Let us pray
UK GM food attempt fails
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Here's what I learned in Tokyo: If you're the leader
of Japan, America, Australia, Taiwan, Malaysia,
Russia, Thailand, Indonesia, Singapore, the
Philippines or the European Union and you're not going
to bed each night saying the following prayer for
China, then you're not paying attention:
"Dear Heavenly Father, please keep the leader of
China, President Hu Jintao, healthy and on an even
keel. Please see to it that he moves steadily and
carefully toward restructuring the Chinese banking
system and ridding it of its huge overhang of bad
loans and corruption, before there is a real meltdown
that would be felt around the world. Give him the
wisdom to cool the overheated Chinese economy without
creating a recession that would prompt China to stop
importing like crazy and start just exporting like
crazy. And Father, forgive us for all the bad words we
used in recent years to describe China's leaders —
terms like `Butchers of Beijing.' We did not mean it.
We meant to say `Bankers of Beijing,' because their
economy is now fueling growth all over Asia,
bolstering Japan and sucking up imports from
everywhere. May China's leaders live to 120, and may
they enjoy 9 percent G.D.P. growth every year of their
lives. Thank you, Father. Amen." The most striking thing about being in Asia today is hearing how much more important China's growth engine has become for companies all across the region and well beyond it. When Chinese authorities told banks last week to cut back their wild lending, commodity prices and stock markets tumbled all over the world. News that China is having regular blackouts because it can't buy enough crude oil is helping push up gasoline prices the world over. While three years ago the Bush team came to office growling about no longer coddling China the way those "wimpy" Clintonites did that talk has disappeared from the Bush vocabulary. It's not just business as usual now. It's business only. To some degree the world is getting hooked on China
its cheap labor, its voracious appetite for
commodities and capital (over $50 billion in foreign
direct investment last year) and its emerging middle
class. The more hooked we become, the less the world
can tolerate any sort of prolonged instability there.
If the China bubble bursts, it will be the mother of
all burst bubbles. Which is why we need to pray that
China's leaders will have the skill to cool things
down, just enough but not too much, without some
wheels falling off. "A lot of the world's stability or instability is resting on the leadership in Beijing — there is no question about that," argues Richard Koo, chief
economist for Nomura Research Institute. But, he
insists, "Chinese leaders understand what world they
are living in. They have a general equilibrium view of
the world — that what they do affects us all and then
comes back to affect them." That seems true. But one of the ways that China has grown so rapidly in the last decade has been by decentralizing authority to regions and letting governors or mayors attract whatever investment they can. It is not clear anymore how much the center can
slow things down. And considering the huge amounts of foreign investment that have flowed into China in such a short time, "it's very hard to think that they could have invested that much money efficiently," remarked Robert Feldman, managing director in Tokyo for Morgan Stanley. "So the senior leadership is scared, because if they have a
hard landing from bad loans you have a regime problem.
[But] when they tried to slow the economy, they got
real push back from the regions, who said, `You in
Beijing have all that infrastructure. Why shouldn't we
have a new bridge or road?' "
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obligation to behave in a way that promotes global
equilibrium with their need to create millions of jobs
each year in order to stay in power. One can only say three things: 1. They've done a pretty good job so far. 2. The job gets harder every day. 3. No one will be immune to the fallout. The relationship of the world to China right now reminds me of that old banker's rule: If a client owes you $1,000, that's his problem. If a client owes you $1 million, that's your problem. China's stability is our problem.
Heavenly Father . . .
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Despite the UK voting against public opinion today by voting for the import of a GM maize for human food into Europe, EU member states have upheld the GM moratorium by failing to support the application by US-based multinational Monsanto [1]. Earlier in the week, Agriculture Ministers also failed to support a different maize application after disagreements emerged over its safety [2]. No new GM foods or crops have been approved for import or growing since 1998.
At today's meeting of the EU´s Standing Committee on the Food Chain and Animal Health, member states voted on the import of a GM maize called NK603 for human food. The Food Standards Agency represented the UK position, supporting the application. The GM maize has been genetically modified to be resistant to Monsanto´s herbicide called RoundUp. In February member states failed to support the same GM crop for use as an animal feed. Friends of the Earth is critical of the Monsanto application which: * fails to look at the grain's effects on subsequent generations, cumulative toxic effects and the effects on the health of sensitive consumers as required under EU food law [3] * fails to explain or fully investigate unexpected discoveries occurring after the genetic modification [4] * insufficiently investigated the possibility of the modification causing more allergies [5] Friends of the Earth's GM Campaigner Clare Oxborrow said:
"Once again the UK Government has ignored people's concerns and supported the import of a GM food. But despite pressure from the US and biotech companies to force GM foods down our throats, many member states have refused to support the application. It is time the Tony Blair listened to our demands for safe food that comes from environmentally friendly farming, rather than supporting biotech interests".
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