The top good news of the week is that we are not yet in the middle of a thermonuclear war. As predicted here several times, with lashings of wishful thinking, North Korea’s leader is bluffing.
Actually, Trump is a topic we prefer to ignore these days, even though the train wreck in Washington impacts on China in all sorts of ways. But this week, we have a pairing of the two, with Trump adviser Steve Bannon making weirdly forthright statements to the media just two weeks after his enemy, The Mooch, got fired for doing much the same thing. Who can keep up with it all? Bannon may well be an excellent fellow, we’ve never had the pleasure, and while some of his views and associations suggest serious white supremacist leanings, he is certainly a strategic heavyweight and has been a significant influence on Trump since well before the election. His comments on China yesterday in brief:
“We’re at economic war with China. One of us is going to be a hegemon in 25 or 30 years, and it’s gonna be them if we go down this path … the economic war with China is everything” and the US needs to be “maniacally focused on that … If we continue to lose it, we’re five years away, I think, 10 years at the most, of hitting an inflection point from which we’ll never be able to recover.”
Whether Trump shares those views, who knows. Whether many of Bannon’s other views are whacky is pretty much beside the point in this context. But these comments are worth a moment of thought.
Is he right? To what extent is this view shared by others in Washington, for instance in the State Department? How should the US respond? Bannon’s answer is trade measures with regards to dumping of products and technology transfer issues. “We’re going to run the tables on these guys. We’ve come to the conclusion that they’re in an economic war and they’re crushing us.”
This is most interesting commentary on the state of the US-China relationship for years. We are not saying it is correct or that we agree, simply that it is worth mulling the issues and potential consequences.
There was a time when we used to fill our weekly reviews with discussions of GDP figures. Long ago, it seems.
Have a happy late-summer weekend.