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Trump’s Trade War with China


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Trump’s Trade War with China: Imagine What Would Happen if China Decided to Impose Economic Sanctions on the USA?

First published in August 2017, Updated  March 23, 2018

Author’s Note

President Trump has announced a trade war directed against China. He has duly instructed his administration to impose tariffs on about $50 billion worth of Chinese imports.

His stated objective is to reduce the trade deficit with China.

What Trump does not realize is that the trade deficit with China contributes to sustaining America’s retail economy, it also contributes to the growth of America’s GDP.

Trade sanctions directed against China would immediately backlash against America.

China is not dependent on US  imports. Quite the opposite. America is an import led economy with a weak industrial and manufacturing base, heavily dependent on imports from China.

Imagine what would happen if China following Washington’s threats decided from one day to the next to significantly curtail its “Made in China” commodity exports to the USA.

It would be absolutely devastating, disrupting the consumer economy, an economic and financial chaos.

“Made in China” is the backbone of retail trade in the USA which indelibly sustains household consumption in virtually all major commodity categories from clothing, footwear, hardware, electronics, toys, jewellery, household fixtures, food, TV sets, mobile phones, etc.

Importing from China is a lucrative multi-trillion dollar operation. It is the source of tremendous profit and wealth in the US, because consumer  commodities imported from China’s low wage economy are often sold at the retail level more than ten times their factory price.

Production does not take place in the USA. The producers have given up production. The US trade deficit with China is instrumental in fuelling the profit driven consumer economy which relies on Made in China consumer goods.

A dozen designer shirts produced in China will sell at a factory price FOB at $36 a dozen ($3 dollars a shirt). Once they reach the shopping malls, each shirt will be sold at $30 or more, approximately ten times its factory price. Vast revenues accrue to wholesale and retail distributors. The US based “non-producers” reap the benefits of China’s low cost commodity production. (Michel Chossudovsky, The Globalization of Poverty and the New World Order, Global Research, 2003).

Trumps recent threats against China follow those formulated in 2017 in relation to China’s trade with North Korea, which are analysed in the first part of this article.

Chinese policy makers are fully aware that the US economy is heavily dependent on “Made in China”.

And with an internal market of more than 1.4 billion people, coupled with a global export market, these veiled threats by President Trump will not be taken seriously in Beijing.

Michel Chossudovsky,  March 23, 2018

***

In June, Washington threatened Beijing with a sanctions regime, in response to China’s increased bilateral commodity trade with North Korea. Initially, the US sanctions were not intended to be against the Chinese government: selected Chinese banks and trading companies involved in the financing of China-DPRK commodity trade would be potential targets of US reprisals.

Having lost patience with China, the Trump administration is studying new steps to starve North Korea of cash for its nuclear program, including an option that would infuriate Beijing: sanctions on Chinese companies that help keep the North’s economy afloat.

According to Chinese sources, China’s trade with the DPRK increased by 37.4 percent in the first quarter of 2017, in relation to the same period in 2016. China’s exports increased by 54.5 percent, with imports from the DPRK experiencing an 18.4 percent increase.

The insinuation was crystal clear: curtail your trade with North Korea, or else…

Coupled with the aggressive legislative sanctions “package” recently adopted by the US Congress directed against Russia, Iran and North Korea, Washington now threatens China in no uncertain terms.

Trump is demanding that Beijing relinquish its relationship with the DPRK, by unconditionally siding with Washington against Pyongyang. Washington has granted China six months “to prove that it is committed to preventing a nuclear-armed North Korea”, despite the fact that Beijing has expressed its firm opposition to the DPRK’s nuclear weapons program.

The political deadline is coupled with veiled threats that “if you do not comply”, punitive trade measures will be adopted which could result in the disruption of China’s exports to the United States.

Moreover, the White House is intent upon conducting “an investigation into China’s trade practices” focussing on alleged  violations of U.S. intellectual property rights. A “Section 301” investigation, named after a portion of the 1974 Trade Act is slated to be launched.

