The following item from today's Chinaview is another reminder that America's and China's economies are becoming inextricably intertwined. Condi's whirlwind tour (as always!) follows an another whirlwind tour earlier this year but, more importantly, follows her deputy Robert Zoellick's stay of several days earlier this year.
By withdrawing their loans to the US Treasury -- or even by not buying bonds at the same rate as heretofore -- China, Japan and Korea could bankrupt America immediately. They wouldn't do that, of course. because they'd damage themselves just as badly because they still need America for their exports. But, as the south-east Asian market domestic expands, there'll come a time when they won't need America quite as much and this is what must be exercising the US State Department and Bernanke, Bush's economic advisor, greatly.
I am think that the invasion of Iraq was, in fact, America's last desperate throw to hang onto cheap oil in large quantities. Its top energy experts must have known some years ago that Saudi Arabian supplies were on the brink and could only be sustained by forcible pumping of compressed air into their largest fields. But, so far, there has been no possibility of developing the northern oilfields of Iraq -- which now must the largest in the world. I think Bush is a great deal more desperate than we imagine. Just when are those oilfields ever going to start getting developed? It would take at least 5-10 years before they could take up the slack of declining Saudi Arabian exports to America and there's no sign of anything being started yet. The western oil corporations won't develop those fields until there's a legitimate government in Iraq -- or at least in the northern and central regions containing the unexploited oifields.
I think that the true interpretation of America's militarism is not so much that it's more innately militaristic than any other country but that America is peculiarly vulnerable to oil supplies. Its invasion of Iraq was a sign of desperation and it's getting worse. And a desperate person or country is a great deal more dangerous than a greedy one -- as I used to tell my children if they thought the house was being burgled.
On the surface, several of the more stupid Republican Senators are raising anti-Chinese voices but, privately, Bush and Cheney know that America is in a predicament. They've probably briefed leading Republican Senators such as McCain but they can't brief them all or some blabbermouth would certainly let the cat out of the bag sooner or later. But more than anything, Bush and Cheney need the goodwill of China even though, as an entity, it is also an economic competitor.
One of the interesting things about the Chinese bid for Unocal versus Chevron's is that they also work closely together on many oil production matters in Asian oilfields. There's a "Chinese wall" (!) within Chevron between those departments which are competing with CNOOC and those which are working amicably with it. Exactly the same now applies to the relationship between America and China at a political level. They'll both make noises against one another on some matters (trivial ones like tariffs against Chinese-made bras, for example) but on other issues they'll sink or fall together.
Keith Hudson
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CONDOLEEZA RICE'S VISIT TO CHINA
Beijing -- US Secretary of State Condoleezza Rice is scheduled to arrive here Saturday evening for a whirlwind visit as guest of Chinese Foreign Minister Li Zhaoxing.
China is the first leg of Rice's four-nation Asian tour aimed primarily at finding ways to resume stalled six-party talks on the Korean Peninsula nuclear issue. During her stay, Rice is expected to confer with Chinese President Hu Jintao, Premier Wen Jiabao, and State Councilor Tang Jiaxuan and hold talks with Li Zhaoxing, on bilateral relations and international and regional issues of common concern, according to sources with the Foreign Ministry.
Besides China, Rice will also go to Thailand, Japan and the Republic of Korea. Before her departure, Rice told reporters Friday the United States had no "timetable" for the Democratic People's Republic of Korea (DPRK) to return to the stalled multilateral negotiations aimed at ending its nuclear weapons program and would "keep opening doors" in a bid to jumpstart the talks. She expressed confidence in the US-China cooperation in the promotion of restarting the six-party talks. This will be Rice's second trip to China in less than four months. Her first China visit in the capacity of US Secretary of State was made on March
20.
Xinhuanet -- 9 July 2005
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Keith Hudson, Bath, England, <www.evolutionary-economics.org>
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