On my honor I will do my best
To do my duty to God and my country
and to obey the Scout Law;
To help other people at all times;
To keep myself physically strong,
mentally awake, and morally straight.
And, for completeness, the Scout Law (referenced above) is:
A Scout is:
Trustworthy, Loyal, Helpful,
Friendly, Courteous, Kind,
Obedient, Cheerful, Thrifty,
Brave, Clean, Reverent.
A few Senators have forgotten these Oaths and Laws in their most recent public statements. By putting the Secretary of the Treasury and the Federal Reserve in the role of chief arbiter of international trade policy, they are failing the public. The problem with the Currency Exchange Rate Oversight Reform Act of 2011 is that it solves nothing while ignoring the true economic disease. The bigger problem with it is that the sponsoring Senators are using anti-China rhetoric to try to get it passed. And the biggest problem with it is that this Act ignores the hundreds of U.S. corporations who – to satiate the demand of U.S. consumers for ever more, ever cheaper products – turned to foreign markets to enable the production that once happened here.
What does it mean to be ‘physically strong’, ‘mentally awake’, and ‘morally straight’? During the post-World War II period of American enterprise, the industrial machines of war were repurposed into the manufacturing envy of many countries. In an effort to show the world that the American version of Freedom and Democracy was desirable over all other social orders, we instituted policies designed to help us enjoy great, short-term benefits. Consumption, home ownership, credit, employment, tax incentives and countless other market aberrations were demanded to insure that the nation accelerated its ascendancy into the realm of super powers of the past. However, beginning with the Nixon Administration’s policies in 1970-71 through the present, we’ve systematically refused to see that, when we encounter challenges, it’s not appropriate to respond with blame. America is harvesting the fruit of its addiction to cheap goods – where Wal Mart was more of a strategic asset than jobs – and, now when we realize that we’ve gutted our domestic economy’s ability to recover, we seek to label the Chinese as the problem.
We didn’t ‘lose’ jobs to China. The stalwarts of the S&P, Dow Jones, and NASDAQ SENT those jobs to China, Vietnam, Thailand, Korea, Taiwan, and India to inflate profits which flowed AWAY from domestic employment and into the corporate coffers of a few and the financiers to whom they deigned ingratiation. Outsourcing - which sounded so good at the time - has left us with inadequate GDP to grow our economy. And until we solve that problem, outsourcing blame for bad corporate decisions will do nothing but harm us and the fragile relationships upon which we depend.
In a rare turn of events, I actually have profound sympathy for Timothy F. Geithner and the Federal Reserve Bank, who, under the Act, become responsible for policing a geopolitical risk that is well beyond their office. The U.S. Treasury and the Fed are neither structured to, nor capable of, remedying the ill advised industrial and employment policies of the past 40 years. Furthermore, this Act places Secretary Geithner and the Fed in an untenable conflict of interest. On the one hand, they are required to assess the manipulation of currencies done by foreign interests. However, at the same time, they have no choice but to acquiesce to the demands of their largest external shareholder – you guessed it, the very country that Senators Brown and Schumer want to demonize.
Honesty, conspicuously absent from the Oath and Law above, is a prerequisite for moral leadership. If this Act were referred to as the Secretary of the Treasury and Federal Reserve Geopolitical Appropriations Act, or the Treasury and Federal Reserve Appropriating the State and Commerce Department Act, it would face greater resistance and more appropriate public scrutiny. This Act is a bad idea. It’s morally unsavory as it fails to hold any domestic factors accountable for our own challenges. And, in the final analysis, no job will be created from this Act’s passage – including the dude that hands out the smiley face stickers at Wal Mart!