of any American business, imagine for the moment you are a Chinese entrepreneur ready to start up a company that will do battle with a competing manufacturer in Ohio, Pennsylvania, Michigan, or Tennessee.

To jumpstart your enterprise, the Chinese government will provide you with free land, subsidized energy, and almost unlimited access to low- or no-interest loans. And, by the way, if you get into trouble, you won’t have to pay the loans back, as the government owns and controls all the banks, and the Communist Party appoints all the bank’s executives.

Now, once you are ready to export your product to America, you will get a nice and juicy direct subsidy for every item you sell—on the order of 10 to 20 cents for every dollar shipped. In addition, when the profits start rolling in, you’ll be eligible for some hefty income and property tax breaks.

On top of all this, your Chinese enterprise need never worry that an American competitor will attack you in your own backyard. If foreigners want to sell into your market, they will be forced to set up shop on Chinese soil and become your minority partner.

Now that you see what American businesses are up against with China’s export subsidies alone, do you have a better understanding of why a refrigerator manufacturer in Madison, Wisconsin, a washing machine maker in Clyde, Ohio, or a blender maker in Orem, Utah, has such a hard time competing with the Dragon? And now does it make more sense why a vacuum cleaner manufacturer in Palm City, Florida, a hand tool crafter in New Britain, Connecticut, or a baby crib maker in Barrington, New Jersey, must struggle so hard to stay afloat on the global seas of Chinese mercantilism?

In fact, the continued existence of China’s elaborate web of illegal export subsidies represents one of the biggest broken promises in world economic history. That’s because when China joined the World Trade Organization in 2001, it promised to promptly eliminate all illegal subsidies—along with all other forms of unfair trade practices.

Well, Communist China, Democratic America is still waiting for you to keep that free trade promise. And, as we wait, your massive illegal export subsidies continue to hammer hardest at some of North America’s most important pillar industries: steel, petrochemicals, paper, textiles, semiconductors, plywood, and machinery. The list is as long as the unemployment lines in Stockton, California; Las Vegas, Nevada; Monroe, Michigan; and Rockford, Illinois.

#2: The New “Great Game”: Chinese Currency Manipulation

China has intervened on a gigantic scale58 to keep its exchange rate down...This surely is currency manipulation. It is also protectionist, being equivalent to a uniform tariff and export subsidy.

—Martin Wolf, Financial Times

Chinese currency manipulation is so important to the understanding of the damage being done to America’s manufacturing base that we are going to devote the whole next chapter to it. For now, however, suffice it to say that by virtually all creditable estimates, the Chinese yuan (aka the renminbi) is grossly undervalued—in the range of 40%.

In practical terms, this means that for every $1 of product that China sells into the United States market, Chinese exporters only have to charge the equivalent of 60 cents. That’s a huge subsidy!

At the same time, for every $1 of product that an American business tries to sell to China, it has to charge the equivalent of considerably more than a buck. On top of that indirect tariff, an American manufacturer exporting to China gets slapped with an additional and very direct 30% tariff.

Knowing how China’s currency manipulation acts as both a subsidy and tariff, is it a little more clear now why it is so difficult for a cutting tool manufacturer in South Easton, Massachusetts or a fastener producer in Corry, Pennsylvania, to compete with their Chinese counterparts in Shenzen, Guangzhou, and Chengdu?

#3: They Think It’s Not Stealing If They Don’t Get Caught

Now what about the effects of China’s rampant counterfeiting, piracy, and intellectual property theft on America’s manufacturing base? Well, here’s the felonious deal.

Every time China steals another technology, design, or process from the good old U.S. of A., it drains a little bit more blood from our manufacturing veins. That’s because when an American company wants to discover a new cancer-fighting drug, build a new fuel-efficient automobile, or develop higher efficiency solar panels, that process of discovery is going to cost both money and time—lots of money and time. If a Chinese pirate or counterfeiter can simply steal the fruits of such innovation—without regard or respect for property rights—that translates into a real cost advantage.

To understand the scale and scope of the cost advantage piracy provides to Chinese manufacturers consider that drug companies like Merck and Pfizer spend up to 20% of their sales on research and development, while tech companies like Intel and Microsoft devote 15% and car companies like General Motors and Ford devote 5%. So when a Chinese competitor simply counterfeits a Pfizer drug like Viagra, reverse-engineers a semiconductor design from Intel, unlawfully replicates an operating system from Mr. Softie, or breaks into a computer to steal a hybrid car design from General Motors, guess what? Yep, that Chinese pirate can charge substantially less for his competing product because this intellectual property thief doesn’t have to recoup any research and development expenditures.

