Run up to the new Opium Wars?

SCANALYZER The Happening World
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Beijing! We have a problem!

Very interesting article about the problems of success facing China now that it has established itself as the Workshop of the World and is setting the pace in many key areas of technological progress. China today runs a $1 Trillion Balance of Payments surplus, resulting from trade surpluses with 170 countries.

This is unsustainable – but reducing the trade surplus could have long-term devastating effects on China – unemployment, citizen dissatisfaction, ultimately political instability. China’s customers are already becoming restive, and tensions between nations have historically led to war.

Unfortunately, most of the Western world is not looking beyond the end of next week. Except for our “leaders” fascination with Anthropogenic Global Warming, long-term trends don’t register. As the author writes: “… the optimal time to rebalance was yesterday, but the political will only materializes when conditions make the transition most painful.”

Dual paradox coiled inside China’s $1 trillion trade surplus - Asia Times

“… This is the first paradox: rising trade power coincides with declining policy autonomy. The bigger the export engine, the less freedom Beijing has to take bold domestic steps or geopolitical risks. …

… The second paradox is already materializing. The larger China’s surpluses, the more probable —and persistent — the institutionalized pushback. Europe, long a champion of open trade, is starting to change its tune. …

… The real test for China is no longer whether it can dominate global trade markets—it already has. The question now is whether it can build an economy capable of standing on its own foundations when international markets turn unpredictable, contested or politically constrained.”

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So…your title suggests China will eventually go to war to force us all to buy its goods?

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Historically, it was England that went to war when England was on the losing end of the 19th Century trade imbalance. The obvious answer – then as well as today – was for China to buy more English goods. But the Chinese Emperor looked at what England had to sell, sniffed, and said there was nothing England could provide which was of interest to China.

Of course, these days it would be hard to imagine the West making war on China to force China to accept Western …. what? Almost everything in our stores comes directly or indirectly from China. And selling China opium this time is a non-starter.

We in the West have a problem – we need goods from China. China has a problem – the West does not have enough to trade for those needed goods. There is a limit to the amount of Western IOUs that China is likely to accept. Maybe China’s trade surplus will not end in war this time, but it certainly won’t end well … probably for all of us on the planet.

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