Thursday, December 23, 2004

Tim Dunlop, in an already much blogged piece, notes what one of his friends heard on a recent Congressional fact-finding trip to India:

They spoke to a lot of Indian government people and the message from them was very clear, and in a nutshell it was this: We don't much care about America. He said they were very polite but almost indifferent. Maybe matter-of-fact is a better description. The conversation went something like this:

We consider ourselves as in competition with China for leadership in the new century. That's our focus and frankly, you have made it very difficult for us to deal with you. ...

And so forth, with assorted comments on the hypocrisy and foolishness of most of our recent initiatives, particularly the war.

Well, if your hobby is handicapping this competition, here's good news for the Chinese side. Dubya's good friend Pooty-poot is now talking about letting the Chinese operate Russian oil fields, including some of those which were just seized from the apparently too independent Russian energy company, Yukos. (It's an interesting transaction, to say, the least, in which a shadowy group of hitherto unknown buyers placed the winning bid at a state-run auction, and then immediately flipped the oil fields to a state-run oil company). Meanwhile, on the other side of the Atlantic, the Chinese are also buying into Canadian oil exports, which right now are headed almost entirely towards the United States.

So, the Chinese are moving to secure energy resources. And if you're looking to the future, you have to wonder: will this be enough for China? Do new oil sources change the outlook for their already calamitous environmental situation? Will the government consider conservation? Do they even care? And what about Pauline Europe and India? Because with the Chinese buying oil off our doorstep, it looks that much less like the future's with us.

And as for us, as our blood and treasure spills on the sands of Iraq, in a war that is spreading the terrorism and instability it was meant to stanch (as Dunlop's Indians are quick to note), is it buying us as much as the Chinese are getting by writing checks?

For more on the future of the U.S., see John Quiggin's paper on our unsustainable trade deficit, which calmly notes that "During 2003 and 2004, private [overseas] investors have ceased accumulating U.S. government debt and have reduced investment in U.S. enterprises. It is only government intervention by foreign governments buying U.S. debt that is now sustaining the value of the dollar." Chief among these governments is, of course, the Chinese. As Quiggin details, it's not clear how long it makes sense for the governments in question to keep doing this, or how long they'll want to...


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