President Bush certainly knows the game. He knows what the trick is and where the limits are.So at his meeting with the Chinese President in Bangkok, he raised the issue but didn't go further.
So does President Hu Jintao. He knew Bush had to convey the message at such a limelight encounter.He knew Bush was actually talking to domestic ears.So he said no need to revalue the Chinese currency now but promised China would study possible freer floats in future.
Neither of them bothered to go for a showdown.Unnecessary and unwise was the subtext. Both of them understood RMB appreciation at the moment would benefit neither side.
Yet the game is not over, at least not to those who are determined to make a case, for they chose not to listen.
They turned a blind eye to the facts that China has taken a series of moves to ease the pressure on RMB to appreciate.
They refused to listen when China argued that the value RMB is already market-based and a stable currency benefits not only Chinese, but also US consumers.
They chose to ignore that China's imports are growing at faster rate and Asian countries actually welcome a market with 1.3 billion people. It seems they are just prepared not to face the reality.
But the questions are: Are they prepared to see another financial turmoil in Asia? Don't care? Ok, then would they be happy to see US companies operating in China lose global competitiveness? These conglomerates move to China for its quality but cheap labor, and labor costs here are determined by the market, not artificially adjusted nor "pegged" to US wages. So, how would they argue for a market-based currency on one hand and a labor price regardless of the labor market on the other?
Politics is politics. Politicizing the market for other gains (say domestic election) means nothing but a planned economy.China used to be a planned economy.For this it used to receive harsh criticism.Then warm applause came when China decided to switch to a market-oriented one.Now are some of these same voices urging China to take a U-turn?For such important issues, it needs wisdom before arguing one way or the other.But importantly, people first need to listen to their hearts and look at facts. But what if hearts distort facts?That's another game.And it puzzles!