"This Would Cross Our Red Line" - Chinese Military Considering Measures To "Cripple" Taiwan

Tyler Durden's picture

While Donald Trump is tweeting his new year's greetings to his friends, and especially enemies, China is thinking three weeks ahead to the day the president-elect is officially inaugurated, and is worried what that could mean for a suddenly empowered Taiwan, whose outreach to Trump now means that the long-standing "One China" policy is now a topic of negotiation.  As a result, Reuters reports that China's military, alarmed by Trump's support of Taiwan, is considering strong measures to prevent the island from moving toward independence.

With China's only aircraft carrier demonstratively passing in close proximity to Taiwan last week, and currently in the contested area inside the South China Sea, it is not surprising that according to Reuters' sources, one measure being contemplated is conducting war games near the self-ruled island. More troubling is that as Reuters' sources add, another measure "was a series of economic measures to cripple Taiwan."

And since Taiwan is among the main sources of global high-tech, semiconductor fabrication and production, an economically "crippled" Taiwan suddenly becomes a potential gray swan for a world reliant on instant access to technological components to grow.

Adding to concerns of a potential "hot" conflict between China and Taiwan, while Reuters sources admitted that it was not clear if any decisions had yet been taken, the Taiwan issue had become a hot topic within the upper echelons of China's People's Liberation Army (PLA) in recent weeks.

"If Trump challenges 'one China' after becoming president, this would cross our red line," said another source, who has ties to China's leadership.

While the defense ministry declined to comment, Reuters said that an official at the ministry's news department said China's position was clearly laid out in the 2005 Anti-Secession Law, which authorizes the use of force against Taiwan in the event China judges it to have seceded.

Asked about any possible aggressive moves from China, Taiwan defense ministry spokesman Chen Chung-shi said: "We are fully prepared, and plan for the worst while preparing for the best."

Meanwhile, Taiwan president Tsai, who took power this year, says she wants to maintain peace with China, but China is unconvinced. Tsai said on Saturday that Taiwan will be "calm" when facing issues to do with China, but uncertainties next year will test the self-ruled island and its national security team.

Beijing has also been angered by a trip planned by Tsai in January to Latin America in which she will transit through Houston and San Francisco. China has urged the United States to block the stopovers, but the US refused to comply.

The silver lining is that Chinese officials have blamed Taiwan for creating the recent diplomatic trouble rather than accuse Trump, and many believe he will be more accommodating to China once in office. That remains to be seen. "We're ready. If Taiwan wants to make trouble so can we. Let's hit them hard," said an official in Beijing who meets regularly with China's most senior military officers, including those who work directly with President Xi Jinping.

"We can hold exercises close to Taiwan, and show them the damage we could cause. Taiwan will have to give in then," the official added, citing a recent conversation with one of the military officers. Unless, of course, Taiwan doesn't "give in", and instead pushes for further diplomatic ties with the US.

But the worst-case scenario would be an economic blockade of the small, but crucial in global technological supply-chains island.

A retired senior officer who maintains contacts with the PLA told Reuters that China probably wouldn't need to fire any missiles to bring Taiwan to its knees. China is Taiwan's largest trading partner, and Taiwan runs a huge trade surplus with China, worth $27 billion in 2015.

"We can just cut them off economically. No more direct flights, no more trade. Nothing. Taiwan would not last long," the officer said. "There would be no need for war."

He added that any Western economic blockade of China put in place in the event of war with Taiwan would also be damaging to China, already dealing with a slowing economy. What is disturbing is that China has already considered the implications of a scenario in which a conventional war on Taiwan is declared.

As for the American response, a US defense official told Reuters that Chinese actions had been more provocative in the past month, since Trump won the U.S. election and made comments about Taiwan, and culminated this month when a Chinese naval flotilla headed by its sole aircraft carrier, the Liaoning, took part in drills that took it around Taiwan. It remains unclear who, how and why tensions surrounding Taiwan will be defused in the near future.

