A Chinese-Russian Christmas tale ?

I spend my time, retreated from society, writing thinking and image-making. I'm presently writing a volume about Modernity. My perception is thus necessarily the long haul. Unfortunately these last few days the anti-system bloggers, who constitute my first source of information, were overtaken by too much fantasy for my taste. 
To console myself in this period of the Year I hereafter share a Geopolitical Christmas tale that is rooted in the last episodes of actuality.

As a preamble…

Power in today’s world is far more complex than a matter of military dominance. Moscow, Beijing and Washington have furthermore an acute understanding that the present Geopolitical contradictions can’t be solved by a world war which would simply cut the escape of their societies and plunge their citizens in a Berezina. In that sense Geopolitics has now to be viewed as the systemic complexity of the interactions between the open societal fields (internal and external) of all nations on earth.

The present Geopolitical moment is a very special moment indeed.

1. Two trends have been solidifying over the centuries of Western Modernity: On one side the center of gravity of the economy-world has been shifting, away from the West, toward East-Asia and more particularly toward China :
   
   
   • This is the 8th such a shift of the center of gravity of the economy-world over the entire span of Modernity… What is different this time is that the center of gravity is leaving the territorial area of the Western civilization which explains the madness that has overtaken Western capitals
   
   
   • On the other hand Western countries have been accumulating a multitude of side-effects over the last centuries of Modernity. The nature of these side-effects is double :  – damages to the habitat of living species (nature) through different forms of pollution – damages to the societal organization of the human species through the pollution of ever more individualism that is concluding presently with the cancer that is societal atomization.


2. The present moment is more particularly characterized by “The Great Convergence of Late-Modernity” :
   
   
   • The convergence, within Western societies, of Neo-liberalism and Postmodernism has unleashed a superficial globalization of Western Modernity to the 4 corners of the world while internally this convergence has forced Western societies into – societal inequality – pauperism – hyper-individualism – a complete loss of meaning – an individual feeling of isolation – and so many more unfortunate facts that are all aspects of societal atomization which means that such societies are no longer united entities and in that sense successful collective undertakings are no longer in their reach (no shared worldview left to glue the individuals in a unified societal whole).
   
   
   • The convergence, within nature, of a multitude of side-effects, that resulted from “the reason that is at work within the transformation of money into capital”,  were called “externalities” because capital refused to pay for eliminating their life disrupting character. These side-effects have thus been left to freely disrupt the equilibrium that has ensured the abundance of flora and fauna and more particularly the stability that ensured an ever increasing complexity of human societal life over the last 10,000 years.
   
   
   • Lately the effects of these disruptions, within Western societies and within nature, have started to converge and are forcing humanity to face its predicament : “what now ?”. Most of us are oblivious to this predicament. But most scientists and some public decision-makers, a rarity in the West, are well aware of this situation… Those of us who listen carefully know for a fact that Beijing and Moscow are realist and are thus well aware of the extreme complexity of the present situation :
   
   
   • An acute awareness has emerged in the minds of the realists that to face the predicament of humanity it is indispensable, first and foremost and also urgently, to solve 1.1. which basically calls for a new world order in which the West is forced to play by the new rules of the game that the community of nation decides upon.
   
   
   • The United Nations’ effort to combat climate change has taught a few important lessons :
     
     ***  the West will never contribute in an adequate manner for the bulk of externalities that it is directly responsible for
     
     *** climate change is merely a symptom of the larger problem which is that the side-effects of Modernity are destroying the habitat of living species 
     

A Geopolitical Christmas Tale…

Moscow and Beijing are well aware of the disintegration of the cultural, social, and economic realities in the West that I sketched in 1.2. and in 2.  and they have patiently been waiting for the most propitious moment to initiate a strategy to placate the West. It so happens that their forecasting services alerted them to an exceptional convergence of factors that would culminate with the Beijing Winter Olympics.

Whatever the Western propaganda might be trying to force in the minds, of the people of this earth, the fact of the matter is that Western countries, in 2020, have entered the greatest depression in the whole of Modernity and this depression is bound to last, at least 10 years but most probably more, creating massive poverty and misery while disintegrating the sickest among Western societies.

