There are many articles about the Trade War between the United States (Donald Trump) and China. Many are written from the perspective of an American consumer sitting in America, and desirous of a return to the “golden days” of industrial might. Others are written from the point of view of a progressive “enlightened” globalist who wants a one-singular world order. This article is different. It is written from the point of view of someone who has a vested interest in both “camps of thought”.

A fresh slap of reality.

In terms of the trade war, there are some facts that do not support any of the assumptions held and promoted by the “talking heads” in the mainstream media.

None of these facts agree with the promoted narratives. This is true whether you are politically liberal or conservative.

On the conservative side...

I’m seeing a type of artificial patriotic fervor. It's an organized  attempt using memes and propaganda to convince conservatives that the trade war requires mindless fealty to the anti-China message.

Americans don’t like dictators, and many don’t like China. However, conservatives are being duped into thinking the trade war against China some type of an ideological crusade. It’s one that somehow will lead to a better America or a better world.

People! Wake up. This is not what the trade war is intended to do.

Let’s start with the assumptions surrounding the trade war and then look at the evidence that debunks them. Remember people…

The American government requires an alert and well-informed citizenry to function properly.

Fallacy #1: China needs America

The idea here is that the entire nation of China, all 1.4 billion of them, needs Americans (325 million) buying their products.

Seriously?

I’m not sure where this idea comes from specifically, but it’s not based on anything tangible. I sometimes wonder if the notion that the world depends on the American consumer (for its bread and butter) is perhaps a kind of appeal to American’s narcissism? Thus making the average American feel superior, or feel special. You know, by simply by telling them that their steady American way of life (one of debt-based consumption) keeps the engine of the global economy running.

Pretty outrageous.

In the case of China, here are the facts:

The US only comprises around 18% of Chinese exports. While this is a nice piece of the pie, it’s hardly enough leverage to bring down China’s economy. China would suffer profit losses in certain sectors as well as a possible recession, but not the kind of crisis that some in the alternative media are predicting.

There will not be riots in the streets, famine, or civil upheavals. Don’t be silly.

In 2018, China shipped 18% of its exports to the United States. That contributed to a $419 billion trade deficit. China's trade with Hong Kong, at 14%, was almost as much. Its trade with Japan, which was at 6%, and South Korea, at 4.5%, was much less. 

-The Balance

You need to know that China is NOT structured like the United States and does not operate under rule by popular opinion. They are a serious, serious nation. Their leadership got where they are through merit. (Have you ever attended school with a Chinese / Asian student? They work hard, study hard, and make informed, calculated decisions.)

Unlike the United States, around 40% of China’s GDP is generated domestically, and 80% of its GDP growth comes from private consumption.

For the last decade or so, China has been busy changing its economic model. They have moved from an export-based system to a far more self-reliant domestic-based system.

I covered this subject in another post. You can click on the link below. It will open up in a separate tab so that your reading here will not be interrupted.

Maybe they knew something that the Bush and Obama administrations didn’t. It appears that they have been preparing for a possible economic war with the US.

For the last decade, indeed since 2010, China’s domestic market has grown dramatically. This should indicate to the more alert in the audience that China has no intention of relying on the US consumer as an economic pillar.

They are a self-sufficient nation.

Meanwhile, the US consumer is almost tapped out. It’s hard to see because retail sales in certain areas remain steady. Not to mention that the mainstream media (and the Fed) has been using this to promote the idea that the economy is still “going strong”. It’s not really the true and real situation.

The reality is that US consumption is driven by historic levels of debt. Household debt is now FAR above levels last seen after the last financial crisis, with total debt at $1.2 trillion higher today than its last peak in 2008. 

The downturn in retail is more obvious in the steady closings of thousands of outlets in 2019 alone.  This year has seen a 29% increase in store closings compared to 2018,  even though 2018 saw a considerable spike in store shutdowns. Around  12,000 stores are slated to close this year.

OK, so the actual situation is quite different from the mainstream media narrative.

• China is a self-sufficient nation.
• America is completely engulfed in a debt hole.

So the question is, with the US consumer stretched thin by debt and US retail on the verge of a recessionary plunge, why would China feel threatened by the loss of the American consumer market? 

They are losing it already by attrition.

The truth is they aren’t threatened. Which is why the trade war continues unabated. This is the situation despite the fact that so many people have argued that China would “quickly fold” to Trump’s demands.

I realize this is not what many people want to hear, but it is foolish to get caught up in a farcical mob mentality and ignore the fundamentals in the trade war. If you think that the US is going to “win” based on leverage, you are sorely mistaken. 

America has NO leverage. The US is in no better shape economically than China; in many ways, we are much worse off.

