Sale of four US carriers would cut China trade deficit
China’s Central Propaganda Department solves the economic conflict with a high-tech shopping list and brands Pence's speech ‘a joke’
Zhong Xuanli does not exist as a person but does exist as the collective voice of the Bureau of Theory at China’s Central Propaganda Department.
In two massive commentaries in the influential People’s Daily, “Zhong” waded into the trade war row with the finesse of a wrecking ball.
Taking aim at a 45-minute policy speech made by the United States Vice-President Mike Pence at the Hudson Institute in Washington, the Communist Party provocateur countered:
“It is noteworthy that [Chinese] growth was achieved as the US has strictly restricted the categories of exports to China and banned the sales of certain high technologies.
“The US trade deficit with China would probably be narrower if the US allowed sales of high-tech products to China. If the US sold four [Gerald R.] Ford-class aircraft carriers priced at US$15 billion each, it would easily make up for a $60 billion trade deficit with China.
“Pence even said that much of China’s success was driven by American investment in China and that the US ‘rebuilt’ China over the last 25 years – what a huge joke!”
Indeed, it is inconceivable that Washington would ever sanction the sale of Ford-class carriers, which are at the sharp end of America’s maritime power. But the fact they were mentioned illustrated how relations have become frozen in a Cold War permafrost.
Earlier this month, Pence accused China of military aggression, commercial theft and human rights violations as he cast the world’s second largest economy in the role of a regional bully in Asia.
His speech preceded a report by the Pentagon that China represents a “significant and growing risk” to the supply of materials vital to the US military.
Yet in Beijing, President Donald Trump’s trade conflict is seen increasingly as a way to contain the country’s growing economic and military might.
By weaponizing tariffs on more than $250 billion worth of Chinese imports, Trump’s administration hopes to force President Xi Jinping’s government to change direction.
This, of course, would involve recasting the “Made in China 2025” high-tech program, as well as adding a layer of transparency to the Belt and Road Initiative, which is at the heart of Beijing’s foreign policy push.
“The world’s two largest economies – China and the United States – are engaged in a full-blown trade war, and what Trump hoped would be a blitzkrieg has turned out more like trench warfare,” Keyu Jin, a professor of economics at the London School of Economics,” said. “Many fear that this is only the beginning of a long conflict that could include weapons – and casualties – far outside the realm of trade.
“Yet, in China’s view, what the US is really reacting to is not only the specifics of its trade policy but also its overall development model and its aspirations to become a major global power – aspirations that are not out of reach,” Jin added. “In fact, the Chinese believe, Trump’s trade war effectively proves that China has become a real and present threat to American hegemony.”
Before the annual meeting of the International Monetary Fund and the World Bank in Bali at the weekend, the IMF managing director Christine Lagarde warned of the damage the trade war would cause.
“The stakes are high because the fracturing of global value chains could have a devastating effect on many countries, including advanced economies,” she said.
Uncertainty has always been the breeding ground for anxiety.
Last week, stock markets tanked after a wave of negative data about the global economy and rising trade tensions between Washington and Beijing.
On Monday, Asian indices wobbled again. But then, hard economic facts have a habit of drowning out the collective voice of the Bureau of Theory.