And please know this: The Chinese pirate never suffers remorse—whether it’s a tiny Shanghai street vendor hawking an unreleased Harry Potter DVD for 80 cents or a top executive from the giant Chery Automotive Company that has stolen both the name and car designs from the American Chevy brand. That lack of remorse exists because over a billion mainland Chinese citizens have been raised in an ethics vacuum where property rights are meant to be trampled—and the state owns everything. It’s an ethics skew that runs straight back to Chairman Mao and straight through the lunacy of the Cultural Revolution. This amoral skew has created an attitude of, “Do whatever you can get away with to better your own situation.” While such disdain for property rights is well understood among China’s Asian neighbors, far too many Westerners remain clueless about the cultural and political roots of Communist China’s amorality.

#4: Trashing China’s Environment for a Few Pieces of Silver

Let’s turn now to arguably the most shortsighted of China’s Weapons of Job Destruction. This is the Chinese government “shoot yourself in the head” willingness to trade off the wholesale destruction of the environment for a few more pennies of production cost advantage.

Despite having some strong environmental laws on the books and despite constantly spewing green rhetoric for Western consumption, the reality is that the Communist Party has no more respect for such fluff than it does for its own constitution, which supposedly guarantees freedom of speech and worship. As an executive at one of China’s biggest factories put it to one of us bluntly, “If you can show performance, you can be promoted very quickly—but nobody cares about the environment.”

To see how this environmental trashing works in China’s favor, suppose an American chemical company in Cincinnati, Ohio, must install sophisticated pollution control equipment to prevent the dumping of chemical waste into the Ohio River. In sharp contrast, a Chinese competitor in Chongqing can simply use the Yangtze River as a toilet for whatever witch’s brew it wants to dump. So guess which company is going to grab a bigger share of the international chemical market?

Or suppose an American paper producer in Waterford, New York, has to install expensive, low-emissions boilers in its steam plants while its Chinese competitor does not. This, too, adds up to more Chinese paper produced and fewer American jobs—and a whole lot more Chinese citizens choking on their own atmosphere.

In fact, China’s “more pollution, lower prices” competitive edge cuts the deepest with precisely those manufacturing industries in the United States that face the highest environmental compliance costs. Consider that companies like Dow Chemical and U.S. Steel spend about ten times as much on environmental protection as do Chinese competitors such as Sinopec Oil and Bao Steel.

That China has trashed its environment to boost its export trade is evident in this stark fact: In the space of the three short decades it has taken China to emerge as the world’s factory floor, China has also earned the dubious distinctions of both “most polluted country on the planet” and “biggest contributor to climate change.” And it’s not just American workers taking the hit. Chinese citizens are paying an exceedingly high price in the form of soaring rates of cancer, heart attacks, strokes, emphysema, and skin disease.

The plight of China’s “non-human inhabitants” is a good barometer of the scope of the problem as well. Any observant visitor to China will note that both the countryside and cities are almost completely devoid of birds. It’s a silent spring, summer, fall, and winter in China’s toxic landscape.

#5: Maiming and Killing Chinese Laborers for No Fun but Lots of Profits

Just as the trashing of its rivers and streams and thrashing of its air basins helps China gain a competitive edge, so, too, does the butchering, battering, and brown-lunging of its workforce. On China’s deadly factory floor,59 silicosis and respiratory failure, severed fingers and sawed-off limbs, organs racked by cancer, and skin etched by acid are not just occupational hazards; for millions of workers, they are virtual certainties. This passage from The New York Times aptly captures the surreal, Slaughterhouse Five nature of the problem:

Yongkang...just south of Shanghai,60 is the hardware capital of China. Its 7,000 metal-working factories...make hinges, hubcaps, pots and pans, power drills, security doors, tool boxes, thermoses, electric razors, headphones, plugs, fans, and just about anything else with metallic innards. Yongkang, which means “eternal health” in Chinese, is also the dismemberment capital of China. At least once a day someone...is rushed to one of the dozen clinics that specialize in treating hand, arm, and finger injuries.

