China has many important internal affairs to deal with, placing a military operation against Taiwan lower on its priority list, especially after observing the costs of the Russia-Ukraine war. Instead, China hopes Taiwanese citizens will recognize the shift in the global landscape and ultimately favor peaceful reunification.
I agree. This stepped up after COVID for many reasons. Biden didn't deviate from the overall premise of 45 and leveraged 45s trade deals with mx and ca. Vietnam was hailed as a big Biden foreign trade partner. Devil's always in the details. During 45 China and it's businesses started figuring out leveraging trade loopholes to evade the larger tariff zone. Singapore and Hong Kong was adept at doing this. South Korea recently disavowed swapping country of origin labels, or country of origin washing. China also poured dump trucks of money into Mexican factories but with the new mx us deal, who knows how much they'll pull out. https://www.northerntrust.com/canada/insights-research/2025/weekly-economic-commentary/how-is-china-dodging-us-tariffs? In Vietnam and Malaysia, Chinese exporters use Chinese-owned facilities in countries with lower tariff rates to make their products appear as though they originated there. In Vietnam, the value of exports to the U.S. has almost matched Vietnamese imports from China in recent years. I don't think this is evil or nefarious as businessmen just want to make the best deal and find places with the least red tape. But it does cloud Official Stats or the notion that China doesn't need the US as much as before. Or the simple observation that the US being number two on some manufacturing list means we're still capable of making our own things when many American plants do similar practices of repackaging or assembling "intermediate parts" from China and marking it up bigly with an American brand. We'll see what ultimately shakes up if there's a signed deal months from now
It is true that while China has reduced its dependence on the US over time, it still relies on the US consumer market for its economic prosperity at present. However, the shrinking US middle class, combined with consumption increasingly fueled by debt accumulation, casts doubt on the sustainability of this demand. Should the dollar's position weaken and the US consumer market contract, the global economic influence of the US would significantly diminish.
What costs did Russia experience? Trump has already floated lifting all sanctions on Russia as part of a "deal." The Russians now have better access to the black Sea which allows them to export gas/oil without needing to pay Ukraine for access to the black Sea as they were before. China controlling Taiwan gives them uninterrupted access to the shipping lanes in the pacific without worrying about a US blockade.
Russian economy meltdown as oil revenues plummet 12% and 'mass bankruptcies loom' Russia's economy plummeted last year. China has prioritized its economic growth for the past decades. It won't put itself into a situation of a potential economic recession. In recent years, China has greatly improved its blue-water capability (i.e., the navy's ability to operate far from its home waters) through expanding its naval fleet and enhancing its anti-ship missile technology. The US can no longer impose a blockade on China's maritime routes in the Pacific as effectively as it did in the past.
Thanks for the thoughtful response. Its good having individuals who actually talk policy post here instead of the typical MAGA trolls. Those statistics you posted about the Russian economy happened bcz of the sanctions. Once Trump removes them they'll be able to do business again like usual. The issue is Trump is floating removing all sanctions in exchange for a "peace deal."
Those factors add up to big reasons why Americans gave a rapist and convicted felon the presidency and congressional majorities. Working class Americans don't pay much attention to news and haven't reached strongly to the headlines of Trump suspending core American rights. I don't think the dollars position will weaken anytime soon (10-20 years minus war) even if the US is only 25% of the world economy but China will continue to use and look for more options to subvert financial pain points like swift. You can't pull off Dual Circulation with an international yuan. Nor can you keep billionaires and Chinese Google and Apple competitors on a tight leash with an international yuan either. Those are obvious reasons to keep their currency internal but I can only guess. Western economists want China to appreciate their currency in order to lift average Chinese living standards but CCP planners think they've found a better path for their people. It's not only China repressing their currency to boost trade. With western economies reaching end states from their debt and aging demographics/infrastructure, I don't think those economists are right either even if they sound so so certain.