“Trump’s claim that an exodus of foreign firms will force China to  capitulate to US demands to settle the trade war is wishful thinking at  best,” 

-Week In China

Fallacy #2: Manufacturing Will Return

This is perhaps the most persistent and fraudulent “carrot” that has been held out to the American people. It’s the idea that those “golden days” of American Manufacturing will return, and all will be back to “normal”.

It’s a lie.

It’s not going to happen.

I am sorry to break this new to you all, but factories, industrial might, scientific ability and skills are not “light switches” that you can turn on and off at will. You cannot just snap your fingers and start up a fully automated factory, producing high quality products with a skilled work force overnight.

It doesn’t work that way.

I covered this subject elsewhere. You can click on the link and it will open up in a separate tab.

First, as it stands now manufacturing in the US makes up only 11% of total economic output. I don’t think that many people understand the consequences of this.

• We have a 70% retail and service-based economy.
• This means that the majority of US citizens in the job market have no experience whatsoever in the manufacturing sector.
• Thus, by extension, the average US company has no guidelines for how to establish a manufacturing base using the existing American labor pool.

Second, American labor expects a certain level of wage compensation. Not to mention an expectation of union organization. Combined, this makes manufacturing far more expensive here than in just about anywhere else in the world.

The average factory worker in China makes around $3.60 per hour. So tell me, just how exactly would the American market ever be able to compete with this?

Tariff’s alone are not enough to force corporations to spend the billions necessary to rebuild factories in the US and hire American workers at $15+ an hour (let alone the $45+ an hour at union wages). It’s just not going to happen.

There's a movie called "American Factory" that might be worth your time to watch. It's a documentary that was released in August 2019.

The documentary tells an increasingly American story. In 2015, seven  years after a General Motors plant closed in Dayton, Ohio, a Chinese  company that manufactures glass for trucks and automobiles reinvests in  the factory.

The former GM workers are are ecstatic. Some went into foreclosure  and were evicted from their homes after GM pulled out — one woman, a  forklift operator named Jill Lamantia, is living in her sister’s  basement. They’re happy to have another factory job. Never mind that the  GM plant was fully unionized and paid more than $20 an hour, and Fuyao,  a non-union shop, has a starting pay of $14 an hour, it’s a job.

Cao has a bold vision: Pair U.S. workers with Chinese workers, who  are brought to Ohio to train and work alongside their American  counterparts. The idea is that the Chinese and the Americans can learn  from each other, taking the best working methods from each culture to  increase production. Although Cao visits regularly from China, the  onsite boss is an American, and management is from both cultures.

But the results don’t meet that utopian ideal. The culture divide  seems insurmountable. To start with, the Chinese workers have no problem  working long hours and overtime, while the Americans are used to  eight-hour shifts...

Download the Movie Torrent HERE.
Read reviews about it HERE.

Third, there are many, many places besides China to build a manufacturing base. No company is going to bring its factories to the US when they can build in Vietnam, or Taiwan, etc. In many cases, it is cheaper to ship raw materials and products to these countries, have them finished by cheap and motivated workers in Asia, and then have the items shipped back, than it is to build the product from start to finish in the US.

Fourth, we can talk all day about patriotism, but in the end, the average American is not going to buy “Made in the USA” for most goods out of a sense of patriotic duty if the price is twice as much or much more. Walmart and Amazon dominate the retail market for a reason – they sell things cheaply.

• $19.95 Toaster – Made in China.
• $79.95 Toaster – Made in the USA.

Fifth, raising tariffs on foreign exporters would only work to encourage consumption of domestically manufactured goods. If the foreign made products cost too much, then you would buy American. Right?

Why buy an Mercedes, when you can buy fifteen (x15) Kia Rio Sedans for the same amount of money?

• 2019 Mercedes-Benz S-Class – $253,550
• Kia Rio LX, 4-Door Sedan. – $16,195

This only holds true if the US already had a large manufacturing base and produced all the items other nations produce. But it doesn’t. Many of the things that are under the tariff schedule are wholly made overseas.

• Televisions – 100% made in China.
• iPhones – 100% made in China.
• Sneakers – 100% made in China.
• Clothes Washers – 100% made in China.
• Automobile Tires – 100% made in China.

The American consumer doesn’t have a choice. He can only buy imported items. Thus, it is the American consumer that ends up paying the tariff.

Entering into a trade war without a resilient manufacturing sector is backward. You don’t fight a trade war to get manufacturing to come back, you fight a trade war to promote the goods you already manufacture.

Seriously, if Trump had really intended to bring factories back to the US, he should have done things differently. For instance, he could have given corporations tax break incentives in exchange for creating manufacturing jobs on US soil.

If you do “A”, I’ll give you “B”.

Instead, he didn’t do this. He just gave American corporations tax breaks for nothing.

Fallacy #3: China Will Starve Without American Food

Uh, no. China will not experience famines, riots, or starvation. It’s all pretty darn silly.

