Chinese World Domination: Defeating The United States Economically

In my Big Peace article, The Growing Potential of Chinese World Domination, I discussed nine points that I believe China needs to take in order to assure Chinese Communist security for the future and a world dominated by communism for the decades, if not centuries. This is the first in a series that will discuss each of these points in greater depth.

While in America we think of two hundred years as a long time for a political system to remain in power, history tells a different story. Ben Russell, writing in Wikipedia, lists 22 empires that lasted more than 500 years, with the Roman Empire lasting between 1500 and 1800 years. The Egyptian monarchy had a continuous line of pharaohs for over 3,000 years. A few centuries of Chinese Communist rule aren’t beyond the realm of possibility. In addition, the Chinese will have the advantage of advanced technology with which to assure their security and longevity.

The only way to beat a major competitor is by differentiating yourself from the competition or destroying them. Since we don’t believe in destroying our international competition, it is critical that the United States continues to be the more compelling alternative, that freedom and liberty remains a choice for the world’s countries and their people. If we fail, there will be nobody left with the power and influence needed to keep the Chinese Communists in check.

The Chinese are well aware that we are, effectively, their only competition for the minds and hearts of the world’s people. Therefore, assuming their ultimate goal is world domination, their first priority must be to defeat the United States economically. In fact, just defeating us isn’t quite enough; they really need to devastate our economy, leave us lying on the ground, belly up, begging for survival.

In Mona Charen’s article, “Raison Debt,” she quotes a chilling scenario from Governor Mitch Daniels’ new book, Keeping the Republic:

America’s decline, Daniels writes, may not be a gradual slide, but instead a sudden plunge into chaos. … “Monday, 6 a.m.– a Chinese official issues a statement saying that China will no longer be buying Treasury securities because ‘we see no evidence that the U.S. will take the steps necessary to grow its economy or limit its spending so it can afford to repay’ . . . Monday 9:30 a.m. — the dollar drops 10 percent . . . New York stock market opens in free fall . . . Monday afternoon — . . . other nations’ central banks begin to sell off U.S. Treasuries. . .”

It continues that way, with runs on banks, the dollar spiraling down, the Dow Jones crashing, Organization of Petroleum Exporting Countries (OPEC) denominating oil in something other than dollars, long gas lines, buying panics for necessities like food, shortages of consumer goods, and finally civil unrest and martial law.

This scenario is not an impossible fantasy; in fact, if we don’t face this threat head on, it’s a distinct possibility. There is no doubt, at the very least; we are in an economic war with China; we may very well be in a life and death struggle for survival.

The amount of America’s debt held by China is immense. According to the U.S. Treasury, as of June, 2010, China held 1.1 trillion dollars or approximately 25 percent of that held by all foreign holders of treasury securities. U.S. Representative Greg Walden puts it this way, “According to the Department of Treasury, China holds $1.154 trillion, or 12.1 percent, of our nation’s public debt. Our interest payments total $616.4 million per day; China’s share is $73.9 million every 24 hours, and $517 million each week.

Most economists are well aware that the debt owed China is beginning to cause us some major problems, while some are sure that we are losing an economic war that has been going on for years. For example, Sy Harding in an article published originally in Business Insider titled “China is Crushing the U.S. in This Economic War” states:

Meanwhile, it can be said that China is eating America’s lunch, never taking its eyes off the goal, while we squabble among ourselves, paying no attention. … [China] is not only making great economic strides, but on the financial side has become the world’s largest creditor nation, even as the U.S. has become the world’s largest debtor nation, with China holding much of its debt.

The U.S. needs to interrupt its angry divisiveness and name-calling long enough to recognize the portent of what is going on.

While some of the media wants to blame the U.S. for this economic war, John Mangun, in an article printed at ABC-CBN.com, states that the “US [is] waging economic war against China.” In support for this contention he includes: the increases in the “prices of commodities like oil and gold,” and worldwide inflation.

Other international publications report the issue quite differently:

China aims to allow all exporters and importers to settle cross-border trades in the yuan by 2011, according to the Chinese central bank, … Moreover, China will “respond to overseas demand for the yuan to be used as a reserve currency” and allow the yuan to flow back into China more easily.

This is all part of China’s plan for the internationalization of its currency, which may, in the decades to come, threaten the global “market share” of other currencies like the U.S. dollar.

For the world to accept the yuan as a major world’s reserve currency could be disastrous for the United States; being the major world’s reserve currency provides the United States with some distinct advantages.

Even Paul Krugman is well aware of the danger China poses to the economic health of not only the U.S. but the world in general. Here are some quotes from his article, “Rare and Foolish,” which describes a situation where “a Chinese trawler operating in Japanese-controlled waters collided with two vessels of Japan’s Coast Guard. Japan detained the trawler’s captain; China responded by cutting off Japan’s access to crucial raw materials.”

… the incident shows a Chinese government that is dangerously trigger-happy, willing to wage economic warfare on the slightest provocation. …

Major economic powers, realizing that they have an important stake in the international system, are normally very hesitant about resorting to economic warfare, even in the face of severe provocation — witness the way U.S. policy makers have agonized and temporized over what to do about China’s grossly protectionist exchange-rate policy.

China, however, showed no hesitation at all about using its trade muscle to get its way in a political dispute, in clear — if denied — violation of international trade law.

However, Krugman, the prototypical liberal, is not ready to even consider that China may not be the least bit interested in assuming “the responsibilities that go with” becoming “the world’s newest economic superpower.” Their behavior is not the least bit “foolish” if you consider that their goal could well be world domination: economically, politically, and socially; and not to become a responsible member of the world community.

There is no doubt that it would be to China’s distinct advantage to defeat the U.S. economically. Or, even better, force the United States to default on its loans. The loss in U.S. prestige, power, and influence would be irrevocable and probably result in our descent into an economic morass that would be extremely difficult to climb out of. If this happens, it will create an opportunity for another “superpower” to step in and gain international dominance.

This happened shortly after World War II when the U.K. passed the baton to the U.S. There is little doubt that the Chinese Communist regime would take greater advantage of this position of immense power than the United States ever did. Remember, the U.S. helped rebuild conquered countries, did not claim conqueror’s rights to national treasures, and refused to use nuclear weapons to bring their current and potential enemies under their control. History tells us that no other conqueror in the history of the world was so kind to its defeated enemies.

The U.S. believes in individual freedom and basically recognized that in its international dealings. Communist China believes in the power of the collective and recognizes that its ultimate security will result in its total domination of the world’s economy, politics, and societies. They will not hesitate to use their newfound power to gain this end.