Why America and China will clash

despite the many ignorant posts in here which goes as far as promoting a nuclear war, which the ignorant poster handily forget that there are more nuclear powers in the world which will cause assured mutual destruction in an all out war

anyhow, a handful of interesting articles for some of you who are really interested in the relationship between the sole superpower and awakening dragon and the status of 2010 and the many years to come, unless we kill each other, whatever comes first.....

The US and China: One Side is Losing, the Other is Winning

US-China Rivalry Intensifies

U.S.-China Military Tensions Grow

Even though the U.S. military budget is almost ten times that of China's (with a population more than four times as large) and Washington plans a record $708 billion defense budget for next year compared to Russia spending less than $40 billion last year for the same, China and Russia are portrayed as threats to the U.S. and its allies. China has no troops outside its borders; Russia has a small handful in its former territories in Abkhazia, Armenia, South Ossetia and Transdniester. The U.S. has hundreds of thousands of troops stationed in six continents.

Russia and China both reacted harshly to Gates' statements in February of 2007 and only three days afterward, with Gates in the audience, Russian President Vladimir Putin delivered a speech at the annual Munich Security Conference in which he warned: "[W]hat is a unipolar world? However one might embellish this term, at the end of the day it refers to one type of situation, namely one centre of authority, one centre of force, one centre of decision-making. "It is world in which there is one master, one sovereign. And at the end of the day this is pernicious not only for all those within this system, but also for the sovereign itself because it destroys itself from within." "Unilateral and frequently illegitimate actions have not resolved any problems. Moreover, they have caused new human tragedies and created new centres of tension. Judge for yourselves: wars as well as local and regional conflicts have not diminished....And no less people perish in these conflicts - even more are dying than before. Significantly more, significantly more! "Today we are witnessing an almost uncontained hyper use of force - military force - in international relations, force that is plunging the world into an abyss of permanent conflicts." "One state and, of course, first and foremost the United States, has overstepped its national borders in every way. This is visible in the economic, political, cultural and educational policies it imposes on other nations...."

"U.S. Defense Secretary Robert Gates says some of China’s efforts cause him concern." The report said "China is pursuing long-term, comprehensive transformation of its military forces” to "enable it to project power and deny other countries the ability to threaten it." [15] While Gates was in charge of the wars in Afghanistan and Iraq and responsible for almost half of international military spending he was offended that the world's most populous nation might desire to "deny others countries the ability to threaten it."

[edit on 20-1-2010 by yiersan]

reply to post by yiersan

the many years to come, unless we kill each other, whatever comes first.....

The connotation of the OP, CLASH is not in the military sense. Certainly the Obama administration probably never will. Obama probably won't challenge the Chinese in rhetoric either. China may be upset by missile defense sales to South Korea or Taiwan but that is part of an ongoing low level cold war.

I see China as more of a strategic ally, useful partner to balance out emerging Russian power. It really depends on how we use our relation with China. I just don't see any direct military confrontations with China but as long as there is a South Korea, a Taiwan or a Tibet there will be an ongoing cold war.

The Chinese middle class is disappearing because of the policies of the ruling Party:

The "forced" disappearance of the Chinese middle class

The saying "A house kills a middle-class citizen" came true in 2009. In Beijing, average housing prices increased 16.7 percent from October to November 2009. Soaring prices not only make the middle class feel less happy but also inhibits its consumption. What's more depressing is that the spiritual state of middle class people has been transferred from rational, casual and rich in mind to tense, fearful and uneasy. The so-called social stabilizers have become pressure-takers. Rationalism is the most important characteristic of modern society. The rational middle class contributes a lot to every aspect of modern society in economics, politics and culture. A society with a disappearing middle class may face the huge danger of being irrational and backward.

This definitely indicates a real estate bubble in China. We all know what a real estate bubble leads to! Economic collapse!

Originally posted by plumranch
reply to post by yiersan

 

the many years to come, unless we kill each other, whatever comes first.....

The connotation of the OP, CLASH is not in the military sense. Certainly the Obama administration probably never will. Obama probably won't challenge the Chinese in rhetoric either. China may be upset by missile defense sales to South Korea or Taiwan but that is part of an ongoing low level cold war.

I see China as more of a strategic ally, useful partner to balance out emerging Russian power. It really depends on how we use our relation with China. I just don't see any direct military confrontations with China but as long as there is a South Korea, a Taiwan or a Tibet there will be an ongoing cold war.

Maybe I did not read OP anymore or well enough and was more influenced by the many ranting posts afterwards about warring and bombing.,,which by the way most likely IS an indication of a big portion of what the average (mostly ignorant sheeple) Americans are thinking, ....

