"There is more logic in humor than in anything else. Because, you see, humor is truth." Victor Borge
Saturday Night Live has received widespread acclaim for their recent skit called "China Cold Open, China would like their money back." (Google that it if you have not seen it.) NBC's website features page after page of praise for the great skit. One calls it an “instant classic.” Another proclaims that with this skit, SNL has been “reborn.” Surely, they hit the ball out of the park with this one. It has been talked about around water coolers, posted on FaceBook and passed around via e-mail.
It is truly laugh-out-loud funny. However, after you laugh, you cry. Like the Victor Borge quote, it is truth. SNL knows to base humor on truth. The rest of us need to acknowledge China's prominence as truth.
Unfortunately, as the skit highlights, America is in no position to lecture China on their shortcomings. We are borrowing their money, but have no way to pay it back. As the skit makes clear, we cannot pay it back in “clunkers.”
In the current economy, China holds all the cards.
Some important news items relating to China have been buried by all the noise about healthcare.
One is in regard to rare earth minerals— things most people are totally unaware of, but things that are essential to modern life. Rare earths include names that most of us cannot pronounce like neodymium, dysprosium, and terbium. (Perhaps that is why no one talks about them.) But these unfamiliar words represent essential components of things as everyday as computers, cell phones, and television as well as less obvious necessities like magnets, CDs, and infrared equipment. The China connection is that China controls 97% of the world’s rare earth market and is working to take over more—a move that was struck down by Australia's Foreign Investment Review Board as they realized the geopolitical danger of China's control. Add to that the fact that China just announced that they will discontinue the export of rare earths as their own needs are exceeding production. This means that all items requiring rare earths will have to be manufactured by China—giving them full market dominance. Unless, America quickly moves forward on accessing our own rare earths that we have in abundance. An important thing to note is that China’s rare earths are essential for the widely touted "green energy."
Next, China is rapidly moving past us when it comes to energy. We hear a lot about how many new coal-fueled power plants China is building and we hear about China's pollution. But we are not reading between the lines of those two news tracks. Yes, China has polluted their skies and waters—much like we did in the early seventies. And, like we did, they are now working to clean them up. However, unlike America, they understand the direct connection between energy, manufacturing, and economic development. So, while they know they need to clean up, they are investing in clean energy that works. They know they need the large-scale power that comes from coal and nuclear and their new power plants are multiplying like rabbits. We all know that nuclear provides clean energy, but what most do not realize is that coal has cleaned up its act. The power plants that are being built in China—and that could be being built here—are now as clean as a natural gas-fueled power plant. The difference is that China is building them and in America we are busy demonizing coal. Professor Michael Economides, author of the new book Energy: China's Choke Point, says “If China and America decided to do something on the same day, two years later America would still be mired in the permitting process and China would have it done.” They now have the “can-do” attitude and America keeps saying we “cannot.”
While China is building the power they need, America is trying to move off of what works and hopes supplemental, intermittent energy can carry the load—when many of the parts needed for wind and solar energy and hybrid cars come from China.
China is loaning us money that we have virtually no hope of paying back. China will also be holding all the cards when it comes to energy. They'll have all they need and we won't have enough. China will be laughing and Americans will be crying. First you laugh, and then you cry.
Marita Noon is the executive director of the Citizens Alliance for Responsible Energy (CARE), a nonprofit organization that operates from the platform of “Energy Makes America Great” and supports all domestic energy development. She can be reached at firstname.lastname@example.org or www.responsiblenergy.org.