Michael Hudson, Other Experts Discuss America, China and Russia Jockeying in G20 and APEC Summits

Yves here. This is an intriguing exchange among Michael Hudson, John Weeks, professor emeritus of development economics at the University of Long and Colin Bradford of Brookings. The points of difference between Hudson and Bradford are sharp, with Bradford admitting to giving a Washington point of view that Obama scored important gains at the APEC summit, with Hudson contending that both confabs exposed America’s declining role and lack of foreign buy-in for its neoliberal economic policies.

While some readers might think that Hudson’s take on how Russia fared is a tad too positive, he isn’t overegging the pudding as far as how America fared at APEC and at the G20. Our Japan-watcher Clive pointed out that Obama got as much (meaning as little) coverage as Putin did in the Japanese press at APEC, which is shocking given the much greater size of the US economy and its much stronger economic and political importance to Japan. A BusinessWeek article today similarly describes the APEC summit as exposing how weak America’s hand in East Asia has become. Key sections:

The breakthroughs won in Asia will be impossible for Obama to implement. And the administration’s attempts to turn U.S. policy toward Asia, a strategy known as “the pivot,” or the “rebalance to Asia,” has actually made the economic and political situation in East Asia worse.

Each supposed success of the president’s trip is likely to unravel. The TPP is far from concluded, with serious gaps remaining in negotiations between the U.S. and Japan, primarily on issues related to agriculture. Even if the U.S. and Japan manage to agree, it will be almost impossible for Obama to pass the agreement through Congress. The president has spent little time trying to convince members of his own party to stand behind the accord. Many prominent Democrats have openly said they will not vote for it. And though the Republicans have historically been more supportive of trade, the Tea Party wing of the GOP is highly suspicious of trade agreements.

The climate deal and the other U.S.-China accords will also turn out to be mostly hot air. Although Obama used executive action to conclude the climate agreement, the incoming Congress, dominated by skeptics of global warming, is likely to do everything it can to water down the accord. The military agreement will not prevent either nation from continuing to build up forces in the region, while the proposed IT tariff reductions, though important, do not change the overall chill that has come over foreign investment in China….

Four goals of the pivot to Asia were to foster a regional free trade agreement, to promote democracy in the most populous region of the globe, to reassure partners throughout Asia that the U.S. would remain committed to the region, and—though this goal was left unsaid— to contain China’s growing assertiveness.

These promises have not been kept, and the visit to Asia only underscored the distance between Obama’s rhetoric and his results. If the TPP does not pass, the White House has no backup trade agenda in the region. (China has a regional trade pact it is pushing in place of the TPP.) Meanwhile, in Northeast Asia, South Korean and Japanese leaders and top officials wonder why, if Obama has made Asia a priority, they have seen so little of the president and senior U.S. cabinet members.

As for containing China’s assertiveness, the policy failed here, too. Several senior Asian officials say that the administration appears focused on other parts of the world, leaving them unclear about America’s position on disputes in Asian waters. The People’s Republic has interpreted Obama’s position as weakness.

This talk gives more color on what the stakes were in this set of talks, and spin versus reality on what came out of them.

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  1. David Lentini

    I noticved that a quick edit gives a nice summary of the issues:

    The goal Four goals of the pivot to Asia is were to foster a regional free trade agreement, to promote democracy in the most populous region of the globe, to reassure partners throughout Asia that the U.S. would remain committed to the region, and—though this goal was left unsaid— to contain China.’s growing assertiveness.

    There! All done.

    1. MyLessThanPrimeBeef


      Short and sweet.

      Of course, China’s elites are pivoting to America…mansions are cheaper, food safer (relatively speaking of course), crime does pay (or at least doesn’t get you a bullet on the back of your head) and you can safely flaunt your Miserableratis (without someone slurring you as a hypocritical communist or quasi-communist – a person with connection, i.e guanxi, to powerful communists).

      1. optimader

        “Of course, China’s elites are pivoting to America”
        Americas , don’t forget about the third most popular country in North America. Vancouver is a virtual Chinese colony.. ;o)

        1. MyLessThanPrimeBeef

          They should pivot to Italy.

