The True Origins Of The US-Chinese Trade War

Authored by Andrew Korybko via Oriental Review,

China responded to Trump’s tariffs with economic restrictions of its own, though its market has always been notoriously difficult to enter due to Beijing’s own ironically “protectionist” policies designed to safeguard its domestic producers, but the government has been easing its prior regulations in recent years in order to facilitate the country’s One Belt One Road (OBOR) global vision of New Silk Road connectivity. The developing trade war between the US and China threatens to formalize the long-running economic competition between these two Great Powers as they vie with one another over control of the world order, with Washington wanting to retain its erstwhile but fading unipolar dominance while Beijing wants to pioneer the emergence of a multipolar system marked by a diversity of theoretically equal stakeholders.

The friction between these contradictory forces is the basis of the ongoing New Cold War, though there’s a bit more of a backstory to this global struggle than just that.

The US thought that “winning back Beijing” through its late Cold War-era alliance with China against the USSR would allow Washington to do as it pleases to what its decision makers had convinced themselves was their largest proxy state to date, but the US’ betrayal of China through the failed Tiananmen Square Color Revolution attempt of 1989 forever changed how the East Asian country’s communist leaders viewed America. Nevertheless, the naïve liberal-globalists of the Clinton era thought that they could bribe China to remain “loyal” to the US-led global world order that emerged after the Cold War by relying on “win-win” investments that would enrich the American elite while helping China rapidly modernize.

Suffice to say, this presumption proved to be totally false.

The so-called “Washington Consensus” and attendant “rules of the game” are rigged in order to benefit the US and indefinitely perpetuate its global hegemony, which is why China continuously broke the rules to its advantage but was allowed to get away with it for so long because of the aforementioned relationship that it had with naïve liberal-globalist American elites who profited from this system at the expense of average Americans.

The Obama Administration tried to preemptively “balance” the inevitable geopolitical consequences of this trend by proposing the so-called “Group of Two” or “Chimerica” global partnership with China, but Beijing rejected this outreach.

By 2013, China felt confident enough with its newfound strength to announce the world-changing OBOR megaproject that’s designed to bring a definitive end to America’s economic dominance and related unipolar “leadership”, but then the US and China suddenly “switched” global economic roles following Trump’s election.

President Xi’s January 2017 speech at Davos saw him proclaim China as the champion of a reformed version of the globalization model that America once led, while President Trump has made no secret of his preference for the type of protectionist-nationalist policies that the People’s Republic itself embraced in the past.

The rest of the world is now compelled to choose between these competing systems.

Just like during the Old Cold War, however, the new one is seeing the reemergence of another Non-Aligned Movement (Neo-NAM) that’s attempting to strike a “middle ground” by “hybridizing” the best policies of both but in a more complicated and comprehensive way than before because of the inextricable geopolitical and economic dimensions that transcend the former dogmatic adherence to a single ideology. If there’s any “ideology” at all nowadays, then it’s the pure self-interest of Neo-Realism, and it’s here where Russia can play a pivotal role during this transitional period of global systemic change by assisting the Neo-NAM in “balancing” between both “blocs” and reaping the resultant advantages.

Comments

Sy Kloine Bee Mon, 04/09/2018 - 23:53 Permalink

We live in interesting times.  Big changes will be coming soon, especially for the US.  I don't think that anyone can accurately predict yet what the effects of them will be on the average Joe. 

kralizec Four Star Tue, 04/10/2018 - 07:49 Permalink

This is childish.  It presumes the Chi-Com's are fully capable of effing over the US and impotent to use and discard Russia as it pleases.  Those two have had more antagonism between them in their history than cooperation.  Presuming their aims as partners are achieved...it is unthinkable that one would seek to dominate the other, I mean that is just impossible, eh?  But hey if the gator bites you last - you win!

In reply to by Four Star

ldd Déjà view Tue, 04/10/2018 - 00:35 Permalink

the chinese have never forgetton and will never forget what the powers did to them. who stole their national treasures and enslaved their people to opium. do you think it is a coincidence that there are chinatowns in every major city around the world. what goes around comes around and they play the long game longer than anyone else.

In reply to by Déjà view

Throat-warbler… Mon, 04/09/2018 - 23:58 Permalink

Negotiators these morons weren't.  Let's give everything away and ASSuME that the recipient communist government will somehow become loyalized to our beneficence.  After all, the elite (bankers, financiers) win either way.

matermaker Tue, 04/10/2018 - 00:05 Permalink

NO.... asshole.... Xi responded, tonight, by saying all roads lead to Rome and that Chinese got along better with Americans... both historically and practically.  I just finished watching the speech..   Xi and the Donald have a bromance that is going to piss Euasia off at Easturasia.  If you're going to beat a thousand years of control, pick the new world.   Fuck Europe.  India, Pakistan, China and just about everyone else over there has a reason to be pissed at Europe.  Makes sense they would side with us.

matermaker BitchesBetterR… Tue, 04/10/2018 - 00:29 Permalink

To eastern asia.... as history goes... we've never occupied any nation in peacetime.  We even quickly let go of Japan.    Turth is... there were three nations in Orwell's book....  There is no reason why Eastern Asia should side with Europe... Old or New...  Russia is their biggest competitor with a few white folks hording a huge chunk of land.  America is the white tip of a brown new world.

