Display:
Proof of what?
by santiago on Wed Jul 21st, 2010 at 08:49:39 AM EST
[ Parent ]
of every your statements here which are unsubstantiated. Take your most recent statement:  

... because China cannot improve itself through any option other than submission to the current world regime of rules on trade, commerce, and finance if it wants to continue to grow.  

please provide proof..

It can't opt out of trade with the US and EU,  

please proof

which means it cannot contest power with the US militarily.

please proof

and every your statement deserve the same questioning.

by FarEasterner on Wed Jul 21st, 2010 at 09:58:13 AM EST
[ Parent ]
Here's the proof that China cannot opt out of trade, done in a stylized, geometric proof format:

Given: China's economic growth in the last decade has occurred mostly due to its national strategy of export promotion, aka mercantilism. (Is this false?  If so, support your refutation.)

Given: China doesn't produce enough oil, soybeans, and other key minerals it needs domestically to satiate the demands of its greatly expanded economy.

Given: China currently does not have a non-oceanic transportation system or the political trust in place to be capable of supplying resources from land routes with neighboring sources such as India and Russia, which are presently relatively minor importers of Chinese production in the first place.

Given: China lacks the military capability of preventing the US from denying access to critical foreign export markets and resources if such a situation occurred.

  1. Assume that China opts out of trade today.
  2. Ask the following questions:

Without exports to the US and EU today, where will China obtain the wealth needed to support greatly expanded middle class lifestyles and pay the bills for its huge export-based industry?

Where will China obtain the mineral and agricultural resources it needs to maintain middle class lifestyles of its urban population as well as provide for industry, state, and military infrastructure?

Argument: If China cannot obtain sufficient income to support its current level of development and growth without international trade, then it cannot opt out of trade. (Is this not true?)

Argument:  If China cannot presently obtain the mineral and agricultural resources it needs to maintain and grow its current level of industrial development, then it cannot opt out of trade.

Proof: If China cannot obtain the resources it currently needs from foreign sources if  US were to choose to deny Chinese access to foreign markets and foreign sources of mineral and agricultural supplies, then China has no real alternative available other than to comply with the present world economic regimes.

China is stuck to trade, at least for the time being.  It has no other option.  This might change if it can become energy independent or if it develops a global military capable of contesting space with America, but that's not the situation today or, I argue, for the foreseeable future.

by santiago on Wed Jul 21st, 2010 at 11:47:37 AM EST
[ Parent ]
Mirror arguments apply to the US.

The difference is that China can afford to throw the US against the wall, providing it stays on good terms with the EU and also supports development in other nations which it can grow as export markets.

The US can't afford to throw China against the wall because it wants, and sometimes needs, the stuff that China makes, which now underpins a huge segment of the US corporate economy.

A trade war with China would be catastrophic for the US, because the shops would soon run out of everything - from food to clothes to toys to consumer electronics. Among others.

You're also ignoring the point that China is already supporting the US financially. If China allowed its currency to float, China would suddenly discover a significant source of wealth.

The relationship is on a knife edge. So far it's been expedient for the Chinese to continue with it, but it's immensely naive to assume that this has to continue because of some kind of implied non-specific US awesomeness that China lacks.

And China has far more options, and is in a much stronger economic and geopolitical position than the US is.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Jul 21st, 2010 at 12:02:11 PM EST
[ Parent ]
There is one important difference:

China is a low-income food-deficit country. The US is neither.

In other words, the US could literally starve China to death in the event of war.

This (the food deficit, not the war scenario) has to be one of the main reasons China is greatly expanding its hold on African agricultural production. I wonder how much of what officially counts as Chinese food imports is already "off-shore food production" on land leased by China.

By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan

by Migeru (migeru at eurotrib dot com) on Wed Jul 21st, 2010 at 12:28:14 PM EST
[ Parent ]
If China revalued the yuan, the low-income element could easily disappear.

