The only new part of the ongoing Trump Administration economic warfare, a calculated assault on friend and foe alike from Russia to China to Iran to Venezuela and the EU, via so-called tariff war, is a President who uses Tweets as a weapon to throw opponents off balance. Since at least the beginning of the 1970’s Washington has deployed similar tactics of economic blackmail and destabilization to force what has become a global domination not of US manufactured goods, but rather of the dollar as world reserve currency. For almost five decades, since August 15, 1971, Washington and Wall Street have used their dominant position to force inflated paper dollars on the world, cause financial bubbles and subsequently debt buildup to impossible levels, then collapse.
The most essential point to understand about the so-called Trump “trade wars” is that they are not at all about trade or correcting trade or currency imbalances with America’s export partners. That world was largely left behind in 1971 by Nixon and the advisers.
The US economy since 1971 has been turned into a financial revenue source, in effect turning the United States from a nation primarily producing industrial goods to one in which the sole aim of all investment is to make money from money. Companies such as General Motors which at the end of the 1960’s was the largest maker of cars and trucks in the world, the heart of the American economy, got lured into speculation using its GMAC auto loan financial arm to make bets in the world economic casino, bets which went badly wrong when the US real estate bubble burst in March 2007 and GM was nationalized while the Wall Street mega banks were bailed out by taxpayers and the Fed.
The process, which I describe in detail in my book Gods of Money, took place over decades. By 2000, Wall Street banks and investment funds essentially dominated the entirety of the US economy. Manufacturing jobs had been pushed offshore, “outsourced,” not by Chinese or German or other “greedy thieves” as charged, but by pressure from those same Wall Street banks that since the 1980’s had driven corporations to focus only on the value of their stock shares and not on the soundness of their products.