Mode trump’s claims that the deal between the US and China looming on the horizon. If a bargain would indeed be achieved, then without a doubt, the bubble world of the stock market inflates even more. According to the Agency Bloomberg, the global stock market could increase by 10%.

If the deal will be a bargain, the mainstream media and trump can tell us what the world is all good: stock markets thrive, so do not worry about anything. Not going to pay attention to exaggeration, but let’s ask ourselves: would a trade deal to a thaw in us-China relations? Could it help to ease the economic and geostrategic tensions that exist between the two countries?

The much-touted “pivot” of President Obama to Asia in 2011 was a belated recognition of the American Empire that it faced the emerging superpower that has jeopardized its economic and geopolitical dominance in the Asia-Pacific region. During President Obama’s Asian “pivot” was largely military in nature, although we must not forget his ill-fated TRANS-Pacific partnership, which was designed to contain China’s economic expansion across the region.

The election of President populist trump, businessman-billionaire, who proclaimed the slogan “let’s Make America great again” revealed that the public mood that reflects rage against the deindustrialization of America, and how wall street was running away from “main street”*. The election trump reflected the recognition of the American ruling class of the need for action against the background of growing competition between the US and China in the field of advanced technology, competition for raw materials/markets in the field of strengthening of geopolitical tensions.

Says Dean Cheng of the Heritage Foundation, the leadership of the Communist party of China (CPC), believes that their country is in a state of peaceful competition with the United States. The leadership of the CPC considers that China is in the period of implementation of the “strategic opportunities”. “This will allow the country to focus on non-military aspects of a “comprehensive national power”. In other words, it is a period when there was a historic opportunity not only to catch up with economically more developed countries of the West, but also to become a world leader in advanced technologies and production. Thus, improving the lives of 1.4 billion people is of paramount importance to President XI.

The leadership of the Communist party of China looked to the future for decades, from the point of view of economic, scientific and military development of the country. The Congress of the CPC in 2017, Chairman XI said that the goal is that by mid-century to become “the world leader in terms of comprehensive national power and international influence.”

The initiative “Made in China 2025”

The initiative “Made in China 2025”, launched in 2015, was a turning point in the escalation of economic and military rivalry between China and the United States. The ruling class of China considers this initiative as an attempt to comprehensively upgrade their entire economy, from advanced manufacturing technologies to traditional industries and services.

Scott Kennedy) from the Center for strategic and international studies notes that: “the Aim is to comprehensively modernize China’s industry and make it more efficient and integrated so that it could occupy the highest links in the global production chains. The plan identifies the purpose of increasing the domestic content of major components and materials up to 40% by 2020 and 70% by 2025. “

In his speech at the meeting, one of the committees of the Congress on 25 September 2018 Dean Cheng stressed the comprehensive nature of the initiative “Made in China 2025”: “This Chinese program, through which the Chinese hope by 2025 to become to a large extent the country, are Autonomous in key production areas need to be considered as part of a broader effort to promote Chinese science and technology, not only innovation and R & d activities. The challenge is to support Chinese industry by localizing the entire technology development, commercialization and production process.“

The initiative “Made in China 2025” the United States is regarded as a serious threat like their advanced technological sector, and their attempts at global military dominance “across the spectrum” in the interests of corporate capital.

According to estimates of the U.S. Congress, the next generation of information technology, in which China intends to dominate, and includes 5G network, artificial intelligence, blockchain, cloud computing, quantum computing, and semiconductors. Fear of Chinese dominance in these high-tech sectors exhibited as a serious threat to economic and national security of the United States that need to be addressed.

Economic competition in the sphere of high technologies

Fear and anxiety due to the fact that China is rising as a competitor to the U.S. in high-tech industries are not unreasonable. Chinese supercomputers among the fastest in the world. China currently is the largest producer of supercomputers in the world. In 2017 202 of the 500 fastest supercomputers were Chinese. For comparison, the United States of 143. Chinese lunar module soon landed on the opposite side of the moon. At the same time the largest radio telescope in the world located in China.

Alex Barrera, editor Adelph Report, made the following observation: “the US and Europe lag behind in the development of the technology. Robotics, systems based on artificial intelligence, automated learning, quantum computing or smart mobility — it all happens in China, but not in the United States.“

The resulting gap from the point of view of investment, research and implementation of artificial intelligence and deep learning is staggering. This prompted the U.S. Congress to hold a series of hearings on the economic threat that China poses to the United States. 26 September 2018 the U.S. house of representatives held a hearing entitled: “countering the China — ensuring that America remains the world leader in advanced technologies and innovation”. The Chairman of the hearing, a member of the house of representatives heard, said that China wants to “replace us” as a world leader in advanced technologies and the blame for that U.S. economy annually loses from 225 to 600 billion dollars.

