By Ramin Mazaheri for The Saker Blog
The Chinese economy is, according to the Western financial media, both a huge success and also a huge failure. It has become an economic rival and superpower, and yet it is also accused of being the cause of the global slowdown.
Why such contradictory, nonsensical reporting?
When the economic panic hit in 2008 Washington needed a scapegoat, as it was US citizens who were the author of the crimes, so they turned to China. “Blaming China” emerged at the very beginning of the crisis.
This 10-part series (this is Part 7) uses as its jumping-off point the 2018 book Collusion: How Central Bankers Rigged the World by Nomi Prins, a former Wall Street executive who saw the light and is now informing on the crimes of Western imperialism-capitalism. Prins gives a thorough and chronological account of central banker doings in key areas – Mexico, China, Brazil, Japan and Europe – ever since US banker crimes set off the Great Recession in 2007. The essence of her thesis is that the US orchestrated collusion among the central bankers of many of the G20 economies and the Eurozone in order to primarily save busted US banks, and then also to maintain the 1%-enriching policies of QE, ZIRP and no-strings attached bailouts.
“Blaming China” emerged at the very beginning of the crisis: immediately after Lehman Brothers in September 2008, Prins notes: “To assign blame elsewhere for US economic problems, the US Treasury Department strongly criticised Chinese exchange rate policy and colluded with other developed countries to do the same.”
Who can forget Barry Obama’s constantly reading from his script and accusing China of “currency manipulation”? Obama’s “pivot to China”, replete with fake South Sea warmongering propaganda over desolate sandy islands, was clearly all an attempt to divert public attention from American financial crimes. “Currency manipulation” was always a code phrase for “financial policies independent from Washington and NYC”.
Rather incredibly, even though Timothy Geithner was the chief of the Federal Reserve Bank of New York – the locus of the banker crimes which created the Great Recession – he got a promotion by Barry Obama to Secretary of the Treasury. In an obvious sign of 1%er collusion and more proof (if anyone needs it) that the Democrats and Republicans are two sides of the same coin, Geithner reportedly also would have been the choice of Republican presidential candidate John McCain.
Print refers to a May 2012 visit along with Hillary Clinton to Beijing: “He (Geithner) was relentless, as if the entire future of the US economy was contingent upon minute differences in the dollar-yuan exchange rate.” It was an obviously absurd emphasis and analysis, and obviously propaganda.
Yes, China will act to protect their currency should disaster arise, but they have floated the yuan since 2016. And yet, years of Obama-era propaganda had their effect on Trump, who in August pressured the Treasury Department to formally declare China as a “currency manipulator”. The IMF didn’t back Trump up, but anti-China rhetoric has a proven track record of propaganda success, thanks to the Democrats false “pivot to China” instead of properly blaming Wall Street.
There is a huge fatal flaw in any Western criticism of Chinese “currency manipulation” – Japan. Since 2011 the yen has lost a whopping 42% of it’s value to the US dollar, making their exports hugely cheaper to buy – so why aren’t they considered to be “manipulators”? The answer is easy: Tokyo follows in lockstep with Washington and NYC in QE and elsewhere, whereas Red China refuses to join Western capitalist imperialism and sticks with the hugely successful “socialism with Chinese characteristics”.
The ‘Blame China game’ – how long can this go on despite all their success and the West’s failure?
A more recent diversionary tactic has been the pathetic reason that “China’s slowing growth” is the reason for the global economic slowdown. Anyone with a basic grasp of global economics knows that this is not just an inherently absurd argument, but a pathetic one.
China’s growth rate has been remarkably stable since 2012 (which was when the West went all-in on “QE forever for 1%er benefit”) despite the global slowdown, always falling between 6.6% and 7.9%. If we take China’s average annual GDP over the last decade to be around $10 trillion annually, a loss of 1% translates to $100 billion – hardly a sum which would have saved the $75 trillion per year world economy. Of course, this all rests upon the faulty idea that China is solely responsible for its minor economic slowdown.
The current tactic is just as absurd – that “Trump’s trade war” with China is the cause of the global economic woes.
Slightly decreased US-China bilateral trade caused by Trump’s sanctions cannot possibly wreck the global economy because the world is so much bigger than just the US and China. Sadly, the US has the biggest megaphone so anything they want to focus on gets over-amplified. US-China tariffs could shave a point of the US annual GDP and 1.5 points off China’s, perhaps, but that would still represent a loss of just 0.2% to the global economy.
