politics

I wonder why he's doing this?

I have been saying that there will be a rapprochement with China under Trump. It will be a nice gesture to China and ByteDance who is still embroiled in a lawsuit against the US government.

It’s the same reason why Elon Musk is on Trump’s team, an exchange for lifting Biden’s tariffs on Chinese EVs.

The signal is also clear from China: the “save the property market” gang has won, as this year the state has implemented the strategy proposed by Meng Xiaosu, the father of real estate market in China, by lifting the property-purchasing restrictions (one property per family) in all cities except for Shenzhen, Shanghai, Beijing and parts of Hainan. The lifting of restrictions on China’s capital markets will allow foreign capital to enter and “help” boost consumption and prop up the falling property prices. This is exactly what the Wall Street finance capital needs.

China is also ready to cooperate and this will allow the US to simultaneously reduce its huge trade deficits (which Trump can then boast about bringing (limited amount of) jobs back to America) while retaining the strength of the dollar hegemony. It would be stupid for Trump not to take the deal - a win-win for the US and China.

Besides, the oil and gas prices are still low (in spite of Biden’s Ukraine war) until China’s consumption rate can be recovered to pre-Covid period. Trump cannot possibly satisfy the oil and gas industry unless he could also boost the consumption level in China.

For the military industrial complex, Trump is now proposing a 5% GDP spending on NATO countries. He had previously suggested 2% during his first term, and nobody even bothered to listen to him. But Biden’s Ukraine war has made Europe’s security a national issue. Gave a little threat on Greenland and Denmark is now ready to pour a billion on defense spending.

The uncertainty will come from the neocon national security state, whether they would be satisfied with this arrangement. If Trump gives them Iran, then they might compromise on the China front. This is where the obstacle will most likely come from.

Of the three major factions of The Blob as defined by Michael Hudson: military industrial complex, oil and gas industry, and the Wall Street finance and real estate capital - there is a fine balance where Trump could reach that satisfies all three at once, while at the same time still do a “limited re-industrialization” to appease his MAGA chud supporters without having to openly confront the Wall Street finance capital. Biden’s Ukraine war had opened up these possibilities.

The question is whether he is even clever enough to see all that, or if he is even competent enough to juggle the interests of all these factions, and whether there will be unforeseen resistance to the plan (don’t forget, anything crazy can happen).

Of course, Trump will sell this as a “win for America” and that he somehow made China submit to his demands, when in reality it’s a “win-win” for both the US and China, and the Chinese with their infinite patience will allow Trump to boast about it knowing his huge ego. If Trump could somehow manage all that, then we’re heading towards the end game. Until the next crisis of capitalism that explodes in America, that is.