As Goes Globalism – So Goes China

Audio Version of “Sunday’s Column”

The headlines across the media are filled with stories how China is about to surpass not just the U.S., but every other nation in regards to: technology, manufacturing, you name it. As a matter of fact, they must also be far ahead of everyone when it comes to environmental issues also, because last time I checked, I didn’t see any once Hollywood “stars” protesting on the capitol steps in Beijing.

Maybe that’s because getting arrested there doesn’t allow for smiles and selfies in plastic zip-bands. In other words “Fade to black” has a much different meaning in China, which is precisely my point.

Now before we go any further let me make this point clear…

When it comes to pollution, of any type, I’m against the wanton abandonment of what used to be known as “corporate responsibility.” Polluting, where the calculus is made between the health and welfare of a populace versus the wealth and share-price of investors, is despicable. And, should have grave consequences for the latter, and not the other way around.

But when human breathing entered the realm of “Needs to be eradicated!” (no joke, look it up) Let’s just say much of the arguments today are a little hyperbolic. But I digress.

But this isn’t about environmental issues, this is about business and communism going forward into the next decade. And it is here I rest firmly on the standpoint that China not only does not remain the latest and greatest economic superpower status most of the so-called “smart-crowd” believes it to be, but rather, will suffer much the same as the U.S.S.R. (aka Russia pre-1991) Why?

Because they are a communist nation. Period. If you don’t understand that one line, you’re either maleducated or, just not as worldly as you think you are. For if communism worked, then why isn’t Russia more wealthy than China? Go ahead and think on it, I’ll wait.

The one and only reason for China’s assent over the last few decades has been borne via the hollowing out of the once dominant U.S. manufacturing sector.

Under the guise of “globalism” businesses were enticed to pick a side. i.e., profits or patriotism. Guess which side won?

In other words, if profits can be enhanced via moving the operation to a communist nation, well, what’s a business leader to do? And they did just that and more. (need I remind you of NAFTA?)

What the mantra of globalism also did was provide cover for these same business leaders, investors and more to proclaim things that sounded a lot like “It’s not us, it’s the market of today.” Bullcrap! This was the “market” globalists have been building for. Literally.

For those wanting an example of such hypocrisy, all I’ll do is point to everyone’s favorite “investor” known colloquially as “Uncle Warren” aka Warren Buffett.

Remember when he was incessantly touting how he wasn’t paying enough in taxes? You don’t hear about him doing that anymore do you? I wonder if it’s because there’s now an entire field of presidential candidates of his earlier supported party willing to make ask him to “Write the check, today!” Coincidental timing, I’m sure.

Yet, there’s another of ole “Uncle Warren’s” prior moves that also helps put this idea of globalism and its true costs back into the spotlight, where it belongs.

In 2014 it was announced, with no prior warning, that the Fruit Of The Loom® (FOTL) plant located in Jamestown, KY would close its doors and lay off 600 employees within months to move the entire operation to Honduras. Why? Hint: rhymes with “save money.” Here’s the statement. To wit:

The company, owned by Warren Buffett’s Berkshire Hathaway but headquartered in Bowling Green, said the move is “part of the company’s ongoing efforts to align its global supply chain” and will allow the company to better use its existing investments to provide products cheaper and faster.

The company said it is moving the plant’s textile operations to Honduras to save money.

The company plans to close the plant in phases from June 8 through Dec. 31.

“This decision is in no way a reflection on the dedication and efforts of the employees in our Jamestown facility, but is a result of a competitive global business environment,” Tony Pelaski, executive vice president and chief operating officer, said in a news release.

It is very devastating,” Hoover said. “Some of the worst news we could possibly hear as a community, not just the 600 jobs but the effect it has on city government, the county government, the school system and local business.”

“Fruit of the Loom to close Jamestown plant, lay off all 600 workers” April 4, 2014 Lexington Herald Leader

Well, at least there was now going to be taxes and paychecks for the population of Honduras. But for the people of KY? I can only guess these former employees reaction as they now had all this “free-time” to watch another sycophantic CNBC™ airing of ole “Uncle Warren” playing the ukulele with the FOTL mascots behind him at his annual share holder meeting. Good times, good times.