Following the completion of the investigation, Washington threatens to “impose steep tariffs on Chinese imports [into the US], rescind licenses for Chinese companies to do business in the United States, or take other measures, which could, “pave the way for the U.S. to impose sanctions on Chinese exporters or to further restrict the transfer of advanced technology to Chinese firms or to U.S.-China joint ventures.”

In formulating these veiled threats, the Trump administration should think twice. These measures would inevitably backlash on the U.S. economy.

China is not dependent on US  imports. Quite the opposite. America is an import led economy with a weak industrial and manufacturing base, heavily dependent on imports from the PRC.

Imagine what would happen if China following Washington’s threats decided from one day to the next to significantly curtail its “Made in China” commodity exports to the USA.

It would be absolutely devastating, disrupting the consumer economy, an economic and financial chaos.

“Made in China” is the backbone of retail trade which indelibly sustains household consumption in virtually all major commodity categories from clothing, footwear, hardware, electronics, toys, jewellery, household fixtures, food, TV sets, mobile phones, etc.  Ask the American consumer: The list is long. “China makes 7 out of every 10 cellphones sold Worldwide, as well as 12 and a half billion pairs of shoes’ (more than 60 percent of total World production). Moreover, China produces over 90% of the World’s computers and 45 percent of shipbuilding capacity (The Atlantic, August 2013)

A large share of goods displayed in America’s shopping malls, including major brands is “Made in China”.

“Made in China” also dominates the production of a wide range of industrial inputs, machinery, building materials, automotive, parts and accessories, etc. not to mention the extensive sub-contracting of Chinese companies on behalf of US conglomerates.

www.Made-In-China.com

China is America’s largest trading partner. According to US sources, trade in goods and services with China totalled an estimated $648.2 billion in 2016.

China’s commodity exports to the US totalled $462.8 billion dollars.

Import Led Growth

Importing from China is a lucrative multi-trillion dollar operation. It is the source of tremendous profit and wealth in the US, because consumer  commodities imported from China’s low wage economy are often sold at the retail level more than ten times their factory price.

Production does not take place in the USA. The producers have given up production. The US trade deficit with China is instrumental in fuelling the profit driven consumer economy which relies on Made in China consumer goods.

A dozen designer shirts produced in China will sell at a factory price FOB at $36 a dozen ($3 dollars a shirt). Once they reach the shopping malls, each shirt will be sold at $30 or more, approximately ten times its factory price. Vast revenues accrue to wholesale and retail distributors. The US based “non-producers” reap the benefits of China’s low cost commodity production. (Michel Chossudovsky, The Globalization of Poverty and the New World Order, Global Research, 2003).

The import of commodities from China (in excess of 462 billion dollars) is conducive through the interplay of wholesale and retail markups (which contribute to value added) to a substantive increase in America’s GDP, without the need for commodity production. Without Chinese imports, the GDP rate of growth would be substantially lower.

What we are referring to is Import Led Growth. US businesses no longer need to produce, they subcontract with a Chinese partner.

And why is this occurring? Because America’s manufacturing industries  (in many sectors of production) has in course of the last forty years been closed down and relocated offshore (through subcontracting), to cheap labor locations in developing countries.

China’s economy is not only linked to industrial assembly, China increasingly constitutes a competitor and major exporter in a variety of  high technology sectors.

Image: Make America Great Again: Made in China

In Your Face Donald Trump!

In summary, this kind of economic blackmail on the part of the Trump administration against China does not work. It falls flat.

In turn, America is threatening both Russia and China militarily including the pre-emptive use of nuclear weapons. How will Russia and China respond to US threats?

While US sanctions against Russia have largely backlashed on the European Union, it is not excluded (although unlikely) that China could at some future date respond to US threats by impose economic sanctions against the USA.

In the short run, the US cannot relinquish its imports of Chinese manufactured goods. It would be economic suicide.

Laughing in Beijing

Chinese policy makers are fully aware that the US economy is heavily dependent on “Made in China”.

