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How Should US Deal with China Long-term?

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  • Ever heard of cooperation?
    "Ask not what your country can do for you"

    Left wing, Right Wing same bird that they are killing.

    you’re entitled to your own opinion but not your own facts.

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    • Originally posted by Half Pint John View Post
      Ever heard of cooperation?
      Dont spoil it. This is another chance to slay a dragon and have someone to fear and worry about it. Fire up the nukes!!

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      • Originally posted by Half Pint John View Post
        Ever heard of cooperation?
        Good point. In the article, at least that's what china is claiming.
        "We have no white flag."

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        • Originally posted by copenhagen View Post
          Dont spoil it. This is another chance to slay a dragon and have someone to fear and worry about it. Fire up the nukes!!
          "We have no white flag."

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          • From Der Spiegel - The Coal Monster: Pollution Forces Chinese Leaders to Act

            http://www.spiegel.de/international/...-a-886901.html

            excerpt
            What does growth smell like? What does the biggest economic miracle of all time taste like?
            In Guiyu, on the South China Sea, the smell of growth is a caustic, slightly nut-like odor emitted when a computer keyboard is placed on a hotplate. Electronic waste is processed in Guiyu, one of the most prosperous cities in Guangdong Province. In Xintang, on the Pearl River Delta, it is the bitterly acidic gases that are released when tons of denim material are bleached, dyed and washed. Xintang is the jeans capital of the world, a source of jobs for tens of thousands of people.
            In Hainan, a coal and cement town in Inner Mongolia, it is a dull cocktail of soot, chalk and desert sand. Here, growth is something you taste and touch, rather than something you smell. It crunches between your teeth when you are outside.
            In Beijing, the capital of the country whose economic success has amazed the world for the last 30 years, the myriad smells and tastes of growth often include a burning odor and an unpleasant aftertaste. It's familiar to many who live in cities whose population is growing by hundreds of thousands a year and whose officials are running out of places to dump garbage.

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            • Chinese people will die out due to bad air and Americans due to bad food...then again,there is so many Chinese in PRC and around the world that some of them will survive,so...

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              • Originally posted by lakechampainer View Post
                How should the US deal with China long-term?
                By co-operation whenever it doesn't harm our own true interests or those of our allies. Frankly, we'd be far better off if we spent more time learning how to deal with our own internal problem here in the U.S. Our people are divided (which is likely what our political and economic leaders prefer), and we're broke (knocking on 17 trillion in debt and increasing by well over one trillion per year; that's a hand-to-mouth existence). Those two problems are more than enough to keep us occupied.

                Challenging the Chinese agressively would be at best, counterproductive; and a majority of our people wouldn't accept it. And down the road some five or so decades from now, the world's nations are going to need all the good will among one another that they can get. Overpopulation, an ever- increasing shortage of raw materials, and shortage of both food and fresh water are going to raise global isues that will be resolved either by conflict or co-operation. Best to build on whatever goodwill we already have with the Chinese, because they WILL be a leading actor on the global stage.
                Sgt.

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                • Originally posted by Sgt. Saunders View Post
                  By co-operation whenever it doesn't harm our own true interests or those of our allies. Frankly, we'd be far better off if we spent more time learning how to deal with our own internal problem here in the U.S. Our people are divided (which is likely what our political and economic leaders prefer), and we're broke (knocking on 17 trillion in debt and increasing by well over one trillion per year; that's a hand-to-mouth existence). Those two problems are more than enough to keep us occupied.
                  The problem is in the long term China is a big threat to our allies. But you're right about one thing, we definitely need to get our house in order.


                  Challenging the Chinese agressively would be at best, counterproductive; and a majority of our people wouldn't accept it.
                  Considering China's increasingly aggressive behavior I think people will accept it. What we have on hands, at least geo-politically, is another Wilhemite Germany, another menace to the global order.


                  And down the road some five or so decades from now, the world's nations are going to need all the good will among one another that they can get. Overpopulation, an ever- increasing shortage of raw materials, and shortage of both food and fresh water are going to raise global isues that will be resolved either by conflict or co-operation.
                  People have been predicting imminent doom from overpopulation and resource depletion for some 200 years now, and they've been quite wrong every time. This narrative was very much in vogue in the 1960's and '70's, and ended up falling flat on its face. Malthusianism has never taken into account technological advance, or in the case today our technological capabilities.


