China economic strategy outmatches US military


China represents an economic challenge to American world power.  The USA is trying to meet that challenge with a military response.  It won’t work.

The United States builds military bases and deploys troops all over the world, while allowing public infrastructure and public services to decline.  China is investing in its manufacturing industry, building infrastructure and expanding its trade to all corners of the world.

trainRoutePROJ-2300Pepe Escobar reported that China now has trains that deliver containerized freight from its Pacific Coast to Madrid.  China plans a network of highways, railroad and oil and gas pipelines that will give it access to all of the interior of Asia and bring to the threshold of Europe and the Middle East.

American spending for military and covert operations drains our national strength.  Chinese spending for construction builds up its national strength.

China has displaced the United States as the world’s largest economy.  It has replaced the United States as the largest trading partner of Australia, India, many countries of Africa and Brazil, Chile and Venezuela. America.

The U.S. government tries to enforce its will on other countries by means of our military and economic clout.  The Chinese government tries to win the friendship of other countries by means of construction projects, increased trade and befriending nations alienated from the USA.

The U.S. government is unequaled in history in its power to spread death and destruction.  The Chinese government cannot and does not compete on that level.  Instead it leverages its power to build—a power we Americans could duplicate if we so desired.

President Obama’s “pivot to Asia” is intended to check the rise of Chinese power, but how is he doing this.  One is by building up the Trans Pacific Partnership, a trading bloc which shuts out China.  The other is by providing military support for small nations with disputes with China.

What’s wrong is that while these policies do nothing to build up the eroding strength of the United States.

SMDC-21stcenturymaritimesilkroad.mapThe TPP would not benefit Americans, only certain international corporations and banks, which may or may not be used in the USA.

And while an alliance with small nations on China’s Pacific front door may limit China’s maritime trading security and access to offshore oil, China’s “new silk roads” will give it access to Central Asia, Russia, the Middle East and Europe overland.

The problem with this is that it does not change the fundamental trading relationship between the United States and China, which is the relationship of an advanced nation supplying manufactured goods in return for raw materials from the backward nation.

China’s chief export to the United States last year was computers and other electrical machinery.  The United States’ chief export to China last year was soybeans and other grains.

China has a trade surplus with the United States, and is a net creditor to the United States.  The United States has a problem of excessive debt.  China has a problem of excessive savings—which, to my mind, is a better problem to have.

China may fade as an economic superpower, as Japan did after the 1980s.  China has many serious problems, which could prove fatal—labor unrest, political unrest, large-scale corruption, environmental pollution, a privileged elite fearful of dissent.

Maybe these problems will prove fatal.  I have no way of knowing, but I doubt it.  When I read about China, I think of the United States in during the Gilded Age of the late 19th century when, for all our corruption and unrest, we were still building for the future.

Our American economic problems do not originate in China.  They are a result of our financialization, deindustrialization, deteriorating public infrastructure and services, growing inequality and dysfunctional government.


Go West, Young Han by Pepe Escobar for Asia Times (via Unz Review).  An important report on China’s economic strategy of “new silk roads”.

Russia, China mock divide and rule by Pepe Escobar for Asia Times.  [added 12/23/14]

The history of the new Chinese empire by Julian Sneider for Australia’s The Interpreter.  A report on China’s new maritime silk road.  (Hat tip to Naked Capitalism)

China Offers Russia Help With Currency Swap Suggestion by James Regan for Bloomberg News (Hat tip to Naked Capitalism).

America: Australia’s Dangerous Ally by Malcolm Fraser, former Prime Minister of Australia, for the National Interest. He fears the United States may drag Australia into a war with China. (Hat tip to Cannonfire).

China plans a global bullet-train dynasty by Julian Sneider for The Interpreter.

China sets out to repave and extend historic Silk Road to the west by Brenda Goh for the Irish Independent.

China’s String of Pearls: Extending their economic and military reach by Malaysia Times.

China’s foreign ports: The new masters and commanders by The Economist.

Would huge Nicaragua canal be a win for China? by Freda Ghitis for CNN.

Yes, there is an Asia space race by Morris Jones for The Interpreter.

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