China’s new premier, Wen Jiabao, will be speaking at the Harvard
Business School, and my Chinese student Simon will be there to give us a first-hand
report. We expect to see a nice Blog entry after the speech, Simon.
Meanwhile, yesterday the New
York Times had an interesting article
on the visit, noting that China has now replaced Japan as the biggest
of US debt (Treasury bonds, mostly, as we discussed in class). As
such, they are in effect financing the current US budget deficit out
of their balance of trade surplus:
So it is no wonder that in addition to lending their billions to the
United States Treasury, the Chinese are suddenly buying big-ticket American
goods, including airplanes, to relieve some of this pressure.
The Chinese, in short, are playing the diplomacy of globalization hard,
knowing it gives them a lot of leverage in the United States. It may
not be clear yet how effective they will be in getting their way with
the Bush team, but it seems safe to say that Prime Minister Wen doesn’t
need to worry about getting any lectures in Washington about globalization,
let alone democracy.
New York Times