Recently Yahoo Finance carried the following article which was full of insights, I think. I attached it below for sharing purposes:
The Trump administration just escalated its high-stakes
competition with China
CNBC
Fred Kempe
CNBC October 6, 2018
Even with all news noise focusing on the Brett Kavanaugh
Supreme Court confirmation fight and the "not NAFTA" trade agreement
among the U.S., Mexico and Canada, it would be a mistake to miss this week's
most significant geopolitical development:
The dramatic unfolding of the Trump administration's
intensified offensive on China.
The administration's clearest and most comprehensive
broadside on China yet followed what one official called "thousands of
hours" of study and planning. It will involve agencies across the U.S.
government, from the Pentagon to the U.S. Trade Representative. The
consequences will be both immediate and potentially generational for global
economic and security matters.
Senior officials in Beijing have increasingly worried that President
Donald Trump , with his new tariffs on more than $200 billion of Chinese
imports, wasn't just acting as a deal-maker seeking greater leverage for market
openings. They suspected a shift was afoot in Washington to more fundamentally
address the Chinese challenge.
Now the Chinese have their answer.
What lies behind a series of administration statements and
actions was a deepening conviction that Trump's predecessors have done too
little to respond to years of unfair Chinese trade practices, cyber transgressions,
rapid military growth, growing technological prowess and the underlying
strategic consequences of the so-called Belt and Road economic initiative,
whose aggregate investment and loan figures are a multiple of the Marshall
Plan.
Four pieces of news this week underscore the far-reaching,
multi-faceted nature of the Trump administration efforts aimed at China, with
senior officials promising more in the weeks ahead.
They include:
A landmark speech by Vice President Mike Pence at the Hudson
Institute, calling out China as America's foremost threat, ahead of Russia, due
to both the scope and seriousness of its activities abroad and within the
United States.
An underreported aspect of the new U.S.-Mexico-Canada trade
agreement that requires all three parties to inform the others if they begin
trade talks with "non-market economies" (read China). Trump
administration officials view it as a template for trade deals to follow.
A leaked report that the U.S. Navy's Pacific Fleet has
proposed a series of military operations during a single week in November to
send a warning to China and to provide a deterrent to its Beijing's regional
military ambitions.
On Friday, the Pentagon released the results of a yearlong
look at vulnerabilities in America's manufacturing and military industrial
base. "China represents a significant and growing risk to the supply of
materials deemed strategic and critical to U.S. national security,"
including a "widely used and specialized metals, alloys and other
materials, including rare earths and permanent magnets," the report says.
Pence went far beyond Trump's UN speech statement that China
was acting to influence American elections against him. Pence said for the
first time, echoing a view held by Trump since before his presidential
campaign, that "what the Russians are doing pales in comparison to what
China is doing across this country."
Pence acknowledged that Trump has built a strong personal
relationship with Chinese President Xi Jinping and that they've worked together
on issues of common interest, particularly the denuclearization of the Korean
Peninsula.
But, said Pence, "the American people deserve to know …
Beijing is employing a whole-of-government approach, using political, economic
and military tools, as well as propaganda, to advance its influence and benefit
its interests in the United States. China is also applying this power in more
proactive ways than ever before, to exert influence and interfere in the
domestic policy and politics of our country."
Some will argue that the timing of the Trump-China reset has
an electoral purpose ahead of U.S. midterms elections. However, the
comprehensive approach ensures it will last long beyond November. It also
reflects a shift of thinking among American experts regarding China. Most have
abandoned the hope that Chinese economic growth would bring with it democratic
change, a greater embrace of individual rights and thus greater common cause
with the U.S.
The Trump administration's new efforts carry with them
considerable risks, which ultimately may be greater than during the Cold War
years. For all of Moscow's nuclear capability, its sclerotic economic system
never made it much of an economic competitor. The Soviet Union also never was
as integrated in the global economy. By some measures, such as purchasing price
parity, China already became the world's largest economy in 2014.
Although such epic, historic contests never begin with
military conflict in mind, they frequently end that way.
"The real lesson of history," writes Anthony
Cordesman of CSIS, paraphrasing Santayana, "is that it really doesn't
matter whether one remembers the past or not. One repeats it anyway."
Graham Allison of Harvard popularized the concept of
"Thucydides Trap," namely that when one great power displaces
another, war is most often the result. He argued this week that to avoid that
outcome this time around the U.S. and China will require the kind of
"extreme imagination" that has failed them thus far.
The Trump administration's China shift is one of its boldest
moves yet. Far more difficult will be to forge a strategy that manages the
competition without conflict and deploys "extreme imagination" to
create a world order that defends U.S. interests and embraces a risen China.
(Note: Frederick Kempe is a best-selling author, prize-winning
journalist and president & CEO of the Atlantic Council, one of the United
States' most influential think tanks on global affairs. He worked at The Wall
Street Journal for more than 25 years as a foreign correspondent, assistant
managing editor and as the longest-serving editor of the paper's European
edition. His latest book – "Berlin 1961: Kennedy, Khrushchev, and the Most
Dangerous Place on Earth" – was a New York Times best-seller and has been
published in more than a dozen languages. Follow him on Twitter @FredKempe and
subscribe here to Inflection Points, his look each Saturday at the past week's
top stories and trends.)
My feeling is that It is time for China to rethink its future economic system in whether to truly open it up. But to change into a true market economy CCP would need substantial changes in its political system which it does not have the nerve to touch on. China is at the crossroad. Trump has fired his first short.