The primary culprits in this carnage are China’s ultra-lax health and safety regulations; and those Chinese workers at highest risk toil in industries ranging from building materials, chemicals, and machinery to metallurgy, plastics, and textiles. In China’s coal mines alone, thousands die every year compared to less than 50 fatalities annually in the United States.

From the standpoint of international competitiveness, all this workplace carnage adds up to the most grisly of the competitive advantages that China holds in its arsenal of weapons—and the phrase blood, sweat, and tears has never had a more literal meaning than in the sweatshops and “blood shops” of China.

#6: The Neutron Bomb of Export Restrictions

Now what about this sixth Weapon of Job Destruction called “export restrictions”? To understand why the World Trade Organization bans them outright—and why they represent a neutron bomb dropped on America’s heavy industries—one need only look at some of the specific raw materials China restricts the export of using both stringent quotas and tariffs as high as 70%.

At the top of the restricted list are such basic industrial building blocks as bauxite, coke, fluorspar, magnesium, manganese, silicone carbide, and zinc. Bauxite is the ore from which aluminum is extracted. Coke is a key fuel and reducing agent in the iron ore smelting process. Fluorspar is critical to both steel and aluminum production. Magnesium is the third most commonly used structural metal behind only iron and aluminum, while manganese is used by steelmakers to prevent rust and corrosion. As for silicon carbide, it’s used to make ceramic materials for products ranging from bulletproof vests to brake disks. And zinc? This versatile staple has applications in everything from galvanizing steel and die-casting brass and bronze to adding pigment to paint and providing a catalyst in the manufacture of rubber.

In other words, virtually all the raw materials that China holds large reserves of and that it now restricts the export of are materials vital to both heavy industry and the world’s metallurgy. Of course, in a global market, Chinese restrictions of basic materials ratchet up costs. So, for an American steelmaker in Gary, Indiana, a Canadian aluminum smelter in Lac Saint-Jean, Quebec, a Japanese die-caster in Hiroshima, or a German glass maker in Düsseldorf, the inevitable result is an increase in world prices for their raw inputs and a reduction in their competitive positions relative to China.

As a further turn of the production cost screw, while American and other Western companies have to endure these higher costs, their Chinese competitors get preferential access and regulated domestic prices. Together, these two effects add up to yet one more Dragonian cost and price advantage over foreign competition.

It is well worth repeating here that the World Trade Organization expressly forbids any such export restrictions, precisely because they convey such an unfair trade advantage. But China doesn’t care. Neither the United States nor Europe has done anything substantive to enforce these particular rules. So a protectionist China keeps these illegal restrictions in place as a means of gaining greater control of—indeed, a tighter chokehold over—virtually all metallurgy and heavy industry in the world.

#7: Predatory Pricing, Dumping, and the Dragon’s Rare Earth Cartel

As bad as China’s export restriction situation is, it is only half of the story. The other half has to do with China’s export restrictions on a wide range of so-called “rare earths.” Rare earths, with far-out names like cerium, erbium, scandium, and terbium, represent the high-tech manufacturing version of the mouse that roared. Because of their critical magnetic and phosphorescent properties and their ability to transmit, produce, and store energy, small quantities of rare earths provide a big punch in a range of high-tech products.

For example, the voice coil in your iPod’s hard drive, that battery in your neighbor’s hybrid car, and the solar panels you might be considering for your home all require one or more of the rare earths. So, too, are the rare earths needed for the automobile catalytic converters that keep our air clean, portable x-ray machines that allow doctors to quickly diagnose problems, lasers used in scientific and industrial applications, and magnets that run the modern navigational systems upon which both commercial and military aircraft depend.

Given the importance of the rare earths in all of our lives, it is chilling to learn that China has effectively cornered the market in many of them. What’s astonishing about China’s market power is that it holds only about a third of the world’s proven reserves of the rare earths, yet it currently accounts for over 90% of world production.

Just how did China manage to create what is effectively its own “Rare Earth Cartel?” That’s where China’s tactics of predatory pricing and dumping come into play; and it’s a lesson straight out of the “Cartel Handbook.”

This lesson started more than a decade ago. That’s when some key Communist Party officials recognized China’s rich endowment of rare earths and began pouring massive government subsidies into their production. Their avowed aim was to turn the People’s Republic into the “OPEC of Rare Earths.”

To develop its Rare Earth Cartel, China’s state-owned mining companies purposefully built up a huge overcapacity and then, with equal purpose, dumped huge quantities onto world markets. The practical effect of this dumping was to drive down world prices well below actual production costs and thereby drive foreign competitors out of the market.

