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If you think I’m worrying too much about new industrialization drives by India and Indonesia greatly strengthening deflationary forces that could further weaken an already feeble global economy, check out some new information from The Economist. It shows the powerful deflationary effect that’s already been generated by the industrialization of another third world population giant – China.

The magazine’s Buttonwood column reports research findings of a 70 percent correlation between Chinese producer prices and American consumer prices since 1995. That’s when the inevitable production- and job-offshoring effects of Clinton-era decisions to expand U.S.-China trade greatly began to kick in. And the China producer price index has been falling for 30 straight months. That’s the longest such tailspin since the late-1990s, the years of the Asian and third world financial crises.

This powerful relationship between China producer prices and U.S. consumer prices also confirms many other important critiques that have long been made by opponents of U.S. trade policies with China and the rest of the world.

For instance, it makes clear that despite endless claims that China is working hard to turn its economy into one led by domestic demand, it still relies heavily on exports for growth – especially to the United States. In the process, it further debunks the contention that integrating huge so-called emerging markets like China more tightly into the global economy will in the policy-relevant future turn into an unprecedented win-win for the entire world economy.

Trade expansion with these countries – which also included decisions to overlook their currency manipulation and other predatory trade policies – was supposed to create immense new sources of net new global demand that in turn would create equally immense new opportunities for producers and workers in first world countries like the United States to supply these new consumers. But because third world populations still remained way too poor to absorb a critical mass of their own production – much less production from high-income countries on a net basis — the emerging markets became bigger emerging net exporters than ever. Consequently, they drained demand from the world economy and growth from wealthier countries, and especially their workers.

The only way this global economic high wire act could be sustained was to extend unprecedented amounts of credit to consumers in America, in particular (the only economy that kept itself fully open to third world exports). The spending and debt explosion that resulted wound up imploding in 2007 and 2008, and produced the global financial and economic near-collapse whose damaging after-effects are still felt in spades more than half a decade later.

Finally (for now), it’s revealing that Buttonwood noted how these burgeoning deflationary forces are also being strengthened by Japan’s recent decision to speed up the weakening of the yen – which will put renewed pressure on China and other Asian net exporters who compete with Japan to respond in kind. He (she?) could have added that Korea has already let its won hit a nine-month low versus the dollar – and has announced that it’s willing to devalue further or respond otherwise.

The columnist drew the right conclusion: “Small wonder if governments decide it is every man for himself.” I just hope that he (she?) and his (her?) colleagues remember that the next time they’re thinking of writing yet another editorial lambasting even the feeblest trade response by an America better positioned to go it alone than any other economy.

Not that Buttonwood or any other cheerleaders for foolhardy, indiscriminate trade expansion seem to have much to worry about.  With his pursuit of new agreements with Korea and proposed deals like the Trans-Pacific Partnership, Barack Obama has been faithfully following their advice throughout his presidency.   And of course this week’s midterm elections have presented him with eager new Republican partners in Congress.