And with an internal market of more than 1.4 billion people, coupled with a global export market, these veiled US threats will not be taken seriously by Beijing.
 

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Dangerous Crossroads: America Threatens China


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Dangerous Crossroads: America Threatens China, US Deploys THAAD Missile System in South Korea, Beijing Warns of Nuclear Arms Race

 
THAAD_1

The US has begun the installation of its Terminal High Altitude Area Defence (THAAD) anti-ballistic missile system in South Korea, provoking an angry reaction from China, which warned that it could trigger a nuclear arms race in the region. The provocative move will heighten the already tense situation on the Korean Peninsula as the US and South Korea engage in huge annual war games.

Two trucks, each mounted with a THAAD launch pad, were landed aboard a C-17 cargo plane at the US military’s Osan Air Base, south of Seoul, on Monday night. According to South Korean military officials, more equipment and personnel will arrive in the coming weeks. The THAAD battery installation is likely to be completed as early as May or June.

US officials exploited North Korea’s test launch of four ballistic missiles on Monday morning as the pretext for commencing the THAAD installation. However, the final go-ahead for the THAAD deployment, which was agreed by South Korea last July, occurred last week when the South Korean government acquired the planned site in a land swap deal with the conglomerate Lotte.

Washington also insists that the THAAD placement is purely defensive and needed to counter North Korea’s nuclear arsenal. In reality, the THAAD system is offensive in character. It is an important component of an expanding US anti-ballistic missile system in Asia that is primarily aimed at preparing for nuclear war against China, not North Korea.

US imperialism, which has an estimated 4,000 nuclear warheads, has never ruled out a first nuclear strike and is spending $1 trillion to upgrade its nuclear weapons and delivery systems. Its anti-ballistic missile systems are designed to neutralise the ability of any enemy to retaliate in the event of a US nuclear attack. The Federation of American Scientists estimated that China had about 260 nuclear warheads as of 2015.

The THAAD system is designed to intercept incoming ballistic missiles at high altitude. It consists of a powerful X-band radar system to track missiles at long range, linked to truck-mounted interceptors designed to destroy a hostile missile in flight. In the event of war with China, the THAAD system would not only protect key US military bases in South Korea and Japan. Its X-band radar could detect and track missile launches deep inside the Chinese mainland.

Chinese foreign ministry spokesman Geng Shuang yesterday reiterated Beijing’s opposition to the THAAD deployment. Geng warned that China would “take necessary measures to defend our security interests and the consequences will be shouldered by the United States and South Korea.”

Russia also condemned the THAAD installation. Victor Ozerov, who chairs Russia’s Federal Defense and Security Committee, branded the deployment as “another provocation against Russia” aimed, if not at encircling Russia, “then at least to besiege it from the west and the east.”

The Chinese government has already taken retaliatory moves against South Korea, closing more than 20 stores owned by Lotte in China on the pretext of safety violations, and has advised travel agents not to sell South Korean packages to Chinese tourists. The state-owned media has suggested a wider boycott of South Korean goods and even the severing of diplomatic relations with Seoul.

A commentary in the official Xinhua news agency warned that the THAAD deployment “will bring an arms race in the region.” Hinting that China would enlarge its nuclear arsenal to counter the US anti-ballistic missile systems, it declared: “More missile shields on one side inevitably bring more nuclear missiles of the opposing side that can break through the missile shield.”

The suggestion that China could expand its nuclear arsenal only underscores the reactionary character of the Chinese regime’s response to the escalating economic and military threats by the Trump administration. The Chinese Communist Party represents the interests of an ultra-rich oligarchy, not Chinese workers and the poor. Its military build-up and whipping up of Chinese nationalism heightens the danger of war and divides the working class.

A nuclear arms race between China and the United States would be profoundly destabilising in Asia and the world. An expansion of the Chinese nuclear arsenal could prompt South Korea and Japan to develop their own nuclear weapons, and encourage India to enlarge its nuclear arsenal, exacerbating tensions throughout South Asia, particularly with Pakistan.

