I’ve worked in the investment analysis industry professionally over the past four years. In addition, I’ve written several blog posts in the alternative press for far longer. Never have I consistently wrote about a single topic more frequently and over a tight timeframe than the trade war.
Of course, I’m referring to rapidly escalating tensions between the U.S. and China. Throughout most of 2018, the top-two economies of the world exchanged retaliatory tariffs. For the Trump administration, the trade war is about fair and transparent scales. The White House alleges that China has repeatedly and brazenly stolen intellectual property, undermining international laws and norms.
On the other hand, China is a traditionally minded nation. It has a rich culture that extends back multiple centuries. While they clearly have an eye for the future, they have not forgotten the past. And such deeply embedded ties means that certain protocols exist for addressing conflicts.
Calling people out and causing them to lose face is a big no-no in China. Despite President Trump largely owning the moral high ground, the manner in which he prosecuted the underlying issues weren’t helpful. Indeed, his rough behaviors sparked the second round of the trade war.
Nevertheless, China isn’t primarily interested in fair trade with the U.S., which complicates matters.
Trade War Is About Playing the Long Game for China
Let me back up: of course, the Chinese government wishes to normalize relations with the U.S. A substantial reason why the Asian juggernaut achieved its current lofty position stems from our robust consumer market.
That’s a cute way of saying we buy their crap!
As an exporting nation, China can’t afford to lose its most viable and lucrative market. Most likely, pressures from both abroad and within their borders may bring them to the negotiating table. The communists vow they will not acquiesce but money always talks.
That said, China could surprise everyone with their resolve. Their national media has consistently brought up the idea of playing the long game in this trade war. Unlike other petty threats in the past, I don’t think we should ignore this one.
After all, the Chinese don’t want to trade in a fair and equitable platform. That would mean playing by the rules. Certainly, it would entail not stealing intellectual property.
But in an emergent China desperate to lead the 21st century and beyond, fairness never comes into the equation. Instead, they’ve chosen to steal their way to the top. From there, they can start imposing their long-term, hegemonic goals.
It’s a dastardly trick, but par for the course for communist nations.