As for food imports:

LJ Anderson: Rise in food imports heightens contamination risk - San Jose Mercury News

As computer jobs have gone offshore, so has the production and processing of food. In addition, the U.S. now imports more food than it exports -- with fresh produce, and fresh and frozen fish and shellfish among the leading imports. Mexico is the No. 1 exporter of fruit to the U.S., and China is in second place.

This unprecedented growth in globalization of food sources is accompanied by concerns about health risks to consumers. Regulations governing food production in many developing countries are often negligible. For example, two-thirds of the world's production of farmed fish is grown in ponds fertilized by animal manure or human sewage.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Jul 21st, 2010 at 12:45:51 PM EST
[ Parent ]
Your source is simply mistaken there. The US does not import more than it exports. The reverse is true, and by a wide margin.  (That story seems to come from a news report in 2004 when, for just a couple months that year, there was actually an agricultural trade deficit. But on an annual basis the surplus was still quite large that year.) Furthermore, the amount of food imported or exported is but a small fraction of total domestic production, so US agriculture, which is mostly a function of controlling the world's single largest and most productive tract of agricultural land -- the 100 million hectares that make up the American Midwest and Great Plains, is neither dependent upon imports nor exports for food.  
by santiago on Wed Jul 21st, 2010 at 12:58:44 PM EST
[ Parent ]
However, there is a trend of offshoring even our agricultural industry. Here in the Salinas Valley, the self-proclaimed "Salad Bowl of the World" that made the base of Steinbeck's work, food packing and processing has been offshored to China and South America, with the last 4-5 years seeing the bulk of this taking place.

There are a lot of vacant warehouses just south of Salinas, and many growers have shifted to growing grapes for wine production to replace lost lettuce and vegetable crops.

To be sure, the overall picture is still one of enormous agricultural productivity, but shifts are under way.

And the world will live as one

by Montereyan (robert at calitics dot com) on Wed Jul 28th, 2010 at 03:27:35 PM EST
[ Parent ]
food packing and processing has been offshored to China and South America

Does this mean American growers would grow lettuce which would then be shipped to China and South America for packing and processing before being shipped back to the US for consumption?

By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan

by Migeru (migeru at eurotrib dot com) on Wed Jul 28th, 2010 at 03:39:01 PM EST
[ Parent ]
See Cantonnery Row by John Steinbeck.
by afew (afew(a in a circle)eurotrib_dot_com) on Wed Jul 28th, 2010 at 04:37:29 PM EST
[ Parent ]
Does this mean American growers would grow lettuce which would then be shipped to China and South America for packing and processing?

If land in the Salinas Valley is being shifted to wine grapes I would suspect that the growing is being off-shored and coming to the US grown, processed and packaged by cheap labor. Gotta get those last few drops of lifeblood out of the bottom 99% of the US population. Poisoning those that are left is a no charge extra.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jul 28th, 2010 at 05:40:49 PM EST
[ Parent ]
No, the mirror arguments don't apply to the US because the US is the only one with a navy capable of securing access to all of the foreign resources it ever needs.  That's my whole argument here against the China is the New Master (tm) narrative in all of this.  

A trade war with China will just replace Chinese goods on US store shelves with goods made in any number of other countries that the US can continue to access. Walmart can replace their suppliers in days, if not minutes, as can any other retailer.  China is a low-cost producer, not a specialty producer.  It is utterly replaceable.

China is financing the US, but even when China reduced it's bond investments when the crisis ensued, other buyers of US private and government debt stepped right in and kept rates low. China is a good option for the US. The US is a critical actor for China.  That's the power disparity at play.  In portfolio theory terms, the US's risks are very diversified, while China's remain concentrated.

What, exactly, are the strong economic and geopolitical positions of China relative to the US that you are talking about.  You seem to be mistaking mere, short-term momentum for actuality here.  Fortunately for the Chinese, they seem to have a more realistic outlook on their own place in the world themselves.

by santiago on Wed Jul 21st, 2010 at 12:42:19 PM EST
[ Parent ]
santiago:
the US is the only one with a navy capable of securing access to all of the foreign resources it ever needs.