However, regardless of these ignorant posters, I and many others in China and outside do start feel much more uncomfortable when a military-driven empiralistic country start warring all around the world, picking fights in places like it is preparing and trying to encircle both Russia and China and then also add both nation into their axis of evil, which at least one of the initial list was being invaded and occupied....

So I am sincerely not thinking that peace is is everlasting, we have to work extremely hard on to maintain the "relative" peace we have now, and sometimes one miststep either side means passing a line beyond return......

reply to post by plumranch


Interestingly, I always wondered how they define a "middle-class" in a country as extreme in the income distribution as in China.

reply to post by yiersan

So I am sincerely not thinking that peace is is everlasting, we have to work extremely hard on to maintain the "relative" peace we have now, and sometimes one miststep either side means passing a line beyond return......

Remember that the USSR and US maintained a more active cold war for decades without military action. It only ended because of the economic collapse of the USSR.

reply to post by plumranch


i can remember that and recall vividly how the Berlin wall was being demolished,was still living in Europe back then, but there were moments that if from both sides a mistake was made a real war would have broken out....

reply to post by yiersan

but there were moments that if from both sides a mistake was made a real war would have broken out....

But war did not break out. That was not an accident. War was not meant to happen because major powers were jockeying for power. That was another Cold war!

Yiersan, I would really like to hear your opinion of what is happening in China in an economic sense, in a social sense, anything you can comment on in regards to sensorship! You're the man, Yiersan! What is going on over there?

It does not matter how many men china can put into the feild or how many tanks they have.The United States military machine will always be more advanced than China.But on the other hand China can afford to lose 10 million soldiers or 600 million people and still have enough people to fight with.If the United States lost numbers like that they would be finished.I guess if China started something serious the United States would pound the hell out of China with Nuclear weapons.On the other hand 40% of the United States would then be destroyed by Chinese nuclear weapons compared to only 20% of China being destroyed by United States nuclear weapons.The benifiet the United States has is it has support from many other countries.At the moment not many countries support China.It could be a different situation all togeather if North Korea,Vietnam,India,venisuala,indonesia,Iran,Syria,and Russia put there military support behind China.A military allience just between China and Russia would pose a a very real threat to the United states and its allies.

It is inevitable that China will become the largest economy in the world. It doesn't mean the average chinese will be wealther than average americans. But it just means they will be the biggest economy in the world. I just don't see it any other way. They have a landmass that is similar size to us, they have population that is 4 times ours.

America has become a debtor nation. After WWII, America was the creditor of the world, racking in interest rates and priciple. Now America has become the biggest debtor nation in world, borrowing the most money, and paying interest on them/ with principal.

My question is, WTF happend??? It was only like half a century ago when USA was the Creditor of the world! Now we are a debtor nation???

How could it come to this???

America has become a debtor nation. After WWII, America was the creditor of the world, racking in interest rates and priciple. Now America has become the biggest debtor nation in world, borrowing the most money, and paying interest on them/ with principal.

My question is, WTF happend??? It was only like half a century ago when USA was the Creditor of the world! Now we are a debtor nation???

How could it come to this???

reply to post by saabacura

They have a landmass that is similar size to us, they have population that is 4 times ours.

What does landmass and population have to do with world power? Please elaborate!

Originally posted by plumranch
Yiersan, I would really like to hear your opinion of what is happening in China in an economic sense, in a social sense, anything you can comment on in regards to sensorship!

As I am extremely bored in a factory supervising several orders I placed here and those stupid machine broke again causing me prolly to have to stay over again, so uhmmm, yeah i will bite.....

First of all, you are definitely right that it was not an accident, after all power hungry guys did not get in power to be mutually destroyed. However, one thing I will always remember is that the Russians refused to give Mao the nuke when they were still allies, especially when Mao said he would want to take on USA and it would not matter so much if a few tens / hundreds mlns of his people were killed in an all out war, this scared the Soviet president at the time.... Mao was maybe a bit extreme at that time, but the world was simply lucky we only had greedy power hungry politicians in USA and USSR and not madmen...... So we just never know what would happen and what kind of person will get in power either in USA or in China (or in Russia) in the coming years, decades or centuries who is crazy enough to pull the trigger.....

As for the so-called censorship, I still laugh at it whenever someone raise this up, for sure facebook and many other websites (mainly sex ones) are being blocked by the CHinese great firewall, but you will be surprised how active the Chinese based forums are in China, who would just like the Western forums talk about anything and everything, including social issues etc etc etc. One good example is the one I heard yesterday when I went to Avatar 3D for the second time in 4 weeks. My friend told me that on the forums netizens are screaming and complaining to some cinemas why they are planning to take Avatar off the screen and allocate some slots for Confucius, which will go on the big screen country wide on by today. It went as far as some netizens screaming that the Chinese government is helpless and will only protect their own inland production blablabla. Stupidity across the world, and in the spoiled ignorant teenagers generation in China this is not less.