Thus, if anything, the neoliberal Mainstream Media’s hype, hysteria and anti-Trump propaganda will probably do more damage to business and consumer confidence than Trump’s tariff increases.
What should be clear is that tiny fraction of global GDP and cannot possibly be more damaging than the neoliberal policies which created the original Great Recession, and then the Lost Decade of Eurozone economic growth and broad economic stagnation which were the pathetic result of men more neoliberal policies.
For example, what if the Eurozone – the biggest macro-economy in the world – had not chosen far-right economic austerity policies which resulted in a lost decade (2008-2017), which is turning into a lost score. They averaged just 0.6% of growth, which makes “blaming China” so absurd considering Beijing centrally-planned their way to results which (8.3% annual average over that period) were 14 times (1,400%) superior.
Adding just 1.4% of average annual growth to a rough average of $12 trillion to the annual Eurozone GDP over the last decade gives $168 billion. Over a decade that adds up to nearly $2 trillion, dwarfing the impact of China’s alleged “currency manipulation”, Trump’s tariffs and would more than offset China’s allegedly horrific GNP fall from 7.9% in 2012 to 6.7% in 2018. “It’s European austerity, stupid,” continues to be the right answer for why the global slowdown persists.
A fundamental problem is: why is decreased demand from China the problem, as opposed to the decreased demand in the US and EU caused by QE, which diverts money from infrastructure growth/consumers’ pockets, and austerity, which worsens infrastructure and takes money out of consumers’ pockets? Why must China pull all the weight?
The answer is: China must pull the weight because the West’s political and cultural elite has used the past 11 years to fundamentally exploit their own communities in neo-imperial fashion. The West has relied on China’s superior economic engine to achieve their incestuous neoliberal goals, but China cannot be blamed by anyone (except a Trotskyist).
China has become a superpower despite the Great Recession, but it’s not because of China
To paraphrase a very intelligent refrain of Prins’: What’s certain is that if, back in 2008, G7 central bankers wanted to do everything they could to empower their enemy – socialist China – they have succeeded wildly.
Beijing says thanks: The past decade has seen China soar so high they have broken the glass ceiling of a unipolar world. This was certainly not the case in 2007.
But it is not “China” which succeeded – that is essentially an ethnic or nationalist argument. China has policies which have nothing to do with lo mein and Fu Manchu moustaches – their policies are globally available and referred to as “socialism”.
It is socialism which is succeeding – saying “China has succeeded” is to divert, in an essentially jingoistic way, credit from socialism.
Of course, capitalists would stoop to any explanation in order to avoid the spread of the acknowledgment of socialism’s fundamentally-superior policymaking and humanity towards its citizens. Capitalists famously launched World War I to prevent the spread of socialism; socialists back then mistakenly assumed that enough people finally realised the stupidity of fighting wars t enrich bankers and were certain that the war would be called off due to a lack of grunt participants – they were dead wrong. A century later the West’s political intelligence and modernity is even worse than back then.
We should absolutely credit China, but the true credit must go to socialism – central planning, state ownership and control of the majority of the economy, actually listening to public opinion when formulating public policy, socialism’s guiding belief of empowerment of the “average person” and not the “exceptional person”; and its implicit rejection of capitalist policies – central planning limited to conjunction with the military, creating state assets via taxpayer money and then privatising them to the 1%, having as few legal restrictions on business as possible, policy formulated by bankers (and now primarily to serve the stock market).
China is fundamentally a Stalinist (socialism in one country) nation rather than a Trotskyist (socialism universally and all at once) nation. Maoism, which highly praised Stalinism of course, is constructed upon a generation of Stalinist success, and later disagreements cannot ever change socialist China’s childhood and adolescence. What Trotskyists and capitalist-imperialists both endlessly, stupidly and boringly criticise China for is the fact that they will gladly manufacture and sell the rope for you to hang yourself with.
China’s central bank is all about encouraging market reforms – of a Chinese socialist-market format and not neoliberal-market format, very significantly – which encourage your consumption and their savings & security. Being a leftist who wants to actually win and a patriot I say, “Yay for Stalinism (which is really “Marxism-Leninism-Stalinism”, of course) ” and “Yay for China”.
China does not want to be France or the US – whose economies are based mostly on consumer demand (i.e., household debt) – they want to be Germany. And that is what they have achieved over the past decade – these are the 2 countries with the biggest positive trade balance. Of course, the US wants China to be like the US, and thus less competitive, but Beijing takes no orders from Washington, unlike Paris.
