by TOM ENGELHARDT
This is indeed a crisis moment in history in which you might think that the greatest powers on the planet would feel impelled to rise together in genuine cooperation. Despite John Kerry’s recent visit to China, however, it looks like no such luck. In that context, check out TomDispatch regular Dilip Hiro on who’s really rising and falling right now in economic, technological, and infrastructural terms. Tom
Biden’s anti-China ambitions: A reality check
by DILIP HIRO
Like his immediate predecessor, Joe Biden is committed to a distinctly anti-China global strategy and has sworn that China will not “become the leading country in the world, the wealthiest country in the world, and the most powerful country in the world… on my watch.” In the topsy-turvy universe created by the Covid-19 pandemic, it was, however, Jamie Dimon, the CEO and chairman of JP Morgan Chase, a banking giant with assets of $3.4 trillion, who spoke truth to Biden on the subject.
While predicting an immediate boom in the U.S. economy “that could easily run into 2023,” Dimon had grimmer news on the future as well. “China’s leaders believe that America is in decline,” he wrote in his annual letter to the company’s shareholders. While the U.S. had faced tough times in the past, he added, today “the Chinese see an America that is losing ground in technology, infrastructure, and education — a nation torn and crippled by politics, as well as racial and income inequality — and a country unable to coordinate government policies (fiscal, monetary, industrial, regulatory) in any coherent way to accomplish national goals.” He was forthright enough to say, “Unfortunately, recently, there is a lot of truth to this.”
As for China, Dimon could also have added, its government possesses at least two powerful levers in areas where the United States is likely to prove vulnerable: dominant control of container ports worldwide and the supplies of rare earth metals critical not just to the information-technology sector but also to the production of electric and hybrid cars, jet fighters, and missile guidance systems. And that’s only a partial list of the areas where China is poised to become dominant in the foreseeable future. Here’s a likely scenario.
The Digital Yuan Versus the (Missing) Digital Dollar
Within the broad headline of the globe’s “second-largest economy,” China has already either surpassed the United States or is running neck-and-neck with it in certain specific sectors.
With a global smartphone market share of 20% in the second quarter of 2020, China’s Huawei Technologies topped the charts, marginally exceeding South Korea’s Samsung, and well ahead of Apple, according to the International Data Corporation. This happened despite a concerted drive by President Donald Trump’s administration to damage Huawei that culminated, in May 2020, with Washington barring companies worldwide from using U.S.-made machinery or software to design or produce chips for that company or its entities from that September on. Nonetheless, with a 47% share of China’s booming 5G smartphone market, Huawei topped the list there while it kept up its investment in future-oriented, cutting-edge technologies and basic research to the tune of a striking $3 billion to $5 billion annually.
Broadly speaking, China continues to make impressive strides when it comes to developing its information and communications technology sector. Its Fintech (Financial Technology) report, published in October 2020, showed that an estimated 87% of Chinese consumers used fintech services. With a vast mobile-payment system that hit $29 trillion (200 trillion yuan) worth of payments in 2019, China is shaping up to become the globe’s first “cashless society” and its largest financial-technology ecosystem by the end of this decade.
Less than 10% of Americans use mobile payments, which means a similar scenario for the United States is nowhere on the horizon. With mobile transactions in China already accounting for at least four out of every five payments and more than half the value of all non-cash retail payments, that country is poised to leave the U.S., a comparative laggard in fintech, shackled to a cash-dominated system.
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