Tuesday, May 19, 2015

Economic War Of The Pacific - 6

The M.V. Usetowas

This series began in 2009.

It began when Dredd Blog came across some concerns of Lee Kuan Yew, a statesman from Singapore (Economic War Of The Pacific, 2, 3, 4, 5).

A related post was also begun in 2009 to help describe and detail dynamics taking place in the Pacific Basin (First Shots Fired In The Currency Wars).

Dynamics that focus on international trade and competition among various nations.

The U.S. is one of those nations.

These dynamics concern and impact national and international economies and currencies.

It may also be that the Trans-Pacific Partnership (TPP) is related to this international competition since it is a classified matter  ("the text of the TPP agreement remains classified information").

Concerns Involved

The overall concern pointed out in Dredd Blog posts mentioned above was economic, which has turned out to have been a realistic view:
“The 21st century will be a contest for supremacy in the Pacific because that’s where the growth will be,” Lee said. U.S. President Barack Obama, he said, must understand this.

“If you do not hold your ground in the Pacific you cannot be a world leader,” Lee said, “That’s number one.”

“Number two, to hold ground in the Pacific, you must not let your fiscal deficits and dollar come to grief,” he said.
(Economic War Of The Pacific, 2009). That may have been ignored, because the results expected were confirmed:
Hang on to your hats, America.

And throw away that big, fat styrofoam finger while you’re about it.

There’s no easy way to say this, so I’ll just say it: We’re no longer No. 1. Today, we’re No. 2. Yes, it’s official. The Chinese economy just
Review Due - On Sale Now
overtook the United States economy to become the largest in the world.
For the first time since Ulysses S. Grant was president, America is not the leading economic power on the planet.

It just happened — and almost nobody noticed.

The International Monetary Fund recently released the latest numbers for the world economy. And when you measure national economic output in “real” terms of goods and services, China will this year produce $17.6 trillion — compared with $17.4 trillion for the U.S.A.

As recently as 2000, we produced nearly three times as much as the Chinese.

To put the numbers slightly differently, China now accounts for 16.5% of the global economy when measured in real purchasing-power terms, compared with 16.3% for the U.S.

This latest economic earthquake follows the development last year when China surpassed the U.S. for the first time in terms of global trade.
(Economic War Of The Pacific - 5, 2015). That eventuality sets the stage for the next concern, the "reserve currency" used by international commerce and intercourse.

Here is what Dredd Blog posted concerning that issue:
China’s central bank governor has issued a bold proposal to overhaul the global monetary system and one day replace the dollar as the world’s main reserve currency with the International Monetary Fund's (IMF) Special Drawing Right
(First Shots Fired In The Currency Wars, 2009). This is a concern because, we would be impacted more so than other players in this game:
One of the concerns of US financial experts is the removal of the dollar as the "reserve currency" of the world:
The United States of America, if we didn't have the dollar as the de facto reserve currency of the world, we'd be Greece. I mean, we are broke, bankrupt. Really bankrupt.
(James Baker on GPS with F. Zakaria). James Baker was a former Secretary of the Treasury of the U.S.A. for Bush I.
(Phase Five Of The Currency Wars? - 2). That dynamic has grown stronger over the past few years, with the U.S. losing a lot of ground:
Russian Prime Minister Vladimir Putin accused the United States on Monday of living beyond its means "like a parasite" on the global economy and said dollar dominance was a threat to the financial markets.

"They are living beyond their means and shifting a part of the weight of their problems to the world economy," Putin told a Kremlin youth group while touring its summer camp north of Moscow.

"They are living like parasites off the global economy and their monopoly of the dollar."
"If over there (in America) there is a systemic malfunction, this will affect everyone," Putin told the young Russians.

"Countries like Russia and China hold a significant part of their reserves in American securities ... There should be other reserve currencies."
(Phase Six Of The Currency Wars?). That talk has been converted into one significant action after the other:
The group of emerging economies signed the long-anticipated document to create the $100 bn BRICS Development Bank and a reserve currency pool worth over another $100 bn. Both will counter the influence of Western-based lending institutions and the dollar.
“BRICS Bank will be one of the major multilateral development finance institutions in this world,” Russian President Vladimir Putin said on Tuesday at the 6th BRICS summit in Fortaleza, Brazil.