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Able Ape's picture

Time to chill not to will; we are NOT dealing with a third world country here!...

JackT's picture

Then why sail that dilapidated Russian carrier around if it's the economicals that will do the trick?

SWRichmond's picture

It is clear that the status quo was unsustainable.

Now, all of the balls are being thrown in the air, as we knew they would / had to be anyway.  The idea of course is to blame those who would question or challenge the status quo (tax slavery).

Keep training.

Ignatius's picture

"...and accept the loss of those sweet things of youth:  clean air, tuna, Taiwan..."

The Saint's picture
The Saint (not verified) Ignatius Dec 31, 2016 11:27 AM

"We can just cut them off economically. No more direct flights, no more trade. Nothing. Taiwan would not last long,"

And the U.S. could do the same to China. 

xythras's picture
xythras (not verified) The Saint Dec 31, 2016 11:33 AM

I hope they'll go at each other's throats. We could do with less chinks around this blue ball.

And making $ while selling weapons to Taiwan is the cherry on top.

BaBaBouy's picture

2017 ===> GOLD 2230. Min...

Tippoo Sultan's picture

"Everybody was kung fu fighting..."

beemasters's picture

Crouching Tiger and Hidden Dragon.
Let the show begin. Everyone else, stay out of it.

Socratic Dog's picture

Eh?  How long do you think the US would last without electronics from China?  I would estimate at least 20 minutes.

roddcarlson's picture

Really this is all a Chinese theater. A Chinese boss I had a couple decades ago, stated that China uses Taiwan as a front to get more US defense goods sent for reverse engineering. The whole thing is a farce and Taiwan is much in the bag to China as any state is to the US federal government. I hate to tell Trump there is no leverage here, the whole thing is a ruse by Chinese on both sides.

Time to mind our own business and let China own the tiny island. Why anyone put so much of our fabrication facilities to start is beyond me. And labor isn't cheap either, so we can toilet the idea that they are staying there for that reason. I guess protectionism does work once the industry is rooted.

MarkD's picture

Electronics is just a drop in the bucket. Came back from EMS with snowshoes made in China and a Marmot jacket made in Vietnam. Nearly all the snowshoes there come from China along with every other product.

We kid ourselves by thinking we can make that stuff here. Unless we are ready to earn $3 an hour and live with air we can't breath and water we can't swim in........ we can't have cheap products and high wages and enviornmental laws.

 

roddcarlson's picture

It seems we used to make it here? What's different now? That we don't get as much for as cheap? How about the equation that young people don't have good paying jobs? I kindly disagree that being industrial has to amount to trashing the environment. The problem for China though is that they don't have capitalism, they have some sort of fiat based government rigging similar to here but are very short termed thinking about their environment. Government and industry means economic and environmental collapse long haul.

MarkD's picture

"I kindly disagree that being industrial has to amount to trashing the environment"

That was the US. Smog alerts in LA...... rivers catching fire.....

When I was a youngster I was fascinated at the canals in Manchester, NH mills how one day they would be yellow and next day purple from the textile process as it flowed into the Merrimack river, once the most polluted rivers in the US. Now it the source for several municipal water supply.

We cleaned up our air and water but at a cost.

 

ipsprez's picture

That is a ridiculous assertion. Somehow we managed to grow an economy from the mid 40's through the 70's but now we can't?? Bullshit!

MEFOBILLS's picture

We kid ourselves by thinking we can make that stuff here. Unless we are ready to earn $3 an hour and live with air we can't breath and water we can't swim in..

Above is an untrue statement.

Finance Capitalism moves its "Capital" to where it can make the best gains.  It seeks out low cost labor, and then externalizes its costs.  For example, pollution over there is externalized onto their economy.  This hides real costs by making price apparently cheaper.

