Central planning has only so much room for slight of hand tricks to keep up its sleeve. When the going gets tough, everyone goes home. For China, that means devaluing its currency, a complaint Trump has long lobbed against the trade giant.
Maintaining good relations with Apple and almost achieving the manufacturing capability long held by Samsung is quite the accomplishment for the Chinese. Good job. Everyone owes them a hand. China’s BOE company hopes to be able to start manufacturing the flexible, “organic” LED displays by 2020.
Devaluing currency as a response to trade tariffs from the US, however, is likely to make those tariffs higher, considering that devaluation of its own currency was one reason Trump argued for tariffs before his election. This, and turning to Africa, means that the international bite is felt. Silicon Valley also has its eyes on Africa, meaning that Apple and China may meet again in Africa, as well as Google. But, doing more of the same things that initiated tariffs is likely to cause more tariffs than tariff problems it alleviates.
China has a hard set of choices ahead and as those choices narrow, the tiger will feel more and more like its been backed against a corner. This path doesn’t endure entirely peacefully.
Global trade has become too congested and inbred. Enemies make vital weapons parts for each other—well, enemies of the US make vital weapons parts for the US, but don’t return the favor. Western companies outsourced to developing markets, then were surprised at workplace hazards, loss in consumer trust, and didn’t seem to anticipate that by sending jobs overseas they were downsizing their own customers.
The borderless fling wasn’t going to last for a myriad of reasons—cultural incohesion being an impossibility for a manufacturing industry in denial, security conflicts of interest being a concern for Western powers. Internationalization is about governments and cultures understanding each other, not forcing cooperation between peoples who haven’t yet learned to gel in the daily routines. Companies like Boeing got themselves too entangled in the scene of borderless manufacturing and are now whining and moaning because the inevitable finally happened. This indicates that their “globalist” action plan wasn’t based in foresight, but delusional hopes.
Globalism is inevitable, but it won’t take the path that the impatient hopefuls dreamed and thereby planned it would. Globalism needs cultural exchange to precede and exceed industrial integration, not vice versa. Boeing through the cart pulled its horse, banked on it, it backfired, and Boeing is now denying blame.
China and Europe, mainly Germany, are headed for the same blend of oil and water. This so-called “trade war” isn’t setting well in China’s market. Chinese people blame their government. That government doesn’t want any misreporting that could even remotely influence the people into thinking that the unrelated trade and stock market could have any kind of direct relationship. The trouble Trump is making for China isn’t demonstrated from rumors of censorship within China or its stock market, but in China’s attempt for yet another foreseeably incohesive relationship with Germany. China is being smart, Germany is not.
China is owed everything by the West, but Germany hasn’t figured this out yet. China doesn’t need to say so because no one tells the obvious. A relationship between China and Germany would rightly favor China, Beijing would have no objection, but Berlin will cry and whine just as much as Boeing, once it all lays flat on the table. And, China will have made the profit.
China is reaching out to the world. It doesn’t want tariffs imposed by the US. President Xi Jinping likely feels betrayed by the man who was so kind to him previously, President of the United States Donald Trump. The Western press will of course paint China and Trump as the villains—each in their different sectors—while painting the consumer as the victim.
China’s role is actually one of confusion. $500B one way and $100B another is fair if China is on the favorable end, of course. Why would someone be so cruel, using that as an excuse?
So, China is making its appeal to international bodies, such as the WTO. But, therein will befall another misunderstanding. The International community agrees on twelve nautical miles of ocean ownership, no more, and building islands doesn’t count. China disagrees. So, appealing to International law won’t work in China’s favor, which will also seem unfair to the Chinese.
The Western press will make China out to be the bad guy, the aggressor. At the same time, the Western press will make Trump another bad guy for imposing tariffs. Of course China doesn’t want tariffs, that much is understandable. But, coming to “China’s” defense (actually their own) are the globalist businesses who believe that nationality, borders, and citizenship are a farce—that companies are the actual “nations” of the world. They are at war against both the US and China for not merging into one corporation. This is actually a battle for nationhood itself; from that perspective, both the US and China’s responses make perfect sense.
As for China being the “bully” as portrayed by the Western press, China really doesn’t see itself that way. The Chinese have no clue why the West would do such a thing, they really don’t understand.
Trump has stopped military exercises near North Korea, but he has not initiated any plans to withdraw troops. His reason for stopping the exercises is that they are provocative and expensive. He has a point: If the heads of state are talking then we are less in need of fighting practice in a scenario where heads of state are not talking.
