Can Offshore Balancing Be More Realistic For The United States’ Foreign Relations?

Although the United States’ old grand strategy was almost forgotten since the fallen of the Soviet Union, but after so many unfinished businesses around the world such as in Afghanistan and elsewhere the United States may have to revisit an old grand strategy which is known as offshore balancing.  According to Stephen Walt in the video right after the break, he suggests that the United States would be better off in foreign relations in applying offshore balancing for foreign relation building.  Offshore balancing may save the United States from overspending in foreign policy matters, but offshore balancing isn’t discouraging in building healthy relations with foreign powers.  Perhaps, if offshore balancing is done right, the United States may have even more friends than enemies while building a stronger nation at home.  Anyhow, I guess no known strategy is invulnerable to everything, and so offshore balancing may not always be best for certain situations.  In my opinion, Stephen Walt does sound very convincing in his argument that the offshore balancing may help the United States navigates the evermore dangerous globe in a more efficient and healthier manner.

Besides South China Sea, United States Is Now Facing A China Which Just Joined Up With Bashar al-Assad’s Regime In Syria

An ocean away, the Atlantic that is, and so I kind of being ignorant to what is really going on in the Middle East.  Still, I’m surprised to see China is now sending military advisers to Syria so China can aid Bashar al-Assad in fighting against the rebels and other extremists.  Meanwhile, Russia is bombing the extremists (i.e., ISIS/ISIL) in Syria from Iran’s military airbase.  Putting these facts together, it’s now clear that China is joining in to help Russia, Iran, and Syria in fighting against the rebels and extremists that are trying to collapse Bashar al-Assad’s government.  Lately though, it seems that the ISIS/ISIL forces are being scattered and being stamped out of Syria, because Russia is still stepping up to drive these forces out of Syria.

Since China’s economy keeps on growing, it needs energy supplies such as oil from the Middle East to secure Chinese future, and so China is going against one of the creeds that China has always held dear most — which is not to interfere with internal matters of another country or region.  Furthermore, China is looking to realize the grand plan of connecting Europe and  everything in between to China through the One Belt One Road (or Silk Road) initiative/project.  With such a grand plan, China needs the Middle East to calm down much more to ensure the safety of the people, companies, and whatever that are involving in developing and realizing the grand Silk Road project.

Since China is now slowly forming a coalition with Russia and Iran, I wonder how Europe is going to react to this.  China is key in Russia’s plan, because China is a very big business partner of most countries in Europe.  The United States may have her plate full from now on, because Europe could decide to be less helpful to the United States since China is now joining in the Middle East’s mess.  If things keep on getting escalating, I think Europe would have less appetite in seeing business with China goes sour, because we’re talking about peace and prosperity in long term here.  Still, Europe could also decide to help the United States fight against China/Russia/Iran coalition, because Europe has a special relationship with the United States.

Whatever the case, it’s bad for the United States, because the United States is still supporting the rebels — who are trying to collapse the government of Bashar al-Assad’s regime.  Check out the video right after the break to see the news on China joined up with Bashar al-Assad’s regime to fight off ISIS/ISIL and the rebels.

Should China and the United States Go To War?

The United States stated she will sail her warships within China’s manmade island’s or islands’ 12 nautical mile, and China openly replied that it would not allow any country to violate its territory.  In coming days, if United States indeed will sail within China’s manmade islands’ 12 nautical mile and if China is indeed going to use force to stop the American warships from entering the area, we may have an uncontrollable situation in which it’s insane just to fathom about the possibility of a situation like this to occur in the first place.  The biggest question is what will happen after if China indeed sinks a ship or two that belong to the United States?  Will the United States go to war with China if such an aftermath would occur?  Who will push the red nuclear button first?  We cannot take China as Iraq, because China got so much more capabilities than Iraq could ever wish for.  China knows United States, although economically weaker by days and months, still has a very strong military and so facing the United States won’t be a walk in the park either.  It just happens that Intelligence Squared Debates program got a debate show in which it asks the debaters to actively debate on the question of “Are China and U.S. long term enemies?”  The video is right after the break.