The Trump administration has targeted China, warning of trade war measures, threatening military action against Chinese-controlled islets in the South China Sea and suggesting it could tear up the “One China” policy that forms the bedrock of US-China relations.

Trump has repeatedly accused China of not imposing crippling sanctions on its ally North Korea to force it to abandon its nuclear weapons and missiles. The White House is currently engaged in a review of US strategy toward North Korea, details of which have been leaked to the media, including proposals for pre-emptive military strikes on North Korea and regime-change operations.

North Korea provides a convenient pretext for the US military build-up in North East Asia against China. The New York Times reported that one option under consideration is the return of tactical nuclear weapons to South Korea—adjacent not only to North Korea, but also China.

Trump has already outlined a huge expansion of the US military and has tweeted that the US has “to greatly strengthen and expand its nuclear capacity.” Moreover, the US strategy is shifting from the use of nuclear weapons as a last resort to the active consideration of a limited nuclear war.

North Korea is rapidly emerging as a dangerous global flashpoint. A small incident, either accidental or calculated, has the potential to trigger a catastrophic conflict on the Korean Peninsula that would draw in nuclear-armed powers such as China and Russia.

The only social force capable of halting the drive to world war is the international working class, through building a unified anti-war movement based on socialist principles to put an end to capitalism and its outmoded nation-state system, which is the source of war.

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Is President Trump Headed for a War With China? All Options Are “on the Table”


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By Rajan Menon, TomDispatch

President Xi Jinping of China during a summit in Washington, DC, on March 31, 2016. (Photo: Doug Mills / The New York Times)

President Xi Jinping of China during a summit in Washington, DC, on March 31, 2016. (Photo: Doug Mills / The New York Times)

Forget those “bad hombres down there” in Mexico that US troops might take out. Ignore the way National Security Adviser Michael Flynn put Iran “on notice” and the new president insisted, that, when it comes to that country, “nothing is off the table.” Instead, focus for a moment on something truly scary: the possibility that Donald Trump’s Washington might slide into an actual war with the planet’s rising superpower, China. No kidding. It could really happen.

Let’s start with silver-maned, stately Rex Tillerson, Donald Trump’s pick for secretary of state. Who could deny that the former ExxonMobil CEO has a foreign minister’s bearing? Trump reportedly chose him over neocon firebrand John Bolton partly for that reason. (Among other things, Bolton was mustachioed, something the new president apparently doesn’t care for.)  But an august persona can only do so much; it can’t offset a lack of professional diplomatic experience.

That became all-too-apparent during Tillerson’s January 11th confirmation hearing before the Senate Foreign Relations Committee. He was asked for his view on the military infrastructure China has been creating on various islands in the South China Sea, the ownership of which other Asian countries, including Taiwan, the Philippines, Vietnam, Malaysia, and Brunei claim as well. China’s actions, he replied, were “extremely worrisome,” likening them to Russia’s annexation of Ukraine’s Crimean peninsula, an infraction for which Russia was slapped with economic sanctions.

The then-secretary-of-state-designate — he’s since been confirmed, despite many negative votes — didn’t, however, stop there. Evidently, he wanted to communicate to the Chinese leadership in Beijing that the new administration was already irked beyond measure with them. So he added, “We’re going to have to send China’s leaders a clear signal: that, first, the island building stops and, second, your access to those islands is not going to be allowed.” Functionally, that fell little short of being an announcement of a future act of war, since not allowing “access” to those islands would clearly involve military moves. In what amounted to a there’s-a-new-sheriff-in-town warning, he then doubled down yet again, insisting, slightly incoherently (in the tradition of his new boss) that “the failure of a response has allowed them to just keep pushing the envelope on this.”

All right, so maybe a novice had a bad day. Maybe the secretary-of-state-to-be simply ad-libbed and misspoke… whatever. If so, you might have expected a later clarification from him or from someone on the Trump national security team anyway.