The deterioration of Russia's economic situation had been a gradual process. Russia redirected substantial human resource and industrial capacity toward military production for the Ukraine war diminished output for agriculture and consumer goods manufacturing inflation in essential commodities like food and daily necessities Central Bank of Russia raised interest rates to curb inflation, leading to increasing corporate borrowing costs businesses either raise consumer prices or face bankruptcy Long-term negative impacts of the war that will persist even after sanctions are lifted include: Russia lost around 2 million workers and at least 650,000 people had left Russia since the war started Frozen Russian assets worth approximately $300 billion will likely remain inaccessible, permanently reducing Russia's foreign currency reserves and constraining its international financial flexibility Russia faces years of elevated defense spending to replenish depleted military inventories, diverting crucial resources away from economic recovery and development Russia-EU relationship has deteriorated to an unprecedented low, creating a climate of distrust that will hinder business partnerships and economic cooperation for years to come. For China, the potential benefits of invading Taiwan would be significantly outweighed by the economic, diplomatic, and military costs in the foreseeable future.
the COVID shutdown in China, during Trump 1.0, prompted many US co to diversify it supply chain As it relates to Apple, it relocated its production for its iPad and non-iPhone products to VietNam starting in Q2 2025, will relocated iPhone production to India
So, China’s tariff on the US went from 3% to 10% (before Trump took office, it was 3%). So much WINNING! WTF did this accomplish MAGA?
There is a lot of uncertainty - it is easy to say "Ohh President Trump will back down and everything will go back to normal. However - we are already rounding second base and towards third. Many of the supposed experts believed that Trump would not actually go through with tariffs after he was elected. Then it was that Trump would only do select tariffs. Then it was that Trump would do widespread tariffs but that congress would force him to walk them back. Then it was Trump would have to pull back his tariffs because he wouldn't let the market tank. Well - here we are, and I see no real indication one way or the other with Trump. He cannot be re-elected, but we already have seen that he doesn't have to follow the SCOTUS because congress does nothing. We really don't even know if there will be elections in 2026 - 2028. Sounds absurd but Trump already is ignoring the SCOTUS and Himmler is claiming he will suspend Habeus Corp. if the courts don't do what the Administration wants. We are already have "sweeps" by the Government. So, if I am a large corporation - I am at BEST standing firm and doing nothing, at worst I am figuring out how to relocate to Europe. I appreciate that Trump acknowledged there was a problem with no one else would - but he has predictably used it as a massive authoritarian grab, and the irony of "stopping waste" when authoritarian regimes are the most corrupt across the board. We are sending Hispanics out in masse but welcoming in white South Africans in at the same time and giving them governmental aid.
I don't want to get too far off topic - but the "shrinking middle class" is not as simple as a lot of people think. over the last 50+ years, the middle class in the USA has shrunk by like 15% (the last time I looked deeply into it), and the amount of wealthy and upper middle class have risen greatly in that same period - overall the wealth in the USA has gone up quite a bit. The "shrinking middle class" is directly linked to the tax policies in the USA over the last 50 years, and the income distribution in the USA - which is the worst in one hundred years. Historically this has fluctuated, and most likely we will see a correction which will again increase the American Middle class as a percentage of the population in the USA. Most of the issues economically in the USA are not wealth or production based - but policy/distribution based. I agree with you that if things were to get bad enough that the USA would inevitably lose economic influence - but the deeper I have delved into the numbers over the last 5 years, the less concerned I am about that. In the short and medium term the only real viable way for the USA to "screw up" is to elected politicians that are consistently beyond ineffective. This does and will continue to happen, but typically in the short and long term this varies in the USA.
In 2028 or 2032 I suspect we are going to get an altering figure, probably from the Democrats that will shift the entire party and policy in this country for good or bad - and based on wealth distribution. Trump has let the genie out of the bottle, and someone that is more competent and more shrewd will follow his blueprint and be successful in making massive unconstitutional changes that will involve changing how wealth is distributed in the USA.
I suspect there will be a Democrat version of Trump soon, charismatic, advocate for class warfare but against the rich, doesn't care so much about DEI.