The big launch of the BRICS bank is seen as a first step to break the dominance of the US dollar in global trade, as well as dollar-backed institutions such as the International Monetary Fund (IMF) and the World Bank, both US-based institutions BRICS countries have little influence within.
(BRICS vs Western dominance). It could be that the secret, classified TPP is a reaction to the ongoing success of BRICS nations.

It is sometimes called "the pivot to Asia" which one documentary journalist sees as part of the preliminary dynamics of The Coming War Between America and China.


Another concern of mine, in this international trading scene, is sea level rise (SLR), even though it is mostly ignored.

The secret, classified, TPP is not immune to the SLR problem, even if it bolsters economies in the short run (The Trans-Pacific Partnership (TPP) and Sea Level Rise (SLR)).


The only thing absolutely certain in this matter is that SLR cannot be defended against by the use of military force (Why The Military Can't Defend Against The Invasion).

Thus, the gunboat diplomacy of recent decades has been a waste of "blood and treasure" (the warmonger description).

We should have been addressing the unstoppable threats, which no international agreement can resist successfully (unless it is a comprehensive international agreement to halt civilization's burning of fossil fuels as a source of energy).


  1. There will be a rather large increment of time between the mess that the TTP brings and before SLR has a demonstrable effect on trade and the population living along shorelines. It could probably be measured in decades. Before SLR, i'd expect food shortages to become a world-wide problem as the weather continues to impact the growing of crops throughout the world (from drought, flooding, hail, wind and storm damage and erratic weather extremes to name some), financial collapse of the world economies is probably also going to precede SLR - and this may lead to nuclear war, since i don't expect anyone will be acting "rationally" or "for the good of all" once these kinds of impacts are felt. i still think that our situation will change drastically (for the worse) by 2020 and that large swaths of the Earth's human population will be dying off in the decade from 2020 to 2030. i'll may be among the first to depart.


    1. Tom,

      Yes, the Pacific SLR is driven more by Antarctica, rather than Greenland.

      But the San Francisco Bay officials published a report that understands the reality and seriousness of the problem.

      They imbibe in more hopium than I do, in terms of when.

      Greenland is the abrupt ground zero.

      Recently the ice sheet was found to be different than the software models had contemplated (Hidden Movements of Greenland Ice Sheet, Runoff Revealed).

      So, they are redoing or remodelling their software.

      One of the most striking discoveries is the amount of water that stays liquid under the surface.

      This continually weakens the sheet.

      Then there are spontaneous hot sprints, volcanoes, and earthquakes that could warm and shake the slushy stuff into flows (New hot springs in Greenland after an earthquake (swarm?)).

      There is potential for unexpected abrupt ice and melt water flow.

      In the absence of abrupt changes, the ice volume loss doubled in only 5 years during and after 2009.

      We need to keep an eye on Greenland as a primary threat to the North East, and the Totten glacier in Antarctica for primary impact on the Pacific.

  2. California blames the victims, lets big oil and big ag slide (link).

  3. Thanks for the explanation Dredd. A sudden Greenland melt-out WOULD be an abrupt SLR. Geez, we're really skating on thin ice. (sorry).


    1. Tom,

      Only a 10% melt or calving of just Greenland's Ice and captured melt-water would do the ports in (21.49 ÷ 10 = 2.149) added to the already 1.0 - 1.5 ft of SLR already in play in the NE U.S. port areas ("Already, at least 13 islands in the bay have disappeared entirely, and many more are at risk of being lost soon." - Will This Float Your Boat - 10).

      Don't sniff too much methane (sorry).

    2. Tom,

      If one one-hundredth [1/100] (263.5 ÷ 100 = 2.635) of the world ice sheets (ice over land) make it to the sea as ice, or as melt water, that would get it up to or over the 1m / 3 ft. SLR disaster level:
      HBO Vice: "Our Rising Oceans", with Dr. Eric Rignot:

      2:43 - "One meter [of SLR] would be a global catastrophic event, 3 meters would remap the world as we know it?"

      2:50 - "Yes, absolutely."

      quote from video @ (The Trans-Pacific Partnership (TPP) and Sea Level Rise (SLR)).

      Put another way, if about 10% of one glacier, the Totten in Antarctica, flows into the sea as ice or melt water, about 2 ft. of SLR will take place.

      If 14.3% of it would result in a 1m / 3ft. SLR (Why Sea Level Rise May Be The Greatest Threat To Civilization).

      That was locked in long ago.

      "See you in the camps."