Re "Editor's Page -- China's Challenge Redux," September 2005. [C]an you possibly be that clueless to what the Chinese have done to us thanks to our idiotic politicians? I've been in the fabricating/machining business for most of my life and I've never been through harder times -- they're killing us lady! Without medical [industries] and the war, most of what's left of us (fabricators and machine shops) would be gone. We (as manufactures) don't make many molds. We don't make many dies. And foundries are virtually non-existent. [You say U.S. manufacturers] "benefited enormously" . . . Who do you converse with, where do you get these ideas and where do you live that you're not touched by China?
Michael Dakin, Indian Creek Fabricators Inc.
Tipp City, Ohio
There Is Much Ado About Yuan
Re "Much Ado About Nothing?" September 2005. I have just finished reading your item about the change in the value of the Chinese currency and ask that in the future when you write on this topic think what should happen to a currency when it is traded freely in some type of open market. The government of China devalued the currency by about 75% in 1994 and then fixed that exchange rate to the dollar. That lasted until July 2005. In that time frame the trade deficit that the U.S. has with China went from $30 billion per year to about $200 billion this year. If the dollar was allowed to adjust to some market value against the yuan this distortion of value would never have occurred. However, the government of China wants dollars and they want manufacturing plants and JOBS.
What has to happen is a revalue of the currency in China by 30%-50% ASAP. I do not know if you have any formal economic training, but common theory of purchasing power parity rates the yuan 40%-55% below its true value. There has to be a major movement in the currency versus the dollar and this will also move the euro lower against the yuan.
Bill Hickey, president, Lapham-Hickey Steel
Assessing Evans Assessing Alan
Re "Evans On The Economy -- Assessing Alan," September 2005. Mike Evans makes some good points. However, I do not agree that a surge in oil prices can distort the CPI. Energy in all its forms is an integral part of our economy, from the cost to produce and transport goods and services to the cost to consumers to travel to work and play. Costs and prices at stores, restaurants and other business will rise as the price of oil /energy increases. Does Evans believe the surge is only temporary? I do not believe all the effects have been felt yet.