Revenge Strategy, wasting the power of your hate on the guiltless (XLVI): What is the love affair between the USA and China since 1979?
In my last publication, we mentioned that conscious integral strategists manage to conduct the comparative analysis between nations by answering the following question: How do the people from each nation live? How do they manage to realize their quotidian activities in that country which are in order of importance as follows (I have added some that I missed before):
- Praise God
- Eat and Hydrate with Healthy Water
- Keep the society safe-secure
- Cleanse (keep themselves immaculately neat: put themselves, their home and the natural resources and community absolutely tidy)
- Cure Sicknesses
- Protect under a decent Shelter
- Cohabit with their nuclear or closed family
- Educate and learn
- Recreate (practice and/or enjoy arts and sports)
- Socialize with others
- Have sex, reproduce
- Grow their kids
- Interact politics-civil in a secure or safe society that respects human rights
- Others non included (according to your own view)
I also wrote that each human being has the right to do all the latter activities with the optimum level of dignity and respectability. Once our mental frameworks to compare nations put people at the core of every analysis, our mental frameworks shift to compare trending economic indicators to people-centered indicators. I also declared that any comparison analysis must be people-centered from now and then.
To be coherent with this reasoning, I managed to “leave out” for some days, the China and US economic, monetary and trade indicators (which are preciously done by other entities dedicated to studying the inherent sovereign risks on economics, commerce, and financing). These entities are deeply associated with every country, and those are Standard and Poors or Moodys or Fitch. There are other multilateral organizations which have taken time to register statistics and create indicators for the economic and monetary development such as the World Bank or the OECD or the IMF. In addition there are independent research centers associated with universities or think-tanks of high caliber which are also monitoring the conditions and statistics of several countries. Finally, the majority of commercial banks are also sponsoring country research, in their quest to control their investments and guide private banking.
The importance of good data is beyond our cerebration.
I have shared the last aquarelle because I wish you to see my degree of accurate respect for the real tiny flower. I have tried to draw and paint it with my most beloved appreciation and exactitude to the genuine flower. For the sake of the flower existence.
Now let´s move to our blog domain. The degree of accuracy from each institute, university, multilateral organization, United Nations, commercial banks research departments or risk credit rating organizations relies and depends on the superior and prime quality of the data they can deal with (data means the numbers, information or basic indicators). The data is usually handled, stored and produced by public local country sources, a.k.a. the governments departments or divisions. That is why data must be carefully scrutinized. And the process to get it, is as relevant as much as its review. If the data is wrong, then everything that analysts, research centers, or risk-credit ratings or strategists do is also wrong. A fallacious data can mislead us to take erroneous decisions and make mistaken judgments. That is why it is so essential to ensure the quality of the data per each country. In our particular example of China and the US, it is indispensable to take excellent data based on precise and true facts, not based on perceptions or surveys which can misinform or misguide us. In general, if the governments from the countries do not take the time to measure and process the data with the truth, or if other organizations dedicated to getting data, do not have data quality control, everything that I have shown you on my last slides is not going to be good either. The quality of the numbers is extremely decisive when designing a country´s strategies, and I conceive of enormous contributions whenever I find self-conscious organizations that take the time and resources to acquire and review the data with careful dedication. It is crucial to invest in extracting and measuring the truth as much as processing the data input correctly.
I exhort to those who have an excess of money, to provide the resources, and become benefactors or sponsors to data gathering organizations. Their contribution will be priceless if the funds are invested in data collection of integral value (not just for economics, trade or financing data). These advocates´ resources must help to fund data gathering in multiple dimensions or contexts, accordingly to the people-centered activities. It is key if we wish that all the entities performing data management can contribute to society.
Let´s start now our third question from our US-China Trade War outline What is the love affair between the USA and China since 1979?
After 1979, Mao Zedong was not anymore leading the PRC boat. Once he passed away, China turned the direction of its economy into a different path. Having a similar territory in terms of land and resources than the USA, China decided to believe in themselves first. China knew what they had to do if they wished to become what they are right now. They knew they needed educated people under different standards. So they took American Universities programs to send their people to learn. The US also wanted to end a legacy of communism, and their interaction with China started not just in terms of commercial relations, but also in terms of an institutional strategic shift.