Covid like a pin first deflated the Western financial bubble in 2020. The FED’s response was the shuffling of uncounted trillions of dollars of paper around the economy in the hope of igniting the animal spirits on Wall Street. This was realized, among other, by :
—   Cutting Federal funds rate to a range of 0% to 0.25%
—   Purchasing massive amounts of debt securities with a questionable value
—   Colossal amounts of low interest rate loans to the largest primary dealers
—  Lending to banks against collateral in IOUs or commercial paper
—   Funneling cash to overnight repo-markets
—   Expansion of International swap lines
—   Massive amounts of funding to foreign central banks without swap lines
—   Cash to the banks against questionable paper collateral at the discount window
—   Support of the flow of credit to U.S. corporations
—   Lending to corporations through the Commercial Paper Funding Facility (CPFF)
—   Lending to households, consumers, and small businesses against asset-backed securities
—   Backstopping municipal and state borrowing
—   Etc…

The result of this financial largess became visible in the second part of 2021. An ever increasing inflation sows misery in the poorest families and people resist this inflation by claiming higher wages which results in the multiplication of social conflicts.

We furthermore recently discovered that all this would be topped this winter by a new wave of Covid infections. The forecasts indicate that the Omicron surge could push the number of infections to their highest level yet. The UT COVID-19 Modeling Consortium at the University of Texas at Austin projects that by the end of January, more than 500,000 people could catch the virus every day on average … with and estimated 3,876 deaths per day on average…

In sum the West is confronted with :  societal disintegration + the greatest of all depressions + hyperinflation + social conflicts + a new Covid wave that could be worse than the earlier ones. The least we can say is that this is going to fatally weaken the US and the same can be said of Europe.

 

 

 

And then came the following...

1. 2021-12-07 : Putin and Biden have a 2 hour video-talk about the Ukraine crisis.



2. 2021-12-07 : President Biden says that putting American troops on the ground in Ukraine to deter a potential Russian invasion is "not on the table" and that he hoped there would be an announcement by Friday 9th of high-level meetings with Russia and major NATO allies to discuss Moscow's "concerns relative to NATO writ large" and the possibility of "bringing down the temperature along the eastern front."



3.  2021-12-15 :  Putin and Xi have a video call and discuss tensions in Europe and the "aggressive" U.S. and NATO rhetoric. Wang Wenbin, spokesperson for the Chinese Ministry of Foreign Affairs, answered the following to a reporter who asked him what was the outcome of this video-call :
   
   

   “The world is witnessing the combined forces of changes and a pandemic both unseen in a century against the backdrop of complex and profound changes in the international and regional landscape. We believe that China and Russia, two permanent members of the UN Security Council, take on an important mission in defending regional peace and stability and promoting development and the revitalization of all countries.
   For some time, certain countries have been drawing ideological lines, building new military blocs and stoking regional tensions, which have all brought grave threats and challenges to regional peace and stability and global strategic stability. China and Russia firmly reject this.
   We will continue to follow the two leaders’ consensus, take up responsibility, unite all forces that love peace and support peace, and make active contribution to realizing sustained, universal and common security in the region and the wider world."

   
   
   There was no way for China to assert more clearly that it is siding with Russia in its demands…  but everyone seems to have missed the seriousness of the Chinese side ...except for M. K. Bhadrakumar who is one of the most lucid observers out there. Few people understand the meaning of the expression “the two leaders’ consensus”.  This expression relates to the will of their countries to see these two leaders in place for the long haul during the stabilization of the post-Western world order. Both countries, not in their unanimity but certainly in their large majority, have sensed since some years already that they have someone unique in  their present president. A person who outshines the other decision-makers around them in term of their stamina and their mental clarity. How is it possible, that the West does not get this, is beyond my understanding ?



4. 2021-12-17 : Moscow releases the texts of two documents in the form of two draft treaties that many interpreted as an ultimatum of Russia to the West.



5.  2021-12-17 : Secretary-General Jens Stoltenberg asserts the alliance’s prerogative to intervene in Ukraine and bluntly rejects Moscow’s notions that it could have a say on the alliance’s future expansion plans.



6. 2021-12-19 :  Christine Lambrecht, German Minister of Defense, Asserts that NATO was willing to discuss Moscow’s demands but would not allow Moscow to “dictate” to the alliance or its partners.

By the 20th of December Western media were littered with articles belittling the partnership between China and Russia as “still having an artificial flavor” and suggesting that China would never fight the US along Russia. Ultimately, they proclaim, Russia will join the West in defeating China. But this is the propaganda of a rear guard of Western ideologues who are bluffing their way trying to force their madness on all nations that refuse to submit to their unilateral order.