And that's working really well in Iraq, Iran and Afghanistan, isn't it? Or how about in South America?

You seem to believe that all the US has to do is turn up with a carrier strike force and help itself to whatever it wants.

Firstly, the US has always preferred to install puppets and do less shooting. Installing puppets actually works quite well, but it's not quite as easy as it used to be, as the US is discovering in Iran and Eastern Europe.

Secondly the idea that all you need is a navy is obvious strategic nonsense. Most resources are landlocked or at least somewhat remote, and if the US wanted them it would have to capture ports and secure extraction and supply lines.

Considering that the US can't even take out the Somali pirates, this seems like a less than entirely plausible scenario.

Successful US naval actions in the last couple of decades are rarer than unicorn testicles. Iraq was a lot of shouting and shelling to no great effect, Afghanistan is a fiasco, USS Cole was another disaster, Somalia continues to be a source of fail, and the rest is - where?

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Jul 21st, 2010 at 12:54:49 PM EST
[ Parent ]
And that's working really well in Iraq, Iran and Afghanistan, isn't it? Or how about in South America?

Actually, yes, it is.  At least as far as securing access to resources goes.  Iraq and Afghanistan just prove, for the umpteenth time, that military force is a poor way to provide for economic development and nation-building, not that military power is useless for killing enemies, toppling opposing governments, or denying other nations access to critical resources while securing them for yourself.

by santiago on Wed Jul 21st, 2010 at 01:01:51 PM EST
[ Parent ]
Naval warfare on the high seas is pretty much as far from counterinsurgency, where the US has struggled, as you can come. I have no doubt over the superiority of the US Navy, even if no one really knows how a modern naval struggle would develop (ie how vulnerable are capital ships in general and carriers in particular to subs and missiles?).

Still, this doesn't really matter that much as the role of capital ships is power projection and keeping the sea lanes of communication open. If you want to deny them to others you use subs. Which the US Navy is shock full of.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid (arvid.hallen at gmail.com) on Wed Jul 21st, 2010 at 04:20:42 PM EST
[ Parent ]
No, that's nonsense. By any sane measure - which excludes that used by Blackwater and other war corporations, of course - it would have been infinitely cheaper to buy Iraqi oil from Saddam than it has been to fight a pointless and destructive war, which has created an oil source that's extremely vulnerable to random attacks.

And exactly which resources has the US secured in Afghanistan? (Apart from heroin.)

The point is that Iraq and Afghanistan are primarily corporate welfare wars, not resource wars.

In terms of value for money and practical success, it's insane to pretend that they've bee anything other than disasters.

What they have done - and what they were likely designed to do - is put tax money into the pockets of a select few lobbyists and corporations.

Which is fine as far as it goes, but it's not a good precedent for a real resource war.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jul 22nd, 2010 at 08:56:37 AM EST
[ Parent ]
You're not seeing it. I agree with you that Iraq was a mistake and that continuing in Afghanistan as we are now is a mistake. What I'm arguing is that those two incidences have nothing to do with the the usefulness of military force for killing enemies, toppling foreign governments or determining who is allowed to buy oil and who isn't.  China can only buy oil from the Middle East, or any other ocean-dependent source, because it is not engaging in armed hostilities with the US.  The US has no such constraint.  It can engage in armed hostilities with just about anyone and still buy everything it needs from foreign sources because it has a navy capable of protecting those lines of communication.
by santiago on Thu Jul 22nd, 2010 at 10:39:23 AM EST
[ Parent ]
China can only buy oil from the Middle East, or any other ocean-dependent source, because it is not engaging in armed hostilities with the US.  The US has no such constraint.

Apart from the fact that if you piss off the people who sell you the stuff you need to buy, they may stop doing that.

