Trade war between the US and China is hotting up and threatens worse

By Jim Hayes

As the trade sanctions begin to bite and the Iran standoff hardens, the tension between the United states and China heats up.

We are even seeing this emerging cold war in Australia, where some elements are pushing, what could frankly be called a racist campaign, trying to convince Australians that the Chinese are taking over the country. There is absolutely no evidence of this. The United States, United Kingdom and other countries have a much bigger portfolio in this country. In addition, everything Chinese, whether it involves people of Chinese extraction living in Australia or based in Singapore and other countries, is counted as part of the Chinese invasion.

It serves a purpose. This is to portray China as an enemy that must be dealt with, and this suits the imperial ambitions of others.

The reality is that China is not only been targeted economically. This nation of one and a quarter billion people has been surrounded by a military cordon. There is a crusade to isolate China diplomatically.

What has China done wrong? It has become the most successful economy on the planet. Without China, the global economy would be in a much more serious crisis. Although far from completing the task, China is also going further than other nations to convert to a sustainable economy.

China is also helping poorer nations with aid and trade deals on much better conditions than the United States, Europe and even Australia have ever offered. Perhaps this is extending Chinese influence. Whose fault is this? Who can blame poorer countries turning towards those who treat them better?

In contrast, the United States has for a long time had its superpower status fed through the global exploitation of labour and resources. It maintains armed force everywhere, and has been at war with someone or other, without break, for more than a century, and is the only power, which has routinely used trade sanctions to impose its political will. Only the United kingdom comes anywhere near it.

Put all this aside, and we are still left with the reality that the growing tension between the two countries does no one any good. If it continues, China may be hurt. So will the United States. It threatens the global economic system and makes the possibility of world war a reality. No one will escape the consequences. Not even Australia.

Rather than faltering, China is fighting back. The alliance with Russia is being strengthened. Relationships with other countries are firming. This week the Chinese leadership has warned the United States not to open a “Pandora’s box” in the Middle East, in response to the deployment of an additional 1,000 troops to the region and the ongoing threats being made against Iran.

In another development this week, China has added to its retaliatory sanctions against the US, a lowering tariffs on other countries competing with the United States in global trade. This puts purpose pressure on American companies and offside the policies of Washington.

While many American imports face a jump from 8 percent at the start of 2018 to 20.7 percent this month, other countries have seen tariffs on their exports to China fall from 8 percent to 6.7 percent.

Increasing economic cooperation and trade with others, lessens China’s exposure to Washington’s sanctions, and the Chinese population will suffer less from rising prices, when they have alternatives to American products.

A report just released by the Peterson Institute for International Economics, the Us economy stands to be harder hit than China’s.

The Chinese strategy puts pressure is on the United States, because in addition to finding many of its big corporations losing out on trade with china, emerging deals between China and other countries, threaten to take other markets away from the same corporations.

Only days ago, US President Donald Trump received a letter signed by 600 companies, expressing their concern over the escalating tariff war and urged a pull back.

Anti-Chinese rhetoric has been rising against this backdrop. We can expect that it will become even more intense in the near future, particularly when the economic war achieves far less than intended. A marked rise in diplomatic is already being felt.

Alongside this, looms the military option. When economic war is not winning the day, the temptation is to turn to the threat and even use of guns. All it requires is enough tactical blunders, a loose cannon at the head and an incident to light the powder keg. We already have two out of the three.

The biggest risk to Australia is the US Australia alliance, which locks us in far too tightly. Australia’s interests would be best served by establishing good relations with as many countries as possible. This includes the United States. But not as master and servant. It includes China, and other countries besides.

Taking part in this war is supremely foolish. Australia must act much more independently and not be someone else’s echo.

Australia can play a positive role, encouraging more peaceful relationships, an end to trade wars, more cooperative international relations, and the resolution of differences by sitting down and talking about them, and doing this in an atmosphere of mutual respect.

Australia can do much more to combat racial profiling and targeting some, because they have a different colour skin. Chinese people are not our enemy. They are not trying to take over Australia.

The alternative is to remain a player in a war that can only make Australia more vulnerable to retaliation, in an increasingly uncertain world. There is nothing to win by going down this road.

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