"Every perception is to some degree an act of creation, and every act of memory is to some degree an act of imagination."

-- Gerald Edelman, Second Nature: Brain Science and Human Knowledge
4 Thus far we haven’t seen the US-China trade war taken very far6 Thus far we haven’t seen the US-China trade war taken very farThus far we haven’t seen the US-China trade war taken very farThe Trade-Economic WarChapter 7: US-China Relations and Wars2020-10-18JournalHow could this war worsen? Classically, the most dangerous part of the trade/economic war comes when countries cut the other off from essential imports (e.g., China cutting the US off from rare earth elements that are needed for the production of lots of high-tech items, auto engines, and defense systems, and the US cutting China off from essential technologies) and/or from essential imports from other countries (e.g., the US cutting China off from semiconductors from Taiwan, crude oil from the Middle East or Russia, or metals from Australia)—much like the US cutting off oil to Japan was a short leading indicator of the military war that followed.  Thus far we haven’t seen this, though we have seen movements in this direction.  I’m not saying such a move is likely but I do want to be clear that moves to cut off essential imports from either side would signal a major escalation that could lead to a much worse conflict.  If that doesn’t happen evolution will take its normal course so international balances of payments will evolve primarily based on each country’s evolving competitiveness. Continue reading…