The Market and the Militarists
John Glover of Bloomberg News wrote an interesting piece recently, “Europe’s debt crisis mirrors collapse of 1930s.” Here we read how the great financial catastrophes of 1929-32 “culminated in the rise of Adolf Hitler’s Nazi party….” As nearly everyone knows, the Nazis were militaristic and fanatical. After taking power they built up Germany’s military machine. In a few years they began invading neighboring countries, triggering World War II. The sequence is thus revealed: financial catastrophe followed by the rise of a militarist faction which takes power and invades neighboring countries. Perhaps it is worthwhile to ask: Could today’s financial crisis lead to a similar outcome? Is there a war party observable within one of the world’s major powers?
Consider the recent outburst of Chinese Rear Adm. Zhang Zaozhong, who announced there were over a million traitors in China, including diplomats and military personnel. Adm. Zhang noted that many Chinese scholars are trained in America and read American books. These traitors, says Zhang, “accepted American ideals and they are now helping the U.S. to fool the Chinese.” Described by the Washington Times as an “anti-U.S. fanatic,” Adm. Zhang is part of a group within China known as “strategic hawks.” These have argued for the inevitability of war with the United States.
Should we take Adm. Zaozhong seriously? We are told that China’s “strategic hawks” have no real power inside the Chinese government. The same was said of Hitler in 1932, before he came to power. Given a more severe economic situation, with a Chinese financial crisis in full swing, it is likely that Adm. Zaozhong will get a wider hearing in China – especially by a ruling Communist Party which may see America as a natural scapegoat. After all, China must grow or die. The Chinese cannot go back. Such would destroy the legitimacy of the ruling party. It is only logical that this party should blame the United States for its financial woes. (And by all accounts, there will be woes.)
A June 27 Washington Times headline reads, “Inside China: PLA says war with U.S. imminent.” Incredibly, PLA Maj. Gen. Peng Guangqian has made a speech in which he complained that the United States was “exhausting all its resources to establish a strategic containment” of China. Using Communist terminology, Gen. Peng said that the “contradictions” between China and America were structural and not amenable to change by any individual – whether George W. Bush or Barack Obama. When speaking of contradictions, Marxist theory (including Chinese Communist theory) holds that the central contradiction is class struggle. When Gen. Peng says the “contradictions” between America and China cannot be resolved by a single individual, he is referring to the inevitable outcome of class struggle. That outcome, by Marxian historical necessity, can only signify defeat of the world bourgeoisie; and America is the embodiment of the world bourgeoisie. Therefore, since the Chinese Communists embody the cause of the workers and peasants of the world, today’s compromise with American capitalism should be viewed by the Communist Party of China as temporary. From the beginning of his reforms, Deng Xiaoping said that it “was a mistake to lose faith in socialism.” Deng underscored the fact that China was engaging the West to get technical and financial support. (Of course, Nixon and Kissinger believed that Chinese Communism would be softened by trade and peaceful exchanges.)
According to Gen. Peng, capitalism has indeed softened and corrupted the ideological purity of the Communist Party. Once upon a time, said Peng, China put forward the slogan of “peace and harmony … which was originally intended for the world to hear, but such chanting left us kidding ourselves and paralyzed. Now no one is willing to think about war.” In other words, the Communist Party has fallen prey to its own propaganda. Peace and harmony were slogans to put the West to sleep, but they have put China to sleep instead.
The statements of Gen. Peng and Adm. Zaozhong suggest there is a split between the civilian leadership of China and certain military officers. As if to reinforce the credibility of this scenario, the PLA Daily has complained of the marginal loyalty of certain military cadres. Last February, Lt. Gen. Gu Junshan was purged in the midst of a leadership shakeup within the PLA. Communist China’s leader, Hu Jintao, has vigorously asserted his authority over the military. Supposedly, there is a massive power-realignment taking place in China.
Foreign observers should be wary of reported disunity in China. It may be true, of course, that Nixon’s opening to China has had the desired effect of softening the Communist leadership. There is also the possibility, on the other hand, that China’s leaders are following the advice of their ancient mentor, Sun Tzu, who once wrote: “All warfare is based on deception. Hence, when able to attack, we must seem unable; when using our forces, we must seem inactive; when we are near, we must make the enemy believe that we are away; when far away, we must make him believe we are near. Hold out baits to entice the enemy. Feign disorder, and crush him.”
Only time will tell which is feigned disorder, and which is real; whether the market has prevailed, or the militarists.
About JR Nyquist
JR Nyquist Archive
|12/30/2013||A Financial Poem for the New Year||story|
|12/23/2013||The Free Market's Path to Peace||story|
|12/16/2013||Learning the Wrong Lessons From the Financial Crisis||story|
|12/09/2013||The Economy of the Future||story|
|12/02/2013||China Troubles and the Incapable Nitwits of 2014||story|
|11/25/2013||The Lost Context of the Economic Crisis||story|
|11/18/2013||Economic Science and the Underworld||story|
|11/12/2013||The Market Knows Best||story|
|11/04/2013||America, Saudi Arabia, and the Dollar||story|
|10/28/2013||The Economics of Disagreement||story|