Friday, December 26, 2008

Joined at the hip

China and the US are twins joined at the hip. The dire economic recession has both countries reeling. The sharp drop in the US consumer's appetite has had a direct impact on China's economic steam engine of growth, and quite frankly has derailed it to varying degrees. China holds a large swarthe of US debt, and as such, is the US' prisoner, since it cannot 'dump' US treasury notes without causing its own house of economic cards to collapse. China is caught in a Chinese thumb twister since tugging on it will not improve its situation a whit. The incoming Obama administration has stronger cards to play, but won't necessarily use them in talking to China. The times call for caution and well chosen words. Guam Diary has no advice to give. It only observes. And there is much to see. Will China change the peg of its 'renminbi yuan' to the US dollar? How will it deal with the growing army of urban unemployed, as well as the mass migration of the rural poor seeking work? Will the central government know when and how to relax the iron fist, to inject new blood into a sagging economy? And then leaving human rights and Tibet and the Turkmen question aside, how will it seek to control runaway military spending which has one object in mind, to plan for war with the US.
What the Communist party of China fears most is the breaking up of a unified China, and when we say a unified China we are speaking of the mainland, not Taiwan. Today's leaders belong to a generation which has known not of the age of the war lords after the fall of the Qing dynasty and the harsh hold of colonial treaties nor necessarily the long war Japan waged against China. They are the sons and daughters of Mao Tse Tung and his long upheavals which caused much turmoil under the heavens. Today's leaders chant endless and meaningless ragas of Communisim but since the reforms of Deng Xiao ping have donned Savile Row hand tailored suits of capitalism, and it is precisely the road to capitalism which is the undoing of China today, in spite of a 'dirigiste' economy. We are spectators of a play which as yet has no closing act.

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