The United States and China look like two punch-drunk prizefighters squaring off for a major championship fight. They have no good reason to fight and every reason to cooperate now that both their stock markets have been in turmoil.
Six hundred point market swings down and then up look like symptoms of economic nervous breakdown.
Factions in both nations are beating the war drums, putting presidents Donald Trump and Xi Jinping under growing pressure to be more aggressive.
Trump shoulders much of the blame for having started this unnecessary confrontation by imposing heavy duties on Chinese goods. The US president has turned the old maxim on its head that nations that trade heavily don’t go to war. The US and China, both huge trading partners, appear headed to military clashes, or even full scale war, if their governments don’t come to their senses soon.
Trump was clearly trying to bully China into major trade concessions and better commercial behavior. He is right about this. I’ve done business in China for over 15 years and seen every kind of chicanery, fakery and double-dealing imaginable. China learned from the French that the First Commandment is ‘Thou Shalt Not Import.’
The Japanese are no better. I recall Japanese health authorities telling my pharma firm that all our tablets had to be triangular shaped to make them nearly impossible to swallow.
Theft of technology is indeed rampant, as Trump asserts. But has he looked into CIA and NSA’s techno spying recently? They ransacked the Soviet Union during its last dying days. Much of our postwar missile technology was developed by German scientists spirited off to the USA. After the Sputnik launch in 1957, I recall seeing a German cartoon showing a Soviet and US satellite in orbit next to one another. One whispers to the other, ‘Now that we’re alone, let’s speak German!’
Meanwhile, US warships are patrolling the South China Sea and playing chicken with Chinese naval units and aircraft. It’s only a matter of time before a dangerous incident occurs that could spark a real shooting war. The Trump White House has been encouraging India to challenge China at sea and in the high Himalayas.
Beijing has pulled the rug out from under Apple sales in China,