Politics is full of spin, hypocrisy, double standards, and contrived emotional outbursts. And geopolitics adds theft and murder at scale to the ignominious traits of politics. So, let’s skip all the sensationalism and analyze what are the real implications and choices for the US, China and India — the three impactful players making waves recently.
Every country has the same goal — to stabilize its internal politics first and then increase its influence as much as possible beyond its borders. A few countries manage to establish regional hegemony; and a handful of countries evolve into bigger empires and enjoy the spoils for decades or centuries. With 800 military bases in 140 countries, a global reserve currency, technology leadership, and dominance over global media, America is the biggest and baddest empire of all.
But now the US Empire is on an undeniable decline and faces some serious challenges for its long-term sustenance. Let’s take a look.
US Goals and Strategy: America’s public enemy #1 is China, for obvious reasons. Unlike any other rival before, China threatens America’s dominance in multiple spheres of influence — economy, finance, military, technology, and diplomatic influence.
The US economy is bigger than Germany, Japan, India, UK, France and Russia combined! But … China is another story.
In 2020, people around the world — including Americans — can’t believe that China can surpass the US. However, nobody will doubt it by 2025. Look at the chart below that shows the relative size of China to the US from 1990 until 2030. (This is the ratio of China’s GDP to US’ GDP. Also note that we are comparing nominal GDP; in terms of purchasing power, or PPP GDP, China surpassed the US in 2014).
In 2025, countries will start switching their allegiance to China. Everybody loves a winner; and the trend is your friend.
The US has two options regarding China:
- Plunge into the Thucydides Trap and try to halt China within the next five years. Wage hybrid wars from all fronts. For example:
- Try to destabilize China from within using Uyghurs, Tibetans and Hong Kong protesters. Maybe send jihadists from Afghanistan and Syria into Xinjiang and blow up some BRI trains and oil/gas pipelines. (BRI is the Belt and Road Initiative project).
- Use China’s neighbors to wage proxy wars — India, Taiwan, Japan, Vietnam, Philippines etc. will be ideal candidates.
- Sanctions, trade wars and financial wars to kill Chinese hi-tech companies and wreck China’s economy. Work with Europeans to move manufacturing out of China.
- Coexist and Manage China: The options listed in the previous list are tough or even impossible for many reasons.
- The US is too intertwined and dependent on China. From antibiotics to rare earth minerals, and shoes to smartphones, the US is almost entirely dependent on China. It will take many years and tremendous amount of investments to change the supply chains.
- Furthermore, every major US corporation has a huge presence in China, where the world’s largest middle class exists. From 4000+ Starbucks stores to Tesla, Apple and JP Morgan, US corporations have invested too much in China to just walk away. Trump failing to win the trade war against China should be an eye-opener.
- Finally, China has 300 nuclear bombs and hypersonic missiles that no US missile defense system can stop.
At some point, Americans must realize that China becoming #1 in GDP is not the end of the world or of America. The #1 and #2 could complement one another. Sharing power is better than fighting to the bitter end to maintain absolute hegemony.
Thus, the best option would be to be a “frenemy,” and throw as many “reasonable” obstacles as possible on China’s path — irrational trade wars, trying to kill Huawei & TikTok, and arresting Huawei’s CFO are definitely unreasonable.
China’s Goals and Strategy: For the Chinese government, the big picture goal is to be a developed nation by 2050. China hasn’t forgotten the Century of Humiliation and colonialism. For them, the return of China to the global stage is only natural and fair. The last 40 years have been some of the best years in Chinese history and they don’t want to ruin it by disastrous wars.
Bruce Lee said in a movie, “My style is the art of fighting without fighting.” It’s also based on Sun Tzu’s Art of War. Thus, China will try to do the following:
- Make sure that the Chinese hi-tech companies can keep getting semiconductor chips and other components to survive for a few more years. Meanwhile, develop domestic champions who can lead to independence from USA.
- Evangelize DCEP, China’s digital Yuan, and get as many countries as possible to adopt it. Weaken the US dollar, and you drain the blood out of the US empire.
- Make alliances and deals with as many countries and leaders as possible to ensure open markets, supplies of raw materials, UN votes, and PR help.
- Ensure that Europe doesn’t join the US. If Germany and France are happy with China, then EU won’t join any disastrous trade, tech or hot war provoked by the US.
- A military alliance with Putin’s Russia will be an insurance against America’s nuclear first-strike. And create an arsenal of 100+ hypersonic missiles with nuclear warheads that can reach the USA.
- Neutralize Japan and India, at least to some extent. Recruit Japanese and Indian business leaders and lobbyists, who would help stop outright wars.
- Help Iran, Iraq and Syria, which would force the US to divert more resources into the Middle East.
- Slowly strengthen the Yuan, which will increase the standard of living of Chinese people and encourage the shift towards a more consumption-based economy. (Already, exports are only 18% of China’s GDP). Also, a stronger Yuan means larger GDP in US dollars. Thus, for example, if the Yuan appreciates by 20% over the next five years, then China will be #1 economy by 2025.
- Work on soft power. China’s soft power and propaganda techniques are so weak that even ethnic Chinese people in Hong Kong and Taiwan are pro-US.
India’s Strategy and Goals: India’s short-term future isn’t so great, as I explained in a previous blog. India would be wise to hedge its bet. Why antagonize the future global leader? If China becomes #1 in 2025, it may seek to punish India. Already, almost all of India’s neighbors are pro-China and some of them are anti-India as well.
- Encourage Chinese investments in India. Play China against the US and get the best deals.
- Let Huawei into India’s 5G. Then, the US will be able to spy only on half of all Indians. Huawei’s technology has been put through a fine-tooth comb by the British and the Europeans. That’s why the UK has said it won’t remove Huawei from the 5G network for another seven years.
- Don’t be a geopolitical pawn. India doesn’t gain anything by starting an economic or hot war with China.
- Accept both China and the US as the “bigger brothers.”
- Singularly focus on growing the economy for the next decade. When India’s economy is half as big as China or the US, it can start thinking about global aspirations.
The problem with the world leaders is that many of them are caught up in their own ego. Then they lose sight of facts and act irrational. And the think tanks and mainstream media are all bought and paid for by the global elites. The common masses are clueless and xenophobic bunch who confuse jingoism with patriotism.
Very few times in the history of the world has a smooth transfer of power occurred from a declining #1 power to a rising #2 power. Let’s hope that China and the US will be an exception. Else, the entire world is in trouble…