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Put simplistically, if the Chinese went to war without a navy like America has, the Chinese wouldn't get to keep their ships -- they would have to surrender them to America who would allow the world to use them for trade and supplying resources to America until China ate its hum humble pie and rejoined the American world again. Since the dawn of capitalism, the importance of having the biggest navy, or capacity to be independent of trade, cannot be overestimated.  Everything else falls into place after control of the seas is established.

It took China 30 years to develop its industrial capacity because it didn't have technology or, more importantly, the social institutions for capitalist industrial organization. Once they developed the social institutions of capitalism, it took only weeks or months for them to build new factories. It woouldn't take even 30 weeks for anyone who has necessary capitalist political institutions and social norms in place to replicate Chinese intermediate good manufacturing in the rest of the world.  Same thing already happened in WWII when the industrial powers retooled their entire economies in matters of months to produce things multiple times the scale that had been produced before the war.  The real limiting factor isn't the knowledge or industrial base; it's the resources -- the oil, and minerals and food supply, and that's what big navies provide.  In the end, the guy with the biggest guns and fastest boats controls the resources, not the the guy with factories to transform resources from one thing to another. You can replicate the factory, not the resources.

Regarding equilibrium, we're not talking long duree here.  We're talking about the political constraints faced by people who have responsibility for feeding billions today.  It's a political equilibrium because no actor can improve their lot by doing something other than what is provided for in the rules of trade, commerce, and global governance set up by, and mostly for the benefit of, the US and its close allies.  

Over the long term, yes, economic advantages can change, and the winds appear to be blowing in China's direction. But in order for China to actually overtake America, it would have to find a way of securing access to the kinds of resources that America can, either militarily, or by reorganizing the institutions by which people organize their economic lives, i.e, overthrowing capitalism. Right now, China is securing access to the resources it needs by merely depending on American goodwill and Western social contrivances for property rights and the like.  China has a long way to go yet before it can do better than just depend on others for both institutions and security, but I agree that it appears to be headed that way someday.

by santiago on Tue Jul 20th, 2010 at 11:20:12 PM EST
[ Parent ]
I tend to agree that new manufacturing could be ramped up quickly, but I cannot see how the current system can possibly have any stable equilibrium. Instead, it seems to me most likely that we are rapidly heading for a massive financial disequilibrium that will require the sort of response that will not be possible while retaining the nature and structure of the present elite and their system.

The current system consists of a pack of sociopaths in suits with the habits of pirates seeking every opportunity to loot and pillage. They and the way they operate take no account of the need for anything but their own immediate returns, which are now only obtainable through organized fraud enabled by their capture and domination of the political process. This is unstable and will crash just as surely as the economy of ancient Rome collapsed when overrun by Goths and Vandals. The pirate elite has no interest in the boring tasks required to run a sustainable society. That is why we don't have one.

Many superior forms of organization are possible, but so are vastly inferior forms of organization. I can only hope that some of those with position and power have the vision to want to secure a livable world and a decent society for their children and grandchildren.

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 21st, 2010 at 01:36:11 AM EST
[ Parent ]
I'm not talking about a system or stable equilibrium in the general sense here.  I'm just saying that the strategic options available to leaders of states like China provide an equilibrium, in the game theory sense of the word, 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.  It can't opt out of trade with the US and EU, which means it cannot contest power with the US militarily.  
by santiago on Wed Jul 21st, 2010 at 08:53:47 AM EST
[ Parent ]
From this statement
It can't opt out of trade with the US and EU

does not necessary follows that
which means it cannot contest power with the US militarily

in other words proof, please.

China cannot improve itself through any option other than submission to the current world regime of rules on trade, commerce, and finance

From this statement we learn that China wish to improve itself without submission to Western narrated "rules".

Proof, please.

by FarEasterner on Wed Jul 21st, 2010 at 01:44:18 PM EST
[ Parent ]
This sis of course only under the condition that the Chinese won't strongly expand their navy. Which they are actually doing. At a faster pace than their economy is growing, IIRC.

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 04:31:05 PM EST
[ Parent ]
Wikipedia:
The future fleet of conventional Chinese submarines is a deadly quiet force that could perform defensive and offensive operations. The future fleet will compose of the Kilo, Song and Yuan types, as the Romeos and Mings are phased out of service. China is reported to have the option of purchasing the more advanced Russian Amur class SSK. With the success of indigenous programmes, however, future purchases of foreign submarines look relatively unlikely.