This is a very weird argument. It’s as if some people assume that the US is China’s only potential source for food. Where do Americans get such really “off the wall” ideas? Seriously!

China buys agricultural products from all over the world and has alternative sources for foods like soybeans and pork, including Brazil, Mexico, and Russia. Not to mention that they grow, and raise their own food. It’s part of the conservative belief in self-sufficiency. Don’t you know.

I covered this subject elsewhere. The link below will open up in a new tab. It’s pretty damming and will open up a few eyes. China is not a nation to be trifled with.

Prices will rise in China, sure, but nowhere near the point of collapse. Again, the Chinese are not reliant on the US for anything, so, the idea that the US has overt leverage in the trade war is simply not true.

• China to boost imports of Russian soybeans, cutting out US crop exports
• China’s ban on US agriculture hurts American farmers & Trump’s re-election bid

Fallacy #4: The World Will Side With The US Over China

This is a prime question – if they had to choose sides, would a given nation choose the USA, or choose China?

On one hand you have the debt-ridden oligarchy-ruled military state with a large consumer base or communist China’s cheap export market. What would they choose if they had to pick only one?

• The US consumer is nearly tapped out.
• China has the largest import/export market in the world.
• The vast bulk of manufacturing is in China.
• The US has little manufacturing to speak of.

I also question the validity of the idea that Europe or most other nations have loyalty to American markets. Think about it; do they really?

Do they see America as indispensable?

Or is the rest of the world being sent on a path towards globalism? Meanwhile the US is being made to look like a barbaric and archaic throwback. Like some kind of Neanderthal man that is desperately clinging to power. And one that is willing to drag everyone else down with him if he doesn’t get his way?

Many in the “liberty movement” understand that this is not the case.

We know that the globalists have sabotaged this country from within. We also know that they are using Trump as controlled opposition and a useful puppet in this task.

Ah yes, but the majority of the rest of the world does NOT understand this.

If there is an economic crash which sends shock-waves through multiple economies, the trade war will most likely be blamed along with Trump and his “populist” supporters.

The rest of the world will see us as the villains, because they do not understand the nature of 4^th Generation Warfare, nor do they understand the globalists’ strategy of “order out of chaos”.

The narrative that has been pushed in the global mainstream media is quite different than what you would see on FOX.

• China is the victim of US aggression.
• The trade war and the economic crisis are purely a product of Trump’s madness.

Who do you honestly think the world will eventually side with?

• Huawei dominates global race to 5G, inking over 50 contracts despite US crackdown

Fallacy #5:  The Trade War Will Be Over Soon

We’ve been hearing this for almost three years now.  Trade wars are “easy to win”, right? 

Every couple of months the trade war deal hype is recycled and every couple of months the markets are hit with renewed disappointment.  The latest trade talks are set for October and if they happen at all, it is unlikely they will result in anything of significance. 

At most, they will be heralded as the “start of a great deal” and both sides will claim “progress was made”, and then, once again, nothing will happen and the conflict will accelerate. 

You would think people would have figured it out by now, but the investment world learns very slowly and functions solely on blind hope.  At the very least, economic analysts are starting to realize that no deal is coming and that the situation is only going to get tenser. 

In fact, it is designed to get more tense.

Fallacy #6: The US Dollar Is Untouchable

This claim revolves mainly around the idea that because the US dollar is the world reserve currency, the US has the upper hand in all trade negotiations. Therefore, the rest of the world will follow the currency leader because there “is no other option”.

I disagree.

As Bank of England governor Mark Carney has openly admitted, the plan is to replace the dollar as the world reserve currency anyway. How? Well with a global cryptocurrency, of course.

They need a massive crash event, and they need the US dollar to go the way of the dodo.

It seems rather convenient to me that China has been preparing for just such an event. While many analysts point out that China has generated intense amounts of debt over the past decade, they seem to forget that this was a requirement in order for China to attach the Yuan to the IMF’s Special Drawing Rights basket. This is, of course, the foundation for a global currency mechanism. 

Chinese economic officials and the globalists both argue that the current monetary system, based on a single national currency (the dollar) as the world reserve is inherently unstable.

Their solution?  A basket of currencies monitored by the IMF, followed by a single digital currency mechanism. 

I would note that China and the globalists have consistently hinted  that a major economic crisis event will act as a catalyst for this  “reset” in the world monetary order and that the dollar must be replaced  in the process.

China has also been stockpiling large amounts of gold for the past decade. This would indicate they are expecting a monetary devaluation event, most specifically in the dollar.  It’s as if they know something the rest of us only suspect.

The trade war is the perfect cover for the collapse of the US dollar that the globalists desire. While some people suggest that China’s dumping of US treasuries is the “nuclear option” in the trade war, this is not exactly true.