China’s (Marxist-Leninist) Stalinist-Maoist ideology pushed it to be the only major central bank which actually pursued policies in the past 10 years which were designed to benefit China and the broad Chinese people and not New York City and Washington. Unsurprisingly, this has created growth (2008-17) 14 times better than both Europe and Japan, and 6 times better than the US. China is able to plan years and decades ahead, as every nation should and as Iran does, but this is against free market ideology.
China thus pursues this very sensible, moral and modern ideology and thus has reaped the benefits. As time goes on, and as neoliberal capitalism continues its inevitable trajectory to an even worse bust than in 2009, I see no logical reason why we cannot see China’s rise during the Great Recession as a historical trend towards more socialism around the world.
The USSR, after all, fell when Gorbachev imposed completely anti-socialist policies – the ending of central planning, the ending of the state being the biggest economic actor, the end of bans on capitalist propaganda, the weakening of the revolution party’s (Communist Party in the USSR) primacy. The USSR fell thanks to Western capitalism and not at all due to socialism – Gorbachev’s policies cannot be interpreted otherwise. China has rejected this Gorbachevian switch to “Westernism”, and at a time when the West and Japan doubled down on capitalism… and they have thrived.
Developing countries are noticing this. Western countries should notice it as well… thus the massive “blame China” propaganda campaign.
The reality is “emulate China” is the answer, but that’s a faulty nationalist claim. It’s not China which is superior, but having national policies influenced by socialism and not capitalism.
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Here is the list of articles slated to be published soon, and I hope you will find them useful in your leftist struggle!
Part 1 – Western central bankers: they’re God, they trust – a 10-part series on the QE economy
Part 2 – How QE has radically changed the nature of the West’s financial system
Part 3 – QE paid for a foreign buying spree: developing countries hurt the most
Part 4 – Iran vs Mexico: ‘economic inflows’ versus ‘economic independence’
Part 5 – Understanding the West’s obsession with inflation
Part 6 – The new ‘beggar thy neighbor’: wars to devalue labor, not currencies
Part 7 – Blaming China for the Great Recession… to avoid emulating China’s (socialist-inspired) success
Part 8 – 1941, 1981, 2017 or today – Europe’s mess is still Germany’s fault
Part 9 – Don’t forget the real root of Brexit: fear of Eurozone economic contagion
Part 10 – Bankocracies: the real Western governance model
Ramin Mazaheri is the chief correspondent in Paris for Press TV and has lived in France since 2009. He has been a daily newspaper reporter in the US, and has reported from Iran, Cuba, Egypt, Tunisia, South Korea and elsewhere. He is the author of the books I’ll Ruin Everything You Are: Ending Western Propaganda on Red China and the upcoming Socialism’s Ignored Success: Iranian Islamic Socialism. His work has appeared in various journals, magazines and websites, as well as on radio and television.
“Eurozone – the biggest macro-economy in the world – … chosen far-right economic austerity policies which resulted in a lost decade (2008-2017)…. They averaged just 0.6% of growth, which makes “blaming China” so absurd considering Beijing centrally-planned their way to results which (8.3% annual average over that period) were 14 times (1,400%) superior.”
Precisely: French economists ought to dust off their old copy of “Le Plan, ou l’Anti-Hazard” to remind them what postwar Eurozone was all about — before this last, lost twenty years of AZC plunder and desolation by rigged “free markets”, rigged “austerity” for the poor and very liberal Social Welfare for the rich.
I continue to honor Ramin as the most insightful and practically useful contributor to The Saker’s website, because he brings totally solid investigative journalism and grounded science to what I consider to be the most critical and central controversial conflict in the world today. That being, objectively, Socialism is both correct and successful, and can be proven to be so. Ramin’s comment below goes directly to the living heart of our collective path to liberation.
“But it is not “China” which succeeded – that is essentially an ethnic or nationalist argument. China has policies which have nothing to do with chou mein and Fu Manchu moustaches – their policies are globally available and referred to as “socialism”. It is socialism which is succeeding – saying “China has succeeded” is to divert, in an essentially jingoistic way, credit from socialism. Of course, capitalists would stoop to any explanation in order to avoid the spread of the acknowledgment of socialism’s fundamentally-superior policymaking and humanity towards its citizens.”
