The Trail: A Daily Diary of Campaign 2008


Foggy Bottom

Obama's Call to the Chinese President, Decoded

By Glenn Kessler
President Obama called Chinese President Hu Jintao today, and both the White House and the official New China news agency put out statements describing the call. But neither statement addressed the burning issue of the day: Did Obama try to explain the statement from his Treasury Secretary that Obama believes China is a currency manipulator?

That statement was buried in lengthy written answers Timothy Geithner provided for his confirmation hearings. It generated a firestorm, and Chinese officials responded with annoyed comments.

The official statements on the calls issued by the two governments, carefully written given the sensitivity of the relationship, provide only a few clues.

In the Chinese version, there is this line: "Hu said the core interest of either country should be respected by each other and taken into consideration." In other words: no insulting comments about our currency exchange rate, please.

The Chinese account also quotes Obama as saying that "Sino-U.S. [are] the most important bilateral relations for both side" -- a comment that might surprise the British and the Japanese.

Obama is further quoted as saying "enhancing bilateral constructive dialogue and cooperation is in the interest of not only the two countries themselves, but the world at large."

Moreover, Obama was said to have added: "It is crucial for the United States and China, the two most important economies, to enhance cooperation."

Note the phrase: "bilateral constructive dialogue" and the word "cooperation." It's hard to do such things if one country is insulting the other.

The White House statement is even more opaque, but it has one interesting passage: "President Obama stressed the need to correct global trade imbalances as well as to stimulate global growth and get credit markets flowing."

U.S. officials have long pressed China to let its currency, the yuan, grow stronger, which could increase the price of Chinese exports and reduce China's trade surplus.

So when Obama is speaking of "global trade imbalances" -- a point the White House noted he "stressed" -- that means he is really saying that China's currency is too weak and the government needs to do something about it.

In other words, stop manipulating it. Or at least manipulate it the way Washington wants.

Posted at 5:32 PM ET on Jan 30, 2009  | Category:  Foggy Bottom
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From the article:

"In the Chinese version, there is this line: 'Hu said the core interest of either country should be respected by each other and taken into consideration.' In other words: no insulting comments about our currency exchange rate, please."

The core interest of a country... actually this sounds more like a reference to sovereignty, which could be monetary policy, BUT would just as likely be culture and ideology (such as when their representatives argue that individual rights is a Western concept and the attempt to evaluate Chinese policies by reference to the concept of individual rights is itself a form of imperialism -- think Tiananmen Square), or territory. The last of these would seem rather pertinent to at least two long-standing issues: Tibet and Taiwan. Both of which seem far more likely candidates for the "core interest" referenced in this sentence. Unless of course the textual context provided some sort giveaway.

Posted by: timothychase | January 31, 2009 7:49 PM

Luckily, for me, only one of those "facts" will be litigated in the courts.

Posted by: JakeD | January 31, 2009 11:57 AM

JakeD is an inmate at St. Elizabeth's.

Posted by: nodebris | January 30, 2009 11:57 PM

Obama is not legally President.

Posted by: JakeD | January 30, 2009 5:43 PM

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