So now let me bring it back around to China and why I believe strongly in what I’m arguing…

For a time being (e.g., when China courted the world after its failed attempt via the “Great Leap”) China played the part of “friendly global supply-chain extraordinaire” in many ways far too similar as to how we think when we contemplate a “Manchurian Candidate” in a Hollywood movie.

Nobody suspects anything is or can go wrong, till that moment when the true reality becomes apparent. Today, that true reality is communism. And just like that proverbial “switch” is thrown in the movies China is “throwing” communism across the global stage.

China’s communist ambitions and Iron-fist rule is on full display. And that “genie” can not – and will not – be put back in the bottle.

Xi Jinping has the potential to be Mao on steroids. This is no secret to anyone with a modicum of interest in both China’s past, present and future. Xi did not have himself declared (via abolishing presidential term limits) “Leader for life” because he just liked the title.

No, this is how totalitarian, communist leaders with their sights on world domination act once they believe the time is right. i.e., “My successors failed because they did not go far enough, but I will not because, I will!” And if thinking that line through and contemplating its true correlations doesn’t make your blood run cold? Just wait till you see it happen in real-time. e.g., Hong Kong.

Hong Kong will not be able to protest indefinitely, it is only a matter of time (soon, I’ll add, as in very) before the orders will come down from Beijing to quell the protesting – all of it – and then open for business the next day looking like the conclusion of a Servpro® commecial. e.g., “Like it never even happened.”

Business leaders of all stripes are already nervously wondering if they really need to be “at the office” in regards to anywhere in China, where reports of business leaders suddenly disappearing, and only some re-appearing, happens far more often than one wants to weigh the odds of noodling “Could I be next?” Hint: See Jack Ma for clues.

China has also been deliberately maneuvering for its Renminbi/Yuan to become the next “reserve currency.” Its inclusion into the IMF’s SDR (Special Drawing Rights) was a strategic and tactical win of the moment, but this “win” has more in common with Jack Dorsey’s only meaningful moment as to have Twitter™ included in the S&P. i.e., The underlying business model is really a disaster waiting to happen. (or actually revealed?) But if its in “the basket” people have to own it – till they don’t.

It should be noted that that “till they don’t” part needs to be a bit more focused on, because the day when suddenly Hong Kong by all appearances appears to be “fixed” in overnight fashion, the world will be fully cognizant of the how and why. And China’s rise of inclusion into everything once deemed “democratic” or “the opening of China” will be viewed from a far different lens than what it is today. As a matter of fact, I predict it won’t be viewed at all. Here’s why…

China announced Friday it’s nearing completion of its own GPS (global positioning system) meaning: it will no longer be linked into the U.S.’s.

Nothing wrong with that, but what that also invites to think though is that they will also (much like Iran) will enable itself to cut out the entire web by a flick-of-the-switch. This will make the saying “What happens in Vegas, stays in Vegas” pale in comparison. But here’s the part that most are missing…

China today is threatening business leaders, nations and more with its supposed/proposed 5G infrastructure. It all sounds great until you think it all the way through, which most of the so-called “smart-crowd” don’t, won’t or can’t, so I will. Because that’s what I do.

If business leaders are increasingly growing concerned that either they or their people are at risk in China; that their company’s secrets are going to be required to be handed over shared with the politburo; that investment returning to Hong Kong is probably decades away, if ever; tariffs from not just the U.S. but other nations is all but an inevitability; the ever-growing shadow banking crisis, and more than likely, currency devaluation that’s on the horizon; ________(fill in the many I left out here): who is it that’s going to remain in China, let alone move their company there? “Bueller?

It is very possible that China has reached a milestone for technological and manufacturing dominance. The problem is, as is the problem with all communist countries and its leaders:

That is usually the moment everyone else sees things for what they really are and will no longer invest or trade freely with them, leaving them (China) to rely solely on the wealth and health of their own populace. There’s a reason why this should be a reason for concern.

Again, China has made great strides since the debacle of the original “Great Leap.” However, the very real problem now facing China is that with all the improvements it’s made – this might be as good as it gets. Why? Like I said…

It’s called “communism” for a reason. And its legacy is spread far and wide for anyone willing to look. But you have to open your eyes first.

© 2019 Mark St.Cyr