Trade Wars – determining who is the real superpower


A war with any adjective preceding it, is still a war, out of which there will be a winner and a loser.  In this case the war is called a trade war and the principals are the USA and China.  There are many stakeholders, one of which is Australia.  To view it as just a trade war is to fail to understand what is happening.

This trade war is a non-violent battle to become the world’s pre-eminent superpower.  Whilst it is, at times, closeted in acts of seeming good will, it is a battle out of which there is going to be only one winner.  That will be China.

In this war, China is the aggressor, notwithstanding how they appear at times.  They want world dominance and after this war, next will come India.

China wants to destabilize the US, both as a country and economically.  With their US treasury ownership, they can play the US as they like, with their methodology being clear, slowly wear the US down.  This explains their actions re devaluing their own currency.  China is prepared to have short term internal losses which they can withstand, in order to hurt the USA. It is in China’s interest for the USA (and its allies) to be stretched thin by engaging in economic/war with other countries

China relies on the predictable short term reactions of the USA to every move they make, moves made from hubris.  In this respect you can see the difference between the two nations, China is strategic and the USA egotistical.

It will not be long before there are more aggressive moves from China in the South China sea where they control the shipping lanes.

Countries such as Australia are in a perilous position.  By blindly supporting the USA, as we have historically, we are standing on a rotting precipice.  Our time of being able to be seen to sitting on the fence is fast coming to an end. 

The sleeper in this is Japan and where they put their support.  Australia ought to be exploring all avenues to fully understand Japan’s position and decide whether or not we want to align to it.

There is a fear in Australia that the ways and methods of China are draconian and not something we can live with or want to align ourselves to.  This is similar to how each middle eastern country has felt about the USA and their style of democracy.

One thing is clear, the story told to Australians by so many post WW2 politicians, that we are an island and control our borders (therefore our destiny) is false.  We are a small player who needs to choose a side, for this trade war is a war.  It might be that not a shot will be fired, but the devastation from this war will still affect many countries, of which Australia is one.

China has continually offered a hand (and at times a stick) to Australia.  To reject it could be catastrophic.

With this backdrop, you can better understand the current micro workings of this trade war.

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