Economic and social sense? I might have to come back on this in another post, just want to share something else with you in this post first. You know, there is one thing you will feel in China is that despite all the day the day issues, such as corruption, pollution, extremely skewed income distribution, etc etc etc etc, one thing I at least do feel when living in China is that the central government set policies for the benefits of the majority of the population. These are not merely what you see in Europe and USA where governments are rotating all the time and each new cabinet is setting short-term 4-6 years policies in order to get re-elected once more. But the government over here you can see that they are setting policies for the longer term for decades and what I personally like is that they can take actions pretty immediately whenever needed. My theory is that the leaders understand very well that if they are not moving into the right direction and keeping the majority happy and providing a sense of continuous growing, development, security and even freedom than they will be taken out of power rapidly. It is a matter of finding the right balances and get the whole country gradually developed from an under-developed country to a developed country. And in this progress of developing a huge populated country, whoever is a bit less stubborn about certain idealogies and understand that progress should be gradually and not in a big boom, will get an surprising sense of freedom to move around and grab all the opportunities around you. This is also why a huge group of local Chinese entrepreneurs are more confident about their future than ever and are a key factor in the success of the Chinese economy.....

[edit on 22-1-2010 by yiersan]

Google may find they regret that choice once China rears up and takes over the world economy (more than they already are, that is).

reply to post by yiersan

As I am extremely bored in a factory supervising several orders I placed here and those stupid machine broke again causing me prolly to have to stay over again,

I thought that sort of breakdown only happened here in my shop! LOL

Maybe you can comment on the economic bubble sometime. Is the pumped state of the economy in China ever going to cause it to overheat and collapse (Like it did in Japan in the 90's?

Do you see China ever attacking any of its neighbors or the US militarily? (Say in the next 25 years)

You say that you are a factory supervisor, that you are not involved in the Party?

Originally posted by plumranch

no, I'm just an entrepreneur exporting, placing orders to outsourced factories. And because I kinda know and understand Westerners, so I can help them to minimize the quality issues in Chinese factories, who tend to have a hard time to understand what the standards are outside China.

anyhow, as for the economic bubble we faced in the 90s for Japan, which they still did not really come out of, well, hard to say, I personally do not think Chinese "bubble" will burst so easily as in Japan:

Why?

1) Unlike in Japan or the rest of the world, you will be still surprised how much areas and how huge the portion of the population of China are not really enjoying the so-called economic success for the past 30 years. I mean there are still hundreds of millions of Chinese and millions of squares areas practically undeveloped. The moment an area is fully developed the government put their attention towards the lesser developed areas and that part will offset the issues and even decline in certain developed areas. This will have to take on for at least another 3 decades before the whole of China is really developed. Currently the policies are aiming to develop the internal consumer market too in these developed areas.

2) Another big reason is that the Chinese government rules our country with strong hands and can take actions right away. How Beijing reacted to the Asian Financial Crisis was ever famous, and more recently during the Financial Tsunami, I believe China was the only country really taking the proper actions to stop a crisis from happening. I sincerely believed that China had a system like Japan or USA, we would have been way too late. Of course many efforts were stopped and delayed at provincial levels, that's the downside of being too big, but you start to see that these officials who did not catch up in time are slowly being replaced, with the Shenzhen mayor as one of the biggest example.

3) Inflated industries are the real estate and the stock market. Especially the stock market is one of the biggest casino in the world with too many uneducated putting their whole life savings in banana stocks or believing that housing pricing has only one way to go. And when human beings are always having a short memory, so these are the biggest concerns one can imagine. However, once again, if these two parts are to burst, so be it, after all, and again quantity speak for itself this time, it will ONLY affect tens of millions "middle class", while there are in relatively lesser developed areas another ten of millions of "middle class" popping up. Call it a lesson for the "victims" of these bubbles, after all it is not like there is not a huge propoganda program going on warning people to be on alert and not play with stocks as it is only rising etc etc.

4) There is a tendency to move labour intensive industries towards the inner parts of China and "upgrade" the industries and manufacturing in the coastal provinces, like the Pearl River delta area. These are done by implementing governmental policies such as minimum wages etc. For these labour intensive factory owners it is a hard time now, literally forced to move. But again, eventually it is better for the longer term for the Chinese economy. And unfortunately some sacrifices need to be made.

5) Unlike Japan, the Chinese government will just do whatever they believe is good for them and not for another country, see RMB.

------

no I do not see China attacking anyone in the upcoming 25 years, the Chinese people will go berserk, and too many corrupted officials will be affected in a war, it is not like that China has such a huge private military industry sector as in the USA. I do see China confronting more often American (and other) presence in areas where there are huge conflicts of benefits between China and USA (or someone else). It won't really lead to war, just more tension, and hopefully nobody makes a real mistake....

