Is Trump’s New Cold War Necessary? by Tom Luongo

Like his presidency, some parts of Trump’s war on China make sense, and some don’t. From Tom Luongo at tomluongo.me:

Donald Trump is winning the propaganda war against China today. But saying that doesn’t imply he either should be fighting this war or is capable of winning the real war.

What is that real war?

Retaining U.S. dominance over the flow of international capital for the next four generations.

Because that is what is at stake.

Trump’s slash and burn policies towards China have always been fraught with inconsistencies. From “trade wars are easy to win” (a lie) to the current over-reaction to COVID-19 (“the China Flu”) Trump is conflating the two main wars he is fighting into one.

Ending the Institutional Rot

The first main war he is fighting is against the globalists I call The Davos Crowd. His fundamental distrust of the post-WWII institutional architecture is at the forefront of why he deals with Europe the way he does.

Trump understands that The Davos Crowd’s goal is the cultural and economic destruction of the U.S. by creating a transnational superstate that exists as a regulatory and monetary framework built on top of the European Union.

This is why his first moves after taking office were to pull out of the Paris Accords on Climate Change and put the kibosh on the TPP and the TTIP.

It’s also why he wanted the JCPOA torn up. It had the added benefit of assisting Israel’s goals in the Middle East, but I think that is tangential to his main purpose, which was to reverse the dynamic of ceding U.S. sovereignty to Europe while they bled us dry.

Queue his complaints about NATO.

 

China is a willing partner with The Davos Crowd’s plan and because of that is part of Trump’s war strategy. He understands, rightly so, that China has been courting Europe, buying strategic assets there — Greek ports, the London Bullion Metals Exchange, etc. — and increasing their influence in international institutions the U.S. created and has dominated for decades.

He also sees, rightly, how the U.S. hollowed itself out giving the money to China to begin, in U.S. foreign policy terms, colonizing Asia, specifically Iraq, Afghanistan and Iran

These institutions are now, from Trump’s perspective, wholly compromised. And he’s willing to throw out as chum to his supporters in an election year as much anti-China propaganda as possible to win that point. At the same time he’s allowing his State Department and CIA, run by arch-Neocons Mike Pompeo and Gina Haspel, to run wild setting off brush fires in China’s backyard, namely Hong Kong, Kashmir and Taiwan.

But, remember, Trump sees this as a defensive war, not an offensive one. And I think he’s right to think of it in these terms. There really is a transnational oligarchy trying to destroy the U.S. His narcissism and limbic nature however, make him susceptible to over-reaction and misinterpretation.

He’s been fighting an unfairly fought media and political war for nearly four years domestically and he’s finally going on the offensive for this election. Most of the people he’s fighting have been selling the U.S. out to China but are also in thrall to The Davos Crowd.

The real rot that he’s fighting is here at home, which he’s done excellent work exposing.

That makes it easy for him to be manipulated into seeing things about COVID-19 that are likely not reality. So, as I said in my last article …

I’m convinced that the circumstances surrounding COVID-19 were a plot by evil people to kill millions of people and usher in a bleak, authoritarian nightmare they’ve had legislation and action plans written to execute for years. I’m just not convinced it was China that was wholly behind it.

But for Trump, the circumstantial evidence of wrongdoing and China’s own statecraft makes the Coronapocalypse a convenient excuse to take things with China to the next level.

He’s doing this even though the real enemy he is fighting is right here at home, some of whom are in his cabinet.

The China Paradox

And this is where Trump’s conflating his two wars is not only dangerous but wholly counter-productive.

Because U.S. adventurism and the vestiges of its colonial mindset, inherited and still shaped by the British, are rooted in its military and intellectual classes which shape foreign policy.

We are still dominated by Brzezinski’s warming over of Halford Mackinder’s Heartland view of the world. He who controls the Heartland — the central Asian landmass — controls the world.