That didn’t happen; instead, that team stuck to its guns. White House Press Secretary Sean Spicer made no effort to add nuance to, let alone walk back, Tillerson’s remarks. During his first official press briefing on January 23rd, Spicer declared that the United States “is going to make sure we defend our interests there” — in the South China Sea, that is — and that “if those islands are in fact in international waters and not part of China proper, then yes, we are going to make sure that we defend international territories from being taken over by one country.”

And what of Trump’s own views on the island controversy? Never one to pass up an opportunity for hyperbole, during the presidential campaign he swore that, on those tiny islands, China was building “a military fortress the likes of which the world has not seen.” As it happened, he wasn’t speaking about, say, the forces that Hitler massed for the ill-fated Operation Barbarossa, launched in June 1941 with the aim of crushing the Red Army and the Soviet Union, or those deployed for the June 1944 Normandy landing, which sealed Nazi Germany’s fate. When applied to what China has been up to in the South China Sea, his statement fell instantly into the not-yet-named category of “alternative facts.”

Candidate Trump also let it be known that he wouldn’t allow Beijing to get away with such cheekiness on his watch. Why had the Chinese engaged in military construction on the islands? Trump had a simple answer (as he invariably does): China “has no respect for our president and no respect for our country.” The implication was evident. Things would be different once he settled into the White House and made America great again. Then — it was easy enough to conclude — China had better watch out.

Standard campaign bombast? Well, Trump hasn’t changed his tune a bit since being elected. On December 4th, using (of course!) his Twitter account, he blasted Beijing for having built “a massive military complex in the middle of the South China Sea.” And it’s safe to assume that he signed off on Spicer’s combative comments as well.

In short, his administration has already drawn a red line — but in the way a petulant child might with a crayon. During and after the campaign he made much of his determination to regain the respect he claims the US has lost in the world, notably from adversaries like China. The danger here is that, in dealing with that country, Trump could, as is typical, make it all about himself, all about “winning,” one of his most beloved words, and disaster might follow.

Whose Islands?

A military clash between Trump-led America and a China led by President Xi Jinping? Understanding how it might happen requires a brief detour to the place where it’s most likely to occur: the South China Sea. Our first task: to understand China’s position on that body of water and the islands it contains, as well as the nature of Beijing’s military projects there. So brace yourself for some necessary detail.

As Marina Tsirbas, a former diplomat now at the Australian National University’s National Security College, explains, Beijing’s written and verbal statements on the South China Sea lend themselves to two different interpretations. The Chinese government’s position boils down to something like this: “We own everything — the waters, islands and reefs, marine resources, and energy and mineral deposits — within the Nine-Dash Line.” That demarcation line, which incidentally has had ten dashes, and sometimes eleven, originally appeared in 1947 maps of the Republic of China, the Nationalist government that would soon flee to the island of Taiwan leaving the Chinese Communists in charge of the mainland. When Mao Ze Dong and his associates established the People’s Republic, they retained that Nationalist map and the demarcation line that went with it, which just happened to enclose virtually all of the South China Sea, claiming sovereign rights.

This stance — think of it as Beijing’s hard line on the subject — raises instant questions about other countries’ navigation and overflight rights through that much-used region. In essence, do they have any and, if so, will Beijing alone be the one to define what those are? And will those definitions start to change as China becomes ever more powerful? These are hardly trivial concerns, given that about $5 trillion worth of goods pass through the South China Sea annually.

Then there’s what might be called Beijing’s softer line, based on rights accorded by the legal concepts of the territorial sea and the Exclusive Economic Zone (EEZ). Under the UN Convention on the Law of the Sea (UNCLOS), which took effect in 1994 and has been signed by 167 states (including China but not the United States), a country has sovereign control within 12 nautical miles of its coast as well as of land formations in that perimeter visible at high tide. But other countries have the right of “innocent passage.” The EEZ goes further. It provides a rightful claimant control over access to fishing, as well as seabed and subsoil natural resources, within “an area beyond and adjacent to the territorial sea” extending 200 nautical miles, while ensuring other states’ freedom of passage by air and sea. UNCLOS also gives a state with an EEZ control over “the establishment and use of artificial islands, installations, and structures” within that zone — an important provision at our present moment.

