The irony (and hypocrisy) of US foreign economic policy

Two years ago China’s third largest oil company attempted to purchase an American oil company named Unocal. At the time the highest bid was from Chevron, who offered $16.5 billion in cash and stocks. The Chinese made a bid of $18.5 billion in straight cash. Chevron went crying to the US government, claiming the bid was unfair because the company was government owned. Corporate lawyers and members of Congress were likewise enraged and claimed that China’s pursuit of world energy sources was a national strategic threat.

After a ferocious political battle, the Chinese withdrew their bid and Chevron got what it wanted: a bargain on a corporate buyout protected from competition by politicians playing upon America’s xenophobia.

A few months later an Arab company named Dubai Ports World purchased a company that managed US container ports on the east coast. Politicians once again played the fear card, saying this would undermine US security and antiterrorism efforts. (It was never mentioned that this same company was contracted with the US Navy to provided security on our aircraft carriers in the Persian Gulf and Indian Ocean.)

Once again, after tremendous political pressure and public outcry by ignorant fools, the company transferred this account to a US contractor. By pushing out an honest Middle Eastern company wanting to participate in a global economy, the US gave credibility to the claims of our terrorist enemies: that we are at bottom racist against Arabs and Muslims.

The irony here is that since the 1840’s the US and Europe have been trying to open China up to free trade unhindered by government protectionism. Western powers have forced treaties on China at gun point and even fought wars so they could force opium imports to the Chinese. But now that China is willing to play by our rules, the US is backing down.

The hypocrisy of this was not lost on China’s minister of commerce, who wrote:

“When [the US] had a comparative advantage, they encouraged the whole world to open its doors, but when they discover that one developing country is becoming more competitive, they say, ‘OK, enough, Let’s close the door now.’ ”

Protectionism. I am reminded of the 1980s when US dairy lobbyists got Congress to impose stiff tariffs and caps on ice-cream imported from Haiti. (Thank goodness our fragile economy is protected from that colossus.)

I am not anti-American, but I do think our actions in these cases undermine our presumption that the "American system" is worth exporting to the world.