We must all take great care to realize just how massively our minds get poisoned by the unrelenting propaganda war waged against socialism by the very people who we are now learning to criticize as our oppressors. It is clear to me that those of us who feel a need to look outside and beyond Socialism for a solution to humanity’s current crisis are victims of capitalist mind control, for all their good intentions. At root Socialism has profound spiritual origins and claim on the hearts of the peoples everywhere. The issue which confuses here is that those authentic spiritual impulses which animate socialism stem from outside the patriarchal spiritual tradition and hence are easily overlooked, and misunderstood, if not outright feared.
I also honor Ramin for upholding the name of Stalin. This is a man who archival records now available prove that Stalin himself attempted to introduce real democracy into the Soviet Union in the 1930’s. However he was thwarted by members of the Party and accepted the push back in a democratic fashion. Also Stalin is condemned for what is called the fabrication of the Doctor’s Plot trials in the late 1930’s. However records indicate that the American ambassador who attended those trials, and who was a trained and experienced lawyer, concluded that those on trial were obviously guilty of anti Soviet conspiracy. There is now proof that Trotsky was in conscious and deliberate alliance with world capitalist reaction to bring down the Soviet Union. Hence Stalin’s purge of Trotskyist reaction in the Soviet Union was correct and justified. (All well understood by the Chinese Socialist power) All for which Stalin has been unrelentingly demonized by both ignorant Trotskyists and the Capitalist propaganda machine. As well as Russian revisionists.
It is most enlightening to uncover just how much the positive contribution of Stalin has been successfully besmirched by unrelenting and highly organized Western capitalist propaganda. I myself as a life long student of socialism must confess that for a long time I too had been a victim of capitalist anti Stalin propaganda. So it is easy for me to understand just how well marinated in anti-Stalinism the whole of the Western mind has become. Stalin’s fear of Trotsky, who was in league with capitalist counter-revolutionaries to bring down the Soviet Union was deeply justified and correct. This is all new information that has not reached the wider socialist public as of yet. I recommend the work of Grover Furr.
All honor to your clear and powerful focus Ramin. I find it to be enormously helpful. Thank You
“The issue which confuses here is that those authentic spiritual impulses which animate socialism stem from outside the patriarchal spiritual tradition and hence are easily overlooked, and misunderstood, if not outright feared.”
What exactly is meant by “patriarchal spiritual tradition” which the spiritual impulses of socialism are outside of, when governments, church, communists and the oligarchy have been and are patriarchal ?
From where do these spiritual impulses of socialism actually stem ?
Maybe Stalin was indeed in the tight grip of western pincers, however, his “positive contributions,” what were they in terms of the spiritual rights of the people and country of Russia, how did they meet these ?
Political terms like socialism, communism and capitalism are fine, but abstract without the defining characteristics of how and what they are thought of as meaning, placed beside the reality of their supposed application.
Thank you so much for your article Ramin !
Mia; Hi!
The struggle between capitalism and socialism is an argument between God and his Wife. In the Jewish tradition Yahweh and Shekenah, his female counterpart. In the Western tradition the Christian God and Isis (or Ishtar, Aphrodite, Venus, Demeter or any other of a great variety of names) This is the radical insight of the psychologist Carl Jung. He observed that the cold war “is an argument within the family.” By this he meant the divine family. Carl Jung also wrote that, for the West, Russia represents the collective unconscious. The West’s ego driven hostility to the unconscious is what is really compelling the NATO establishment in its deeply irrational hostility toward Russia. (Russiagate is driven by irrational fear of the contents of the unconscious. Hence Trump derangement Syndrome)
Carl Jung’s contribution to political consciousness is great here because he teaches us to understand that for the last 200 years the female dimension of God has been attempting to emerge from out of 5,000 years of banishment into the unconscious at the hands of an exclusively masculine socialization of God. (Scratch a Vatican edict here) Therefore it is eminently logical that this insurgency would be represented by the great nation that, for the West, represents the opening to the collective unconscious. That being “Mother” Russia. From there socialism was spread to nations that had minimal cultural resistance to the divine feminine. Such as China, Cuba, Latin America etc.
Socialism is far more than a bunch of abstract political ideas. It is a living mass culture that in multiple ways reveals its inner content. That being the resurgence of the feminine aspect of cosmic creation. This living cultural (i.e., psychological) content is locatable in poetry, literature, the arts, including cinematographic arts (such as socialist realism and surrealism.) It has its own psychologically active religious symbols. Such as the red star, and the hammer and sickle, among others. It is locatable in philosophy as materialist dialectics. The atheism of socialist philosophy is better understood as an argumentative rejection of the patriarchal god in favor of the grounded materialism natural to the divine feminine. Here is Jung’s “argument.” If one looks closely at socialist culture one sees constant and varied emphasis on the emancipation of the feminine.