What makes all of this so much more complicated is that many of the islands and reefs in the South China Sea that provide the basis for defining China’s EEZ are also claimed by other countries under the terms of UNCLOS. That, of course, immediately raises questions about the legality of Beijing’s military construction projects in that watery expanse on islands, atolls, and strips of land it’s dredging into existence, as well as its claims to seabed energy resources, fishing rights, and land reclamation rights there — to say nothing about its willingness to seize some of them by force, rival claims be damned.

Moreover, figuring out which of these two positions — hard or soft — China embraces at any moment is tricky indeed. Beijing, for instance, insists that it upholds freedom of navigation and overflight rights in the Sea, but it has also said that these rights don’t apply to warships and military aircraft. In recent years its warplanes have intercepted, and at close quarters, American military aircraft flying outside Chinese territorial waters in the same region. Similarly, in 2015, Chinese aircraft and ships followed and issued warnings to an American warship off Subi Reef in the Spratly Islands, which both China and Vietnam claim in their entirety. This past December, its Navy seized, but later returned, an underwater drone the American naval ship Bowditch had been operating near the coast of the Philippines.

There were similar incidents in 2000, 2001, 2002, 2009, 2013, and 2014. In the second of these episodes, a Chinese fighter jet collided with a US Navy EP-3 reconnaissance plane, which had a crew of 24 on board, less than 70 miles off Hainan island, forcing it to make an emergency landing in China and creating a tense standoff between Beijing and Washington. The Chinese detained the crew for 11 days. They disassembled the EP-3, returning it three months later in pieces.

Such muscle flexing in the South China Sea isn’t new. China has long been tough on its weaker neighbors in those waters. Back in 1974, for instance, its forces ejected South Vietnamese troops from parts of the Paracel/Xisha islands that Beijing claimed but did not yet control. China has also backed up its claim to the Spratly/Nansha islands (which Taiwan, Vietnam, and other regional countries reject) with air and naval patrols, tough talk, and more. In 1988, it forcibly occupied the Vietnamese-controlled Johnson Reef, securing control over the first of what would eventually become seven possessions in the Spratlys.

Vietnam has not been the only Southeast Asian country to receive such rough treatment. China and the Philippines both claim ownership of Panatag (Scarborough) Shoal/Huangyang Island, located 124 nautical miles off Luzon Island in the Philippines. In 2012, Beijing simply seized it, having already ejected Manila from Panganiban Reef (aka Mischief Reef), about 129 nautical miles from the Philippines’ Palawan Island, in . In 2016, when an international arbitration tribunal upheld Manila’s position on Mischief Reef and Scarborough Shoal, the Chinese Foreign Ministry sniffed that “the decision is invalid and has no binding force.” Chinese president Xi Jinping added for good measure that China’s claims to the South China Sea stretched back to “ancient times.”

Then there’s China’s military construction work in the area, which includes the building of full-scale artificial islands, as well as harbors, military airfields, storage facilities, and hangars reinforced to protect military aircraft. In addition, the Chinese have installed radar systems, anti-aircraft missiles, and anti-missile defense systems on some of these islands.

These, then, are the projects that the Trump administration says it will stop. But China’s conduct in the South China Sea leaves little doubt about its determination to hold onto what it has and continue its activities. The Chinese leadership has made this clear since Donald Trump’s election, and the state-run press has struck a similarly defiant note, drawing crude red lines of its own. For example, the Global Times, a nationalist newspaper, mocked Trump’s pretensions and issued a doomsday warning: “The US has no absolute power to dominate the South China Sea. Tillerson had better bone up on nuclear strategies if he wants to force a big nuclear power to withdraw from its own territories.”

