China, America and the yuan

Time for a Beijing bargain
轮到中国说话了
May 28th 2009
From The Economist print edition

Sino-American economic policy needs a new start. Tim Geithner’s visit to China provides an opportunity
中美经济政策需新起点 盖特纳访华提供契机

HOW times change. When George Bush’s treasury secretaries first visited China, Wall Street was booming, America’s economy was growing and the president’s emissaries routinely lectured their Chinese hosts on the need for freer financial markets and a more flexible yuan. But as Tim Geithner, the current treasury secretary, prepares to make his maiden trip to Beijing on May 31st, Wall Street is synonymous with greed and failure, America’s economy is on its knees and it is the Chinese who have been doing the lecturing. With America’s budget deficit soaring and the Fed’s printing presses running at full speed, China is complaining loudly of the risks that inflation and depreciation pose to its huge stash of dollars, and arguing for an alternative to the greenback as the world’s reserve currency.
时过境迁。当年，前总统布什的财长们首次访华的时候，华尔街还是一派繁华景象，美国经济持续增长，作为总统的使节，财长们总是一如既往的对中国进行指导，要求中国提供更为自由的金融市场以及更为灵活的人民币汇率。如今，待到现任财长盖特纳准备于5月31日进行其首次访华时，华尔街却几乎等同于贪婪或失败的代名词，美国的经济陷入低谷，现在轮到中国给美国上课了。美国的预算赤字激增，美联储又全力印钞，这使得中国持有的大量美元资产面临通货膨胀或贬值的危险，中国对此大加指责并呼呼用一种新的替代货币取代美元作为世界存储货币。

The tables may have turned, but the dynamics on both sides of the Sino-American economic relationship are remarkably similar. The lecturing tone is driven largely by politics at home. Just as American treasury secretaries needed to shout loudly about China’s currency in order to appease a potentially protectionist Congress, so Beijing officials must hector Americans about their profligacy to assuage rising domestic fury about the losses China faces on its reserve holdings. On both sides, the most egregious posturing is economically illiterate. America’s bilateral trade deficit with China does not prove that Beijing manipulates its currency, as many congressmen have argued. And despite the huffing in Beijing, the losses that China faces on its reserve portfolio have more to do with its own policy choices than America’s spendthrift ways.
“三十年河东，三十年河西。”不过，中美经济关系的形式基本没有什么变化。双边指责的基调主要取决于其国内的政策。如同当年，美国财长们为了平息国会内部可能出现的保护主义而对中国人为操纵人民币汇率大声谴责一样，如今，中国持有的大量美元资产面临贬值使得国内愤怒情绪持续升温，中国官员为了安抚民众也必须对美国进行谴责。但对于两国而言，过于严厉的指责只能证明对经济的一窍不通。美国当年与中国的贸易赤字并非如国会议员所言是中国人为操纵人民币汇率所致，同样，尽管现在中国指责美国，但其持有美元资产面临的损失与其说是由于美国的铺张浪费，不如说是其政策选择的结果。

Courageous choreography required
需要有胆识的政策

Both China and America should use Mr Geithner’s three-day visit to set a new tone in which co-operation replaces rhetoric. The two countries need to act on a broad economic agenda from global warming (real progress is impossible without co-operation between the world’s two biggest carbon emitters) to funding the expansion of the International Monetary Fund (China has yet to come up with any cash and Congress has not authorised the $100 billion promised by the Obama administration). The priority, however, should be a healthier macroeconomic relationship between the world’s biggest sovereign borrower and America’s largest creditor. What is needed for a sustainable global recovery is well known. China must foster private-sector domestic demand with a stronger currency, among other things. And America must lay out a credible route to the eventual unwinding of its massive stimulus.
中美两国都应借财长盖特纳访华的三天时间为契机，确立一个新的合作的基调来取代相互的指责。两国需要在广泛的经济层面加强合作，从应对全球变暖（若世界两个最大的碳排放国不能携手合作的话，就不肯能取得实质性的进步）到为国际货币扩张融资都是如此（但中国还未表示要出资，美国会也未通过奥巴马政府承诺的1000亿美元投资）。目前，当务之急就是两国建立一个更为健康的宏观经济关系，毕竟美国是最大的债务国，而中国是美国最大的债权国。如何实现全球经济可持续性复苏的要素众所周知，也就是，中国需要更为坚挺的货币来促进其国内私有部门的需求，而美国方面必须制定可信的道路，以便其大规模经济刺激方案的潜力可以得到全面的释放。

In today’s febrile markets any misstep could cause the dollar to tumble and Treasury yields to soar further. So the moves must be carefully choreographed. China should be more forthright on the yuan. After a welcome appreciation alongside a stronger dollar in 2008, China’s currency has fallen on a trade-weighted basis in recent weeks as the dollar has tumbled. Mr Geithner’s hosts should make it clear that even if the dollar continues its slide against other currencies, the yuan will not follow suit. Instead it will gradually appreciate. To forestall any additional surge in Treasury yields, Mr Geithner should elaborate on how the Obama administration intends to cut spending and raise tax revenue in the medium term.
在当今槽糕的市场环境下，稍有差错就是导致美元大幅贬值，与此同时，美国债收益激增。因此，制定下一步举措时必须小心谨慎。中国在人民币汇率方面应更加坦诚布公。2008年，美元坚挺，人民币也随之升值，这很令人欣喜，但近来，美元大幅贬值，人民币也在加权平均基础上贬值。盖特纳访问中国之际，中方应向其明确表示，即便美元相较于其他币种继续贬值，人民币也不会随之贬值。相反，人民币将会逐步升值。为了防止美国债收益继续大幅增长，盖特纳届时应详细向中方说明，奥巴马在中期计划中如何削减开支并增加税收。

It will take political courage for the Chinese to eschew a weak currency and for an American treasury secretary to unveil fiscal details in Beijing. But the parlous state of the world economy demands nothing less.
中国要避免人民币疲软需要政策上的扶持，而美财长要公布其财政细节也要政策上的鼓励。要应对当前不景气的世界经济也必须如此。

《经济学人》（The Economist ( http://www.economist.com ))
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incambrian: http://www.ecocn.org/bbs/viewthread.php?tid=19578