Following today’s Chinese market crash, governor and presidential candidate Scott Walker is calling for President Obama to cancel the upcoming state visit by Chinese President Xi Jinping in September:
Let’s take the second half of the statement first. The issues Walker highlights—cyberattacks, militarization of the South China Sea, human rights abuses—are serious concerns, and I would hope President Obama uses the visit to press Xi on all of them. Walker seems to think that these concerns would be best addressed by snubbing Xi altogether, even though he himself met with Xi in a 2013 visit to China, when relations weren’t significantly better than they are now. Cutting off dialogue with China at a time of rising tension seems disastrously short-sighted to me, but at least I understand the impulse, which is: Don’t give Xi the benefit of a high profile visit.
But Walker loses me by suggesting that today’s market crash is some sort of tipping point in U.S.-China relations. He’s echoing GOP front-runner Donald Trump in suggesting that what’s happening in China right now is primarily the result of currency manipulation meant to undermine the U.S. economy. (This isn’t just a Republican issue: Chuck Schumer has been saying similar things.) It’s true that other countries have long had good reason to accuse China of keeping the yuan artificially low, but the IMF says the currency is no longer undervalued. Last week’s crash was, in part, the result of China allowing the market to play a greater role in determining its value—as the U.S. has been demanding for years.
To state the obvious: China isn’t deliberately crashing its market to punish Wall Street. Chinese investors and businesses are themselves among the worst losers. Some are even resorting to vigilante justice against the alleged perpetrators of their misfortune. As for China’s political leaders, they look skittish if not terrified about the consequences of what’s been unleashed.
There are real and serious conflicts between the United States and China, many of which China deserves blame for. But it’s hard to avoid the impression that Walker simply saw that China was in the news today and decided to make some tough sounding noises about it.