          Buy one Miserablerati and you get permanent residency (to escape the bullet waiting for you in China).

          It’s cheaper than what people used to propose (in order to prop up the housing bubble) – buy an American house and get a green card.

      2. penny bloater

        Of course they are. This is a class based conflict where nationality is just another myth that is mobilised to mystify an incurious general public strung out on private debt and captivated by reality game-shows.

        Wake up people – TAFTA/TTIP is coming over the horizon!

  2. Yonatan

    A concise summary:
    i) Western media reports of the summit are an embarrassing travesty.

    ii) Far from isolated, Putin was embraced by the great majority of heads of state.

    iii) Idea that he left early, upset over criticism is total, complete, sheer, bloody rot – a new low for western media who alleged this in chorus [shades of MH17 controlled-media response].

    iv) EU leaders tried to browbeat Putin – Putin told them to take a few laps in the Brisbane river, and explained to them yet again, correctly, that it is he, in fact, who holds the strong cards in Ukraine, and that the EU had better get its act together.

    v) As before, the EU has no idea what to do about the Ukraine mess.

    vi) The clinically obtuse Mr. Obama managed to insult China.

    1. Banger

      Paul Craig Roberts seems to think that Washington and the neocon faction around Hilary Clinton are aiming for war with Russia–I tend to doubt that because I see no evidence that the military is interested in conducting such a war or can, in fact, conduct such a war and I doubt Wall Street favors it–they like international tensions to keep the public distracted and the FBI focused on domestic dissent and fake terrorists but I don’t think they want war unless they believe we are headed for a major financial crisis yet again.

      1. optimader

        “I tend to doubt”
        Agreed, no matter what some wingnut individual may possibly be advising HC, I don’t conceive of a conventional military war w/ Russia being in the cards. Neither country could afford it, too many toys would get broken too quickly and where would we hold that party anyway?

        “..unless they believe we are headed for a major financial crisis yet again”
        Isnt that the formula for smaller wars of distraction rather than historically major conflicts?

  3. Banger

    I like Crosstalk and it is one of the few programs that allows truly divergent views on cable. Having said that this was not an informative talk because the guests were talking past each other. Nothing useful was learned. Hudson, in particular, did not address any of Bradford’s points–he came off as ideological and strident.

    As for Ukraine–the petty posturing at the G-20 by people like Abbott (magnificently world-class asshole) and the Western media is kind of pathetic. I would like to add that the European leadership seems to be under the control of Western intel agencies which I think are fairly well-integrated at this time so their support of the Imperial capital’s position on Russia (as with Merkel’s speech) makes sense only in that context.

    1. Yves Smith Post author

      With all due respect, Bradford’s points were total garbage, hence Hudson’s refusal to engage them. Bradford either is totally uninformed about the TPP or a liar. He depicted it as being about trade when it is about isolating China and rendering nation-based regulations toothless. We’ve covered that at length here and for you to treat Bradford’s remarks as anything but shillery is astonishing.

      Similarly, Bradford basically admitted he was running pure DC PR at one point when Hudson rattled off concrete measures that showed that America didn’t gain, and arguably lost ground at APEC. Bradford talked about a dinner with Xi and the climate pact. Just about every commentator who has looked at the climate deal describes it as meaningless. Similarly, the media in Asia saw the Xi-Abe talks as hugely consequential; the Xi dinner got close to no attention and looks at best like a consolation prize.

      I agree Hudson came off a bit screechy, but I thought his substance was effective, save looking too optimistic re Russia. My take is Russia is not cornered, as the US media would have you believe, but is taking economic damage from the sanctions. If I were in Hudson’s shoes, I’d have been frustrated when confronted with distortions of that magnitude.

      1. Banger

        Bradford made the point that he was talking from the Washington perspective several times. He said that in relatively minor matters the international bureaucrats made some agreements between each other–this is more important than it seems. Much of international relations is mediated by this class of people you encounter in conferences in hotels around the world. They attempt to put band-aids on international tensions and gum up the works a bit when rash politicians attempt to heighten tensions.

