The lesson for the Western political and ruling elites from China’s economic success story is that we have to actively decide what sort of economy and society we want, and promote it with appropriate government policies, just as China has successfully done. Otherwise, left to the free market alone, the deadly combination of ‘ponzi-financialisation’, deindustrialisation and consumerism, comprising the most significant downsides of neoliberal economics, mean that we are precipitating our own decline and facilitating the rise of China at the expense of our economic security and foreign policy.
The ultimate price that we will pay in the West, especially in the U.S. and Australia, for allowing ourselves to become economically weakened is for China to increasingly dominate the Asia-Pacific region, in a foreign policy sense, as a corollary of its economic strength. Numerous authors have been documenting this increasing foreign policy shift, involving both soft and hard power. Joshua Kurlantzick has noted that the rapidly growing economic power of the Chinese economic model has enabled it to flex its foreign policy muscles to the extent that “it may already be the pre-eminent power in parts of Asia and Africa”.
Therefore, there is an imperative to reverse deindustrialisation in the Anglo economies...
... the deindustrialisation process wrought by ‘Millennial Capitalism’ is now rapidly accelerating, and ... this is exacerbating the ‘break point’ between the mainstream voter and the neoconservative and neoliberal elites.
ALMOST half of Australians believe that China will become a military threat to Australia within 20 years, prompting record support for the US alliance.
According to the 2010 Lowy Institute foreign policy poll, 46 per cent of people think China will be a threat, with 19 per cent of them rating the possibility as "very likely"....
57 per cent said the Government had allowed too much investment from China, and 69 per cent said China's aim was to dominate Asia.
Of those surveyed, 55 per cent wanted Australia to join with other countries to limit China's influence.
Americans see more economic threat than opportunity in China, and divide almost evenly on whether they regard it as a friendly or unfriendly nation – results that underscore the challenging nature of relations between the two powers.
With President Hu Jintao visiting the United States ... an ABC News/Washington Post poll finds that 47 percent of Americans see China as a friendly nation, while 44 percent regard it as unfriendly. Personal views tip the other way – 42 percent say their own opinion of China is favorable overall, 49 percent unfavorable.
The first clear pictures of what appears to be a Chinese stealth fighter prototype have been published online ...
... A few experts have suggested that the pictured aircraft is a mock-up, rather than a functioning prototype ...
But many more experts say they believe the pictures and the aircraft are authentic ...
Dang! This wasn't mentioned in the economic textbooks. I'm sure my economics teacher didn't mention this in the theory of comparative advantage! Why not? Specialise, trade, and get bombed! Nobody mentioned the bombing!
Oh, hang on. It's becoming clearer now. This stealth fighter must be what all the experts on China have been talking about ...
In defence of her homeland, China would have the capacity to sustain casualties far beyond that of the US. As a result of such a conflict, the US would be required to withdraw to the western hemisphere. We would be left a defeated ally of a defeated superpower without a friend in our part of the world. There are many who would then regard Australia as a prize...
The decline in American economic power has already begun and cannot be reversed without an economic revolution of which the US is not capable. China's economic rise will continue...
The challenge for Australia is to recognise the reality of this world. To learn to live with a superpower whose overall impact is declining and at the same time to pursue close relationships with a power whose influence will continue to grow...
We don't have to choose between America and China, but America needs to understand that on several issues Australia's national objectives will not coincide with hers.
Fact 1: if the US vacates Asia, there are many who regard Australia as a prize, mainly China. We are so loved in the region that we are "without a friend".
Fact 2: we are strengthening the military of China by trading with it.
Fact 3: free trade is weakening the USA.
Conclusion: free trade is strengthening the arm of those who regard Australia as a prize, and weakening the USA. Ergo, indiscriminate trade is a threat to national security.
Does this make any sense at all, other than in the la la land of ideology where the economics of free trade is a supreme ideal that cannot be questioned?
File under: 3 simple dots which cannot be connected in the pickled and emotion-neutered brain of an ideologue/fatalist/appeaser/progressive/globalist; and the West is in dire need of an "economic revolution".
