By Eric Zuesse
The Chinese Government’s Global Times newspaper headlined on August 25th, “Quitting Chinese market will be suicide for US firms”, and reported that,
China is now the biggest market for some US-based enterprises, such as US automaker General Motors (GM). The automaker’s China sales came to 3.65 million cars in 2018, exceeding its total sales in the US market, where GM delivered nearly 3 million vehicles.
The vast majority of those vehicles are being manufactured in China, and sold in China. China’s Government would have no problem with increasing vehicle-imports from Japan, Germany, and other countries, or else ramping up its own domestic brands, within China, so as to replace Chinese workers at GM, and terminate GM’s income-flow from China — GM’s largest market in the entire world — if Trump’s trade-war against China proceeds as he has promised. Could GM survive, if it loses its largest market?
That example might sound extreme, but there actually is nothing unique about it. Lots of U.S. manufacturers will be hard-hit if Trump’s trade-war continues. Until now, his policies thus far have been much better for America’s billionaires than for the American people; but, now, he is posing an enormous threat against America’s billionaires (including some of his donors), perhaps even more than against all other Americans.
Those laid-off Chinese GM workers wouldn’t be Americans (only few GM vehicles that are sold in China come from the United States), but the corporate profits that would be lost would be to the owners of GM stock.
The only big threat to GM’s American workforce would be the danger that is posed to any corporation when its profits turn into losses and the corporation’s workers are therefore forced to accept cuts from their pay or benefits, in order to keep the corporation afloat instead of going bankrupt. However, any corporation which loses its biggest market is severely jeopardized, and therefore the job-impacts within the United States itself could turn out to be significant, and could become enormous especially if this trade-war goes on for a long time.
The German intelligence analyst who blogs anonymously as “Moon of Alabama” headlined on August 24th, “U.S. Decoupling From China Forces Others To Decouple From U.S.” and he argued that “The U.S. is decoupling itself from China. The effects of that process hurt all global economies. To avoid damage, other countries have no choice but to decouple themselves from the U.S.”
His view is that “Trump does not want a new trade deal with China. He wants to decouple the U.S. economy from the future enemy,” because Trump, in his estimation, has determined that only if there is an actual military war between the United States and China, can the U.S. prevent China from becoming the world’s biggest economy and leading nation. His hypothesis is that Trump’s chief objective is to avoid the U.S. becoming, on his watch (after having campaigned on “Make America Great Again”), the world’s second-most-powerful country. The only field on which the U.S still dwarfs China now is military; and, therefore, Trump is using this trade-war in order to generate, at home, enough anti-China sentiment (a hate-China campaign), so as for Americans to support launching military action (starting perhaps in the South China Sea) against China. It’s a war that Trump, apparently, feels confident that the U.S. would win.
Presumably, Trump expects that in the face of America’s world-leading position in nuclear forces, and having, by far, the world’s largest number (over 800) of foreign military bases, surrounding any country (including China), China will ultimately cave, and accept Trump’s terms for a settlement. Trump wants to “decouple” America’s economy from China because doing that “decouple” would be an essential pre-requisite to going militarily to war against China. This is the way that Trump intends to propose to China’s Government “an offer it cannot refuse” — or, at least this intelligence-analyst interprets Trump’s actions via this theory. (His track-record of correct predictions is pretty awesome. I wouldn’t even cite him, otherwise.)
According to this blogger, “Trump is afraid that a downturn in the U.S. [economy] could lower his re-election chances. That is why he wants to use the Federal Reserve Bank to douse the economy with more money without regard for the long term consequences. That is the reason why the first part of his tweet storm was directed at Fed chief Jay Powell,” to open up the money-spigots, in order to keep in check the economic conflagration that otherwise could quickly take over in the United States and terminate Trump’s chances of re-election. He needs to postpone the costs to the American people until November 2020.
Certainly, Trump is taking a high-risk path for the United States, and for the entire world; but, what other type of options are open for him, in order to be able to fulfill on his “America First” campaign-promises? At this stage, those options are few, if any. The likelihood is therefore that whomever the Democrats will nominate as their candidate will become America’s President, on 20 January 2021, unless Trump can rally Americans around the flag, and wrap himself in it, against China. What we’re now seeing is probably his Hail Mary pass. And it might work, until Election Day of 2020. Anyway, it’s a feasible campaign-strategy, to make his electoral opponents appear to be unpatriotic.