        Also Bradford made the cogent point that Merkel did make a (for her) saber-rattling speech on Russia while Hudson has long made an issue out of the fact Europe is not as pro-U.S. as they appear to be. Well, show us why Bradford is wrong then. Personally, I agree more with Hudson and the speech in Brisbane was mainly posturing–but why does Merkel have to suffer the indignity of posturing before the Anglo-Saxons who are fundamentally not friendly to continental Europe? And, for that matter, why are the French so fawning to U.S. power?

          1. Andrew Watts

            Like the Japanese, the French are as dependent on the empire for natural resources. It doesn’t stop French bobos from whining about American imperialism though.

            When France lost Algeria it was a massive economic blow to the country. A good portion of the coal, uranium, and natural gas the French consumed came from that colony. Which is one of the reasons why they almost fought a civil war over it until De Gaulle’s quasi coup.

            1. MyLessThanPrimeBeef

              I believe France can still get coal, uranium and natural gas from Algeria today.

              The difference, I think, is now, natural gas is priced in dollars, and not francs, most likely, and the French can’t just print more their own version of ‘imperial reserve currency’ to get free coal like they did in the 1950s.

              Only one county in the world can still do that today, and not just in one corner of Africa, but all over the world.

              1. Andrew Watts

                Good point. This further reveals the dependence on the American imperial system that France was reduced to when she lost her formal empire.

                1. MyLessThanPrimeBeef

                  I think of it as the First Law of Imperial Rule – to get others to use the imperial currency you can print at will.

        1. Yves Smith Post author

          Did you miss that the Europeans are almost as much a military protectorate of the US as Japan? Merkel appears to buy the Nato line that Russia has moved into Ukraine, when other commentators have pointed out the evidence is (as usual) ambiguous. But talk and actions are two different things. Germany has not toughened sanctions despite the US desire for them to do so. So her firmer tone may simply be to appease the US.

            1. Andrew Watts

              To be fair, Russia did shell Ukraine; whether through aggression, genuine retaliation, or false flag attack. They then followed that act by brazenly driving tanks over the notional border between Russia and Ukraine. In front of a bunch of western journalists no less! (“That takes balls Putin.”)

              If I was Merkel I’d be genuinely worried that Putin might try similar tactics deployed inside Ukraine in Eastern Europe. This would have a massively destabilizing influence on Germany and the European Union. That doesn’t mean that Merkel has cast her lot in with Washington.

              Umm, like, we’re still bugging Merkel’s phones, right?

              1. Yves Smith Post author

                The media was claiming that Putin did a lot more than provocations, and there is admittedly a lot that is unclear. For instance, it seems clear that there are Russian personnel with military experience in Ukraine. But there are tons of Russians with close family in Ukraine. Are these Russians volunteers? Wink and nod volunteers (“if you go AWOL for a few weeks, no one will ask any questions”) or officially dispatched?

                1. Andrew Watts

                  Why are you asking me…? D’oh!

                  Probably both. It would’ve made for a good cover story just in case any members of the Russian military were captured alive and/or identified as members fighting alongside the separatists. I cannot be absolutely sure and I certainly don’t want to encourage the media or the US government in their folly. But Russian politicians and servicemen, like their American counterparts, are notoriously loose lipped about what their government is capable of or actively planning on doing.

                  Sometime after the Crimean incident some Russian pol from the United Russia party was openly talking about how convenient it was to have an unofficial army of a few thousand “little green men”. This was all before the massive Kremlin/FSB crackdown on social media that shut down all the reliable Russian sources of information I had.

                  I don’t think Germany/EU has anything to be worried about. Whatever else the Russians may be guilty of (“Two wrongs don’t make a right”) forcefully re-negotiating the Yalta accord through the expansion of NATO was a stupid idea guaranteed to trigger a hostile response. Most Russians remember how many people Frederick the Great, Napoleon, and Hitler killed by using Eastern Europe as a staging area for their invasions. That doesn’t mean that Putin is going to attempt to destabilize every country along the South Stream pipeline’s route. I mean he probably could if he wanted to, (“Yes, I’m that scared of Russian intelligence.”) I just don’t see the logic from the Russian POV.

                  It’s a valid concern for Germany/EU though. Especially with Washington’s belligerence inspiring the Russians to think that the United States would never respect them as an independent country and that the Cold War never truly ended.