The long term enemies part the video may get it wrong, because countries don’t look at each other as buddies but potential competitors or pawns or necessary evils or enemies.  It isn’t strange when I stated like that, because it’s true.  Basically, nobody knows how the United States and China will behave toward each other in a much longer term.  Nonetheless, at the present time, United States and China are clearly on the verge of starting a dangerous proposition in which neither country may want to back down, consequently leading to a global war.  If China and United States are at war, the war environment won’t be a vacuum space in which the participants are only China and the United States.  In fact, I believe that a war between these two giants will pull in all sorts of countries that choose sides.  Even a country wants to be neutral in such a scenario may not have a choice to do so, because geographical reason or whatever, one or both giants may want to push such a country into war anyway.

We can have a debate all we want on how long U.S. and China would be enemies, but if someone is crazy enough to think that it’s sensible to have China and United States go to war, we cannot rule out a situation in which nuclear weapons would fall off from the sky in both directions toward both countries.  By the way, Russia is China’s neighbor.  If Russia sees nuclear missiles from the United States heading toward the east, what do you think Russia will do?  If I’m a Russian leader, I would definitely think that the nuclear missiles are heading my way, and so I must reply in kind with my own nuclear missiles.  Meanwhile China too would be in panic and push the red nuclear button.  From my understanding, both China and Russia together have more nuclear weapons than the United States.  It’s not a situation I like to see for sure, because I don’t want to see my life and countless other people lives to be wasted away in seconds for power politics in geopolitical common sense.

In my opinion, geopolitical common sense is opposite from treating thy neighbor the way you want to be treated common sense, because geopolitical common sense is about not having to lose one’s position, power, and so on.  To put it bluntly, nobody wants to be a little guy, because being a king is always better.  A king can have his way, and a little guy will often have to swallow a hurtful pride.  Nonetheless, whenever we include nuclear weapons into the equation, it’s hard for a sane person to think it would be possible for United States and China to go to an all out war.  Perhaps, one side likes to think that such an all out war is insane, and so a controllable war would be possible.  One side may think that at some point, a situation got to a point that nuclear weapons may be used, they could negotiate deals to unwind down the war and nuclear weapons will not be used.  Unfortunately, in a war, I don’t think it’s that easy to control or wish a situation to occur the way we like it.  Thus, we may want to unwind the war down in a war in which nuclear weapons would be used, the enemy may not know our best intention and misread the intention somehow and nuclear weapons would be used anyway.

It’s scary to see the biggest boys on the block with nuclear weapons are about to strangle each other out.  Right after 9/11 of 2001 terrorist attack on World Trade Center’s twin towers in New York, time had become ever more dangerous.  It’s cliche to say that we are living in an interesting time, but I think cliche or not we are actually witnessing a time in which humanity is at risk of losing the sanity of it all.  What is even crazier?  It is that in a time in which I attended middle school, a time in which it was way before 9/11 of 2001, I had read something from a book in which a title I totally have now forgotten, and this something predicted the explosion of a major landmark in New York.  On 9/11 of 2001, I could not believe of what I’d witnessed on that day, and it reminded me a prediction I’d read in a book way back then.  How could a prediction be so true even though prediction is purely a fiction?  In my opinion, prediction is a fiction unless it becomes real.  Today, some people like to use bible prophecy which had been written eons ago to predict a war between China and the United States.  I want to say this, be careful of what you wish for!  A prediction may come true if we believe it and allow it to happen.

China’s Aircraft Carrier Entered Tartus To Support Russia and Iran In Syrian Force Building

Something big is happening under the surface, but we have no idea what is going on.  Basically, security-intelligence.org’s article “DEBKAfile Exclusive Report: A Chinese aircraft carrier docks at Tartus to support Russian-Iranian military buildup” suggests that China’s aircraft carrier Liaoning has docked at Syrian port Tartus to back the Russians up on building up forces in Syria for fighting against ISIS.  I’m not very well informed with the Middle East and Syria situations at all, but this news tells me that united force building of Russia, China, and Iran in this region prepares for something big.  Perhaps, fighting ISIS is only a piece of the puzzle, because ISIS isn’t strong enough to encourage China, Russia and Iran to combine forces and take actions in this region.  Without China in the picture, I think the overall picture of the Syrian conflict was murky but somewhat clearer than how it’s now.  Meanwhile, China is cooperating with the United States in boosting trades and agreeing on cyber security.  Nonetheless, geopolitically, China is helping out Russia and Iran in securing Bashar Assad’s power in Syria.