The REAL nuclear option is for China to dump the US dollar as the reserve trade mechanism and go to a basket of currencies, which the IMF will happily aid them with.

As the largest exporter/importer in the world, China can drop the dollar and most of their trading partners will follow their lead. The US economy would crumble in response, as the dollar is the only thread holding our system together.

This is a FACT, Jack.

This is the ugly truth behind the trade war. It is nothing more than a farce, a smoke and mirrors distraction leading up the dismantling of the US dollar and paving the way for the globalist one-world digital currency system.

Whether or not the plan succeeds relies on ample resistance from people who see the danger ahead. However, make no mistake, the globalists are not afraid of an economic crash or the decline of the dollar. In truth, they WANT these things to happen so they can establish even more centralized control.

Updates

 Hot off the presses! We surveyed our members on how they are adapting to the US-China Trade War and have some surprising comparative data here from a previous survey in January 2019.  

Long story short: European companies have resigned themselves to the long-term nature of the trade war, and many have made significant shifts in strategy to mitigate its effects. That means changing suppliers, rejigging product flows through corporate global operations, and avoiding the US-China trade 'border' like the plague.  

Interestingly, roughly the same number of companies that are moving relevant production out of China (8%) are increasing investment in China (6%) as companies decide to move out affected production or further onshore supply chains respectively to avoid the tariff bite.  

However, the effects of the uncertainty coming from the trade war are increasingly significant. In January, 6% of members said they were delaying investment/expansion decisions in reaction to the conflict. That number climbed to 15% in September. 

-European Survey

Conclusion

The “Trump Trade War” is a natural progression of events that were bound to occur sooner or later. It will eventually precipitate numerous events. One of which will be a global currency. Another will be a strong ascendancy of China in the global stage. As well as some serious internal economic readjustments (collapse, maybe?) in America.

We will sit by and see what happens.

Personally, I hope that any changes that occur to be a painless as possible. To endure the changes, you might need to turn off the mainstream American media which will be shrieking, wailing, gnashing it’s teeth and flaying it’s arms all about in wild, crazed abandon.

12OCT19 Update

 Trump said the U.S. and China have "agreed in  principle" on a preliminary trade agreement. Trump acknowledged that  differences remain on major issues on which the two countries are  divided, but the White House still decided not to push ahead with a  planned increased to tariffs on $250 billion of Chinese goods next week.
The move would have raised those tariffs to 30% from 25%.

"There's  too many factors at play for him to just issue threats to governments,  China's or anybody else's, to just follow along with what he says," said  Wang, referring to the U.S. president's previous threats to slap  additional penalties on Chinese goods.

-USA Today;  Senior China adviser: Trump to blame for delays in securing final trade deal, says China has been 'accommodating' 

Take a break

I know all this is very serious stuff, and a tad alarming. I would suggest that you might want to check out some of my lighter articles. Here’s four stories for starters. All open up in a separate tab for your viewing pleasure. Pick one and relax.

Links about China

Here are some links about my observations on China. I think that you, the reader, might find them to be of interest. Please kindly enjoy.

China and America Comparisons

As an American, I cannot help but compare what my life was in the United States with what it is like living in China. Here we discuss that.

The Chinese Business KTV Experience

This is the real deal. Forget about all that nonsense that you find in the British tabloids and an occasional write up in the American liberal press. This is the reality. Read or not.

Learning About China

Who doesn’t like to look at pretty girls? Ugly girls? Here we discuss what China is like by looking at videos of pretty girls doing things in China.

Contemporaneous Chinese Music

This is a series of posts that discuss contemporaneous popular music in China. It is a wide ranging and broad spectrum of travel, and at that, all that I am able to provide is the flimsiest of overviews. However, this series of posts should serve as a great starting place for investigation and enjoyment.

Parks in China

The parks in China are very unique. They are enormous and tend to be very mountainous. Here we take a look at this most interesting of subjects.

Really Strange China

Here are some posts that discuss a number of things about China that might seem odd, or strange to Westerners. Some of the things are everyday events, while others are just representative of the differences in culture.

What is China like?

The purpose of this post is to illustrate that the rest of the world, outside of America, has moved on with their lives. That while they might not be as great as America is, they are doing just fine thank you.

And while America has been squandering it’s money, decimating it’s resources, and just being cavalier with it’s military, the rest of the world has done the opposite. They have husbanded their day to day fortunes, and you can see this in their day-to-day lives.

Summer in Asia

Let’s take a moment to explore Asia. That includes China, but also includes such places as Vietnam, Thailand, Japan and others…

Some Fun Videos

Here’s a collection of some fun videos taken all over Asia. While there are many videos taken in China, we also have some taken in Thailand, Vietnam, Cambodia, Korea and Japan as well. It’s all in fun.

Articles & Links

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