hongkongpride
New Member
Re: Great China VS U.S war book
Well, with the advent of globalization no country can 'stay an island'. The US and China are linked economically so close that a economic downturn in one of the countries would affect both of them catastrophically. What I mean about economic deterrence is that the PRC currently holds about $13 bn in US Treasury Bonds and racks up about $75 bn/ year trade surplus with the US. So what if the PRC sold its US Treasury bonds in the event of a conflict btwn them? Pentagon analysts privately say it would depreciate the US dollar even more, meaning that foreign investors would get much less returns on their investments in the US, severely eroding investor confidence in the $US and consequently a BIG fall in the $US leading to a recession or possibly depression (1929 repeat). While this a superb form of deterrence, remember in the age of globalization it goes both ways too. US consumers will simply stop buying made in China products and the Chinese economy and social stability will go down the toilet as rest of the world demand is not enough to satisfy the c. $760 bn worth of Imports US consumers spend each year on mostly Chinese goods.
But economic warfare/deterrence is simply not feasible in this age unless you are willing to take a big gamble and these days with global linkages, you have to be very brave or plain stupid to eco. warfare with countries-unlike in 1940, where a Western embargo on oil to Japan led to WWII in the Pacific and the attack on Pearl Harbor.
@hongkongpride:
Obviously China does not have a sufficient and credible second strike capability against the US and the PLA is currently working hard to put that right as you have observed correctly. So my intention was to show that China' comprehensive military capabilities (not only nuclear but also other means of effective destruction) are indeed sufficient already today to make even the US think twice about whether the price to pay is worth ´it´. Your thesis about China's potential ´economic deterrence´ is quite interesting and perhaps you could elaborate in a further post?
Well, with the advent of globalization no country can 'stay an island'. The US and China are linked economically so close that a economic downturn in one of the countries would affect both of them catastrophically. What I mean about economic deterrence is that the PRC currently holds about $13 bn in US Treasury Bonds and racks up about $75 bn/ year trade surplus with the US. So what if the PRC sold its US Treasury bonds in the event of a conflict btwn them? Pentagon analysts privately say it would depreciate the US dollar even more, meaning that foreign investors would get much less returns on their investments in the US, severely eroding investor confidence in the $US and consequently a BIG fall in the $US leading to a recession or possibly depression (1929 repeat). While this a superb form of deterrence, remember in the age of globalization it goes both ways too. US consumers will simply stop buying made in China products and the Chinese economy and social stability will go down the toilet as rest of the world demand is not enough to satisfy the c. $760 bn worth of Imports US consumers spend each year on mostly Chinese goods.
But economic warfare/deterrence is simply not feasible in this age unless you are willing to take a big gamble and these days with global linkages, you have to be very brave or plain stupid to eco. warfare with countries-unlike in 1940, where a Western embargo on oil to Japan led to WWII in the Pacific and the attack on Pearl Harbor.