Crossing the Pacific by feeling the stones
The Chinese have a saying that arose from the Long March—crossing the river by feeling the stones. In a situation of grave uncertainty—how deep the water is—you can only cross the river by slowly taking one step at a time, making sure that the next stone is firm enough for you to step on before you take the next step. If you are wrong, you change course and feel for the next stone.
During the Long March, the PLA soldiers had to crisscross many rivers and stones, with the enemy behind them and possible enemies across the river, but they made it by taking bold steps forward, but repeatedly retreating or re-crossing many rivers when the way forward was blocked.
This pragmatic approach towards dealing with uncertainty is a direct descendent from Ming Dynasty philosopher and warrior Wang Yangming's dictum of "knowledge and action are one." In a situation when existing theory and knowledge cannot guide you, only action can reveal the next steps forward.
We have arrived at a moment in history when knowledge and theory cannot guide us. Bold steps are necessary to move forward or to retreat. Those who hesitate midstream will be swept away by the next flood.
The last few months seem to widen the river between the US and China into the Pacific Ocean, with escalations in words as well as action. Vice President Michael Pence's speech was interpreted as the opening salvo in the New Cold War, and the unprecedented inability to arrive at a joint communique at the Papua New Guinea APEC Summit was a clear signal that the gulf between the two countries is widening.
Most analysts are looking forward to the forthcoming Trump-Xi meeting at the G20 meeting to cool down the rhetoric and enable some forward movement. But it is clear that Trump and Pence are only reflecting a widespread consensus that China is the US strategic competitor, with a deeper swing towards more inward protectionist trend as America regroups its energy away from globalisation.
Steve Bannon's Oxford Union speech sums up this mood. The American people are angry at their elites—the industry-financial-political complex—who spent USD 7 trillion in futile wars in Iraq and Afghanistan, lost 2.4 million jobs to foreigners, and printed over USD 3.4 trillion in money to keep the rich richer, making hard-working Americans poorer than ever. The Trump promise therefore is to restrict immigration and engage in a trade war with China in order to "maximise citizen value," a variation of corporate "maximise shareholder value."
There is little doubt that America's trading partners, China as well as Europe and Japan, were wrong-footed by this profound change in direction. From now onwards, it can be no longer business as usual. America is "deconstructing" the multilateral order that she built over the last 70 years and embarking on a bilateral negotiation stance that will force her allies to pay for their own defence, reduce bilateral trade deficits and play by US-decided rules.
America can do this not because she is the strongest militarily, but because she is the largest consumer in value terms in the world. The buyer is always right, not the seller. As former Chongqing mayor Huang Qifan insightfully pointed out, a strong exporter is not a strong nation, but a large importer is the real powerhouse. Strategically, China sees already that domestic consumption and imports will be the way to go.
The Cold War of the 1960s is not the right analogy for today, because the Soviet Union was never a major global trader. China today is instead the largest trading nation in the world, with more trading partners than the US. With the global supply chain centred around assembly in China of raw materials and components around the world, that supply chain can be transformed but not disassembled easily. The trade war is actually a disentanglement exercise in which there will be few winners in the short-term, with unpredictable long-term consequences.
The best example of how difficult it is to disentangle cross-border relationships is Brexit. After two years of hard negotiations, the Brexit deal proposed by Prime Minister Theresa May is lose-lose for all. The United Kingdom cannot keep the benefits of free trade with Europe without yielding its sovereign rights to jurisdiction by the European court. Europe cannot afford to let Britain leave easily without itself being hurt by leavers. And there is no way that either Europe or America can exit their Middle East entanglement without hurting Israel and themselves. A failed Middle East and North Africa will increase the annual flood of migrants to Europe by millions.
Historian and political philosopher Francis Fukuyama famously predicted the End of History at the end of the last Cold War, in which the West seemed to have conquered history through democracy and rule of law. What we have witnessed instead is the Revenge of History, Geography, Demography and Climate Change. At a time when the world should be cooperating to deal with worsening climate change, social inequality and disruptive technology, the divide in views is even wider than the Pacific Ocean.
Seen from this side of the Pacific, the Asian people have for the last 70 years been chasing the American dream, realising that they have destroyed their youth, natural environment and health to chase a piece of greenback paper that may be worthless if war is declared. The American rhetoric that Asian trade has been unfair should be seen from the Asian perspective. Trying to consume like the average American consumer has been terrible in terms of carbon emission and destruction of natural forests, rivers and marine reefs.
Asking Asian exporters to choose between America and China is like trying to disentangle a tapestry woven over many years at many levels. This side of the Pacific, no one wants to cut the threads that bind us all. But if America wants to go it alone, then the Asian narrative will be spun very differently from now onwards.
Andrew Sheng writes on global issues from an Asian perspective.
Copyright: Asia News Network