Major powers in the world have a lot of issues going on right now- climate change, a broken economy, and just the general sense that things are not going well. Three of the major players, the U.S., the EU and China have intricately interwoven foreign policies, histories and financial ties that bind them in an inconceivable domino set up. This week, two of three made a move that will affect the foreign policy, trade and financial scales for the entire world.

The United States and the European Union implemented action against China this week to stop them from restricting exports of industrial raw materials. In fact, the U.S. had recently brought the issue before the World Trade Organization (WTO), in line with President Obama’s attempts to flex some muscle in the trade policy world.

The catch is that the U.S. needs China to keep buying our debt.

So, China, if it’s cool, can you just sell us cheaper raw materials and keep buying our debt? Does that work for you? K, thanks.

"After more than two years of urging China to lift these unfair restrictions, with no result, we are filing at the WTO today," said U.S. Trade Representative Ron Kirk. "We are most troubled that this appears to be a conscious policy to create unfair preferences for Chinese industries" that use the materials, he said.

This isn’t fair, China!!!

The EU and the U.S. have recently failed to persuade China to do just this kind of thing, so it was time to got to the WTO. Billions of dollars hang in the balance.

If the currently scheduled talks between the U.S. and the European Commission with China do not work the western powers may request that the WTO hear a formal complaint.

"The Chinese restrictions on raw materials distort competition and increase global prices, making things even more difficult for our companies in this economic downturn," said EU Trade Commissioner Catherine Ashton.

Give us your raw materials, China!!!

"I hope that we can find an amicable solution to this issue through the consultation process," she said in a statement.

Somebody better tell these Chinese that they need to give us their raw materials!!!

Ok, all exclamatory sarcasm aside, according to the U.S. and the EU, China pledged to eliminate export taxes and related charges when they joined the WTO in 2001.

But you said you were gonna charge us less!!! You said!!!

The big issue is that smaller manufacturers and producers have a tough time competing with Chinese manufacturers if the materials are that much more expensive. If Chinese raw materials were available without export taxes, the world playing field would be more even.

Rather than worry that the dispute will spill over into other parts of international relations and create a full-fledged trade war, there is reason to believe that the WTO will resolve the dispute and both countries will abide by the results.

Frank Vargo, VP for international economic affairs at the National Association of Manufacturers, said that the WTO is "the impartial place you go to resolve trade disputes so you don't have to have a trade war.”
In fact, that may be true. The U.S. has filed 7 cases against China and China has filed 4 against the U.S.

Sell us your stuff!!!