From Greg Jericho today:
On Tuesday Trump suggested that “I am doing this whether it’s good or bad for your statement about, ‘Oh, will we fall into a recession for two months?’ The fact is, somebody had to take China on. Whether it’s good for our country or bad for our country, short term, it had to be done.”
He repeated that “whether it’s good or bad, short term, is irrelevant”.
This all comes in a week in which BHP announced a 124% rise in profits to $US8.31bn for 2018-19 and in which its chief executive, Andrew Mackenzie, told journalists that “the US-China relationship is a consideration for us. We continue to enjoy strong sales to China. But no doubt this [trade standoff] will put a dampener on world economic growth. Ultimately it will impact demand for our products.”
For Australia anything that hits China’s economic growth is bad news given how important it is to our economy.
Our merchandise exports to China totalled $133.8bn in the past financial year – some $75bn more than the exports to Japan:
China now accounts for 36% of our total merchandise exports – or more than to Japan, Korea, Taiwan, the US and EU combined.
Similarly, Chinese students make up more than a third of all foreign students enrolled in higher education – and more than double the number of those from the next most common nation of India.
And while the volume of our exports accounts for around 22% of our GDP, over the past decade around 35% of the growth in our economy has come from exports.
In effect what has happened over the past 20 years is that private investment and exports have swapped in importance – during the mining boom, investment was the key; now it is exports:
It means our economic health is much more subject to conniptions in China and the US than it was prior to the GFC.
…And so as the jitters across the world continue with the president of the United States now apparently trying to soften up his supporters for a recession that it needs to have, Australian companies and our government will hoping against hope that we don’t fall into a recession because of one man’s ego and economic ignorance.
Wow indeed. Has Greg Jericho never heard of the Communist Party of China? Of Xinjang? Of Tibet? Of Hong Kong? Of the South China Sea? Of the Silent Invasion? Of liberal capitalism? Of freedom?
As usual Jericho is so busy stroking his reader’s hatred of Donald Trump owing to culture wars that he can’t see the woods for the trees.
The CPC is the world’s greatest tyranny and was in the process of dismantling the US liberal empire to replace it with its own illiberal version before Donald Trump came along. The Obama Administration had recognised this reality and “pivoted to Asia” but its approach was too soft. Trump’s approach is stronger, and it will break some eggs, but so what? What matters is the US gets it done. If we lose a few points of GDP in the process so be it.
Trump and the US liberal empire are at times obnoxious, but it is the geopolitical umbrella under which Australian democracy has existential force. If the CPC dominates the region instead there will be no Australian freedom worth a damn.
The irony is that Jericho and The Guardian would be shut down and shipped out for re-education the moment this became reality.
Or would they?!?