This sounds so totally believable that I am surprised that I am just now hearing this account of things. Do you have diaries or references to this that date to late summer 2007?
There was ET discussion (Migeru's photographic memory may recall....) last year in the course of which I put this view, but the truth of it will only come out when Paulson - who would have been the message boy - and the Chinese Central Committee, write their memoirs! ie probably never.
It's only an intuitive view (most of mine are!) really.
There was some weird shit going on around then: the Israeli raid on Syria (which wwas meant to impress Iran, and probably did), the B52 lugging nuclear tipped cruise missiles around (possibly even a Dr Strangelove moment defused?); but particularly for me, it was the fact that the Chinese reinstated a pre Saddam oil contract with Iraq: could they ever have done that if they, rather than the US, weren't calling the shots?
I think a covert deal has been struck by Khatami and his co-realists in Iran with the US. That's why the Surge worked - Sadr was prevailed upon by the Iranians to call a halt and continue his religious studies in Qom, Iran.
That's not the public position in either the US or Iran, of course, because it would be political poison in both countries to be seen to be cooperating.
So, there's a lot of noise from the Israeli's (who nevertheless continue to import Iranian oil, but business is business) and the Neocons, and from a very few Iranian hotheads, but the moment passed last year IMHO.
The new President - whoever he is - is going to have to swallow US pride and convene a Creditors' Meeting: that's the truth of it.
US Inc is about to enter Chapter 11.
And he's also going to have to come to terms with Iran in order to be able to leave behind a remotely stable Iraq.
I think we are no longer in a Unipolar world in the sense that no one power will ever again be able to impose themselves on the rest. It might have been different if Russia had not maintained a nuclear deterrent: I never thought I would be grateful that they did.
I see this as profoundly positive: I do not foresee a future of War.
It might have been different if Russia had not maintained a nuclear deterrent: I never thought I would be grateful that they did.
Isn't life just full of these surprises!
Point One - we will no longer fund a US military industrial complex geared up for aggressive War - and you can no longer fund it yourself.
Point Two - we will fund a military industrial complex redeployed to a a War on Climate Change - Green New deal - and we will share equitably in the gains.
ie US resources at last redeployed from destructive to constructive purposes.
to implement it sounds like it would entail the biggest re-definition of 'capital' since the middle ages.
how many more dead end avenues will it take before your way becomes the path of least resistance, i wonder.
whole lot of disaffected middlemen going to try and stall... The person who says it cannot be done should not interrupt the person doing it. Chinese Proverb.
you say it's already happening, when will the tide turn?
The tide turned years ago, and now it's well on the flood. I'm observing what people are actually doing, and analysing, refining, reporting and discussing it.
melo:
That is exactly right. Since double entry book-keeping came along, in fact.
Open Capital
is what I call it...
It will come about "bottom up", and probably first in those countries which do not have the barriers which we do.
eg mobile payments are being introduced in Kenya at the rate of 50,000 new users per week
And although Banks are still involved in payments we are seeing African Telco's actually buying banks......
After all, a payment is merely a "money message" between databases of obligations.
It's not so much the "dead end avenues" which are the problem, it's more inertia, and conservatism, and "the devil we know". I found until about a year ago that people said "Great idea, but we'll stick with what we know".
Now that what they know isn't working, they are saying:
"about that idea of yours....".
whole lot of disaffected middlemen going to try and stall...
...while some of the middlemen actually morph from value extracting rent-seekers to value creating service providers....
You can resist an invading army, melo, but you can't resist an idea....
i wonder if the chinese will like your idea, or the russians.
we'll find out at your 'bretton woods' 2! The person who says it cannot be done should not interrupt the person doing it. Chinese Proverb.
THIS IS THE BRIGHTEST RAY OF LIGHT I HAVE SEEN IN WHAT OTHERWISE APPEARS TO BE THE DESCENT INTO THE ABYSS.
Cahill needs to write another book in his series: HOW THE CHINESE COMMUNISTS SAVED CAPITALISM AND ENABLED THE WORLD TO AVOID CLIMATE CATASTROPHY.
MAY IT BE SO! Thank you Chris. If sanity be culturally normative, then by the norms of this culture I claim insanity.
The problem with being an optimist is you only get unpleasant surprises: the good part is you have a happy life 'til then.
I agree about the Russian deterrence. Under Reagan I felt at times that the future of the world depended much more on the sensibility of the Russians than on that of the USA. I haven't followed these things for years, but I see no reason for Russia and China not to be willing to cooperate on such matters of mutual defense as threats from the USA. Both are pretty pragmatic and seem to have their domestic populations well under control without having to play foreign adventure games.
The other thing I like about your scenario is that it gives me a reason why the Chinese have been willing to keep extending credit to us. Doing so has given them a powerful weapon that greatly enhances their security. Their behavior never completely made sense to me on purely economic grounds, even with the cushion it gave them against peak oil of $144.00/bbl. Now I can see enough advantages for it to make sense. Being able to destabilize the US economy on a moments notice is a powerful club.
Paul Kennedy, in
But they've handed the same club to the US. Its MAD in the economic sphere. China goes all out sell off, what it sells goes at fire sale prices given the circumstances. What it doesn't sell in time gets confiscated. Ditto for US assets in China. Trade ends. Tens of millions of suddenly unemployed Chinese workers. Shortages and price shocks in the US. Mass bankruptcies in China with a collapse of the normal banking system. Euro skyrockets, dollar crashes, yuan crashes against the Euro. Europeans take measures against the sudden flood of cut rate Chinese goods.
All in all, I'd say that if anything the sort of doomsday scenario you suggest would turn out worse for the Chinese than the Americans, and that's saying a lot. The Europeans would lose the least, but they'd be hurt badly as well. The cheap labour third world countries outside East and Southeast Asia would do well, the commodity nations would be screwed. Which also means that I don't think the oil exporters would be too happy - their wealth funds suddenly plummet in value at the same time as their export revenues do the same.
It would not be to their advantage to push it unless their interests were truly being damaged by US actions. Nor should it be in the US interest to destabilize China. Who knows what might emerge from that? This certainly does not preclude Cheney trying to play Dr. Strangelove, however. Leaders with death wishes have the means of wish fulfillment in their hands if they are major nuclear powers. If sanity be culturally normative, then by the norms of this culture I claim insanity.
They would make sure that their approach was shared by others with large dollar balances, particularly Russia (that's waht the SCO is for), Norway (now mightily pissed off with the US having seen all of their Oil fund gains in the last ten years wiped out two or three times over, and counting....),and regional holders of dollar balances.
We may put the Middle East to one side, although with the exception of Iran (who would join tomorrow, but have no dollar balances to speak of) I think they would undoubtedly join an initiative if they were certain everyone else was participating.
And re nuclear, it's only the Russians who have a credible deterrent, for which I never thought I would be thankful.
North America is better placed physically (or geophysically) to survive its crash. Mentally? Not so clear.