So Kevin Rudd’s been musing about the Chinese and how we might need to be ready to “deploy force” if efforts to integrate the PRC into the rest of the world go horribly wrong...
... it would be good to know what’s fueling Rudd’s “brutal realism” on China, and what exactly he means by everything going wrong when he says: “while also preparing to deploy force if everything goes wrong.” Does the foreign minister seriously think we might need to use military force against China?
Rudd knows that trading with China is based on a gamble. A gamble that China will liberalise into democracy before it gains military supremacy over the USA.
"I am acutely conscious of what happens when you simply allow things to drift to unrestrained nationalism," Rudd told TIME. "[I want to] avoid long-term strategic drift, avoid the possibility of America drifting away from Asia."
It's the unrestrained nationalism of China that is the long-term worry. The nationalism in Western countries has been moderated by the horror of recent wars and a liberal culture. But what moderating force will hold back China when their military gets big enough to do what they want? Nothing. There are no such reigns on China: no post traumatic war stress, no guilt over imperialism, racism or slavery. And do you think China welcomes a liberal culture that has weakened the West with an identity crisis? Nope, on the contrary, they see homogeneity as a strength. So there will be nothing to stop their nationalism tripping over into empathy-free indulgent imperial opportunism at the point of a gun.
Rudd knows all that. But his diplomatic-superman-complex dreams of smothering China in a wave of transnational love, connections and regional groupthink, so much that it will collapse into liberal democracy. Rudd is a high stakes gambler. He knows it could all go wrong and the worst case scenario arises: that we simply fed the tiger until it broke off its leash.
The diplomatic-superman's brain cannot contemplate the prudent solution i.e. simply stop trading with China. Nope, the diplomatic-superman's brain is chockablock full of the 'age of globalisation of everything' ideology. No room in his brain to contemplate 'regressive' protectionism or trade sanctions. Progressivism means never looking back, no matter where the groupthink of the day may lead.
File under: trade with China is a matter of national security; vote for Donald Trump; and Kevin Rudd has a gambling problem.
Australia has lost its appeal against a WTO ruling which ordered Canberra to change restrictions on imports of New Zealand apples.
"The Appellate Body upheld the panel's findings that... Australia's measures, regarding fire blight and apple leafcurling midge, as well as the general measures, are inconsistent," the WTO's appeal body said in a statement.
The WTO had earlier found Australia's restrictions on New Zealand apples, dating from the 1920s, breached global rules.
File under: inconsistency with global rules is a crime, resistance is futile, diseases must be shared, you will be assimilated.
The US Secretary of State also claimed that any strategic bet on China is a punt on a geopolitical uncertainty - the future stability and continuity of China: "There's no doubt about its economic success. But any fair reading of history would argue that unless that economic success is matched by growing political space and openness, there are going to a lot of tensions within China that will have to be dealt with.''
The Gillard government has decided that it agrees with Clinton. The two countries concur that the best chance of avoiding a major clash with China is not to yield to its new assertiveness, but to strengthen the network of alliances to better temper its demands.
Bzzz! Politician and journalist fail. So long as we continue to support China's economic and military rise by trading with it, we are strengthening China's arm. Non-yielding assertive posturing is a bugger-all brainless left-hand policy if it refuses to acknowledge the right-hand which is feeding the monster. But what else do you expect from ideologues other than denial of reality?
But at least there is some acknowledgement of the rising menace ...
Mrs Clinton squarely confronted the question of whether Australia should reassess its American alliance to give greater weight to a fast-rising China.
"I think that the core values of the Australian people, the quality of life, the standard of living, the aspirations that Australians feel are very much in line with the way Americans think and act," she said in Melbourne yesterday.
"So our relationship is essential to both of us. That doesn't mean we won't have relationships with others, but it does mean that this will remain the core partnership.
"And it is important to recognise that just because you increase your trade with China or your diplomatic exchanges with China, China has a long way to go in demonstrating its interest in being - and its ability to become - a responsible stakeholder.