Let me explain it simply with a metaphor. When China and the US started diplomatic and commercial relations in 1979, it was like when the bride and the groom are introduced for the first time to know each other. And the love affair started. Like any relationship, both countries have lived ups and downs. Sometimes China has been happy and also radically tough with the US, and have had their fights. Sometimes the US has been grumpy with China and has resisted embracing China because of their lack of respect for Human Rights. But trade continued despite their love affair. China continued producing low-cost things massively during the last 40 years. It is the main exporter in the world. The US has been buying China´s merchandise. Without hesitation and for many years. Out of controversy, China has not stopped to grow economically, and the US has been not just a main customer, but also the same designer of the Chinese economic growth. Chinese policymakers, strategists and businessmen have studied mainly at the top American universities since 1979, and their commercial enterprise mentality is almost equivalent and it is deeply rooted in global value chains designed and organized with the American Capitalist frameworks. A result: It seems, for the time being, that China has been able to leave the poverty behind.
Nevertheless, only 4% of China’s population is extremely poor, we can´t forget that 25% of close to 1.4 billion Chinese people are still in a vulnerable position of poverty (OPHI.org.uk). If 4% of China’s population is living below the $1.90/day benchmark, that means they are still in need of urgent help. In addition, 25% of Chinese population is the equivalent amount of the total US total population (approximately), and it represents 348 million souls. And all of them are in a vulnerable position of poverty. If you read it again: the whole quantity of the Chinese population in a condition of vulnerability to poverty is the same amount of the total and whole US population.
At this point, I will try to explain the difference between the concepts of extreme poverty and vulnerability to poverty. I have to refer to Mauricio Gallardo´s paper “Measuring Vulnerability to Multidimensional Poverty”. Gallardo has written: “About poverty: The only thing we need in order to identify if a person as poor is to record whether he/she meets the condition of being under certain poverty thresholds”. For example, according to the World Bank, everyone who lives with less than $1.90/day is poor. The threshold is $1.90 per day. “Vulnerability instead concerns the uncertainty that people face with regard to having a welfare level below such poverty thresholds. That is, unlike poverty, vulnerability concerns the risk of being poor, which is not necessarily realized in a state of effective poverty. Thus, as vulnerability concerns only a probable event, not an effective one, it is a phenomenon that is not easy to measure and verify. For public policy purposes, however, knowing not only who are those multidimensionally poor but also those who are at risk of becoming or remaining multidimensionally poor is crucial. Policymakers should make decisions taking into account not only effective poverty but also the uncertainty surrounding people with low welfare achievements in order to prevent future states of poverty”.
The love affair of China and the US has inherent risks associated with a possible scenario in which China may not solve its issues with the US promptly. China´s future infrastructure projects and investments are an example of its aim to expand its customer base, through the geographic diversification of its clientele. If China wishes to expand to other countries, they also must solve the outstanding issues related to the still present communist and totalitarian ideology legacy from Mao, particularly its concerns related to human rights and climate change. At this point, the US also is hurting itself by not solving the trade war either. I will explain why before Christmas.
In my next edition, I will share the educational comparative analysis between China and the USA. Next week, as I promised, I will proceed to provide the whole strategic analysis once I include the economics-trade and financing relative position between the two countries. This is a previous requisite to answer our 4th outline question: Why did China and the USA “seem” to be playing to hurt each other through a revenge commercial strategy?. Thank you.
See you before the end of this week again. Hugs for reading to me!
Sources of reference cited to write this post:
Disclaimer: Illustrations in Watercolor are painted by Eleonora Escalante. Other types of illustrations or videos (which are not mine) are used for educational purposes ONLY. Nevertheless, the majority of the pictures, images or videos shown on this blog are not mine. I do not own any of the lovely photos or images posted unless otherwise stated.
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