                  1. Yves Smith Post author

                    There is still a very big difference between irregulars who are trained soldiers allowed/encouraged to go into Ukraine and formal interventions. There is a huge amount of value in military ops in the command, control, and logistics structure.

                    1. Andrew Watts

                      True, but we’re talking about a limited armed conflict with a relatively small amount of objectives. Whether they were covert Russian forces, semi-organized and probably Russian trained irregulars, or both they were enough to tilt the scales. If Russia had wanted to roll over Ukraine it could at virtually any time.

                      Nor do I think Putin is in total control of the separatists. While they may be dependent on Russia for munitions and logistical support they possess their own set of goals.

        2. grizziz

          I think that Yves is right that and the talks are not about trade, but where property rights and contracts are to be adjudicated. Laws and regulations have arisen as a part of culture, are not universal and subject to varied interpretation. Having the power to place the judges is what is most at stake here in whatever agreements are reached.

          IMO this is what Hudson is getting at when he speaks about issues of civilization. The APEC meeting appears to be about trading stuff, while the TTP contains bits about the trading of memes, if that is a meaningful way to describe IP. China is more collective about ideas and Apple is not. Environmental regulations are mostly about dealing with the externalities created by the manufacture, trade and disposal of stuff and which party is responsible. Once again, who judges, who has power to name the judges?

        3. Jackrabbit

          I think your reply to Yves is just argumentative. Yve’s assessment of Bradford’s contribution (“garbage”) is exactly right because the “Washington perspective” is a propaganda-infused, self-important fantasy. Hudson engaged Bradford enough to make that clear. But you apparently wish that he had fawned over, and thereby given substance to, the fantasy instead.


          I think Weeks’s closing remarks are haunting, and the backdrop to all of this.

          H O P

  4. Camelotkidd

    There is a great article in thee Asian Times that illustrates how clueless the Obama administration has been with its pivot to Asia, coupled with its meddling in the Ukraine. atimes.com/atimes/China/CHIN-02-101114.html

    “Chinese analysts are dumbfounded about the US response to what they view as a sideshow in the South China Sea and only tangentially concerned about India. They struggle to understand why a vastly improved relationship with Russia has emerged in response to US blundering in Ukraine.”

    1. Banger

      But is it really blundering? Here is a possible scenario–financial crisis looms, U.S. standard of living to plunge even further than it has already and war whether Orwellian or real breaks out. Could this be what the neocons want?

      1. Jackrabbit

        First you are an expert on neocons and Washington politics (especially with regard to Foreign Policy), now you pretend to not know what they want?


        H O P

  5. Mel

    Does anybody have good links to summaries of American manufacturing lately? I’ve been going around thinking that USA would have great trouble fielding materiel to participate in a really big war. I could be exaggerating. A fact or two would be welcome. I can’t see a lend-lease without floods of trucks and Liberty ships etc. I can’t see a Marshall Plan without the capacity to supply resouces and a market. I can see a future battleground littered with RFPs for boots.
    Force isn’t directly connected to free-trade, but it can be taken as a measure of capacity to do things generally, and, in extremis, the capacity to make claims and get one’s way.

    1. Steven

      It all depends on what you mean by “really big”. I suspect with all of its nuclear weapons the US is still more than capable of ‘participating in a really big war’. This of course is one of the consequences of transitioning to a post-industrial economy so Wall Street and the nation’s CEOs can continue raking in money (which most of the recipients only need so they can “keep score”).

    2. anobserver

      ” I could be exaggerating. A fact or two would be welcome.”

      Your intuition is correct, and even the second Iraq war already constitutes “really big war” in this respect.

      I was immensely surprised the first time I saw a short newspaper article about it, and then in the following years I was stunned to see the issue popping up repeatedly — in a very low-key profile; it was never big news — but here is the truth: the USA was incapable of manufacturing rifle/assault rifle ammunition in the necessary quantities. The USA had to procure it from Israel, South Korea, actually several countries around the world. This issue lasted for most, if not the entire Iraq war. At some point, the USA were incapable of manufacturing heavy machine-gun ammunition in the required quantities, and were drawing on really old supplies dating back from WWII (that had to be reconditioned). From what I read, most arsenals and production facilities in the USA had been dismantled and production largely privatized, but commercial firms eventually could not produce the required military grade ordnance.