[edit on 23-1-2010 by yiersan]

reply to post by yiersan

Thanks again! Good perspective!

Most people don't know what is really going on in China as it is a rather closed system. I probably take most seriously what Stratfor has written. To summarize this latest stimulus that China did over a year ago now, pumped a lot of money in the form of loans back into China businesses. These businesses were already operating on a very thin margin (only marginably profitable). The world market greatly contracted after the collapse so the market wasn't there any more and probably won't recover for years yet. It has come back by only 1/3 so far. Chinese businesses didn't lay off workers like happened in the rest of the world, so the businesses are turning out goods filling warehouses, the businesses are operating on borrowed money (only recently did China banks tighten lending).

I think the reason your real estate and home prices are skyrocketing is because businessmen and laborers still have a lot of borrowed money in their bank accounts and are bidding up land and housing (in limited supply in the developed coastal areas). I have a business, I know how that works! Its really fun till you run out of loans!

Chinese Economic Collapse, Dubai X 1000

I get a little concerned (as do many) about China's lackadaisical attitude toward pollution and environmental issues. Most recently the pollution associated with the mining of rare earth metals (20 lb. in every Honda Prius) and 95% comes from mines in China. Incredible pollution problems swept under the rug by your (closed) iron hand government. This is certainly one of the biggest faults of your one Party system. That has got to change eventually, they can't hide it forever. I wonder if you are aware of this situation?

Inside China's Toxic Unobtanium Mines

And yes, I agree with your assessment of China's military intentions. I see just an ongoing cold war with very limited incidents and a lot of rhetoric and fist pounding!

[edit on 23/1/10 by plumranch]

reply to post by plumranch


I know what you mean by this borrowed money issue, and eventually it will come back. Again, so be it for those who are too greedy and neglect the many warnings.

However, regardless of what the Western market feel about their own market, guess what, what I noticed is a surprising increase in "new businesses", my theory is that previous European and American brands/distributors who did not buy from China before, yet are simply forced to take the risk and started in China, this offsetted the loss of businesses for those existing ones. Do not under-estimate this, some factories I am working with were in production capacity shortage simply because of these new customers. We were fighting for the production allocation especially from last year May on.

You noted one important point, businesses over here simply have a hard time to do mass lay off. It ain't so easy as many think. These workers who continue to receive salary kept an internal consumer market intact, offsetting and stopped the worsening of the economic collapse all around us. Eventually because of active developing of this consumer market it even starts to pick up. For your notice, I went to meet one of the biggest car dealer in Chengdu, and their sales in 2009 were unlike they have thought showed even a growth of double-digit figures. When this consumer market is going to get matured and grow bigger, it will offset the reliance on the exports.

The inventory level did rise a lot, but again, we have to be aware of how factories operate here. SOE are excluded in my review, as I never deal with them. And believe they never operated efficiently anyhow. But for privately owned factories, most of them will simply NOT produce when there are no orders coming, and those products which did keep on being manufactured because of the machines costs were merely dumped at even lower margin, or even at loss to get the cash back in, with it supplemented by the "borrowed money" these factories are waiting for better time. And it does seem that better time had come along already either it be the export or the internal consumer market.

Talking about borrowing money again, I believe there are misunderstandings how borrowing money works and if it is indeed that easy. Businesses either borrow from the local government or the banks, while individuals can only borrow from the banks. One anecdote, a friend who owns a medium sized PCB board factory heard about "easy loans", so they called up their contacts in the city house and had a fun night drinking in those everfamous KTVs with these officials. When the topic comes to borrowing, guess what, "well yeah, we have a more active policy in supporting important manufacturers blablbla, so I think you are obliged to borrow 1 million RMB, max 2 with this and that condition blablabla". What a joke, as you are a business owner as well, that is certainly not enough. Afterwards he understood that these officials have to be very cautious how much and what to lend out and to whom, as bad loans will affect their performance and in certain cases you might be literally hanged for making a bad decision. So why take this risk and rather pump that money in some public spending like building a new highway?

As for banking loans, it really depends on the bank internal people you know. I know local people (i call those local who are born in the Mainland) who could get a mortage of the legal maximum of 70% of the value, but guess what, when the guy making the valuation is setting the value like 150% the actual market price, well you can easily buy a house and still get extra cash! Typical example of how the law sets precautious rules, but because of your relationship people can be corrupted and skip it. Too much of these kinds of cases in China.

[to be continued]

I think China will have a civil war before anything ignites between the US and China. Sooner or later, the people of China will get tired of the Dictatorship and want to rule themselves. It is inevitable.

Just a thought:

A full out war between China and the US would be the start of WW3. It wouldn't be like Vietnam, Korea or Iraq.