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Chinese Nationalists Angry at U.S. and China

The latest recession-fueled outburst of America-bashing in China might worry Washington, but it's even scarier to the rulers in Beijing. Millions of ordinary Chinese are in trouble, and they're asking why their government is continuing to prop up the United States, the country that practically everyone blames for creating the global economic crisis. Never mind what would happen to the roughly $2 trillion in Chinese foreign reserves that are invested in U.S. securities if Beijing suddenly tried to cut America loose.

Seeking to placate the domestic critics, China's leaders are hardening their stance toward the Americans. Last week China's Central Bank Gov. Zhou Xiaochuan called for the greenback to be replaced with a new reserve currency controlled by the International Monetary Fund. That proposal came on the heels of Premier Wen Jiabao's pointed expression of "concern" for the safety of China's U.S. holdings amid the current turmoil. The tough talk is expected to continue as China demands a greater say in international financial matters at this week's G20 summit in London.

But the anti-U.S. hard-liners—"economic nationalists," as they're known in China—are far from satisfied. Wang Xiaodong, a prominent member of the movement, scoffs at the idea of replacing the dollar with a new IMF-backed reserve currency. "Isn't the IMF also under the control of the United States?" he asks, with a conspiratorial grin. He says Beijing should simply quit buying U.S. T-bills and invest the money at home instead, building up China's own infrastructure, defense forces and social services. Wang is one of five authors of a new book, "Unhappy China," which sold 100,000 copies in just 11 days after its release in mid-March. The book takes Beijing to task not only for coddling the Americans but also for neglecting national defense. Wang and his cohorts say China needs to beef up its Navy if it continues buying up natural resources everywhere from Australia to Africa. "All those commercial contracts mean nothing unless we have aircraft carriers to back them up," says Wang, "That's why so many younger Chinese are asking for a strong Navy."

A new Pentagon report says China is already headed in that direction. Beijing's military budgets have doubled between 2000 and 2008; the Chinese Navy is venturing farther out to sea to secure energy transport routes and conduct anti-piracy patrols off the coast of Somalia; and senior officers have reportedly decided to train 50 pilots to operate from a refurbished Soviet-era aircraft carrier purchased from Ukraine. This month Chinese forces are scheduled to lay on a spectacular "naval parade" off Qingdao, the biggest show of Chinese sea power since the birth of the People's Republic in 1949. Perhaps the sight will make Wang and his coauthors at least a little less unhappy.

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