by Leif Johnson for The Saker Blog
The present lockdown of the Western world and much of the Third World is an attack on China. Here is how it works:
- Slash Chinese export earnings. The Chinese economy is heavily export-oriented. Seventeen percent of all China’s enormous production is shipped to countries that now, either cannot afford imports, or whose buying power is reduced from months of massive unemployment. What remains of Chinese exports will fetch lower prices. This comes after China’s export market to its largest trading partner, the U.S., was slapped by 10 to 25% import duties, beginning 2018.
- Bankrupt the Chinese Belt and Road projects. The Chinese export of capital (Belt and Road) for railways, waterways, dams, ports, power stations and other infrastructure improvements in 138 nations in the world, is estimated at three trillion dollars. These projects are expected to be paid for by user fees. Because many Third World and other countries may be unable to repay those loans, China’s losses could be in the trillions.
- Attack Chinese commerce world-wide. To halt Chinese competition especially in electronics, companies such as Huawei and TikTok are banned in the U.S. and Britain, and the Chief Financial Officer of Huawei is jailed. Chinese scientists and students are deported, while American sanctions against Iran and Venezuela are designed to cut petroleum exports to China.
Of these, by far the greatest damage to the Chinese economy has been the lockdown; that damage will increase as world economies decline. This economic vacuum will put an extraordinary strain on the Chinese export industries and banking system.
There are two more major areas of attacks:
Military: The U S. has sent an enlarged fleet, including two aircraft carriers, into Chinese coastal waters. Australia is now building a base on a forward island confronting China, Japanese and Korean militaries have been beefed up and Japan may allow nuclear weapons on their territory. The U.S. has increased its military spending especially on advanced and nuclear weapons.
Chinese defense against such threats will be a military buildup costing an additional two or three hundred billion a year. This buildup entails a shift from peace-time capital and consumer goods to the military sector—a serious economic drain.
Propaganda: Hostile measures taken against China will be dressed up as the fight for “democracy,” “openness,” free trade,” “free enterprise,” “justice,” “rule of law,” “international rules,” “human rights,” “anti-terrorism,” “reform,” “anti-corruption” and “anti-communism.” We, especially North Americans, should expect human rights stories from Hong Kong and Xinjiang, yearly memorialization of the massacre at Tienanmen Square, documentaries on persecutions of Christians, Buddhists, the Dalai Lama and… don’t forget Tibet. And what about Chinese pollution that could destroy the planet? And what about the Chinese Communist Party, the most execrable, dangerous, evil organization in the world, towards which people of the West should direct an Orwellian hatred?
These attacks come at an inopportune time. China is embracing large scale automation requiring large capital outlays, while at the same time suffering natural disasters including the swine flu, widespread infestation of the dreaded Fall Army Worm, and devastating floods and droughts.
Is it possible that the Anglo-American financial elite had the power to convince nations worldwide to lock down? Well, they control the UN, WHO, the world organs of mass media, worldwide military deployment, world finance, and the Dollar Empire’s elaborate political, drug, crime, financial, propaganda and cultural networks. Euro-oligarchs collaborate (usually) with this system.
What do they hope to achieve?
We can put aside the easier answers like “world domination,” New World Order, corporate greed, financial control, 1984-style mind control, surveillance state. It is much more fundamental: The world Dollar Empire, and its predecessor British Empire, have ruled much of the world for 400 years. China has emerged as the most powerful challenger to that Empire. If China cannot be destroyed, the Dollar Empire will be vanquished.
Ranked from most desirable to least, here is what I believe the Western merchant-bankers hope to gain.
Most desirable: A regime change in China, whereby the government is overthrown in favor of a Dollar Empire vassal regime. A revolt of the Chinese people against a government that has lifted 800 million people out of poverty is very unlikely. However, military force is not out of the question. Foreign Affairs magazine, (September-October, 2020, p. 156) wrote: “By upgrading their already substantial capabilities in this domain [unmanned submersibles], the United States and its allies would highlight the possibility of a maritime blockade of China.”