Pepe Escobar’s latest reminds us of this in relation to Trump’s stepping up his attacks at every level against China’s advances in Eurasia, especially in Hong Kong. Speaking about H.R. McMaster’s latest policy memo on U.S. foreign policy objectives, Escobar says:

He {McMaster} suggests – what else – “containment,” which should be “firm and vigilant.” And he recognizes, to his credit, that it should be “based on an understanding of Chinese history and Indo-Pacific geography.” But then, once again, he gives away the game – in true Zbigniew Brzezinski fashion: what matters most is “the need to prevent a hostile power from controlling the key power centers of the Eurasian landmass.”

It’s no wonder the US Deep State identifies Belt and Road and its spin-offs such as the Digital Silk Road and the Health Silk Road across Eurasia as manifestations of a “hostile power.”

The whole fulcrum of US foreign policy since WWII has been to prevent Eurasia integration – now actively pursued by the Russia-China strategic partnership. New Silk Roads across Russia – part of Putin’s Great Eurasia Partnership – are bound to merge with Belt and Road. Putin and Xi will meet again, face-to-face, in mid-July in St. Petersburg, for the twin summits of BRICS and the Shanghai Cooperation Organization, and will further discuss it in extensive detail.

Hong Kong has been in the sights of the U.S. and U.K. for year now, going back to theprotests over the Extradition Treaty. And China’s latest Security mandate for Hong Kong is aimed directly at foreign interference into the city-state’s future.

This move by China was long overdue since last year’s attempt at a color revolution failed. The fallout from the Coronapocalypse economically is here and it is the perfect moment for China to push back.

Because with China’s move to end the “One Nation, Two Systems” approach of the past 23 years, Hong Kong as we’ve known it is gone. And China just upped the stakes on U.S./U.K. activity there to spark an overthrow of its rule.

Because what comes into focus next is a breaking of the peg between the Hong Kong dollar and the U.S. dollar which has fueled so much of what we think of as Hong Kong.

The property bubble will burst now as upward pressure on the HKD threatens to blow out yield spreads between Hong Kong and U.S. debt, the fulcrum on which the peg rests. As I said in the article for Money and Markets linked above:

That {yield} spread across maturities should blow out wider as the situation on the ground worsens and there is upward pressure on the Hong Kong dollar due to the collapse of the global economy. Short-term rates will rise faster than long-term rates, and this could happen while rates in the U.S hold serve or continue to drop.

There is no way the HKMA {Hong Kong Monetary Authority} can maintain the peg under those conditions.

Right on cue there are protests against China’s pronouncement getting hastily organized for this weekend.

Those protests the typically volatile admixture of organic social unrest and NGO-sponsored agent provocateur activity will grab headlines for the next few weeks.

And this is why Trump’s multi-pronged assault on China is ill-advised. China and Russia both have asked the U.S. to come to the negotiating table on what the post-Unipolar world would look like and they have been met with nothing but insane hostility.

So, the responses from here from them will be to attack pillars of U.S./U.K. financial system and erode their hybrid war effectiveness. Hong Kong as a money laundering operation under Western control is a major one of these pillars.

That’s what China just attacked. It’s a massive move. And Trump would do well to trust his instincts about maintaining an Empire around the world while his budget deficit to GDP balloons out to levels beyond those seen during WWII.

Meanwhile China is looking at mild deficit spending (3.6% of GDP) and a mild contraction given the global circumstances.

Trump thinks he’s fighting a new Cold War against China but he’s really just fighting the next round in an old war on Asia that’s over 200 years old.

And it’s a war he cannot win.

Because most of the world, thanks to his weaponization of the dollar on top of decades of geopolitical abuse and adventurism, now views the U.S. unfavorably. And with every further act of financial and diplomatic aggression will accelerate their perceived need to ditch the dollar in favor of anything else.

That is what will ultimately fuel the switch from a Unipolar world to the so-called Multi-polar one. Trump had the opportunity to make this change a more amicable one. But I think that opportunity is now behind us.

Sadly, I don’t think he’s got any intention backing down here, not in an election year, and not when he’s finally convinced more than half of Americans that China is our biggest problem.

But now that we know Trump thinks these wars are necessary, at least we can be clear as to what to do next.

 

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