                  Best to build on whatever goodwill we already have with the Chinese, because they WILL be a leading actor on the global stage.
                  Sgt.
                  30 years ago people had much the same sentiment about Japan. At that point Japan's growth rates were pretty high, and had been for quite some time. The assumption was that it would always be this way and we should get used to being a second rate power because they were going to overtake us in a decade. But that didn't happen. It turned out a lot of that growth was caused by a massive bubble that burst in the early 1990's. Instead of reforming they tried to take the easy way out and just paper over their problems with Keynsian stimulus. Their economy has mostly been in the doldrums ever since. This will be China's fate, and it will happen much sooner than you might think.

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                  • Originally posted by illumined View Post
                    ... 30 years ago people had much the same sentiment about Japan. At that point Japan's growth rates were pretty high, and had been for quite some time. The assumption was that it would always be this way and we should get used to being a second rate power because they were going to overtake us in a decade. But that didn't happen. It turned out a lot of that growth was caused by a massive bubble that burst in the early 1990's. Instead of reforming they tried to take the easy way out and just paper over their problems with Keynsian stimulus. Their economy has mostly been in the doldrums ever since. This will be China's fate, and it will happen much sooner than you might think.
                    My own thoughts keep coming back to this as well. A lot of western companies have made huge investments in China premised on massive future growth. Some people assume that the failure of China would only be good for the west. I'm not so sure about that.
                    Any metaphor will tear if stretched over too much reality.

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                    • Originally posted by GCoyote View Post
                      My own thoughts keep coming back to this as well. A lot of western companies have made huge investments in China premised on massive future growth. Some people assume that the failure of China would only be good for the west. I'm not so sure about that.

                      From what I've seen the vast majority of that investment is in the form of factories built to export those corporation's products back to the US. That accounts for about half of their export surplus with US. Thing is, it doesn't matter whether or not it is good for the West, the bursting of the China Bubble is inevitable as this cycle of globalization comes to an end. It will be good for us economically, because we will see at least a partial reindustrialization and our own economy will become a lot more balanced and China will be a lot weaker as it faces one or more lost decades.

                      How this will affect the geo-political situation is harder to say. It will either short circuit their regional imperial ambitions for a while (which is a good thing) or push them to act on them (which is basically WW3).

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                      • It will be good for us economically, because we will see at least a partial reindustrialization and our own economy will become a lot more balanced and China will be a lot weaker as it faces one or more lost decades.
                        I am not sure I agree with this proposition, if China's bubble bursts then so will many other economies as well, remembering that China owes a massive slice of the US debt. If China calls on this debt and the US does not or cannot repay it, then the US and likely most economies will all tumble and dont think for a moment anyone comes out of that freefall feeling better or stronger.


                        In regard how to handle China I do not see a happy ending to this challenge. The way I predict it will unfold is either the economic collapse of not only China but the Asian economies as well.
                        The Asian nations have over the last 10 years increased their arms purchases massively, whilst the arms race has increased at a terrifying rate the economies havent, so all this hardware is being accumulated on debt, so sooner or later it will occur to someone "use it or lose it".
                        As a consequence the rest of us could find ourselves in a crisis (accidental or otherwise) no one wants but cannot avoid.
                        America has placed much emphasise on its new policy of "Asia Pivot" but the consequence of guaranteeing the security of its Asian allies is that should one of these nations get into difficulty with China (very likely) the US is forced to back their allies or become isolated. When either of those options occur we all lose.

                        Sadly diplomacy in the Asian world is becoming more one of brinkmanship rather than problem solving, a dangerous policy to follow as I am sure anyone who plays Russian Roulette will agree with.
                        An 18th century Imagi nation blog set in England/

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                        • Originally posted by Baztanz View Post
                          I am not sure I agree with this proposition, if China's bubble bursts then so will many other economies as well, remembering that China owes a massive slice of the US debt. If China calls on this debt and the US does not or cannot repay it, then the US and likely most economies will all tumble and dont think for a moment anyone comes out of that freefall feeling better or stronger.
                          Here's a chart of who owns our debt:



                          It's not a question of if the China bubble bursts, it's a matter of when. Their system is piling on unbelievable amounts of debt, far more than is being officially reported. This simply can't go on, and I suspect it will happen sooner rather than later. I found some predictions for this decade from an economist I've been following:

                          Originally posted by Michael Pettis
                          My basic sense is that we are at the end of one of the six or so major globalization cycles that have occurred in the past two centuries. If I am right, this means that there still is a pretty significant set of major adjustments globally that have to take place before we will have reversed the most important of the many global debt and payments imbalances that have been created during the last two decades. These will be driven overall by a contraction in global liquidity, a sharply rising risk premium, substantial deleveraging, and a sharp contraction in international trade and capital imbalances.

