CAMBRIDGE (USA) — the US President, Donald trump continues to destabilize the postwar world economic order, while most of the rest of the world collectively held its breath. Commentators look for the words that would describe his attack on traditional norms of leadership and tolerance, typical of modern liberal democracy. The mainstream media, faced with a President who is sometimes very ill-informed, but nonetheless, truly believes in everything he says, don’t hesitate to call demonstrably false statements lies.
But there are those who would argue that the basis of all this chaos and noise generated by the chaotic withdrawal of the administration of the trump of globalization, lies the efficient cause. According to this view, the U.S. was foolish in allowing China to rise, and someday Americans will live to regret this. We economists tend to think of the abdication of the U.S. from world leadership as a historic mistake.
It is important to understand that the roots of the anti-globalization movement in the United States extend much deeper are unhappy with the hardship of the workers. For example, some economists have opposed the TRANS-Pacific partnership (a trade agreement of 12 countries, which accounted for 40% of the world economy), because it allegedly could harm American workers. In reality, the TPP would open markets in Japan are much stronger than could affect US. The rejection of this agreement only opens the door for Chinese economic dominance in the Pacific.
American populists, inspired, apparently, the works of Thomas Piketty, it seems, is not impressive by the fact that due to globalization hundreds of millions of desperately poor people in China and India rose to the level of the global middle class. According to the liberal point of view, the rise of Asia makes the world a more equitable place to live, so, where the economic fate of a man depends too much on where he happened to be born.
However, the logic of populist permeates more cynical view of the world: because of its excessive commitment to globalism, the US sowed the seeds of its own political and economic destruction. Tranism uses this sense of national mortality; we are dealing with someone who thinks that anything to do with it. The aim is not just that the “return home” American jobs, but to create a system that will expand American dominance.
“We need to focus on yourself” is the mantra of trump and others. Unfortunately, with this approach, America is unlikely to maintain the world order, which for decades has brought her so many benefits. Make no mistake: America is much won. No other major country is not even close to now is so rich, and, judging by world standards, the American middle class, things are still very good.
Yes, presidential candidate, Democrat Bernie Sanders was right in saying that Denmark is a wonderful place to live and they are doing a lot right. But he might mention that Denmark is a relatively homogeneous country with a population of 5.6 million people who have very low level of tolerance towards immigrants.
For better or worse, but the train of globalization has long departed, and the idea that someone is able to get it back, is extremely naive. Everything else could be done as something different to the trip of U.S. President Richard Nixon to China in 1972, it is now impossible. The fate of China and its role in the world is now in the hands of the Chinese and the leadership of this country. If the administration trump thinks he can start all over again, unleashing a trade war with China economic and military development of China can not only slow down, but equally likely to accelerate.
So far, the administration trump only contend with China, concentrating his first attack against the international trade in Mexico. The North American free trade agreement (NAFTA), which trump so much abuses, had only a moderate effect on U.S. trade and jobs, but he still tries to humiliate the Mexicans, insisting that they paid for it a border wall, as if Mexico is a colony of the United States.
USA very lightly began to destabilize its Latin American neighbors. In the short term, Mexican institutions can be quite stable; but in the long term tranism, fueling anti-American sentiment will weaken leaders who otherwise would be sympathetic to American interests.
If the property is trump’s attempt to apply such crude tactics against China, it will be a harsh surprise. China has the financial weapons, in particular, us debt in the trillions of dollars. A failure in the trade with China can result in powerful growth of prices in five and dime stores, for example Wal-Mart and Target, which are many Americans.
In addition, a large part of Asia, from Taiwan to India, would be vulnerable to Chinese aggression. Now the Chinese army comparatively weak and, most likely, in a traditional war with the United States she would have lost, but the situation is changing rapidly. China may soon acquire its own aircraft carriers and other advanced military equipment.
America cannot “win” a trade war with China, any victory will be Pyrrhic. USA need to engage in tough negotiations with China to protect its friends in Asia and to solve the pariah state of North Korea. And the best way to get good deals, which seeks, according to his own words, trump — to a more open trade policy with China, not destructive trade war.