Due to the arrest by the canadian authorities financial Director of Huawei Meng Wanzhou December 1, 2018 at the request of U.S. authorities, General attention was attracted to this fast growing technological competition between China and the United States.

This is evidence that the United States is growing annoyance at the fact that China rises as a high-tech superpower, which in the next 20 years may well overshadow US.

In 2018, Huawei became the world number one in China, overshadowing Apple and making the Corporation the second largest producer in the world. In 2017, the net profit of Huawei was higher than those of Chinese corporate giants like Alibaba, Tencent and Baidu. More than half of this income came from sales abroad in Europe and Asia. In recent years, this revenue growth greatly exceeded such American competitors like Cisco. In 2012, the revenues of Huawei and Cisco were the same, but in 2017, Huawei far exceeded Cisco — 92 billion $ 50 billion Blake Schmidt of Bloomberg noted that the revenue growth Huawei “causes fear among some policy makers in the West.”

War with China? She already is

The military-industrial complex is pushing trump to ban the export Corporation Huawei equipment to wireless operators as they transition to 5G. While U.S. allies such as Australia, New Zealand and Japan, are planning to use Huawei equipment in their countries.

It will be interesting to see how the “impending” trade deal will resolve issues of intellectual property rights, access to software and patents for the sector of advanced technologies.

The interdependence of the US and China

On the one hand, both countries are mutually dependent on one another. However, they compete with each other for economic, technological, diplomatic and military fronts. The question is whether the state of interdependence cause any further deterioration in their relations, which will increase the likelihood of a military conflict.

The United States depends on China in several key areas, starting with cheap consumer goods that Chinese and American manufacturers, based in China, are sold to the us consumers. In addition, China is playing for the United States vital role because it is one of the key foreign creditors of America, those that hold US Treasury bonds worth more than $ 1 trillion. Foreign lenders to help the US government to Finance national debt in excess of 22 trillion dollars, which in turn, helps the US to Finance its huge military machine.

China’s economic troubles

And Vice versa. Chinese manufacturing industry depends on the continued ability sverhpredelna debt U.S. consumers continue to buy Chinese goods. China’s leaders consider that in the key technology areas of the Chinese industry is heavily dependent on foreign sources. Major Chinese companies such as ZTE and Huawei, and key state-owned enterprises such as Petro China is still heavily dependent on Western technology in some key areas.

More importantly, the Chinese leaders are keenly aware that they need to work hard to solve their huge debt issues especially in the area of corporate debt, which amounts to 145% of GDP. According to the IMF, 15% of Bank loans to corporate sector (more than 1.3 trillion dollars) are “under threat”. That’s why to help solve this growing debt crisis, the Chinese government is so eager to stimulate their economies. The project “One belt and one road” and “Made in China 2025”, which are regarded as major threats to the American Empire, are an integral part of attempts to stimulate economic growth.

The US and China will probably conclude the bargain, which will allow some of their short-term problems. However, longer term trends suggest economic, technological and military rivalry between the two countries.

Economic problems of the United States
Despite the widely publicized boom in the economy, the United States faces several structural problems that threaten to undermine their status as a superpower. Economic problems facing the United States also illustrate a profound “short-termism” of American capitalism, which threatens to exacerbate great-power rivalry with China.

In 1945, the United States was the main creditor, and the workshop of the world. The US dollar became the world reserve currency, which, along with fixed exchange rates between all other currencies and the dollar, allowed the United States to dominate the world economy a completely unprecedented way.

Long before 2019, the United States allowed most of its manufacturing industry to be relocated offshore in China and other countries with low wages. Corporate giants such as Apple make their iPhones in China and shipping them to the USA. The United States is faced with the fact that many countries, led by China, are trying to circumvent the dominance of the dollar in world trade, expanding the purchase of goods and services for their own national currency. From the world’s creditor, the United States became a country drowning in unpaid debt volume 22 trillion national debt and $ 13.4 trillion of household debt.