Were the administration to follow its threatening talk with military action, the Global Times added ominously, “The two sides had better prepare for a military clash.” Although the Chinese leadership hasn’t been anywhere near as bombastic, top officials have made it clear that they won’t yield an inch on the South China Sea, that disputes over territories are matters for China and its neighbors to settle, and that Washington had best butt out.

True, as the acolytes of a “unipolar” world remind us, China’s military spending amounts to barely more than a quarter of Washington’s and US naval and air forces are far more advanced and lethal than their Chinese equivalents. However, although there certainly is a debate about the legal validity and historical accuracy of China’s territorial claims, given the increasingly acrimonious relationship between Washington and Beijing the more strategically salient point may be that these territories, thousands of miles from the US mainland, mean so much more to China than they do to the United States. By now, they are inextricably bound up with its national identity and pride, and with powerful historical and nationalistic memories — with, that is, a sense that, after nearly two centuries of humiliation at the hands of the West, China is now a rising global power that can no longer be pushed around.

Behind such sentiments lies steel. By buying some $30 billion in advanced Russian armaments since the early 1990s and developing the capacity to build advanced weaponry of its own, China has methodically acquired the military means, and devised a strategy, to inflict serious losses on the American navy in any clash in the South China Sea, where geography serves as its ally. Beijing may, in the end, lose a showdown there, but rest assured that it would exact a heavy price before that. What sort of “victory” would that be?

If the fighting starts, it will be tough for the presidents of either country to back down. Xi Jinping, like Trump, presents himself as a tough guy, sure to trounce his enemies at home and abroad. Retaining that image requires that he not bend when it comes to defending China’s land and honor. He faces another problem as well. Nationalism long ago sidelined Maoism in his country. As a result, were he and his colleagues to appear pusillanimous in the face of a Trumpian challenge, they would risk losing their legitimacy and potentially bringing their people onto the streets (something that can happen quickly in the age of social media). That’s a particularly forbidding thought in what is arguably the most rebellious land in the historical record. In such circumstances, the leadership’s abiding conviction that it can calibrate the public’s nationalism to serve the Communist Party’s purposes without letting it get out of hand may prove delusional.

Certainly, the Party understands the danger that runaway nationalism could pose to its authority. Its paper, the People’s Daily, condemned the “irrational patriotism” that manifested itself in social media forums and street protests after the recent international tribunal’s verdict favoring the Philippines. And that’s hardly the first time a foreign policy fracas has excited public passions. Think, for example, of the anti-Japanese demonstrations that swept the country in 2005, provoked by Japanese school textbooks that sanitized that country’s World War II-era atrocities in China. Those protests spread to many cities, and the numbers were sizeable with more than 10,000 angry demonstrators on the streets of Shanghai alone. At first, the leadership encouraged the rallies, but it got nervous as things started to spin out of control.

“We’re Going to War in the South China Sea…”

Facing off against China, President Trump could find himself in a similar predicament, having so emphasized his toughness, his determination to regain America’s lost respect and make the country great again. The bigger problem, however, will undoubtedly be his own narcissism and his obsession with winning, not to mention his inability to resist sending incendiary messages via Twitter. Just try to imagine for a moment how a president who blows his stack during a getting-to-know-you phone call with the prime minister of Australia, a close ally, is likely to conduct himself in a confrontation with a country he’s labeled a prime adversary.

In the event of a military crisis between China and the United States, neither side may want an escalation, to say nothing of a nuclear war. Yet Trump’s threats to impose 45% tariffs on Chinese exports to the US and his repeated condemnation of China as a “currency manipulator” and stealer of American jobs have already produced a poisonous atmosphere between the world’s two most powerful countries. And it was made worse by his December phone conversation with Taiwan’s president, Tsai Ing-wen, which created doubts about his commitment to the One China policy the United States has adhered to since 1972. The Chinese authorities apparently made it clear to the White House that there couldn’t even be a first-time phone call to Xi unless the new president agreed to stick with that policy. During a conversation with the Chinese president on February 9th, Trump reportedly provided that essential assurance. Given the new American president’s volatility, however, Beijing will be playing close attention to his words and actions, even his symbolic ones, related to Taiwan.

