Thursday, November 20, 2014

Q&A: Peter Navarro on America's Death by China

Workers on a production line at a toy factory in China
Photograph by AFP/Getty
Workers on a production line at a toy factory in China
Bloomberg Businessweek speaks with Peter Navarro, a business professor at theUniversity of California, Irvine, about his new documentary Death By China. The film, based on the eponymous book he co-authored with Greg Autry in 2011, opened in Los Angeles on Aug. 17 and comes to New York on Aug. 24. Reviews have described it as “a lucid wake-up call” and criticized it for being “heavy handed” and containing “xenophobic hysteria.” Navarro reponds, “The film accurately depicts the devastation China’s unfair trade practices are having on Americans. Critics giving bad reviews should get out into the heartland of America more. Viewers are deeply moved by the film if our L.A. opening is any indicator.”
Poster for the movie 'Death By China'Poster for the movie 'Death By China'
Death By China. That’s a pretty grim prognosis. Is China killing us?
We’re billing this as the feel-good movie of the year. [Laughs.] There’s nothing subtle about what’s happening. It’s an economic death because of China’s unfair trade practices and the loss of the U.S. manufacturing base. Also, literal death because of the loss of consumer safety: toothpaste, baby formula, a dizzying array of products. There are also human rights abuses—China’s forced labor camps. There’s a chilling discovery in the film about how people are being taken out of labor camps and their organs are harvested. Also, the military buildup of China. It’s an evocative title, yes, and it has multiple meanings.
Is it about declining U.S. dominance?
That would be jingoistic. It doesn’t matter to me who’s the most powerful or profitable country in the world. All countries want to be prosperous. What’s happening is a zero-sum game between China and the U.S. where their gain is our loss. It’s about the fact that we don’t make things any more, that we lost our manufacturing base, the 25 million people who can’t find a decent job in this country, the zero wage growth. I want consumers to connect the dots, to go to any store and look at the label and connect the dots between buying cheap China products, which is better for the wallet, and all the other things we lose, like jobs.
Some would argue that the U.S. shifting away from a manufacturing economy to a knowledge- and service-based economy is a good thing.
The best counterfactual argument to that is Germany. Germany is one of the strongest, most stable economies, and 25 percent of their workforce is in manufacturing, compared with 9 percent in the U.S. The service-sector opium they tried to sell us in 1990s and early 2000s hasn’t worked. Manufacturing is the seed corn for other jobs in the U.S.
Would you call yourself a protectionist?
The way that my view on this is often derided is using the P word. It’s a very inflammatory word in my profession. There’s a big difference between self-defense against unfair trade practices and protectionism. The biggest protectionist in the world now is China. If you want to go into China now, you can’t without a joint venture Chinese partner, and you have to give them your tech. The logical result of that is they take your IP and then you’re obsolete. This is not protectionist; it’s self-defense against a very mercantilist trading partner.
Is calling you a Democrat just as inflammatory? 
The greatest compliment is I am accused of being a Dem leftie and a Republican righty. I am a pragmatist. I call it as I see it. This country needs more of that. I am a Democrat. I ran for Congress in 1996 as a Democrat. Both parties have failed us in the same way. We’re really careful in the movie to make this a nonpartisan issue. It’s an American problem, not a Democrat or Republican issue.
When was the last time you went to China?
I went back just before the release of the Coming China Wars in 2006. Once I wrote that book … it’s dangerous for me to go back there. My co-author Greg Autry was followed, and they searched his room. Some think this movie is too strong, but it’s not. It’s a serious national security issue. I don’t go back to China. I understand the country at some level. And a lot of my colleagues are wined and dined, but it’s Beijing and Shanghai, and that’s it. You have to get out in the countryside to know what’s going on.

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