The great difficulty is that the socialist movement never had a conscious awareness of this living archetypal presence of the divine feminine. It just lived it and felt it. It was not until 1970 that the West actually became consciously aware of the fact that the long forgotten Goddess was rising again. And it was not until 1985 that the connection was made that Socialism is a living manifestation in political culture of that emergent “Wife of God.” The challenge for today is that after 5,000 years of moral and religious assimilation of a one sided patriarchal god-image, and its condemnation of the spiritual identity and values of the divine feminine, we have lost the ability to even recognize her presence. We no longer have the eyes to see her. So for two hundred years we have been living in a “mythic” insurgency. Meaning, acting out a spiritual process of which we were actually “unconscious.”
Carl Jung’s psychological argument is that it is the role of the divine feminine to complete the reunion of the twin halves of god into a liberated unity. This points to the leading spiritual role of socialism in the healing of Western “Christian civilization.
All of this can be mined from a close study of Carl Jung. Hopefully this helps.
China has surged ahead economically, since its central bank The Bank of China is government owned, that enables it to create its internal domestic currency, the yuan free from debt. This enables it to put its population to work building infrastructure: high speed rail, highways, power stations, the electricity grid, hydro schemes, schools, universities, hospitals, pay for education, research and development without having to go into debt to the private world banking cabal. For this it is accused of currency manipulation.
The Problem of Labelling.
It’s a very old ruse: Put a label on a bottle in order to sell it………..then fool the consumer by filling the bottle with something entirely different.
Most of the people…in most places……….. are fooled most of the time………..but not all of the people are fooled all of the time.
It is the Survival Instinct of Nature itself that drives the individual or society to correct its errors of discernment before collapse, slavery and death naturally result from being TOO badly fooled….and imbibing lethal doses of ideological poison.
What is bottled as “Socialism” in North America, for example, is entirely different from what has energized China and brought hundreds of millions of persons out of poverty there. The contents of western policy bottles labelled “socialism”..in the last few decades, especially……..are for the most part pure poison intended to result in slow death….. not life-sustaining health nor any sort of improved material nor cultural level of the members of its society, nor any foreign societies it seeks to impose its hegemonic perversions upon.
Meanwhile, as China and Russia and Iran and other places achieve some blend of personal entrepreneurial initiative and communal well being for more and more members of their societies, the badly fooled by fake labelling American public are more divided and convinced of the delusion of their ideological opposites…… now “RED” (ironically!!!) versus “BLUE” (and virulently Russophobic…just as ironically!) ……….than ever before in their history.
The most deluded side, IMHO (as evidenced by their hysterical Russophobia and Trump Derangement Syndrome……fear-based nonsense and irrationality) are the Blue ones and their Fake Socialism …a sort of Mass-Suicide ..and “Me-too” Victimization Cult
However, the Red, MAGA side does have its discernment issues as well. A common reaction of these US Constitution worshippers, upon the Preamble section of that document being quoted (citing promoting “The General Welfare”: as being its purpose.) …is to recoil in horror…..exclaiming: “That sounds like Socialism, to me!”
People are hilarious.
Since settling these differences and arguments with the increasing mass lethality of the weapons of war has become less and less of a “viable” option,as it was (sic) in “former times” ……I am optimistic that the powers of discernment of the common man and woman anywhere in the world……..have a wonderful opportunity to dramatically improve, in the coming decade……..Necessity being the Mother of Invention
Happy New Decade!
to Snow Leopard:
In ancient times of the Egyptian Pharaonic times, women had the same rights as men, officially and in laws.
This is too clearly up till today visible in the depiction and story about Isis and Osiris, wife and mother.
The Roman Empire was – in my opinion – guilty of the destruction of the rights of the women in Egypt. Even in Italy up till approx. 600 AD Isis had temples and had been worshipped. Isis is depicted quite early on as holding her child on her knees.
Thus leads clearly to put away some sorts of veils upon the Roman-Catholic church und its propagated believes.
‘.. later disagreements cannot ever change socialist China’s childhood and adolescence.’
Mao stated in 1949 ‘China must utilize all the factors of urban and rural capitalism that are beneficial and not harmful to the national economy and the people’s livelihood, and we must unite with the national bourgeoisie in common struggle. Our present policy is to regulate capitalism, not to destroy it.’
To the degree that any nation is NOT socialist they will be better off, surely not to the degree they are. Freedom; something the US no longer advocates in reality.