And unrestricted commerce warfare is a really good way to piss people off. Especially if it's against their biggest customer.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Jul 22nd, 2010 at 10:43:04 AM EST
[ Parent ]
Except that they have to sell oil to someone or they can't pay their bills either. It's sad, but like storefronts in Chinatowns, because people need to work in order to eat, they end up doing business with the gun-toting gang in the neighborhood whether they like it or not.
by santiago on Thu Jul 22nd, 2010 at 10:50:52 AM EST
[ Parent ]
I would not be so sure. An oil embargo wouldn't have to last that long before the American ability to engage in global piracy would be seriously impaired.

But actually, I wasn't thinking so much about the oil producers as about the merchant marine. The US directly controls a fairly small share of the global merchant marine. And there's a difference between being able to blow up a ship and being able to take it over in a useful condition. Tick off enough of the rest of the world's maritime nations through unrestricted commerce warfare and you will find yourself unable to find civilian shipping for your own needs.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Jul 22nd, 2010 at 11:36:24 AM EST
[ Parent ]
I see you point about the oil embargo, but that's where having both a navy, and US dollars to pay for oil.

I guess I'm thinking that the merchant marine is basically like any other business.  Ship owners, when they are not a government, have real fortunes and savings invested in them and stand to lose a lot if someone wrecks a boat, and crew members have even more to lose.  (Ship insurance doesn't cover acts of war, generally, so the owners have a lot of skin exposed in such situations.)  Maybe I'm wrong, but I doubt many ship owners, flagging their vessels out of Liberia and Panama as the vast majority of ships are, are going to risk putting their investments in harms' way if the world's big boys came to blows, which means that the only way they could continue to pay their loans and bills is to sail them with non-Chinese cargo. To me it looks like the very market forces that allow China to benefit now, would act completely the opposite if the risk level of doing business with Chinese cargo increased. Risk gives advantages to those with the greater power, or biggest guns, all the more so when you can't afford to idle your capital (or labor) as most ship owners are.

by santiago on Thu Jul 22nd, 2010 at 10:00:56 PM EST
[ Parent ]
China can only buy oil from the Middle East

False. What about working pipeline from Kazakhstan and under construction from Russian Far East?

because it is not engaging in armed hostilities with the US

Neocon crap.

We used to hear such stuff from John Bolton. Are you his deputy on ET?

by FarEasterner on Thu Jul 22nd, 2010 at 10:54:45 AM EST
[ Parent ]
I'll be happy to respond to your comments when you stop the false, Ad Hominem attacks.
by santiago on Thu Jul 22nd, 2010 at 11:27:51 AM EST
[ Parent ]
truth hurts?

No attempt to back your neocon statements?

I am happy to receive "2" marks from neocons every day.

by FarEasterner on Thu Jul 22nd, 2010 at 11:37:32 AM EST
[ Parent ]
FarEasterner, please. If santiago's comments appear neocon-like to you, that is no reason to call him a neocon or ask him if he's John Bolton's deputy.

It's possible to discuss this without name-calling, isn't it?

by afew (afew(a in a circle)eurotrib_dot_com) on Thu Jul 22nd, 2010 at 12:13:59 PM EST
[ Parent ]
this is internet. there is no ban on using word "neocon". if he cares to back his claims he keep repeating in every other post i would be only happy to unravel and show where and how his views are neocon with extensive quotations from speeches of honourable John Bolton and comrades.
by FarEasterner on Thu Jul 22nd, 2010 at 12:27:39 PM EST
[ Parent ]
There's no ban on saying "neocon", but calling the other person a neocon and comparing them to John Bolton would, on many Internet discussion sites as on ET, be called "flaming".

If you want to show what you think is of neocon inspiration in santiago's comments, that is a different matter.

by afew (afew(a in a circle)eurotrib_dot_com) on Thu Jul 22nd, 2010 at 12:43:01 PM EST
[ Parent ]
really? even if John Bolton himself will appear on ET you would not call him neocon because it will be flaming?
by FarEasterner on Thu Jul 22nd, 2010 at 12:45:47 PM EST
[ Parent ]
What good does namecalling do? Address the arguments if Bolton had any...