Next best: To convince China to adopt financial and political measures amenable to Dollar Empire domination. In the words of former Goldman Sachs banker and Treasury Secretary Henry Paulson Jr., (Council on Foreign Relations newsletter, 5/19/20):
China must move to a “market-driven economy, improve corporate governance, and develop efficient, well-regulated financial markets that earn the respect of international investors, so that Beijing can eliminate capital controls and turn the RMB [renminbi] into a market-determined currency.”
In other words, de-regulation, lifting of capital and bank controls, opening the Chinese currency, the renminbi, to international speculation, “free trade,” “free markets” and IMF and WTO conditionalities, designed to open the huge Chinese economy to Dollar Empire looting—as occurred in Russia in 1992-1998. But the Chinese have found a recipe for national success (industrial capitalism), and that fire-belching dragon, the Chinese Communist Party, guards the gate against renewed imperialist looting.
Least: The Dollar System can achieve the third level of options: a combined economic (lockdown, sanctions, trade and financial war), military (NATO, Five Eyes, 7th fleet) and political (ethnic/jihadist subversion, drugs, propaganda) attack on the Chinese economy. That will retard China’s growth and reduce its world power.
Instead of strife, bloodshed and terrible destruction, why doesn’t the Western financial elite join with China in solving the world crises of poverty, refugees and war; why not together explore the frontiers of medicine, science and space? While China might be amenable to collaboration with the West, the oligarchs of the West are locked against it. After all, it is they who created the poverty, refugees and war, and it is they who have spent the post-WWII years dismantling industry, sending much of it to China.
China is a successful, developing economy; the West is an unsuccessful, deteriorating economy. China is based on industrial capitalism; the West is based on merchant-banking capitalism. China invests its capital in industrial plant and equipment and infrastructure; the West invests in financial instruments.
The Chinese seek increased industrial and agricultural production to satisfy people’s needs. The Dollar Empire steals the wealth of nations to create speculative profits. The Chinese system creates capital. The Western system destroys capital. The Chinese System never has financial crashes; the Western System suffers devastating crashes rescued by levies on the population. Chinese industrial capitalism raises the living standard of the population; the West’s financial capitalism lowers the living standard.
The destruction of capital is the hallmark of merchant-banker rule.
Consider the following example: The grain cartel buys products from farmers and sells at a profit. That profit is real capital (no matter how exploitative) because the profit was made on real merchandise being sold.
The cartel does not invest that real profit in agricultural production. It pours its profits into investment funds, banks, off-shore funds, which are largely invested in speculative paper—securitized paper, derivatives, indexes—all of which represents no real goods. It re-invests the paper profits and receives more paper profits. Thus the merchant-banker system sucks capital out of productive agricultural, industrial and commercial enterprise into non-productive financial channels. That is the destruction of capital. It is a misnomer to call this speculative system “capitalism.” It is a cancer. It uses the forms of capitalism, but it destroys capital, just as cancer uses the nutrients of the body but destroys the body.
This is a “system.” It takes capital from the economy (society as a whole), and destroys it by investing in paper (nothing). This is how it thrives. All governments, laws, academia, social mores, mass media, culture and, of course, economics and finance are shaped by this system. It cannot change. It cannot create new productive enterprises. It cannot compete with China, only impede China’s growth.
This is “end game” for the governing oligarchy. This is their Götterdämmerung, their Armageddon. In the death throes of their 400-year-long reign, they will impose a desperate economic, financial and social reorganization which the World Economic Forum calls the “Great Reset.”
One of the world’s most prominent merchant-banker organizations, the World Economic Forum, issued a report, titled:
“This is Now the World’s Greatest Threat—And It’s Not Coronavirus”
- “Affluence is the biggest threat to our world according to a new scientific report.
- “True sustainability will only be achieved through drastic lifestyle changes.
- “The World Economic Forum has called for a ‘great reset’ of capitalism in the wake of the pandemic.
“A detailed analysis of environmental research has revealed the greatest threat to the world: affluence… we have to change our affluent lifestyles and reduce overconsumption in combination with structural change.” (Mind you, this is written by the world’s most wealthy individuals.)