Alas, there are those who are ready to ditch the alliance.
... China is already strong enough economically to challenge American power in Asia, it is already acquiring the military and diplomatic muscle to compete directly for leadership, and it is showing its determination to do so...
China's rise presents the US with a serious challenge to its leadership of Asia for the first time in decades, and presents Australia with an impossible choice between our traditional alliance and our economic future. The two allies are as a result pulling further apart. Washington wants Australia to help resist China's challenge by increasing military and diplomatic co-operation, while Canberra just wants to avoid taking sides between our major ally and our major trading partner.
The result is an alliance that, despite the warm words, is rapidly losing strategic and political coherence...
The more the rest of us try to constrain China, the more disruptive it will become.
So we should be asking the US to strike a delicate balance, playing a strong role in Asia while allowing China scope to satisfy its legitimate aspirations for more influence. We have to be careful not to appease aggression, but we must also be sure we do not incite aggression by refusing to accommodate legitimate ambition. This will not be easy, but a peaceful future for Asia, and for Australia, depends perhaps more than anything else on the US getting this balance right.
... there are real risks that it would become out of control, with serious danger of war... Australia would find itself forced to choose whether to follow the US into an increasingly intense strategic competition with China, or abandon the alliance.
So we keep supporting the rise of China with our trade, only we're going to pull a magical diplomatic solution out of our proverbial to calm the monster we have created? I'd say that's a solution definitely lacking "coherence".
And finally we come to biggest ideologue of them all: Big Kev. When there are only two clear choices ahead, you can count on the ideologue to concoct a magical "third way".
TONY JONES: Now, you've talked recently about a third way of dealing with China that involves neither conflict nor kowtowing. What do you mean exactly by that?
KEVIN RUDD: What I mean, Tony, is that for many, many years now, the debate in Western countries in particular, and to some extent even within China itself, has said that there's only two ways of approaching the rise of this great power.
One is that we're in some sort of incipient or emerging conflict with China, and the other is the only way forward is to kowtow, in other words to comply with everything China says.
I don't think either of those paths is productive. I think there is a rational third way to proceed, and I believe that can be done through a comprehensive political and economic relationship where we agree on our common interests, both in the region, both at a world stage and bilaterally as well, but also not walking away from those areas in which we disagree.
I think that's the right and rational way to proceed, rather than having this simple, black/white alternative which frankly doesn't lend itself to the great complexity that is modern China.
KEVIN RUDD, FOREIGN MINISTER: ... the Asia Pacific region, which is in a state of huge change. Yes, we do have the rise of China, and we to have of course burgeoning military expenditures in many other countries in the region. So one of the things that we engage in is: how do you build for the future a stable, rules-based order for East Asia and the Pacific for this 21st Century? That's one of the things that we engaged in substantively during these discussions in Melbourne...
I think it's important that we're all contributors to the regional and global order. China has come from being an impoverished state 30 years or so ago to being one of this region's great powers and is on track to become a global great power. Therefore, it's entirely right that the Americans, ourselves and others talk about how these rising powers, including India, contribute to a regional and global rules-based order. And the reason is that provides the stability for the future, and that strategic stability then makes economic growth and jobs possible as well. So therefore, this is not specifically targeted at the PRC; it's targeted at the region as a whole, and that's what we're in the business of doing with our American friends...
Foreign policy is looking ahead and seeing where we're likely to be in a decade's time, and how do we make appropriate preparations? If we look at this region of ours, it's replete with strategic uncertainty. Why? Here, unlike in Europe, we've outstanding territorial disputes - on the Korean Peninsula, in the East China Sea, in the South China Sea and going further round to India of course in Kashmir. So you ask: why are we so keen on developing a rules-based order which enables us to have confidence in security building measures among us, greater predictability of military budgeting, military exercising and the like? It's because this region is much rawer - or much more raw - whatever the correct English is - than is the case in Europe. Therefore, we've got a whole lot of building to do. That's why we've been such strong supporters of this concept of an Asia Pacific community, which now has its form and shape through the East Asia Summit. We've gotta develop its agenda and establish those rules. We don't want conflict in our region.