                          To summarize, my predictions are:

                          BRICS and other developing countries have not decoupled in any meaningful sense, and once the current liquidity-driven investment boom subsides the developing world will be hit hard by the global crisis.
                          Over the next two years Chinese household consumption will continue declining as a share of GDP.
                          Chinese debt levels will continue to rise quickly over the rest of this year and next.
                          Chinese growth will begin to slow sharply by 2013-14 and will hit an average of 3% well before the end of the decade.
                          Any decline in GDP growth will disproportionately affect investment and so the demand for non-food commodities.
                          If the PBoC resists interest rate cuts as inflation declines, China may even begin slowing in 2012.
                          Much slower growth in China will not lead to social unrest if China meaningfully rebalances.
                          Within three years Beijing will be seriously examining large-scale privatization as part of its adjustment policy.
                          European politics will continue to deteriorate rapidly and the major political parties will either become increasingly radicalized or marginalized.
                          Spain and several countries, perhaps even Italy (but probably not France) will be forced to leave the euro and restructure their debt with significant debt forgiveness.
                          Germany will stubbornly (and foolishly) refuse to bear its share of the burden of the European adjustment, and the subsequent retaliation by the deficit countries will cause German growth to drop to zero or negative for many years.
                          Trade protection sentiment in the US will rise inexorably and unemployment stays high for a few more years.
                          From a very worthwhile source.

                          The bottom line is the financial crisis is not really over at all, instead we're in sort of the eye of the storm. Soon enough we will see the next phase occur. I'm not economist but I wouldn't be surprised if Japan ended up starting it. Their government debt is astronomical, one of the highest in the world. This will end very very badly for them.


                          In regard how to handle China I do not see a happy ending to this challenge. The way I predict it will unfold is either the economic collapse of not only China but the Asian economies as well.
                          The Asian nations have over the last 10 years increased their arms purchases massively, whilst the arms race has increased at a terrifying rate the economies havent, so all this hardware is being accumulated on debt, so sooner or later it will occur to someone "use it or lose it".
                          As a consequence the rest of us could find ourselves in a crisis (accidental or otherwise) no one wants but cannot avoid.
                          America has placed much emphasise on its new policy of "Asia Pivot" but the consequence of guaranteeing the security of its Asian allies is that should one of these nations get into difficulty with China (very likely) the US is forced to back their allies or become isolated. When either of those options occur we all lose.

                          Sadly diplomacy in the Asian world is becoming more one of brinkmanship rather than problem solving, a dangerous policy to follow as I am sure anyone who plays Russian Roulette will agree with.
                          I agree with you about the arms race and the overall shaky political situation. This does bear a striking resemblance to Europe at the turn of the 20th century, with brinkmanship and seemingly endless streams of crises being the norm. The whole area is a powderkeg, with something of a defacto power bloc forming around the Philippines, Vietnam and Japan to oppose the China centered power bloc. This two alliance dynamic is highly unstable and could easily lead to a major war, which in which China will probably lose.

                          EDIT: I'll also mention that much like Germany 100 years ago China is very much boxed in politically by its desire for a Place in the Sun. This does have important implications because it forces us to choose between letting a despotic regime run things or active confrontation.

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                          • Originally posted by illumined
                            30 years ago people had much the same sentiment about Japan. At that point Japan's growth rates were pretty high, and had been for quite some time. The assumption was that it would always be this way and we should get used to being a second rate power because they were going to overtake us in a decade. But that didn't happen. It turned out a lot of that growth was caused by a massive bubble that burst in the early 1990's. Instead of reforming they tried to take the easy way out and just paper over their problems with Keynsian stimulus. Their economy has mostly been in the doldrums ever since. This will be China's fate, and it will happen much sooner than you might think.
                            You seem to forget that China, as of 2012, has a population of 1,353,821,000 people. That's more than 4x the population of America as of 2013 (315,718,000).

                            While back in 1970, Japan had a population of only 103,720,000 or just 51% of America's population of 203,211,000.

                            China already has about 100,000,000 people who are living lifestyles that would meet the standards set by the UN for being regarded as Highly Developed.

                            Simply put, due to its sheer size alone, China will surpass America as the world's largest economy.

                            That does mean however that they'll become the world's paramount military power, or achieve a national living standard that is anywhere close to America.
                            ´
                            “You need to help people. I know it's not very Republican to say but you need to help people.” DONALD TRUMP, 2016

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                            • You guys just too nervous about China. In some aspects, you just don't realize China.

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                              • In what fashion?
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