Will Kennecott Copper (the worlds largest open pit mine) soon be owned by China? Per this CNN report, China has invested $19,500,000,000.00 (that’s $19.5 billion) in Rio Tinto. Per Kennecott’s web site http://www.kennecott.com Rio Tinto (a multinational corporation) became the owner of Kennecott in 1989.
CNN’s claims can easily be verified by a press release from Rio Tinto’s own web site http://www.riotinto.com
Rio Tinto announces pioneering strategic partnership with Chinalco
Joint ventures and convertible bonds to deliver US $19.5 billion in cash to Rio Tinto
Is it not a national security risk to let a foreign country buy up another countries mineral rights?
CNN reports China has so much US cash they can’t find enough places to spend it. There is also the aspect China may be putting it’s US cash into hard assets before the dollar crashes.
How did US citizens allow this to take place? People have been suckered into the policies of corporate driven organizations like the Heritage Foundation.
The Heritage Foundation makes this claim:
Myth #4: Free trade, free labor, and free capital harm the U.S. economy.
Fact: Economic freedom is necessary for economic growth, new jobs, and higher living standards.
A study conducted for the 2004 Index of Economic Freedom confirms a strong, positive relationship between economic freedom and per capita GDP. Countries that adopt policies antithetical to economic freedom, including trying to protect jobs of a few from outsourcing, tend to retard economic growth, which leads to fewer jobs.
What about protecting an entire country from being outsourced? Where do people think China got the money to buy up US and international assets?
- Per a product manager I know who works for one of the largest software companies in the world, China requires a physical factory presence in China to employ Chinese workers or a company can’t sell their products in China.
- Per Lou Dobbs War On the Middle Class China has a 25% tariff against most US imports, while the US tariff against China’s product is 3% (rate dropped by Bill Clinton).
The relationship the US has with China isn’t exactly free trade. Most people attribute the United States trade policy with China to Richard Nixon. Jimmy Carter gave himself credit for establishing US trade policy with China when he made an appearance on the Daily Show (January 26th 2009).
CNN appears to agree with Carter http://www.cnn.com/ALLPOLITICS/1998/06/03/china.trade
The Trade Act of 1974 allowed “nonmarket economy” countries to be granted a waiver and have their MFN [Most Favored Nation] status restored. Under the conditions of that act the waiver must be renewed every year. In 1979 President Jimmy Carter sent Congress a trade agreement with China that included a MFN waiver. Normal trade status was formally restored to China on Feb. 1, 1980.
Let’s contrast the Heritage Foundation’s claims against those of economist Paul Craig Roberts who was Assistant Secretary of the Treasury in the Reagan Administration and is said to be the “Father of Reaganomics” I encourage everyone to read the entire article, but I am providing key excerpts below.
How the Economy Was Lost by Paul Craig Roberts
In contrast, countries such as Japan and Germany used industrial policy to plot their comebacks. By the late 1970s, Japanese auto makers had the once dominant American auto industry on the ropes. The first economic act of the “free market” Reagan administration in 1981 was to put quotas on the import of Japanese cars in order to protect Detroit and the United Auto Workers.
To get Wall Street analysts and shareholder advocacy groups off their backs, and to boost shareholder returns and management bonuses, American corporations began moving their production for American markets offshore. Products that were made in Peoria are now made in China.
As offshoring spread, American cities and states lost tax base, and families and communities lost jobs. The replacement jobs, such as selling the offshored products at Wal-Mart, brought home less pay.
“Free market economists” covered up the damage done to the US economy by preaching a New Economy based on services and innovation. But it wasn’t long before corporations discovered that the high speed Internet let them offshore a wide range of professional service jobs. In America, the hardest hit have been software engineers and information technology (IT) workers.
The American corporations quickly learned that by declaring “shortages” of skilled Americans, they could get from Congress H-1b work visas for lower paid foreigners with whom to replace their American work force. Many US corporations are known for forcing their US employees to train their foreign replacements in exchange for severance pay.
Which is more credible: Paul Craig Roberts or the Heritage Foundation? I can vouch for Mr. Robert’s claim American workers are forced to train their replacements. For two out of three years while I worked doing tech support for Microsoft I was coaching techs in India. The US support techs knew India would eventually get all of our jobs, although no one was going to tell us that.
I was recently laid off again due to outsourcing. We used to have Nortel tech support in Orem, Utah; but that was lost to India. Gateway used to have a support center in Utah, which was closed down and moved over seas. Teleperformance in Utah who handles Dell’s tech support, is starting to move jobs to the Philipeans. My house was formerly owned by someone who worked for Geneva Steel, but when the US dropped tariffs on steel imports, Geneva closed down. Now that steel is manufactured in a foreign country, as most the steel used in the US. Isn’t that a national security threat? Pick one industry that’s safe? Even the reading of X-Rays is starting to be outsourced.
As side note, I leave you with this video on H1-B Visas