... therefore the idea of some zero sum game, head to Washington or head to Beijing, is frankly nonsense. That's not the way in which you conduct a foreign policy of a robust, independent and proud state such as ours, Australia.
... we believe therefore that by enhancing the dialogue one-on-one with the Chinese, but also regionally, through this emerging institution, the East Asian Summit, we can obtain greater predictability, greater consistency and we believe greater stability in terms of military operations within the region. As I said before, right now, it's all a bit brittle. We've not had these sort of institutions on the political and security front. Our job now as builders of the region's architecture is to get that right, and that includes with our friends in China as well.
Awww, that's so nice. A rules-based order sounds so strong, when now there is only brittleness. Kevin is so nice, he must be right. No need to change our suicidal trade policy which is feeding a monster. No, the monster will follow the rules. No, really. Kevin said it so articulately it must be true. He speaks Mandarin, so he must be right.
Here is the great ideologue denying our suicidal trade policy and pulling a magical third-way out of his proverbial.
File under: relax, the suicidal ideology of indiscriminate trade comes equipped with magical solutions which can be pulled from the proverbial at the last minute to calm any monsters that we may have blindly created in full view and plain sight because (a) the ideology of free trade is never wrong and (b) bullies just need more love and time to develop and (c) a rules-based order will fix everything anyway and (d) the mindless groupthink that will come with the Asia-Pacific Community will put everyone to sleep and herald an open-borders nirvana just like the EU, just wait, you'll see.
The Chinese have just made a serious strategic blunder.
They dropped the mask and showed their scowling face to Asia, exposing how the Middle Kingdom intends to deal with smaller powers, now that she is the largest military and economic force in Asia and second largest on earth.
A fortnight ago, a Chinese trawler rammed a Japanese patrol boat in the Senkaku Islands, administered by Japan but also claimed by China. Tokyo released the ship and crew, but held the captain...
Now Beijing has decided to rub Japan's nose in her humiliation by demanding a full apology and compensation.
Suddenly, the world sees, no longer as through a glass darkly, the China that has emerged from a quarter century of American indulgence, patronage and tutelage since Tiananmen Square.
The Chinese tiger is all grown up, and it's not cuddly anymore.
And with Beijing's threat to use its monopoly of rare-earth materials to bend nations to its will, how does the Milton Friedmanite free-trade ideology of the Republican Party, which fed Beijing $2 trillion in trade surpluses at America's expense over two decades, look now?
How do all those lockstep Republican votes for Most Favored Nation status for Beijing, ushering her into the World Trade Organization and looking the other way as China dumped into our markets, thieved our technology and carted off our factories look today?
The self-sufficient Republic that could stand alone in the world is more dependent than Japan on China for rare-earth elements vital to our industries, for the necessities of our daily life, and for the loans to finance our massive trade and budget deficits.
How does the interdependence of nations in a global economy look now, compared to the independence American patriots from Alexander Hamilton to Calvin Coolidge guaranteed to us, that enabled us to win World War II in Europe and the Pacific in less than four years?
Yet China's bullying of Japan is beneficial, for it may wake us up to the world as it is, as it has been, and ever shall be...
How should America respond?
As none of these territorial disputes involves our vital interests, we should stay out and let free Asia get a good close look at the new China.
Then explore the depths of our own dependency on this bellicose Beijing and determine how to restore our economic independence.
Ending the trade deficit with China now becomes a matter of national security.
So, while Greg Sheridan is painting a rosy picture of the US not surrendering an inch of the South China Sea, Buchanan demonstrates the Yanks could easily just let it go.
Sheridan should return to questioning the wisdom of trading with China.
This is not that China is planning to go to war with the US, but that it is planning to compromise and degrade US strategic supremacy in the Asia-Pacific. That, certainly, is a long-term trend in the US-China relationship.
As these trends mature, it is unclear if the US will decide that continuing to make China rich is in its own national interests. The US-China relationship is going to become more complicated. Those many pro-China voices in the Australian debate, especially those at the Australian National University, have no answer to why accommodating China on all points, which seems to be their policy, would produce a good outcome for Australia.
