Thursday, January 19, 2017


    The World Economic Forum has been going on this week in Davos, Switzerland. The US had very little presence there due to the transition in Administrations. Obama---who was humiliated by China at the G-20, ASEAN, and APEC meetings declined to attend this year and sent the hapless Joe Biden in his place.

    Like Obama at the previous conferences, Biden too was essentially snubbed by the over 3,000 international dignitaries in attendance. As if to put the final exclamation point on Obama's failed foreign policy, Chinese President Xi Jinping emerged as the clear world economic leader at the WEF.

    President Xi gave the keynote address at Davos, stressing the successes of China's New Silk Road Initiative, and the Asian Infrastructure Investment Bank. Most importantly for  the incoming American Administration, Xi encouraged Trump not to replicate Obama's blunders and instead seek a path of cooperation with China.

    "China will always keep the door open to trade," Xi stressed, "There will be no winners in a trade war. There is no point in blaming economic globalization for the world's problems. The root causes of the sluggish global economy stem from a lack of initiative, poor management, and uneven rates of development."

     Xi announced that during the coming 5 years, China expects to import a massive $8 trillion in goods; attract $600 billion in new investments in China; and garner $750 billion in foreign investment.

      The future of US-Sino relations is an open question at this point. Trump has appointed a very capable ambassador to China, but much of his rhetoric on China has raised concerns of a trade war. It is to be hoped that Trump will not take a hardline policy with China---that approach completely failed for Obama. The trap that Trump needs to avoid is falling for the Neocon illusion that Obama failed because he wasn't tough enough with China.

     Trump should take the same position with China that he's taken with Russia. Xi Jinping, like Trump, is basically a businessman and negotiator by nature. By the standards of recent Chinese leaders, Xi is something of a moderate who prefers diplomacy and trade to conflict. It could very well be, as some have speculated, that what we're really hearing from Trump is The Art of the Deal. His rhetoric is calculated to bring China to the negotiating table and trade concessions in the mutual interest of both countries. This would be the wisest approach. America actually stands to gain more from a reconciliation with China than with Russia.

      The basic problem with a trade war with China is that Protectionist policies do not build native industry---they only work when there's something to protect. China could, paradoxically, help revive American industry and infrastructure if we were cooperating more closely economically.

     This is another area where Trump can really demonstrate his leadership abilities: not as adversary with China, but a US-China Economic Partnership would be the greatest business deal of his life. The reason that China is dominating these recent economic conferences is because China comes to the table ready to make deals while America's under Bush/Clinton/ Obama has been coming to the table to dictate terms.

     Almost as if to underscore symbolically the new global paradigm: on the same day that Obama was boasting that his greatest legacy was so-called 'marriage equality'; Chinese First Lady Peng Liyuan was awarded by the World Health Organization for her humanitarian efforts in fighting HIV/AIDS. China solves problems; recent US Administrations exacerbate them.

     Time will determine what Trump's China Policy will be; but we have eight years of examples of what does not work. A fresh approach in this direction would be a welcome change.


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