Mexinvasion in the U.S. is the same gambit.  Low cost labor lowers price for U.S. captains of industry, but health care and social costs are externalized.  The middle class in the U.S. actually carry this burnden in the form of higher taxes, to then have lower cost lettuce, etc.

These hidden costs are the siphoning away from Say's circular flow, and this diversion of capital actually makes high prices. Rent seeking makes high prices. Payment to third parties who do not really perform value add are hidden in the price, so owners of Capital can make their sordid gains.

Cut out sordid gains by defunding funding parasitism, and the real price falls dramatically.

There is another factor too, and that is automation.  Many products that use low cost labor could be automated.  In any case, Taiwan makes HIGH VALUE GOODS, especially semiconductors.  TSMC (Tawain Semiconductor Manufacturing Corporation) has fully automated cutting edge factories.  They got these factories initially by stealing U.S. manufacturing secrets through technology transfer - this then screwed America's future. (American's actually sent their engineers over there to teach them America's patrimony.)

It is the U.S. which is still in debt- depression (due to finance gains),  neo-liberal prescription for recovery is austerity.   This means more finance extraction, and no real new investment in plant and equipment.  The end result is that prices cannot be driven down with new improvements in productivity.

In other words, Neo-Liberal economic orthodoxy has done a number on most people's brain function, and convinced them that to have low prices, Capital needs to seek out low cost labor overseas, and pollute overseas.  

Oligarchy has actually created this skull f*ck hypnosis so they can take perpetual rents.

A good example of this is buying a Chinese table at Wall Mart in North Carolina.  North Carolina was a center of furniture making and wood is abundant. 

China has no real sources of wood, and must ship both the wood and finished table adding cost.  When you see this kind of thing, then you know that the game is rigged and prices are not reflective of reality.


oncefired's picture

Labor isn't the only equation in making a Product - Energy Costs, Regulations, employee benefits, etc. China is getting to the point where it is becoming unprofitable, that is why the Big Companies are moving to Cambodia, Vietnam, etc. They would have already been in Africa somewhere if governments weren't being overthrown and civil wars weren't starting every other day. Everything comes full circle - if Trump presses the right buttons, the cost of shipping appliances would be enough to start making washing machines in this Country again and on and on.

MEFOBILLS's picture

Conservatives have trouble with the below concepts.  But, in my opinion, having lowest possible cost is conservation:

http://www.unz.com/mhudson/rebel-economists-unpick-historical-path-to-gl...

Classical economics was all about separating the rent-extracting sectors – landlords, monopolies, and finance – from the rest of the economy. And that was unearned income. It wasn’t necessary. And the whole idea of classical economics from Quesnay’s Tableau Economique to all the way through Adam Smith and John Stuart Mill was to look at the finance sector and the landlord sector and monopolies as unnecessary. You’re going to get rid of them. You’re going to tax away all the land’s rent or else nationalize the land. And you are going to have public enterprises as basic infrastructure so that they couldn’t be monopolized.

_____-

If American's have income that is being siphoned away to overhead, then they cannot be competitive on price.   Rents, bad taxes, finance cost, monopoly pricing, etc.

How to build a competitive economy WAS KNOWN in the past, but finance has fought back.  As Warren Buffet says, my class is winning.


fattail's picture

The products would not be cheap, and shouldn't be now if the chinese were not mining what's left of their clear air, water, and land to make cheap crap we don't need to provide huge profits to corporations.  All that earnings growth comes from cheap labor and a polluted environment.  We don't need 10 basketballs, 5 soccer balls, 35 stuffed animals, and 10 barbie dolls in each house hold.  One of each would do fine, we would be just as happy and the chinese would have a much cleaner environment.  Of course the Walton heirs may only be worth $1 billion each, instead of $20 billion.

