2007-12-01, China's View of Wal-Mart: Big Partner 3

Walmart had estimates that they import 15 billion dollars of Chinese goods every year, and maybe a lot more. Evan mentioned a figure of fifteen billion dollars direct and indirect imports, others have given this higher estimates, so well under 20 or 30 billion dollars, is that possible?

I think it could be possible, it could be higher, could be lower. The other thing we have to remember is that we are growing pretty significantly in terms of sales. So next year we could be higher, the year after that alike we could be higher as well.

Walmart is providing a gateway 1 into the American economy for oversea suppliers and China and elsewhere. And it is doing on a scale that has…is unprecedented 2.

COSCO is a Chinese ship and Japanese ship here. (But they are all carrying Chinese container.) at the other of the pipeline 3, I visited the port of the long beach in California. I wanted to see how Washington’s promised as mass of America made exports to China was working out. The port’s communication director E. Smith.

What they are shipping 4 in, what we shipping back?
Well, we bring in consumer products. We bring in about 36 billion dollars worth of machinery 5, toys, clothing, food ware 6.
36 billion right here on long beach?
36 billion come to long beach from China alone. Consumer products.
And what we shipping back?
We shipping out about 3 billion dollars worth of raw materials. We export cotton, we bring in clothing. We export hides, we bring in shoes. We export scrap 7 metal, we bring back machinery.
So they are doing all. But where we get third world country
We exporting waste paper, containers full of wasted paper, we bring back cardboard boxes with products inside.

Added it all up, the US had a record 120 billion dollar trade deficit 8 with China last year. And it’s heading even higher in this year.
The myth of the enormously growing China market went up locking the US into a trading partnership 9 with China, that had to been a benefit to China, much more than that could benefit us. The reason was China would always be able to sell to US much more goods that Americans sell to Chinese, because Americans have the incomes that is needed to buy Chinese products. Chinese consumers overwhelmingly don’t have the incomes needed to buy American products. (The whole idea was wrong!) it was completely wrong.
When you look at the growth of trade deficit with China, you can say that very conservative estimate is that we have a loss more that a million jobs to China since the early 1990s.
I think it’s impossible to say we lost a million jobs to China. Trade policy or trade flows one way or another don’t have an effect on overall employment numbers. They affect kinds of jobs we have, and so some number of jobs have definitely been eliminated because of Chinese competition. Another, elsewhere in the economy, other jobs have been created because of Chinese competition, because American consumers have say it walmart sell Chinese goods, they got more money in their pocket to buy something else, which creates opportunities for those other businesses, which means they hire workers where they would not hire otherwise. The net effect most economists 10 think is awash.
Theoretically the gain from trade all set losses from trade, but nothing says there are more winners than losers, and nothing says that for the bottom three fourths of America that they are net gainers. In fact, I believe that most people have been losers from trade.