Sooner or later, if Trump doesn’t also dial down the rest of his rhetoric on China, its leaders will surely ratchet up theirs, thereby aggravating the situation further. So far, they’ve restrained themselves in order to figure Trump out — not an easy task even for Americans — and in hopes that his present way of dealing with the world might be replaced with something more conventional and recognizable. Hope, as they say, springs eternal, but as of now, in repeatedly insisting that China must do as he says, Trump and his surrogates have inserted themselves and the country into a complicated territorial dispute far from America’s shores. The hubris of Washington acting as the keeper of world order, but regularly breaking the rules as it wishes, whether by invading Iraq in 2003 or making open use of torture and a global network of secret prisons, is an aspect of American behavior long obvious to foreign powers. It looks to be the essence of Trumpism, too, even if its roots are old indeed.

Don’t dismiss the importance of heated exchanges between Washington and Beijing in the wake of Trump’s election. The political atmosphere between rival powers, especially those with massive arsenals, can matter a great deal when they face off in a crisis. Pernicious stereotypes and mutual mistrust only increase the odds that crucial information will be misinterpreted in the heat of the moment because of entrenched beliefs that are immune to contrary evidence, misperceptions, worst-case calculations, and up-the-ante reactions. In academic jargon, these constitute the ingredients for a classic conflict spiral. In such a situation, events take control of leaders, producing outcomes that none of them sought. Not for nothing during the Cuban Missile Crisis of 1962 did President John Kennedy look to Barbara Tuchman’s book, Guns of August — a gripping account of how Europe slipped and slid into a disastrous world war in 1914.

There has been lots of anxiety about the malign effects that Donald Trump’s temperament and beliefs could have domestically, and for good reason. But in domestic politics, institutions and laws, civic organizations, the press, and public protests can serve, however imperfectly, as countervailing forces. In international politics, crises can erupt suddenly and unfold rapidly — and the checks on rash behavior by American presidents are much weaker. They have considerable leeway to use military force (having repeatedly circumvented the War Powers Act). They can manipulate public opinion from the Bully Pulpit and shape the flow of information. (Think back to the Iraq war.) Congress typically rallies reflexively around the flag during international crises. In such moments, citizens’ criticism or mass protest invites charges of disloyalty.

This is why the brewing conflict in the South China Sea and rising animosities on both sides could produce something resembling a Cuban-Missile-Crisis-style situation — with the United States lacking the geographical advantage this time around. If you think that a war between China and the United States couldn’t possibly happen, you might have a point in ordinary times, which these distinctly aren’t.

Take the latest news on Stephen Bannon, formerly the executive chairman of the alt-right publication Breitbart News and now President Trump’s chief political strategist. He has even been granted the right to sit in on every meeting of the National Security Council and its Principals Committee, the highest inter-agency forum for day-to-day national security deliberations. He will be privy to meetings that, according to a directive signed by Trump, even the chairman of the Joint Chiefs of Staff and the director of national intelligence may not join unless “issues pertaining to their responsibilities and expertise will be discussed.” Calling this a break with past practice would be an understatement of the first order.

So Bannon’s views, once of interest only to a fringe group of Americans, now matter greatly. Here’s what he said last March about China in a radio interview: “We’re going to war in the South China Sea in five to 10 years, aren’t we? There’s no doubt about that. They’re taking their sandbars and making basically stationary aircraft carriers and putting missiles on those. They come here to the United States in front of our face — and you understand how important face is — and say it’s an ancient territorial sea.”

Think of this as Bannon’s version of apocalyptic prophecy. Then consider the volatility of the new president he advises. Then focus on the larger message: these are not ordinary times. Most Americans probably don’t even know that there is a South China Sea. Count on one thing, though: they will soon.

Posted in USA, ChinaComments Off on Is President Trump Headed for a War With China? All Options Are “on the Table”


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