After the attacks of 11 September, the US got rid of the so-called “Vietnam syndrome” They used their military power to openly resort to “gunboat diplomacy” fighting for regime change in one country after another in an attempt to regain its political, economic and strategic domination over the Middle East.

Instead of investing in its education system, crumbling infrastructure and an unbalanced economy, the ruling class of the United States, dominated by financial capital, has degenerated into those who short-sightedly chasing short-term, even huge, profits. Wall street and the bloated financial industry getting fat at the expense of the rest of society. This led in America to the great wealth that threatens long-term stability of society. The US Federal reserve is probably the most powerful Central Bank on the planet devoted himself to maintaining the financial markets, creating the mechanism of a giant transfer of wealth that has not been equal in the history of mankind.

Fed policy regarding low interest rates along with the printing of money through the program of “quantitative easing” fed the Orgy of the parasitic debt. This gave rise to the mania of acquisitions and mergers (valued at over $ 400 billion in 2018 and the repurchase of shares amounting to more than $ 800 billion in 2018, which for the first time since 2008 exceeded capital costs.

Despite the correction of the stock market in the last quarter of 2018, fed policy, especially its recent moves, encourages speculative frenzy.

It looks like the financial elite in America have completely lost the head. Instead of punishing investors for such a short-term approach, they are encouraged. The American media and corporate politicians have the courage to complain about the rapid economic development of China, saber-rattling and impose tariffs on Chinese imports.

China overtakes the United States
No amount of American trade tariffs and there is no “gunboat diplomacy” in the South China sea will not prevent China to invest heavily in research and development to stimulate its economy, those innovations that would threaten American hegemony over the global economy. It is expected that this year China will surpass the United States on the amount of money allocated for research and development. Chinese R & d expenditure increased on average by 18% per year since 2004 compared to 4% a year from the United States, which allocate more resources on its bloated military.

The us military budget for the next fiscal year will reach 989 billion, which is 4 times more than the Chinese, which amounts to 228 billion dollars. America’s defense budget larger than the defense budgets of the next 9 countries combined!

Consider two examples, which illustrate how long-term economic strategy of China surpasses USA in critical areas. Thus, the telecommunications sector is a critical sector for any modern industrial economy. Over the past 3 years China surpassed the United States, spending 24 billion dollars on investments in the telecommunications infrastructure. Over the next 5 years plans to spend another $ 400 billion to develop 5G wireless technology. China has already deployed the 350,000 cell sites for 5G. The United States launched only 30000.

In key sector — education — China is rapidly catching up with US. According to the National science Foundation, is currently China awards almost the same number of degrees of doctors of natural and technical Sciences as America. Meanwhile, in China is produced 22% of the global number of students in science and technology compared to 10% in the United States. In 2017, American scientists published 409 000 scientific, medical and technological articles in leading international journals, compared to 426 000 in China.

Dr. John shrock article for University World News in December 2018, said that American science is in decline at the time, science China is moving forward. Shrock noted that in China: “…the long-term policy and investment in education and people accelerated the progress of science … the United States failed to move forward in many areas of science — from particle accelerators, to astronomy, and biology of the body.”

Geopolitical rivalry wants to grow

Widely advertised a bargain, if it takes place, may help ease tensions between China and the United States on a temporary short-term basis. However, no matter how comprehensive the deal, it will not resolve the fundamental economic problems in relations between the two countries. And these problems lead to an increase in geopolitical and military tensions.

Despite its serious problems with a huge pile of debt, China has committed itself for a massive long-term investment in its economic development. And all the trends say that by mid-century or even earlier, China will Eclipse the U.S. and become a world leader in advanced technologies.

This undermining American hegemony in the world economy, obviously, has major geopolitical implications because the US will not let that happen without a fight. Another view, will it be limited to global competition the economic sphere or it became a matter of escalation. Following a global recession that is approaching every day will undoubtedly exacerbate relations between the US and China and could lead to a military and geopolitical tension to the limit. In the end, war and foreign policy are merely an extension of domestic policy and the economy by other means.

Author: Leon Tressel -Leon Tressell is a historian, specializing in geopolitics and Economics. Lives in United Kingdom.

Translation Of Sergei Duhanov.

Russian news: the Central Bank announced the official exchange rate on 23 Mar

Published with permission of the publisher.

Copyright © Dr. Leon Tressell, Global Research, 2019

*Main Street (main street) — a phrase used to refer to the so-called “one-storeyed America”, i.e. of the America of small towns and villages, which always have a main street with the same name.

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