Many commentators wrongly say Australian wealth is dependent on China and therefore we must forgo our principles in order to make money. This is not true. The Chinese economy is at least as dependent on Australian commodities as we are on Chinese customers. The Chinese will buy commodities on the basis of price and reliability. The political dimension makes very little difference to that trade. And if they did go somewhere else that would chew up other suppliers and thereby leave other customers for us, of which there are many.
The bellicosity and arrogance of the Beijing government are very difficult to deal with at the moment...
... there are serious signs that the US is reconsidering its policy of taking as many exports as China can dump on it.
There are going to be a lot of headaches in Australia-China relations over the next few years...
File under: the ideology of indiscriminate trade is now a matter of national security.
... 'theological correctness'... applies to those who genuflect to a system of thought they despise ... in order to further their political, business or academic ambitions...
Another is the Prime Minister's avowed belief in free trade. Though it drives dairy farmers to suicide (as Bob Katter correctly yelped) and props up child slavery in South-East Asia and encourages Tasmanians to stop growing apples and to sell their family farms to red Chinese corporations and though (as Bob Katter correctly screeched) no other country actually practises it, and though no Australian actually believes in it, it nonetheless soothes and solaces some sad souls to murmur from time to time a prayerful affirmation of it, as the Prime Minister did last week in a public response to Katter that lost his vote. For though it's an international disaster that kills tens of thousands of children a week it's appropriate to speak well of it, to call it the only way of doing things. And though protectionism worked well for 5,000 years this, though currently disastrous, is clearly the only way forward. We're moving forward with free trade, repeat after me. It kills more people than Asian flu but we're moving forward with it, march in step there.
File under: never thought I'd positively quote Bob Ellis.
BY the middle of this century, an Australia with today's population of 22 million would have an increasingly precarious hold on a vast continent.
It would be the envy of others.
China, India and possibly Indonesia would have become wealthier and even more populous, each of them having the latest military hardware that would dwarf Australia's capability.
More ominous would be the relative decline of the US as our protector in the Asia-Pacific region, the result of catch-up by these new powers and its own economic malaise that began with the financial crisis of 2008...
It seems hardly plausible that a tiny population of 22 million would be able to hang on to such an enormous natural resource bounty in the face of inexorably rising demand and increasingly muscular military might.
Without a substantially bigger economy and population, Australians could well lose the lot...
The call by Dick Smith and others for a policy of zero population growth is incredibly reckless when thought of in strategic terms...
Gee. And not a word of criticism for the self-harming ideologies that are causing our economic and military decline i.e. free trade, globalisation, diversity. No acknowledgement that we were safer when we were protectionist, or trading only with our allies. No acknowledgement that our alliances were more secure when we shared a common identity. No, those ideologies are beyond criticism, and that part of Paul Cleary's brain is compartmentalised and suppressed with every morning coffee. No, his left hand never sees what his right hand does. He doesn't deal with cause and effect, only effects. He doesn't deal with action and reaction, just reaction. Fatalism is the new drug, man. Nope, it's full steam ahead to finance the rise of China, India and Indonesia who are (apparently) inherently antagonistic towards us. Well then, goose stepping along with the globalisation cult to our own demise it is then. I'm inclined to call such stupidity "incredibly reckless when thought of in strategic terms" but that would be a tad cruel. The poor journalist would lose his job if he dared question the "great" ideologies of our time. Not to worry, a big country can fix a suicidal ideology, eh? Yeah, sure.
The lesson for the Western political and ruling elites from China’s economic success story is that we have to actively decide what sort of economy and society we want, and promote it with appropriate government policies, just as China has successfully done. Otherwise, left to the free market alone, the deadly combination of ‘ponzi-financialisation’, deindustrialisation and consumerism, comprising the most significant downsides of neoliberal economics, mean that we are precipitating our own decline and facilitating the rise of China at the expense of our economic security and foreign policy.
