President Obama is dispatching his Secretary of the Treasury, Timothy Geithner, to India and reconvening the Strategic Economic Dialog with China to raise U.S exports to both these Asian countries. America is not a country that has ever been comfortable with Asia, so he must not let his hopes for his country rise expecting foreign markets to come through for him when a majority of his country, including himself, does not like the foreigners who make up those foreign markets. He must look elsewhere, beginning in his own backyard, to recover the U.S economy. China and India are well advised to be cautious in responding to any American propositions because they being driven by American electoral politics. They must act on their time in their own best interest. The time has passed for the United States to think that it can maneuver geopolitics for domestic political gain.
The U.S economy, at 10 per cent joblessness and the rising costs of the social safety net, albeit a string of diluted reforms he may pass before the mid-term elections on November 2, 2010, faced by the steady drum beat of the long term consequences of the rising cost of government and the endless talk from his administration (Larry Summers and Timothy Geithner’s prolonged unemployment forecasts for the United States) in spite of the President’s public concerns about the level of persistent joblessness, could cost the Democrats at the polls if only the Republicans can focus on unemployment and the cost of government. Otherwise, the Democrats may squeak by on Election Day despite the President’s inadequate follow through on all fronts, from foreign policy to domestic policies, looking like an A-student who had really failed but got the grade because he was graded on an inflated curve at Harvard, consistent with its affirmative action policies of integrating blacks and whites.
Every President sees America through his (or, not yet, her) own lens. Obama sees it through his. George Bush had seen it has English. He had even called the visiting Queen Elizabeth II his metaphorical mother. So, presidents have a tendency to make policy deeply personal, though it should not be that way if the national interest is to be truly served.
Barack Obama sees America’s progression since 1787 (not 1776), per his post-election speech in Chicago, as the struggle to include blacks in a white world. All others, he appears to believe, from the American Indians (whose American status he thinks little of per his speech in Montana during the election campaign) to the Hispanics and the Asians as beneficiaries of the long American struggle between blacks and whites in the United States. Barack Obama’s American family is the United States of black and white, white Christian Europe, mostly white Canada and black Africa. He wants his version of Americans to take back America.
Obama’s blackness comes from his father’s Kenyan origin who had left him because of the discrimination he would have been subject to in the United States, especially with a white spouse. The de jure eradicated miscegenation laws his parents had faced still ravage the lives of many Americans even in today’s sociologically dysfunctional American society, whatever its public image around the world, the President being the poster child of that global ad campaign, and are tolerated by the country’s institutions and elected officials.
Obama’s whiteness from his mother’s Kansas nativity of European descent. He is a man who is deeply conflicted and uncomfortable with the world that is outside that blackness and whiteness. The black and white president of the United States wants to increase exports. When policy is personal in a world of politics that is just as personal, even though the rhetorically transcendental president appears not to want to make it so but for his deeply contradictory politics on the ground, to raise exports he must perhaps look to Canada, Europe and Africa and forget about China and India to at least project a sense of consistency and integrity if he wants to win back the trust of the world that was lost since the European currency crises in the early ‘90s after the Cold War had ended.
Currently, China, lacking in the institutional infrastructure of capitalism is grossly overvalued. China has become the foreign bubble created by the United States, particularly since the end of the Cold War. If China floats its currency, it will most likely sink like a rock before adjusting to normalcy because the United States wants to drain its dollars so as to diffuse any Chinese threat. And Europe could not agree more.
India, by contrast, is grossly undervalued. It possesses all the democratic and capitalist institutional infrastructure. Yet, its currency trades at a value far below what such a country’s currency should, also because of the kind of currency market interventions that China is being accused of. If India floats the rupee, its currency will rise against the dollar without any fear of crisis in India.
Over time, China’s depreciation and India’s appreciation will most likely make the two currencies trade at par with each other in the world’s currency markets. To enable that parity perhaps in a decade by 2020, the current trend of the rising trade volumes among the major emerging markets will continue to rise in parallel with the G7 (minus Japan) countries continuing to work with each others’ markets.
The best course of action at this point for the United States is to, therefore, let the remaining 14 countries outside the G7 (minus Japan) in the G20 cooperate and compete with each other and with the G7 (minus Japan) for resources and markets where each is socially comfortable in the deeply personal worlds of politics and policy. It is only fair to all.