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Honestly, I think that goes beyond politically incorrect and starts crossing over into the racist/prejudice category. I think the sign would have worked much better with 2 changes:
1) Instead of just "China" crossed out in the circle, have "Made in China" crossed out.
2) Delete the last line "0% Chinese CRAP".
IMO the aim should be to show pride in American made products, rather than to denigrate Chinese production.