China and the US - Comparing apples to tanks

 

While the US conducted naval exercises under the auspices of the North Atlantic Treaty Organization in the South Pacific, the Chinese were quietly extending their influence with constructive economic investment. In 2023, the US will pour almost $1,000,000,000,000 (more than the military spending of the next 11 countries in the world combined) into its military might to cower countries into submission in order to protect and extend its global empire, with the added benefit(?) that it will make obscene profits for the “Masters of War” at home. This, while only investing in the countries of the Global South in projects that will benefit the CEO’s and shareholders of the largest corporations and the banks at home.

I recall an old example of how this works. There once was a small country south of the border, called Guatemala (it could have had a number of other names), where the natives elected a government pledged to nationalize the US company that literally owned the majority of the arable land in the entire country. The government even agreed to repay the company for their “investment” over a 30-year period, but only at the value that the company had declared for tax purposes. The company demurred.

Relevant here are some other facts: first, that United Fruit Company (think Chiquita Banana) was extracting huge profits by paying its workers near starvation wages and then repatriating those profits, minus a few pesos to increase their “investment” in Guatemala. I’m not sure of the exact definition of repatriating, but I would imagine it is somewhat akin to theft, legal theft, that is.

The new government had another issue, this one with Chiquita Banana’s infrastructure “investments”. The company had built roads in Guatemala, but only from the banana plantations (note the use of the term plantations rather than farms) to the ports. As a result the development of infrastructure in Guatemala in no way facilitated the creation of a strong local economy; it was designed to cement the banana republic status of that country.

This all happened almost 70 years ago, but I’m willing to bet that it is what continues to happen in the US’s relationship with the countries of the Global South, and I only bet on sure things. The exact methods of extracting wealth from countries of the Global South may have changed, but, as the saying goes, “the more things change, the more they stay the same”.

To finish the story of Guatemala and the United Fruit Company, it didn’t have a happy ending for the Guatemalans. It turns out that United Fruit had some powerful friends in the US government. Two of their lawyers (and probably stockholders) were John Foster Dulles and Alan Dulles, respectively, the US Secretary of State and the head of the CIA. The Dulles boys plotted and carried out the overthrow of the elected government of President Jacobo Arbenz and installed and supported a series of brutal regimes, which committed widespread torture and genocide against the Mayan people living in Guatemala.

The US actions in Guatemala were replicated around the world, over and over during the 40+ years of the Cold War, supposedly justified by the need to stop the spread of communism. With the disintegration of the Soviet Union and the end of the Cold War, one might have expected a major push to reduce armament (it was called the “peace dividend”) and a real effort to help the Global South develop; instead what we have seen is an intensifying new Cold War, as the US (the Empire of Liberty) worked to overpower any threat to its constantly expanding global empire.

Today, the threat is no longer communism or national liberation, but the growth in influence of a new economic giant, China and its junior partner, Russia. With its economic weaknesses, the US seems bent of responding the only way it knows how, with violence. This just one more version of a long and terrible history of violence at home and abroad. Ever wonder why our national anthem celebrates war? But more on that in another post.

Below is a post from Adam Tooze on one of many, many projects China has as part of the Belt and Road Initiative.

From Adam Tooze, Chartbook #141

After three years of Chinese-led construction work, Cambodia's very first toll expressway has opened for business, the project symbolizing the deepening economic ties between the Southeast Asian nation and Beijing. Costing roughly $2 billion to construct, the expressway stretches 190 kilometers between Phnom Penh, the capital, and the port city of Sihanoukville. CRBC was also responsible for the construction of the expressway.

China and Cambodia first signed a deal for the road in 2018 under the build-operate-transfer model. Under the agreement, CRBC will collect tolls for five decades, before transferring ownership of the road to Cambodia. In return, Cambodia is believed to be responsible for virtually none of the costs. CRBC is headquartered in Beijing and has offices in about 60 countries and territories. Although CRBC's earnings are unclear, its parent entity, the China Communications Construction Group (CCCG), recorded 842.8 billion yuan ($119.9 billion) in group sales last year. CCCG is the third-ranked contractor in the world in terms of overseas revenue, according to Engineering News-Record, a U.S. construction industry publication.

The group serves as one of the biggest players in the Belt and Road Initiative … Sihanoukville is home to the Ream Naval Base, which is undergoing a China-funded expansion and could be used by the Chinese military as it seeks to strengthen its military presence in the South China Sea. Chinese entities have also ramped up investment in hotels and casinos in Sihanoukville.