      I kept a few references somewhere. If there ever is a post in nakedcapitalism investigating the issue, I can try to find them.

  6. susan the other

    Thanks for this post. It was a great interview and, as always, I agree with Michael Hudson. The bit about Merkel doing blatant PR in Australia, just after a 3 hour conference with Putin and his departure (pre planned it looks like) so he could front-run her with a German audience. This whole bit between Germany and Russia is about energy. So I would conclude that the things left entirely unsaid have to do with an agreement between Merkel and Putin to do an arrangement for gas to Germany via Ukraine if possible and from another direction if not. And Merkel talking about military intervention is almost too bizarre to fit into any possibility. She’s not a crazy person. So she’s an almost perfect delivery system for disinfo. So my guess is that it is definitely disinformation at a high level. A piece of art that confounds characters like John McCain and other orks. Maybe.

    1. juliania

      Of course we can’t really know what happened between Putin and Merkel in that nearly four-hour meeting, and indeed it could have materialized into a ‘good cop/bad cop scenario as Obama and the duopoly are fond of creating for us, but I don’t think that’s Putin’s style. I rather propose that the meeting was so lengthy because there were areas of disagreement as to how to proceed – and they ‘proceeded’ immediately afterwards in opposite directions. Perhaps they are friends under the skin of it all, but Merkel, it seems to me is shooting herself in the foot politically by so blatantly taking on the US anti-Russian propaganda. I can’t think she’d really enjoy Putin’s ‘au contraire, mon ami’ on the home front, but perhaps there’s a lovely dacha somewhere in those magnificent pines that’s beckoning to her as she writes her memoirs. And maybe she told Putin that she has no choice but to commit hari kiri – some comments I’ve read portray how much Germany is dominated by the US. Her speech isn’t going over well in Germany, as Michael Hudson vehemently pointed out. And that is going to lead somewhere.

      Thank you, Yves, for bringing this analysis here.

  7. kevinearick

    Basically, you want to ‘see’ the dimensional frequency that eliminates spacetime, gravitational friction, between where you are and where you want to go, with resonance. Set up the supply and return, beginning with the return, the key/needle. What does substrate evolution look like? Which came first, the lock or the key?

    Of course I embedded the integral in the kernel, which is casting off derivatives, favoring my daughters. Take another look at Fourier.

    Russia hasn’t been able to feed itself for over a century, America is on the ebb, and China is certainly not the answer.

    1. kevinearick

      the critters cannot feed themselves, so they immobilize what they think is labor and mobilize capital, with toilet paper, to feed each other, until they can’t, and it gets ugly, with bedfellows swapping at increasing rates. Switzerland could work, if labor wanted it to.

  8. Mark J. Lovas

    I am only in the middle of watching this, but I’ve got to react: The Washington guy says they have “different journalistic prisms”. To be positive, for a moment, that means he recognizes that there are serious disagreements here. However, the image suggests that he is going to avoid articulating or discussing those deeper issues. I find such a hands-off approach intellectually dishonest. I’ve seen it before, e.g., in a discussion about housing in New York City which included David Harvey. The distinguished guests on that program behaved as though Harvey’s Marxism were akin to rooting for a different sports team, and occasionally laughed about it as though it were a peculiar feature of Harvey’s physiognomy. All I can say is that when a person avoids addressing an issue or question, that makes me think they’ve not really got an argument to defend their own position. Even if they have different “prisms”, you can ask whether one prism reveals something that others miss. The guy seems to be suggesting, dishonestly, that somehow they are all flawed. It is a rhetorical trick and a dishonest one. If they are all so flawed in their views, then what’s the point of having any discussion at all? (Incidentally, after watching further, I see that Michael Hudson did react to this little bit of rhetorical dishonesty.)
    A final, less polite reaction: My, oh my, Bradford does get (for him, consider his relatively distanced emotional expressiveness) emotionally engaged in asserting that the USA is still Number One.

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