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 05:06:07 PM EST
[ Parent ]
Yes, that China wants to be able to blockade Taiwan aint no surprise. What we should keep our eyes and ears open for is any news about Chinese capital ships, to secure SLOC's.

Like the ones the Koreans and Japanese are building.

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 05:11:07 PM EST
[ Parent ]
Why?

Take a capital ship that you don't like.

Then take a moderately modern spy satellite.

Then take four dozen submarines.

Launch five hundred cruise missiles over the horizon.

Watch as ten million man hours, five thousand sailors and pilots and a hundred thousand tons of high-grade steel sinks helplessly to the bottom of the Pacific Ocean.

Dive, scatter and lose the counter-sub task force dispatched to hunt you down.

Repeat as necessary. They can get twenty of your subs for each capital ship you take out and you still come out ahead in terms of steel, man-hours and trained sailors.

Watch your capital be reduced to radioactive glass about forty-five minutes after the first capital ship gets an impromptu U-boat makeover.

- 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 Wed Jul 21st, 2010 at 06:13:06 PM EST
[ Parent ]
First, it boils down to how effective subs are vs ASW vessels, and how effective the anti-missile systems are. No one knows this, because there hasn't been any serious naval warfare since WW2, with the exception of the Falklands war, which for several reasons actually told us less than one might imagine.

Second, even if the subs win, you still don't control the SLOC's. You just deny them to the enemy.

If you don't believe me, send in your merchantmen and watch as land-based (and carrier-based) fighters, long-range bombers, missile armed fast attack crafts and enemy submarines close on them. Not pretty. You need your own ASW and AA (and ASh) bubble around your convoys of merchantmen. You only get that from capital ships, or a plentiful base network.

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 07:17:48 PM EST
[ Parent ]
I might add that with "capital ship", I'm not just referring to carriers, but to guided missile destroyers/cruisers and the like as well.

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 07:23:44 PM EST
[ Parent ]
Interesting article to your attention on American-Russian-Chinese triangle:

The Moscow Times: Tangled Triangle of Russia, China and the U.S.

recently .. former high-ranking Pentagon official.. made a special trip to Moscow to warn us about an increasingly powerful China. The "Chinese dragon," he said, has large ambitions and will try to dominate the world. He hinted at the need for Washington and Moscow to close ranks and start preparing for a joint defense against Chinese political and economic expansion.

... Reveling in its victory in the Cold War and its clear military, political and economic superiority, the United States set its sights on global hegemony. This antagonized and alienated both Moscow and Beijing and created an opportunity for them to join forces once again to oppose U.S. hegemony.

The Sept. 11, 2001, terrorist attacks marked the beginning of the end of U.S. global domination. The U.S. fall from the stars was accelerated by its unsuccessful, taxing military campaigns in Afghanistan and Iraq and the deep economic crisis.

By 2009, it became obvious that the "Pax Americana" global empire was a pipe dream, and the United States -- now under the leadership of a more pragmatic and realistic President Barack Obama -- began looking for new alliances. One of the Obama administration's ideas was sharing the burden of responsibility for global security with China...

In February 2009, U.S. Secretary of State Hillary Clinton proposed creating a U.S.-Chinese superpower alliance... But the Chinese leadership flatly rejected Clinton's proposal. ...China has always insisted that it has no ambitions to become a hegemony and is opposed to any global domination by any superpower.
...This is why many U.S. policymakers view China as the country's largest threat.

How can the United States counter this threat? ... once again, Washington has courted Moscow to help the United States counterbalance China's growing global influence. But the United States doesn't realize that Russia has no interest in alienating China.

Eighteenth-century French philosopher Charles de Montesquieu said, "Small counties perish from external enemies, and large countries perish from internal ones." Russia has more than enough internal problems that it needs to solve without having to worry about conflicts with China. This is why ... the Russian-Chinese-U.S. triangle will remain as three separate centers for a long time to come.

by FarEasterner on Wed Jul 21st, 2010 at 05:55:38 PM EST
[ Parent ]
The US does its best to alienate the EU from Russia and Russia from China in order to preserve its hegemony. I don't think the EU, Russia or China are concerned with hegemony but, in Chomsky's dychotomy, survival. So the US can scaremonger and drive wedges all they want but I don't think it will work.