With lockdown-caused destitution, unemployment, lack of food and shelter for hundreds of millions of people worldwide, one would expect that the WEF would be satisfied that “overconsumption” had been sufficiently curbed. However, they know there is still substantial wealth in the American and European middle classes that can be tapped for the post-lockdown economy. They have big plans to get rid of that “overconsumption.”
The first task is to reduce unemployment, now probably 25 million long-term jobless in the U.S. Make-work projects will be “green” and “sustainable” (low technology). This will be paid for by taxing the middle class.
The second task, their true and ultimate agenda, is to create an all-out war economy—the final attempt to terrify the East into submission. This will bring extreme austerity and repression.
The “structural change” mentioned in the World Economic Forum report was made explicit by UN Secretary General Antonio Guterres in his “International Mother Earth Day” message:
“First, the huge amounts of money to be spent on recovery from the coronavirus must deliver new jobs and businesses through a clean, green transition.
“Second, where taxpayers’ money is used to rescue business, it must tied to achieving green jobs and sustainable growth.
“Third, fiscal firepower must drive a shift from the grey to the green economy, empowering societies and people to be more resilient.
“Fourth, public funds should be used to invest in the future, not the past, and flow to sustainable sectors and projects that help the environment and the climate…
“Fifth, climate risks and opportunities must be incorporated into the financial system as well as all aspects of public policy making and infrastructure.”
The World Economic Forum chieftains could not be more pleased. Changeover to “green” sustainability would bring a great reduction in “affluence” by heavily raising the price of energy making everything, from agriculture to industry to transportation, grossly more expensive. Furthermore, to pay the “huge amounts of money to be spent on recovery,” will require heavy tax burdens, or social services spending cuts. The Western populations will not be told their sacrifices are made to thwart China and collapse world industry, but rather, made to “save the planet.” The theory of the Green Revolution is that the West will continue to dismantle its industry to meet climate deadlines while China will be forced, by world public opinion, to follow suit.
The “Green Revolution” will soon dissolve into a total war policy. Sacrifices imposed by the “final solution” military buildup against the East (Russia-China bloc) will strip the remaining wealth of the people. Taxes, inflation, interest rates, will rise as the nation is deprived of health care, education, public services, pensions and Social Security. The “global warming” foe will turn into the Yellow Peril foe.
Totalitarian destruction of our freedoms will be as dread as those of Hitler Germany. Free speech will be considered a security risk, neighbors will spy on neighbors, thousands will disappear or be assassinated. Race riots will be used to “divide and conquer.” Electronic spying will be ubiquitous, as will be preventive detention. All the police state measures used against foreign populations by the military, State Department, intelligence agencies and hired mercenaries and drug mafias, will be turned against Americans.
America does not deserve this. America was the first nation to overthrow the shackles of the merchant-banker British Empire. America was the first nation to lay the basis for an industrial republic. America became the most free, equal and magnanimous nation in the world which triggered a century-long battle between the industrial American System and the merchant-banking British System. The American System built a great nation.
Apostles of the American System included Alexander Hamilton, Mathew Carey, John Quincy Adams, Henry Clay, Nicholas Biddle, Henry Carey, and Abraham Lincoln. The American System was succinctly described by Abraham Lincoln in an election palm card: “My program, like an old lady’s dance, is short and sweet: I am for a protective tariff, a national bank and internal improvements.”
In 1851, Henry Carey (The Harmony of Interests, p. 217) summarized America’s role in the world as follows:
“Two Systems are before the world; the one looks to increasing the proportion of persons and of capital engaged in trade and transportation, and therefore to diminish the proportion engaged in producing commodities with which to trade, with necessarily diminished return to the labour of all; while the other looks to increasing the proportion engaged in the work of production… with increased return to all, giving to the labourer good wages, and to the owner of capital good profits…
“One looks to pauperism, ignorance, depopulation, and barbarism; the other to increasing wealth, comfort, intelligence, combination of action, and civilization. One looks towards universal war; the other towards universal peace.
“One is the English System; the other we may be proud to call the American System, for it is the only one ever devised, the tendency of which was that of ELEVATING while EQUALIZING the condition of man throughout the world.
“Such is the true MISSION of the people of these United States…”
Let American history be our guide as we restore that mission.
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