By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan
by Migeru (migeru at eurotrib dot com) on Thu Jul 22nd, 2010 at 12:47:13 PM EST
[ Parent ]
not political correct enough to call spade a spade
by FarEasterner on Thu Jul 22nd, 2010 at 12:50:36 PM EST
[ Parent ]
The problem is that the shouting match between you and santiago is not very enlightening as to the underlying issue. For instance, for all your criticism of other's imputations of Chinese motivations, you haven't provided your own view of what moves China while suggesting that you have an insight or lack of bias that others lack.

So you calling santiago a neocon doesn't tell me anything about what you think is the correct view of China's motivations, nor what evidence one can get about it from outside.

You can call a spade a spade but the question of what China wants is more interesting than the question of whether santiago is a neocon.

By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan

by Migeru (migeru at eurotrib dot com) on Thu Jul 22nd, 2010 at 01:58:56 PM EST
[ Parent ]
ThatBritGuy:
Successful US naval actions in the last couple of decades are rarer than unicorn testicles.
Cue in the Exile classic U Sank My Carrier! - By Gary Brecher - The War Nerd
The truth is that van Ripen did something so important that I still can't believe the mainstream press hasn't made anything of it. With nothing more than a few "small boats and aircraft," van Ripen managed to sink most of the US fleet in the Persian Gulf.

What this means is as simple and plain as a skull: every US Navy battle group, every one of those big fancy aircraft carriers we love, won't last one single day in combat against a serious enemy.

The Navy brass tried to bluff it out, but they were pretty lame about it. They just declared the sunken ships "refloated" so the game could go on as planned. This is the kind of word-game that makes the military look so damn dumb. Too bad Bonaparte never thought of that after Trafalgar: "My vleete, she is now reflotte!" Too bad Phillip didn't demand a refloat after the Armada went down: "Oye, vatos, dees English sink todos mi ships, chinga sus madres, so escuche: el fleet es ahora refloated, OK?"



By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan
by Migeru (migeru at eurotrib dot com) on Wed Jul 21st, 2010 at 01:02:17 PM EST
[ Parent ]

And that's working really well in Iraq, Iran and Afghanistan, isn't it?

Iraq is a failure precisely because they moved away from their usual modus operandi. They did not need to invade Iraq to get its oil (in fact, the opposite is true). But it doesn't disprove either the point that they can isolate any country they want whereas nobody can isolate the US from the resources of the rest of the world.

Wind power

by Jerome a Paris (etg@eurotrib.com) on Thu Jul 22nd, 2010 at 09:01:21 PM EST
[ Parent ]
However the landward side of the harbor is problematic for much of the resources that the US needs if the strategy is to squeeze the resources out of the country as opposed to pursuing mutually beneficial trade ... especially in Africa and South America.

As in the turn of the last Century, places like Afghanistan and Burma are near the pivots of the great game. And China is already better positioned to cope with a massive disruption of Arabian oil exports than the US is, and pulling further ahead.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Thu Jul 22nd, 2010 at 06:13:46 PM EST
[ Parent ]
Didn't you notice how many times you used words China "can", "can't", "must" etc. In other words you tell us what China really wants to do. You says "China can't opt out of trade" when this premise is patently false because no Chinese would want "to opt out of trade" in the first place. All other your assertions about China's policy built on the same false antagonistic assumptions. I (and no doubt others on ET) are still awaiting your proofs that China really wants to do this or that which you attributed to her.
by FarEasterner on Wed Jul 21st, 2010 at 12:30:32 PM EST
[ Parent ]
China doesn't want to opt out of trade. Why should it? It wants to trade. But trade creates dependency, and unlike the EU or the US, whose highly diversified economies benefit from, but are not dependent upon, trade, China has actually become dependent upon trade, particularly trade with the US and the EU.  Dependency is the opposite of independence, and independence is what provides power in counter-party relationships. Think it through.
by santiago on Wed Jul 21st, 2010 at 12:46:42 PM EST
[ Parent ]

Display:
Login
. Make a new account
. Reset password
Occasional Series