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 04:18:53 AM EST
[ Parent ]
Everything else falls into place after control of the seas is established.

Looking at Somali piracy, isn't it possible to mess up the world system badly enough that there are no safe shipping lanes anywhere?

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 02:44:21 AM EST
[ Parent ]
No. The Somali pirates are a paper tiger. If the powers that be really wanted to clear out the Gulf of Aden it could be done in a week.

But there is no feeling that it's needed, as so very few ships fall prey to the pirates. The real cost of this piracy is reflected in the insurance premiums shipping companies must pay when they pass through these waters. The increase of the premiums is smaller than the cost of maintaining the current naval forces down there. Heard that one before? Yeah... Privatise the profits, socialise the costs.

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 04:34:38 PM EST
[ Parent ]
Put simplistically, if the Chinese went to war without a navy like America has, the Chinese wouldn't get to keep their ships -- they would have to surrender them to America

Or re-flag them with a neutral-in-their-favour country prior to the commencement of hostilities. The only historical examples of successfully blockading serious industrial powers (France during the Napoleanic Wars, Germany during the world wars) involve countries that did not have any land borders with neutral-in-their-favour countries possessing blue-water ports.

It took China 30 years to develop its industrial capacity because it didn't have technology or, more importantly, the social institutions for capitalist industrial organization.

And after thirty years of systematically dismantling their industrial plant, it is doubtful that the Americans have that capacity either at this point.

Same thing already happened in WWII when the industrial powers retooled their entire economies in matters of months to produce things multiple times the scale that had been produced before the war.

This requires there to be an industrial plant to re-tool. Re-tooling and re-building from the ground up is not the same story. And even re-tooling isn't as easy as it was in the '30s and '40s because the machinery has gotten a lot more specialised since then. You can't take a jet engine factory and convert it to a rail engine factory the way you could take an automobile factory in the '40s and convert it into an aircraft factory - you might as well scrap the whole thing and start over instead.

You would be better advised to compare the task at hand to the re-building after the War, when most of the pre-existing industrial plant had ceased to exist. That took a couple of years, not a couple of months, and they had help from the premier industrial power of the time, whereas you are talking about doing it in opposition to the premier industrial power of our time.

The real limiting factor isn't the knowledge or industrial base; it's the resources -- the oil, and minerals and food supply, and that's what big navies provide.  In the end, the guy with the biggest guns and fastest boats controls the resources,

Only against countries that he can effectively blockade. Once Chinese shipping is out of the Sea of Japan, it's impossible to interdict without cutting off the Russian East as well, unless Russia is neutral in your favour. Which, at the moment, they are not. And if you send your carrier task forces into the Sea of Japan to carry out piracy against Chinese shipping, land-based cruise missiles can make them not come home again for a fraction of the cost of building a blue-water navy.

It's a political equilibrium because no actor can improve their lot by doing something other than what is provided for in the rules of trade, commerce, and global governance set up by, and mostly for the benefit of, the US and its close allies.

That is a necessary but not sufficient condition for describing it as an equilibrium situation - it could also be (and in this case is, due to the secular trends involved) - a positive feedback loop. The atmospheric concentration of water vapour is a stable equilibrium (on the macro scale). A ball balancing on top of another ball is an unstable equilibrium. A Ponzi scam is a positive feedback loop.

(Stable and meta-stable) equilibria change gradually - unconstrained positive feedback loops crash. (Unstable equilibria rarely live long enough to be observed in noisy environments.)

But in order for China to actually overtake America, it would have to find a way of securing access to the kinds of resources that America can,

You're still assuming that the Americans can simply start interdicting Chinese commerce at will. Physically, they can, but doing so would piss off every other industrial power on the planet. So economically speaking, they can't.

Germany thought they could get away with unrestricted commerce warfare against the Entente during the first world war. That is probably the single strategic decision that goes the longest way towards explaining their defeat, because that's what brought the Americans in on the side of the Entente.

- 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 Wed Jul 21st, 2010 at 04:56:36 AM EST
[ Parent ]

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