SPEAKING FREELY Christmas is made in China
By Lester R Brown
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I know Santa Claus is Chinese because each Christmas morning after all the
gifts are unwrapped and things settle down I systematically go through the
presents to see where they are made. The results are almost always the same:
roughly 70% are from China. After some research, it seems that my one-family
survey is representative of the country as a whole.
Let's start with toys. Some 80% of the toys sold in the United States - from
Barbie dolls to video games - are made in China. Talking toys that speak
English learned the language from
Chinese workers. Electronic goods - from Apple's iPod to Microsoft's Xbox - are
made in China. Clothing - from the latest cashmere sweaters to gym suits - is
also likely to have a "Made in China" label.
The Christmas tree itself may come from China. While real Christmas trees are
grown in every state in the United States and are marketed locally, many
families now gather around artificial Christmas trees. Eight out of every 10
artificial Christmas trees sold in the United States are made in China. Last
year Americans spent over US$130 million on plastic Christmas trees from China,
more than 90% of which were manufactured in the semi-tropical southern city of
This year Americans will spend over $1 billion on Christmas ornaments from
China. And in perhaps the greatest irony of all, even nativity scenes are made
in China. Last year Americans spent more than $39 million buying nativity
scenes shipped in from the East. China's success in attracting foreign
investment capital and mobilizing this huge workforce has made it the workshop
of the world.
That the US Christmas is made in China is a metaphor for a far deeper set of
economic issues affecting the United States. Today Christmas is celebrated in
both the United States and China - but for different reasons and with far
different economic consequences. For the Chinese, the manufacturing bonanza
means record profits, rising incomes, and, in a society where people save some
40% of their income, a sharp jump in savings. In the United States, Christmas
shopping expenditures, headed for another record high this year, contribute to
rising credit card debt and a soaring trade deficit.
Underneath the American Christmas spirit and good cheer is a debt-laden society
that appears to have lost its way, marred in the quicksand of consumerism. As a
society, we seem to have forgotten how to save so we can invest in a better
future. Instead of leaving our children a promising economic future, we are
bequeathing them the largest debt burden of any generation in history.
At the personal level, credit card debt just keeps climbing, and at the
government level, we have the largest deficit in history. At the international
level, we have a trade deficit that moves to a new high month after month.
It's not the fact that our Christmas is made in China, but rather the mindset
that has led to it that is most disturbing. We want to consume no matter what.
We want to spend now and let our children pay. It is this same mindset that
introduces tax cuts while waging a costly war. Economic sacrifice is no longer
part of our vocabulary. After the Japanese attack on Pearl Harbor, President
Roosevelt banned the sale of private cars in order to mobilize the
manufacturing capacity and engineering skills of the US automobile industry to
build tanks and planes. In contrast, after 9/11, President Bush urged us to go
In the United States we are so intent on consuming that personal savings have
virtually disappeared. We have an average of five credit cards for every man,
woman, and child. Of the 145 million cardholders, only 55 million clear their
accounts each month. The other 90 million cannot seem to catch up and are
paying steep interest rates on their remaining balance. Millions of people are
so deeply in debt that they may remain indebted for life.
The official national debt, the product of years of fiscal deficits, now totals
$8.5 trillion - some $64,000 per taxpayer. (See
data at Earth Policy Institute) By the end of the Bush administration
in 2008, this figure is projected to reach a staggering $9.4 trillion. We are
digging a fiscal black hole and sinking deeper and deeper into it.
Each month the Treasury covers the fiscal deficit by auctioning off securities.
The two leading international buyers of US Treasury securities are Japan and
China. In this role, China is now also becoming our banker. This developing
country, where income levels are one sixth those of the United States, is
financing the excesses of an affluent industrial society. What's wrong with
In times past, when our fiscal deficits were covered largely by US lenders,
interest payments on the debt were reinvested in the United States. Now they
are flowing abroad to Japan, China and other foreign holders of US debt.
While the US fiscal deficit, driven partly by the war in Iraq, soars to
stratospheric levels, the country is facing an unprecedented fiscal challenge
as the baby boomer generation retires, pushing up the costs of social security,
Medicaid, and Medicare. This, combined with the growing interest payments on
our debt to China and other countries, will put a nearly impossible tax burden
on the next generation - something for which they may never forgive us.
The US trade deficit is growing by leaps and bounds, nearly doubling from $452
billion in 2000 to an estimated $850 billion in 2006. Rising oil imports and
the trade deficit with China account for over half of it.
National policy failures such as not adequately supporting the use of renewable
energy technologies have contributed to the growing US trade deficit. For
example, the United States should be a leading manufacturer and exporter of
solar cells and wind turbines, but it has fallen behind both Europe and Japan.
The solar cell, invented at Bell Labs in 1954, is an American technology. But
the US effort to develop solar energy was so weak and sporadic that both
Germany and Japan forged ahead and developed robust solar cell manufacturing
and export industries.
The situation is similar with wind. Although the modern wind industry was born
in California at the beginning of the 1980s, the US failure to sustain support
for wind resource development allowed European countries to largely take over
Even though rising oil imports are widening our trade deficit, we consume oil
with abandon, weakening the economy and undermining our political independence.
We have lost influence in world financial markets simply because of our
mounting debt, much of it held by other countries. If China's leaders ever
become convinced that the dollar is headed continuously downward and they
decide to dump their dollar holdings, the dollar could collapse.
Beholden to other countries for oil and to finance our debt, the United States
is fast losing its leadership role in the world. The question we are facing is
not simply whether our Christmas is made in China, but more fundamentally
whether we can restore the discipline and values that made us a great nation -
a nation the world admired, respected, and emulated. This is not something that
Santa Claus can deliver, not even a Chinese Santa Claus. This is something only
we can do.
Lester R. Brown is president of the Earth Policy Institute and author of Plan B 3.0: Mobilizing to Save
is an Asia Times Online feature that allows guest
writers to have their say. Please click hereif you are interested in