The modern belief that deep economic ties between the U.S. and China will prevent war echoes Norman Angell's 1910 bestseller, "The Great Illusion." That book argued European economies were too intertwined for a major war, a theory tragically debunked just four years later by World War I.
Related Insights
Politicians predictably declare initiatives for domestic production of critical goods like munitions or rare earths when dependencies are exposed. However, these declarations rarely translate into effective action, suggesting we must learn to manage economic entanglement as a form of mutual deterrence rather than wish it away.
The dynamic between a rising power (China) and a ruling one (the U.S.) fits the historical pattern of the "Thucydides' trap." In 12 of the last 16 instances of this scenario, the confrontation has ended in open war, suggesting that a peaceful resolution is the exception, not the rule.
Modern global conflict is primarily economic, not kinetic. Nations now engage in strategic warfare through currency debasement, asset seizures, and manipulating capital flows. The objective is to inflict maximum financial damage on adversaries, making economic policy a primary weapon of war.
Historically, rising and ruling powers don't stumble into war directly. Instead, their heightened distrust creates a tinderbox where a seemingly minor incident involving a third party (like the assassination in Sarajevo pre-WWI) can escalate uncontrollably into a catastrophic conflict.
Contrary to its goals, the U.S. trade war has resulted in self-isolation. Data shows the U.S. is the only country buying less from China, while U.S. allies and developing nations have increased their trade, leading to a record $1 trillion surplus for China. This highlights a strategic miscalculation in U.S. foreign trade policy.
The core driver of a 'Thucydides Trap' conflict is the psychological distress experienced by the ruling power. For the U.S., the challenge to its identity as '#1' creates a disorienting fear and paranoia, making it prone to miscalculation, independent of actual military or economic shifts.
Unlike the old Cold War with Russia, the U.S. and China's deep economic interdependence prevents open conflict. The current "Rice War" is like water polo: while business and diplomacy occur on the surface, a covert intelligence and influence war rages underneath.
The only historically effective method to resolve deep-rooted religious and ideological conflicts is to shift focus toward shared economic prosperity. Alliances like the Abraham Accords create tangible incentives for peace that ideology alone cannot, by making life demonstrably better for citizens.
Despite narratives of higher purpose, the bedrock of modern life is economic specialization. This system ensures survival and allows for hyper-specialization, which is why economic disruptions so easily unravel societal stability and lead to global conflict.
Globalism was highly successful, lifting millions from poverty. Its failure wasn't the concept itself, but the lack of strategic boundaries. By allowing critical supply chains (like microchips and steel) to move offshore for cost savings, nations sacrificed sovereignty and created vulnerabilities that are now causing a predictable backlash.
