Has the U.S. really thrown down the gauntlet?
Revalue the Yuan or it will be revalued!? While strong points can be made on both sides of spectrum – that a stronger/weaker Yuan is good/bad for the U.S. economy – the goals of the administration should not be forgotten: keeping jobs in America in the near term means a better chance of reelection in 2004. It goes without saying that in the context of doing whatever is necessary to get reelected the Bush Administration has unleashed a deficit monster the likes of which has never before been seen. However, it is the administrations policy on the dollar – the carefully worded threats and innuendo – which are likely to remain in the spotlight well beyond next years election. Incidentally, the Bush administration could be playing its cards correctly – at least considering the hand they have been dealt. Quite frankly, and even though a freely floating Yuan is not likely anytime soon, awing U.S. corporations into sticking with the highly priced U.S. labor force could yield immediate results