In fact, one of the biggest victims of Chinese dumping was an American company based in Denver, Colorado, called Molycorp. At one time, Molycorp was the king of rare earths, and its Mountain Pass mine in California was the largest in the world. But under China’s predatory onslaught, Molycorp was forced to shut down its mines in 2002.

Over the last several years, with its rare earth cartel now well established, China has moved from the Phase I dumping part of its predatory scheme to Phase II: that of price gouging. In this phase, having successfully shut down many foreign mines with its dumping, China has begun to dramatically raise the prices of its rare earths.

Consider, for example, cerium oxide, a critical component in fuel cells and catalytic converters. In 2007, the world spot price was just about $3 a kilogram. Today, after China’s export restrictions, the price of cerium oxide has jumped to over $23 a kilogram—a more than seven-fold increase in just 3 years.

And how about samarium oxide, a rare earth important for the manufacture of high-performance magnets and used in the radiation treatment of lung cancer? Its price has increased by close to 1,000%.

Of course, these whopping price hikes have begun to draw foreign competitors gingerly back into the market (even Molycorp has reopened its mine). However, all of China’s competitors face one very huge risk: At any time, China’s state-run rare earth companies can turn the spigot back up, flood the market once again, drive down prices, and, in a déjà vu all over again moment, put companies like Molycorp right back out of business. Not surprisingly, the ever-present risk of renewed Chinese dumping of rare earths has had the quite intentional effect of suppressing rare earth production outside of China—just as the Chinese government has intended.

As a final dimension of its ultimate rare earth strategy, China is even changing its predatory game from that of mere economic domination to some very real, brass-knuckled, political blackmail. For example, in a well-publicized 2010 event, Japan backed down and released a criminally reckless Chinese boat captain who had been rightfully detained for ramming a Japanese Coast Guard cutter in waters surrounding the Senkaku Islands—territory controlled by Japan but claimed by China. Of course, one very big reason why Japan bowed to Chinese pressure is because China completely cut off the export of rare earths critical to production in the Japanese auto and electronics industries.

#8: Goodness Gracious, Great Walls of Protectionism

As a final Weapon of Job Destruction, China’s “Great Walls of Protectionism” loom large. These imposing edifices are built with many kinds of bricks: outright tariffs, thinly disguised quotas, inflated customs duties, “Buy China” domestic content laws, all manner of technical barriers to trade, and corrupt practices like rigged bidding.

In practical terms, these walls mean this: While a Chinese manufacturer of computers in Shenzhen, garments in Dong Yang, or aircraft components in Shanghai can freely sell into the North American market, its counterparts and competitors in San Jose, Mexico City, and Dorval, Quebec cannot do the same. Is it any wonder that our manufacturing base is on life support?

The Sum of All Our China Fears

When you sum up China’s Eight Weapons of Job Destruction, the total is millions of American, Canadian, European, Mexican, and Asian jobs lost and the entire Western manufacturing base brought to its knees. When you connect the dots that link each of China’s Eight Weapons of Job Destruction to the unemployment lines in America, economic malaise in Japan, debt crisis in Europe, and civil disorder in Mexico, you also see this much bigger picture: a mercantilist and protectionist Chinese industrial policy strategy aimed at nothing short of the total domination of world manufacturing, the total penetration of global markets, and the economic subjection of the Western World.

As the CEO of Nucor Steel, Dan DiMicco has eloquently described the situation: “We’ve been in a trade war with China for more than a decade. But they are the only ones firing the shots!” Even the normally kowtowing GE Chief Jeffery Immelt remarked in a rare moment of clarity, “I really worry about China;61 I am not sure that in the end they want any of us to win or any of us to be successful.”

Clearly, it’s long past time that America and its free market and fair trading allies fired back. It’s also well past time for China’s Communist Party leaders to know this: The World Trade Organization was founded for a reason: to promote real free trade and advance the growth of all countries around the world. By using its Eight Weapons of Job Destruction, China systematically subverts the entire free-trade framework—even as it invades American market after American market under WTO cover. This is one of the great obscenities in global economic history; and Chinese mercantilism and protectionism must be stopped. If not now, when? If not by America, then by what nation? As Winston Churchill once said, “The Americans can always be counted upon to do the right thing, after they have exhausted all other possibilities.” We’ve reached that point.