As Long Humans Won’t Go Insane, M.A.D. Still Matters For Some Time To Come

I’m a keyboard warrior, and here is my theory on what if U.S.A. and China would go to war against each other.  I’m not an expert in military weaponries and technologies, and so I’m not even going to try to be specific in details.  Read on to see what I got in mind.

Many people would think China would go to war with Philippines and Japan before they would attack U.S.A., and I think this is unlikely.  Only if Philippines and Japan provoke China in unbearable way, then China would attack these two countries.  Nonetheless, if I’m in charge of China, I would not think Philippines and Japan would dare to provoke and attack China first.  Thusly, I would only draw out secondary defensive plans, with care though, to address the what if Philippines and Japan attack China.  The primary plan which to address the priority would be going to war against U.S.A., because — at this point in human timeline — U.S.A. is the only foe in the world that would dare to truly challenge China right in the open, conventional or not.

Of course, in the between of everything, I don’t think China would be careless about little details, and so China would probably draw out plans to address diplomatic conundrums just so China could have an edge in world diplomacy.  Furthermore, China would want to make sure she knows who would side with U.S.A. when war truly breaks out between U.S.A. and herself.  Meanwhile, China is trying to scare Vietnam and her neighbors into submission, because this way China would get an idea of who will be against her for sure when war breaks out between U.S.A. and herself.  Vietnam is going to be capitulated between China and United States.  Simply put, Vietnam knows China will forever be her neighbor through geography, but she can use U.S.A. to push back against China when things get too ugly.  Other asian neighbors will think twice in challenging China, and so China would know of this too.

Russia would love to see China and U.S.A. go to war, because Russia wants to see two tigers on a mountain killing each other as she waits for her turn to swoop down and destroy both when the time and means are on her side.  Although it seems as if Russia is suffering consequences of economic sanctions and the turmoil in Ukraine, but Russia got time on her side to just wait things out.  Meanwhile, Russia is cozying up with China to leverage against U.S.A. and Europe in terms of military, diplomacy, energy, and economy.  Moreover, Russia would throw oil into the fire to flame things up between U.S.A. and China.  Thus, we will see Russia and China will strike even more deals in weapons, military, economics, and whatnot.

Europe is facing economic turmoils in several parts of her region.  I think China, Russia, and United States are befriending Europe on the surface but taking advantages of her underneath the surface.  After all, who could let go a bargain/deal or a momentous advantage in whatever, right?  Thus, we will see China, Russia, and the United States to partly be helpful but also partly be very unhelpful toward European countries in general.  Nonetheless, it’s possible that there are several European countries that aren’t expendable for military strategical reasons, thus we would see China, Russia and the United States fight for European friendships in this specific situation.  What military strategic reasons?  Don’t ask me, because Europe is a big place too, and so it’s obvious that Europe will have a role to play if a war between China and United States breaks out.

U.S.A. is trying to have her economy recovers from the recent financial crisis in 2008.  The recovery in the United States is truly slow, and so the United States does have her hands tie behind her back.  As China increases her military expenditures, the United States compels to spend money on keeping her military edge even though her economy is still not recovering.  China got Russia to supply some military technologies, but China is probably spending untold amount of money in research and development to develop her own in-house military technologies that would give her an edge over her foes.  Obviously, United States faces a difficulty in scaring China nowadays, because China is way stronger in terms of military and economics.  Thus we have seen China becomes more assertive in pushing United States out of the Pacific.  This way, China is going to have her own Monroe doctrine in the 21st century.  Of course, if United States refuses to allow China to have her own Monroe doctrine, China would probably do whatever she can to push United States out of the Pacific regardless.

