Free market? So when the Congress tries to blocks a purchase of one of its private oil companies to a Chinese stateown one, that is against free market principles?

But can any US oil company buy out any Chinese oil company, like CNOOC? No? What... China can do something Americans can't? If CNOOC is a privately-owned company with most of its paid-up capital private too, then perhaps the free market argument makes sense.

Sorry, Rajan, I beg to differ. Different governments have different economic policies. Western countries also have or used to have state owned business which are or were not allowed to be entered by private business.

You just can't blame China for not allowing US oil company buying out her state owned oil companies because no any private company including Chinese private companies themselevs or any other foreign companies is allowed doing this.

On the other hand, new Chinese oil companies, especially those operating over the ocean near the mainland do accept foreign investments.

Now imagine that UNOCAL was a target of a British company, would US government interfer? probably not.
Not to mention the oil sources of UNOCAL are mainly located in South East Asia (which is the main reason why CNOOC wants it)instead of US.

Let's just take a look what has happened recently:
1. Just after new textile agreement between China and US, US started another round of attack towards Chinese shoes...
2. After sued by Australia and other nations, Continued Dumping and Subsidy Act has been illegal according to WTO for several years, yet US just don't care, which has led to the 15% retaliation tariff from Japan recently on steel products, EU and Canada on agricultural products a while ago. There are even more US laws which are considered illegal by WTO. Well, same old, US don't care. Of course, unlike EU or Japan, as a small boy of US, China dare not to do such things...otherwise Uncle Sam would let millions of migrant workers go back to mountains and shut down thousands of businesses.

Yeah.... it's all about national interests, and this word is so beautiful that no body dare to challenge it....not to mention Americans are all naturally born to be patriotic.
But what is not national interests?

It's all about free market? appear so, at least when US presses China to revalue Yuan.
But in terms of something like CNOOC/UNOCAL or Continued Dumping and Subsidy Act, free market?
what the hell...Uncle Sam rules!
Rajan, again, I hope you understand, US rules......no other excuses needed, period.

If would be good for the U.S. economy in China would invest more in American companies instead of Treasury Bonds (would be good for China aswell). But the wellness of the U.S. economy is not the primary concern of the Bush-adminstration apperantly, cheap finance for it's budget deficit is.

Ivan, there is an interesting article in last week's issue of the Economist about how the state of the world economy, and even of the US economy, are being increasingly called in Beijing - as the country with the largest net increase in Treasuries investment from its Central Bank, it does seem as though China's choice of its reserve currency going forward will increasingly determine the economic consequences of America's perceived asset bubble. A highly entertaining read! Just find the July 30th edition, "How China runs the world economy."

As for the debate between Rajan and Lin, well I have some sympathy for Rajan's position that China does also not provide equal access for buyers of its assets, but then again America has always accepted asymmetry in its relations with the developing world - to a point. They do need to be aware that other nations expect them to live up to their lofty rhetoric.

Lin, I would agree with some of your points, but you must concede that even under the Bush administration, America is still the most open large economy in the world, and its consumer has been the engine of growth for China's exports, and before China, the export-led industrializations of Korea, Taiwan, Hong Kong and Singapore, as well as Southeast Asia. Given that perspective, perhaps America does deserve some forbearance from the rest of the world when they now find themselves in a tough spot both fiscally and geopolitically...

Fair enough, Dave.

but you must concede that even under the Bush administration, America is still the most open large economy in the world

Thanks to you pointing out the article on economists, I feel US points its fingers to China too frequently, as the matter of facts "US deficit from China is only a fraction (12%) of its total deficit."
Not to mention the deficit should be the expected results of its own economic policies.

One thing I don't understand:

perhaps America does deserve some forbearance from the rest of the world when they now find themselves in a tough spot both fiscally and geopolitically...

Why are you saying tha US is in a tough spot geopolitically?
I thought China is...
Fiscally? blame Iraq War and the Bush's tax break for the rich.

Ok, if you are a republican, blame China. It makes your life easier...