America losing economic war to China: Analysts
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WASHINGTON (Sputnik) — Former white House chief strategist Steve Bannon said earlier this week that the United States was already locked in a covert economic war with China. But only days later on Friday, Bannon announced his resignation after less than seven months in the crucial post.
US ELITE TO AVOID TRADE WAR WITH CHINA
Retired professor and political commentator John Walsh explained why Bannon had to go and why his claim of an economic conflict with China was untenable.
"An economic ‘war’ with China no longer makes sense for the US elite. Nor does a trade war which is one aspect of economic warfare. The US will lose," Walsh said.
The United States had already lost the global race to retain dominance over the global economy in terms of production and purchasing power, Walsh observed.
"The main strength of the United States is no longer economic. If one looks at the gross GDP's in Purchasing Power Parity terms for 2017… the list of the top six is: China, European Union, United States, Japan, India, Russia [and] Germany."
PPP remained the best way to assess overall economic power, Walsh explained.
China’s advantage and relative negotiating leverage against the United States was growing rapidly not only in terms of productive capability but also in terms of consumer purchasing power, Walsh pointed out.
"Not only does China have an enormous productive capacity but it has a huge market. And that market is made up of ever more prosperous consumers," he said.The global demand for entertainment movies was an important indicator of the growth in Chinese influence and purchasing power, Walsh observed.
"China has the second largest movie going audience in the world, after US/Canada which are lumped together in the statistic. In a year or so China will have the largest audience. This fact shows up more and more in Hollywood blockbusters," he said.
Such major movie investments make their revenues from an international audience. Therefore, they increasingly contain pro-China segments, Walsh noted.
"For example, in ‘The Martian’ where the Americans need an extra rocket engine to rescue their man stranded on Mars. Of course, Russia would be the place to get such a piece of hardware, but the economics of the situation being what it is, the Americans turn to China," he said.
China’s rapidly growing economic clout was therefore also strengthening its international prestige relative to the United States, Walsh maintained.
The United States was increasingly relying on its raw military night to dominate the world but this was a dangerous and inherently unstable grand strategy to follow, Walsh warned.
"The main power of the US now is military. And so in the face of relative economic decline, there should be a fear that the US will try to ‘take China out’ with war. That would seem to be a non-starter in the nuclear age, but a desperate US imperial elite may do desperate things," he said.
When Trump was elected there was a possibility that he would seek to limit US-China competition to the economic sphere, Walsh recalled, but a military solution presents high risks.
"If the US tries to throw the weight of its military into the economic competition, the world could be in peril. China is a major nuclear power after all. The survival of humanity would be at stake. Let us hope that does not happen," he said.
TRUMP TRADE POLICIES BACKFIRE
Trump’s aggressive international trade policies towards China and other countries are already backfiring and forcing those nations to make their own trade deals in response, University of Houston University of Houston History Professor Gerald Horne said.