China also got a backup plan to make sure her country isn’t too relying on the Pacific for energy and whatnot.  This is why we are seeing China proposes the modern Silk Road development.  This means China is creating a land route for her energy and trades just so in case she can circumvent the United States’ possible actions in the Pacific.  For an example, the United States can use her carrier fleet to blockade China from doing her normal operations in the Pacific, and this would hamper China’s trades and energy imports.  The Silk Road is like one arrow shoots two birds at the same time.  On one hand the Silk Road will boost the regional economies and in longer term would also keep China’s economy strong, and on the other hand the Silk Road would allow China to develop a second route to circumvent the possible Pacific blockades from her foes.

I can go on, but I’m just a keyboard warrior, and so let me summarize things up.  I conclude that if the United States will not allow China to have her own Monroe doctrine, China would do just about anything to push the United States out of the Pacific regardless.  I don’t see how China would allow the United States to contain her as she soars higher and higher.  Meanwhile, the United States has her plate full, but she probably tries to contain China regardless.  This will lead to the faster development of China’s modern Silk Road.  Furthermore, we will see Russia and China team up even more closely.  In this way, China/Russia alliance will try to win even more friends.  With both powerful countries (i.e., China and Russia) together they are more convincing this way in winning friends.  Basically, China and Russia are trying hard to isolate the United States in all fronts before a real war would break out.  Of course, things won’t go as plan if the United States or China decide to back down for world peace.  Nonetheless, I don’t know if there is any will in either China or the United States for backing down.  Sure, we still got M.A.D. to prevent an all out war such as a new World War (i.e., WWIII), but humans are capable of going insane.

Middle Income Trap Theory Is Not Perfect

Obviously, I’m nowhere near of anywhere to consider myself a knowledgeable person on the topic of economics, and to have myself even consider of dabbling with the topic of world economy is just ludicrous.  Nonetheless, I’m just like any other human who has imperfections, and so let me indulgently dabble with what I want to write next.  I have seen people talk of middle income trap this and that, but the uneducated me think the middle income trap is overrated.

When people talk of middle income trap pertains to a country, they tend to assume that such a country has uncompetitive edge in export market and (has) yet to be able to raise the per capita income level which can break out of the middle income status.  This idea/theory does have some merits (but must include the inflationary rates in the formula).  If a country is losing in export competition around the world and yet the per capita is still hovering around the middle income status, it’s true that such a country can be in for a struggle of improving the country’s economic status and people’s happiness.  Nonetheless, this theory doesn’t work for a country such as China or similar country to China.  Why?

China has 1.3 billion people, and their economy is still the fastest growing economy in the world which hovers around 7% of GDP growth.  When people think in term of percentage for GDP growth, they tend to over-rate the growth percentage.  When China’s economy was way way smaller than Italy, China’s GDP growth was hovering in double digits of GDP percentage growth, but now China economy is the biggest in Asia and way way more bigger than Italy — the GDP growth of China slows down to 7%.  This fact alone can argue that with bigger economic base and foundation, even at 7% GDP growth China can still bring in more revenues as a whole country than Italy can ever achieve even if we see Italy grows at 7% in GDP.  In reality though, if I’m not wrong, in 2013, Italy has around 2.1 trillion dollar GDP economy in nominal term, but the GDP growth is at -1.9% (negative 1.9%).  To sum this idea up, at 7% of GDP growth, China is still growing like she was around 10% or higher, because her whole economy is so much more powerful and bigger.

As China is slowing down in term of nominal GDP percentage growth, the world is fixated with the percentage growth in GDP and wondering if China may stuck in the middle income trap.  Some people, out of ignorance, are definitely loving to use the slowing down of nominal GDP growth percentage for China to make their point that China is going to stuck in the middle income trap if she doesn’t transform herself into a domestic consumption led economy.  I don’t like to delude myself and agree with such nonsense.  Not because I dare to think I’m smart and taking the road that less people walk and say that China doesn’t need to transform herself into domestic consumption led economy, but the facts on the ground are that China is getting richer — meaning when the Chinese average citizens have more money they automatically spend the extra money they have even though they are going to save a lot still.