In reply to by BitchesBetterR…

besnook matermaker Tue, 04/10/2018 - 00:34 Permalink

total miss. you have to look back at the historical role china has played in the region and the world. theirs was the first globalized economy. they are an old hand at it. they have always been loved and hated at the same time by everyone in asia. china has always been the source of their(oceania all the way to africa) wealth and made them subservient to that wealth. china always follows money exportation with people exportation who end up being a dominant local economic force.

contrast that with china's relationship with the west. if you think china has changed its view much you would be mistaken. the west is clearly the enemy as it always has been. the boxer rebellion will be successful this time.

In reply to by matermaker

besnook matermaker Tue, 04/10/2018 - 01:12 Permalink

actually, no. the jap hating thing is kind of bs. yea, the chinese don't like the japanese for it but they are more upset the japanese beat them and ruled over them, the same source of hate they have for the west. the difference is the japanese and chinese have a much longer relationship than the few weeks the japanese lost their minds. the chinese understand war. if anyone hates the japanese it's the koreans, all of them, deeply, but again, the local culture is important. the koreans have always been low man on the totem pole in the region so they start with a chip on their shoulder. it's actually the foundation of their culture.

In reply to by matermaker

Pi Bolar Tue, 04/10/2018 - 00:09 Permalink

Free trade is A exchange for B. Two winners. Two happy customers. The politicians blurred and scarred true free trade with crap like tariffs, exchange rates, sanctions, protectionism, underhand deals, lobbying, buying influence and so on. 

 

Vendetta Pi Bolar Tue, 04/10/2018 - 09:12 Permalink

Buying socks like I did last week for $14 that were made in Pakistan makes zero sense to me ... that the things can be shipped thousands upon thousands of miles and someone is still making a profit is insane  ... trade was and is all about trading for things one cannot build or do not have the natural resources to do yourself ... the meme regarding trade today is all about labor exploitation .. nothing else 

In reply to by Pi Bolar

matermaker matermaker Tue, 04/10/2018 - 00:51 Permalink

Think on that... we nuke and destroyed Japan... interned them and not the Germans living with us.  Bombed the shit out of Europe through two World Wars because they couldn't get along over stupid shit.  America is everyone.. Even the poor natives that the rest of the world poured into and left fucked.  Save Antarctica and maybe Patagonia,  The new world is only new by taking the misfits in from the old.

In reply to by matermaker

matermaker Tue, 04/10/2018 - 01:23 Permalink

America was built upon the backs of Asians as much if not more than the backs of Africans or slaves.  You think Trump is being a dick about immigration now?  Look back a hundred years.  Simple reality is that America is more Oriental than Europe.  Even Russia fucks it's eastern half.  The UK empire conquered India and Pakistan, so that's a problem.  What this speech by Xi basically said, tonight.... I'm more with the Yanks than the rest of you bitches.  The Donald has great soft lips.

Batman11 Tue, 04/10/2018 - 03:29 Permalink

The equation Western leaders failed to grasp.

Disposable income = wages – (taxes + the cost of living)

Apple maximises profit by letting Foxconn do most of it’s manufacturing in China.

How does Foxconn maximise profit?

Disposable income = wages – (taxes + the cost of living)

It provides accommodation, food and entertainment to ensure workers have a very low (zero) cost of living and even provides free entertainment to ensure workers don’t need much disposable income.

It can pay very low wages and maximise profit.

Business understands capitalism.

American leaders don’t and are ensuring US workers can’t compete in the global economy.

The cost of living = housing costs + healthcare costs + student loan costs + food + other costs of living

Batman11 Batman11 Tue, 04/10/2018 - 03:47 Permalink

Western leaders skimped on their Ricardo.

Ricardo made the arguments for the Repeal of the Corn Laws and the case for free trade through comparative advantage.

We have one, but not the other.

When the architects of globalisation were reading up on Ricardo’s law of comparative advantage they must have missed it.

You need a low cost of living for free trade, which is why Ricardo campaigned for the repeal of the Corn Laws. The repeal of the Corn Laws was essential to usher in the era of Laissez-Faire.

Why did the jobs go to Mexico after NAFTA?

The cost of living = housing costs + healthcare costs + student loan costs + food + other costs of living

The cost of living is too high in the US, and this has to be covered in wages reducing profit.

The US economy is not geared for a free trade world.

In reply to by Batman11

Scipio Africanuz Batman11 Tue, 04/10/2018 - 09:03 Permalink

The cost of living, while high, is not the major problem. The standard of living (gluttony based), is the problem! Why do you need a new iPhone when the old one works perfectly fine?

Americans have forgotten how to live within their means, how to prioritize their needs, how to delay gratification, how to ignore wants in favor of needs.

This is the problem! Americans have become wasteful, indolent, childish, gluttonous, selfish, and delusional. As long as this state of psychology remains, it's gonna be drip drip drip bye...

In reply to by Batman11

Grandad Grumps Tue, 04/10/2018 - 04:07 Permalink

In China this week. There is no trade war.. it is a cooperative rebalancing and Xi has already agreed to implement the new policies and informed the Chinese people. Everyone can climb out of their bunkers for a little while longer.

SmittyinLA Tue, 04/10/2018 - 04:44 Permalink

They weren't delusional globalists, they were greedy traitor-whores, where they gonna live now, prison Israel where all the inmates are above the law?