The military exercises with South Korea are expensive and provocative, as Trump explains. Frankly, they should stop. With healthy conversations and progress toward peace already behind us, there won’t be a need for those drills any longer. Rehearsal for conflict that might never exist can often provoke the very conflicts we otherwise would not need to prepare for. As for the “expense” defense, few accountants will argue in favor of nickeling and diming away money as fiscally responsible and no one believes that taxpayers’ pockets are infinitely deep except pundits with portfolios in public funding.
The Western news is that Trump is wrong, specifically with regard to China that China wins. According to this week’s Western news narrative, China wins because of troop withdrawals that haven’t happened, because a friend of China will de-nuke, and because over 30k US troops will be free to go home—or go to Taiwan, Mischief Reef, Vietnam, the Philippines, Japan, or any number of other Pacific island-nations China doesn’t get along with.
Economically, China “wins” because manufacturing is leaving China—which must therefore mean that China’s innovation and science is the new source of manufacturing elsewhere. Perhaps that includes innovation and science like the Chinese government now trying to track every car with a chip as of 2019. The “Mad Scientist” theorem of the experimental police state research moving from North Korea to China continues to play out.
Just remember with everything: There’s more going on than anyone can see. Deals between governments are never fully explained to the public. They shouldn’t be. But, as peace develops in one part of the western Pacific, hostilities move around and every pundit seizes opportunity to say, “I was right.” No conflict is without news profiteering.
North Korea inches further and further toward talks with the US. China fears this. If Kim Jong-Un get in the same room as the man who wrote The Art of the Deal, North Korea could become a stronger ally to the US than even South Korea overnight. That would likely lead to a quick reunification of the Korean Peninsula, as well as other shifts in power, even before any alliance might be formalized. But, Trump’s deal-making reputation should bring no shocks to what is about to transpire in the Singapore Summit.
Then, there’s China, about to be left behind. The hardline crackdown on free speech throughout China won’t be without consequence. Symphony has been saying so for years; Albert Ho effectively said the same, quoted in a Bloomberg article dated June 4. Party power is getting brittle. But, the consequences of brutal brittality are rarely explored. So, here goes.
Hong Kong won’t shut up anytime soon. The whining, whimpering bratty students of Hong Kong may be wrong to demand rights when freedom was largely handed to them by the British. But, those bratty students sure are drawing a press load of attention to China. That alone should be a heavy factor in logistics calculation. Hong Kong is a megaphone for any anti-China sentiment because the world reads about Hong Kong every day. After all, Hong Kong is “Asia’s World City”.
But, then there’s the problem of cracking down within “China proper”, the Mainland governed directly by Beijing, not a SAR like Hong Kong or Macau. If China considers friendly sarcasm to be a threat within China—that means tech companies and hardware manufacturers won’t have candid conversations about quality control and competitive design. Once free speech becomes a minefield, people will divert mental resources away from fee and open brainstorming toward making sure that they don’t say anything offensive. The key to good brainstorm sessions and innovation is that nothing is off the table and no one is allowed to take offense at anything whatsoever. That’s can’t happen in China anymore. Bye-bye Western manufacturing paradise. It’s only a matter of time before Western outsourcing brands figure it out. One little story, like an innovator being locked up for a tech suggestion because it was interpreted as “opposing to the Party”, might plunge Chinese factory stocks into the void below.
“Single-Party Rule” is the key topic now, at least according to Western papers. That’s the protest mantra in Hong Kong. It’s the talking point of headlines and marches. It is the so-called “problem” as is being presented to the world. The Western press is on a path for reporting a narrative that stirs sentiment for two-party rule in China. Whether it’s a typhoon, an earthquake, a solar flare, or some other “act of God”, if China suddenly adopts a two-party system, Western newspaper readers will have already been prepped to think it is a good thing.
Then, there’s Vietnam, exploring foreign investment “zones”. Deserved or unfair, distrust is stirring against China as a place of investment. This will have a double-edged effect in Vietnam. Firstly, Western manufacturing will flock to Vietnam as a way of fleeing the newspaper villain, China. But, with a Communist Party having total rule in Vietnam, Western investors will demand certain assurances before dumping too much money into yet another single-party market. Sooner or later, we could be looking at Vietnam adopting a friendly two-party system as a stronger strategy of competing with China. That will only add to the momentum of change in East Asia.