GreatCaesar'sGhost's picture

I estimate it would take about 35 minutes for the US to be back up and manufacturing better junk than the Reds. Everything they build is copied from Western technology, all of their smarter students come to the West for their educations and most stay for the better pay, benefits and freedom. The Chicoms are a paper dragon.

popeye's picture

I suspect the whole story is BS. Look at the source: Reuters; no longer a neutral observer. And the pronouncements of any un-named officials (who you can guarantee would not say anything without permission/instruction) are for face, nothing more.

 

Fact is, Taiwan and China have extremely close ties in trade and finance, and neither gains a benefit from disrupting these. Although most mainland Chinese consider Taiwan a part of China, the current arrangement works well.

 

Recent years have revealed how the Chinese (both sides of the Strait: >95% of "Taiwanese" are ethnically Han Chinese) are pragmatic and value trade over violence (local maritime disputes notwithstanding, and if anything confirming this view).

GreatCaesar'sGhost's picture

Dopey Truman should have let MacArthur take them out back in the early 50's. It's still doable though, the Red Chinese aren't as strong as they think they are, but it would cost a lot of lives and maybe even nuclear attacks.

zorba THE GREEK's picture

everyone is getting so touchy these days. you know the Chinese have their social problems too. they may take a page out of the U.S. handbook and start a war to blame the bad times on. time for the U.S. to chill and time for the Kenyan to pass the baton to a U.S. born President.  

ChinaCatRider's picture

"everyone is getting so touchy these days."

Pansies have no place in goepolitics. BTW, that handbook existed before the US existed and is followed by many cultures/countries. Look at Iran/Isreal, Russia in Syria, etc...

 

Taiwan is a bargaining chip that will be used to raise the bet, bluff away, or double down. 

xythras's picture
xythras (not verified) ChinaCatRider Dec 31, 2016 11:34 AM

(EOF)

groaner's picture
groaner (not verified) Able Ape Dec 31, 2016 11:36 AM

Taiwan is threatening China if they dont stop,, they will tell all their Foxcon workers who make Iphones, to start jumping off the buildings in revolt

 

laomei's picture

China is a 3rd world shithole that is primed to implode. They have zero ability to project and all Trump needs to do is to give Taiwan nukes. Taiwan with nukes ends all Beijing ambitions, period.

ThirteenthFloor's picture

That "third world shithole" owns 1 Chase Plaza, home of JP Morgan.

https://www.google.com/amp/s/www.bloomberg.com/amp/news/articles/2013-10...

China acquires largest US companies in 2016

http://fortune.com/2016/03/18/the-biggest-american-companies-now-owned-b...

Who's the third world shithole ?

laomei's picture

China, the shithole is china.  Sprinkle some glitter on a turd, and it's still a turd.  A crackhead with some bling doesn't make them not a crackhead. China will -never- be great, and we will be ensuring that.

flaminratzazz's picture

"Ok lunger, I'll put you out of your misery"

roadhazard's picture

I'd bet Trump would sell out Taiwan to get what he wanted.

flaminratzazz's picture

and exactly what might that be?

roadhazard's picture

Who knows what the Donald wants but we are damn sure going to find out. To a gambler like Trump Taiwan looks like a poker chip. I hope they have paid their protection money.

BaBaBouy's picture

Getting HIS KIDS and In-laws RICH like Him ~~~

Yukon Cornholius's picture

Trump would sell (((Ivanka))) to get what he wants.

Kayman's picture

Must be could up there on the telegraph wires chattering to each other about nothing.

Yukon Cornholius's picture

So Trump didn't marry off his eldest daughter to Heeb bankster? Damn fake news got me again.

BarkingCat's picture

All his adult children married heebs......but I do not think that particular son-in-law is a banker.

I though he was from real estate, like Trump.

Kayman's picture

And a "one China" policy wasn't selling out Taiwan ?  If Trump can find a way to settle down the anti-Russian nonsense, then China is fucked.  

BarkingCat's picture

I don't think China and Russia will go back to being hostile to each other.

They know that US has too many neocons and neolibs and what their long term vision is.

roadhazard's picture

One China did nothing to Taiwan. It is still there, the Gov. is still there, the economy is still there and the military is still there.