The Russian treaty/ultimatum has to be understood as a first act in a wider strategy that is being played out, in concert by Russia and China, in order to provoke the financial and economic fall of the US.

 

But why pushing the US to fall precisely now ?

Well the present context offers a unique opportunity. The Chinese sages never tired to repeat that if you are forced to fight you do it when your enemy is at its weakest !  And the present Geopolitical context announces the coming of the peak bacterial catalysis infesting Western wounds. This is why pushing the US to fall precisely now has the best chances to succeed.

Now about China. It is without any doubt an a-religious country.
Its early-power society grew, as the outcome of the cultural unification of its tribes, sometimes between 6000 and 5000 years ago. And thereafter it constantly actualized animism with present changing trends by topping it with add-ons in the same way as open-source software integrates innovations from the community… Now animism was a highly pragmatic knowledge formation approach that is rooted in observation over the very long haul that led to the induction of abstract principles from this observation. Animism remains in application today in its appellation of “Chinese Traditional Culture” which is  a form of animism+.

This means that China is — a-religious — highly pragmatic — and a reserved nation with reserved individuals.

What this means is that the Chinese thinking is not driven by ideology and is not experiencing the need to impose itself on others. Having said that the Chinese have been observing the vile racist aggression coming out of the West over the last few years. They have spoken little. They have observed and have been thinking hard. And now they are at the end of their strategic patience. Chinese leaders know darn well that they have not much of a history in diplomacy which means, if I may say so, that their practice has not had the time yet to grow into a perfectly polished whole. That is why China, in all humility, openly recognizes Russia’s ‘panache’ in the diplomatic field and now relies on it to position its own.

So it was only natural for China to let Russia publicly initiate the decisive movement forward in their common play for a new world order. China publicly sided with Russia when it announced its treaty-proposal/ultimatum and what is most important is that China detains the weapon of last resort which is the termination of US dollar payments for the delivery of its goods and services. ;

 

Fast forward…

Russian leaders have informed their Western counterparts that if they do not start to negotiate soon they will take the necessary technical measures to make them understand that they are deadly serious. It seems that Westerners have understood this part of Russia’s argument. Russian leaders even went further and informed very publicly that if the West was participating in negotiations in order to drag them down they would use their technical means to awake Western attention.

The latest news is now that negotiations will start in the beginning of January 2022. In the eyes of the Russians one month is amply sufficient to reach an agreement and if there is no agreement by the end of the month they say that they will act.

Coincidentally President Putin and President Xi will meet in Beijing to open the Winter Olympics on the 4th  of February 2022 at Beijing National Stadium.  The Russian timing of the conclusion of its negotiations with the US and Nato coincides thus with the very public and media relayed meeting of President Putin and President Xi !  Ho ho...

Now the fact is that the discourse of Russian leaders leaves no place for a 3rd alternative as a possible outcome of these talks. From what we hear it is  —  or “we have a deal” and the West accepts a retreat to its posture before the fall of the Soviet Union  —  or “we have no deal” and China and Russia, on the 4th of February, announce their further game-plan to the world.

Some Russian officials have already announced that one of the measures that they could take if there is no agreement is to refuse payment in dollars for any goods they export… And the fact is that China’s Digital Yuan is ready for use by the Chinese public at large. By October there were already 140 million people who had opened “wallets” and remember that this digital yuan has been designed, over the last 7 years, to act as a new technical payment system for international exchanges that will thus for the first time be free of Swift’s intervention and Washington’s judicial long arm…  This Digital Yuan will also be connected to block-chains that will handle  the currency exchange between Yuan and local currency, the final payment as well as tax matters, transportation matters,… all this promises to erase the hefty bank commissions and lengthy bureaucratic delays which should catch the attention of the buyers of Chinese goods while reducing the volume of exchanges in US dollars.

To get a sense of how the digital Yuan is going to impact the world watch these 2 interviews of Richard Turrin who is one of the most knowledgeable English speakers about the subject.
China’s Central Bank Digital Currency by Fat Tail Investment Research
Big Tech in China and the Digital Yuan by Oriol Caudevilla

The reader is encouraged to imagine his own conclusion ... 

Happy Christmas and New Year to everyone.