I think China knows this, and this is why we are seeing China encourages the world to support her in building new land and maritime silk roads.  Instead of implementing policies that would transform herself into domestic consumption led market, China wants to have her cake and eat it too.  In China case, I have a feeling that she may achieve this objective.  Why?  The facts on the ground tell me that China is now the largest trading partner for most countries around the world, and so it’s logical for China not to be stupid and thinking that by letting go the export market and just ramping up the import market will make China richer.  It’s just common sense that I sense China knows this, and so this is why we are seeing China promotes more trades around the world.  The argument that China must transform herself into domestic consumption led is nonsense.  China takes 35 years to build up herself as the largest export trading partner with the world, why would she want to give all that up and get herself into debts by going the hyper-importing route?  The truth is that China is going to import more anyway since she is richer and wealthier, but she is going to do this in a natural manner.  Natural manner?  When her citizens get richer and wealthier, her citizens are going to demand for more import goods naturally with or without the intervention of her government’s import preset models.  One example would be China now has the largest automobile market in the world.

I’m writing this article to argue why people should not think the middle income trap theory is always going to be correct.  To think so would be a delusion.  Who would want to be delusional?  In the end the facts on the ground will always going to be freely available for people to understand.  As long China has the export competitive edge, she is going to be fine even if her per capita income isn’t higher than the middle income status.  Only when China loses her export competitive edge, that is when she finds middle income trap is troublesome.  Nonetheless, China is too smart to fix something that isn’t broken.  The proposal of the new land and maritime silk roads is one of the logical methods of how China is going to build a stronger export foundation to ramp up her future export market.  China is seeing weakness in her export market as the world experiences a big recession.  Europe and America and many other countries around the world are poorer now, thus the export market for China is naturally weaker.  As China is seeing this, she proposes the silk roads and establishes AIIB (Asian Infrastructure Investment Bank) so she can ramp up her export market and maintain her manufacturing hubs and capabilities.  If China is going to achieve this, even if China is still a middle income country for the next ten years, I think China is going to be just fine and her economy is going to grow even bigger than ever before.

China is also a special case in term of her foreign exchange reserve.  China has a surplus of around 4 to 5 trillion dollar foreign exchange reserve, and so she can use this to preemptively stopping weaknesses in her economy.  One example would be funding the AIIB that she is in process of establishing.  Furthermore, China is still pegging her Yuan to the Dollar, and so she can just tweak her currency the way she wants.  By being able to tweak her currency the way she wants, China can effectively control how she wants to get herself out of the middle income trap at the pace that she decides.  How?  By being able to increase or decrease the strength of Yuan according to the Dollar peg, China can dictate how much more stuffs her citizen can afford from import.  Rising Yuan would make her export weakened, but she can afford more from import.  Weakening Yuan would boost her export but weaken her import.  Instead of raising the wages of her people’s per capita income, China can just tweak her dollar currency peg to have the same effects as countries that have already escaped the middle income trap.

As long the United States’ Dollar is still the reserve currency of the world, I don’t think China will unpeg her Yuan against the Dollar.  Only when China can establish her own currency as the reserve currency of the world, this is when China will unpeg the Yuan from the Dollar.  Of course, if this to happen, I think China will be more careful in tweaking her currency and will consider of implementing policies that encourage higher wages/incomes for her people.  Nonetheless, if China’s Yuan becomes a reserve currency, she will have a lot of tools to get herself out of middle income trap easily.  Why?  Because world reserve currency has a lot of power!  The power to affect trade and world policies are two examples of a country that has her currency as a reserve currency for the world.  With huge export capability and manufacturing power, a Yuan currency reserve for the world will make China unchallenged for decades to come.  Nonetheless, it’s not that easy for just any country to turn her own currency into a world reserve currency, and the United States is going to challenge such a country for sure if that is going to happen.  I think we are going to see China and United States compete in currency arena for some time to come, because I think China is challenging the United States’ world currency reserve status as we speak.