General Titus's picture

The "Red Line" and the "Rat Line" according to Bill Clinton, Al Gore, & the Democrat Campaign Finance Committee

https://www.youtube.com/watch?v=A8mcN1putuc

Cox Report

http://www.house.gov/coxreport/chapfs/over.html

orangegeek's picture

Russia's biggest threat is China - particularly along their south border with China.

 

Putin knows this.

 

China needs Russian natural resources to become self sustaining and at some point China may just march into Russia and take what they want - Russia would have a difficult time defending such a move.

 

If China oversteps, they can easily be starved by blocking/slowing food imports.  China is also a fragmented country and internal revolution could easily be triggered by the US.

 

Trump's is going to "slow bleed" China into submission - ergo the Putin / Trump "we need each other for now" alliance.  Trade with China will also be reset to more favorable US terms.

Handful of Dust's picture

Exactly what Kissinger has said many times and in fact said Soweeto is a failure because he pushed Russia and China very close together. Kissinger said USA should work closer with Russia to keep China at bay.

ChinaCatRider's picture

"Russia's biggest threat is China - particularly along their south border with China.

 

Putin knows this."

 

Putin's biggest threat is Russia. Putin knows this, and so does everyone else.

Vlad needs to pay the bills via resource exports that are depressed. That is why he creates distractions across the global stage. Just a page off the old play book.

 

 

YHC-FTSE's picture

"Russia's biggest threat is China - particularly along their south border with China."

LOL. Isn't that what the Zionist fucks are selling at the moment? Soooo, you reckon the Russians will forget what happened in Ukraine and Syria and the sanctions, the false accusations, the demonization of Russians, MH17, the CIA and US State Dept murdering their soldiers via ISIS......Did I leave anything out?

I can see this is going to be the new narrative - the US is going to be pals with Russia and the new enemy is going to be China. Putin would have to be insane to trust anything from those neocon zionist fucks, even if Trump is fronting for them now.

As for Taiwan. They call themselves "The Republic of China". The mainlanders call themselves "The People's Republic of China". So basically, it's a family feud that has got nothing to do with me or anyone else. They can go fuck themselves, kiss and make up or kill each other. Not my business, nor is it yours fucker.

Grimaldus's picture

China is everybody's enemy and it is not new.

Just sayin.

I agree about Taiwan it is none of our business. But the "One China" bend over and spread em for murdering Chinese tyrants was pretty sickening and should have never happened.

Somehow I think murdering Chinese despots will end up killing millions moar of their own citizens, as they have countless time after time throughout history. It is what they do best.

 

 

 

Grimaldus

YHC-FTSE's picture

"China is everybody's enemy" You'll have to explain that one to me. I haven't seen them dropping bombs on kids and hospitals and wedding parties all over the fucking globe, so how exactly are they my enemy? The current chinese despots just lifted almost 2/3 billion people out of abject poverty and they've done nothing to me except make the crappy ipads that I had to buy for my kids.

I didn't buy that fucking warmongering lying shit and hatred towards Russia and I'm not buying the same lying shit towards China either. This cretinous propaganda is straight out of 1984 and that fucking zionist Kissinger is behind it.

Socratic Dog's picture

Great comments YHC.  China is everyones enemy, yeah sure.  And the USSA and Israel are everyones friends, right.

"How many kids have they murdered recently" might be a pretty useful objective  metric in evaluating enemy/threat status.  Maybe a bit more useful and objective  than swallowing the current zio narrative hook, line and sinker.  And referring to Kissinger for validation.  That shit belongs on Bezos' blog.

Zen Xenu's picture

I didn't buy that fucking warmongering lying shit and hatred towards Russia and I'm not buying the same lying shit towards China either. This cretinous propaganda is straight out of 1984 and that fucking zionist Kissinger is behind it.

^ this