Global prestige on life support

Recently, on the occasion of commemorating the United Nations' 75th anniversary, world leaders took turns addressing the General Assembly via video feed.

US President Donald Trump's surprisingly short seven-and-ahalf-minute address can be summarized in three words: "Chia-nah, Chia-nah, Chia-nah," with a sneer and a snarl for emphasis. Trump blamed China for covering up the Covid-19 outbreak, and for spreading it to the rest of world.

He also congratulated himself for his great job in bringing the pandemic under control - despite the fact that the America he has supposedly made great, with slightly over 4% of world's population, has accounted for more than 20% of the world's Covid infections.

In his address, Chinese President Xi Jinping reported that China has several vaccines undergoing final stages of clinical trials. When the vaccines become available, he promised that they would be a public good available to the world.

"Covid-19 will not be the last crisis to confront humanity, so we must join hands and be prepared to meet even more global challenges," Xi said. In short, China considers itself a member of the world community of nations and wishes to collaborate within the UN framework.

Trump's America wants to go it alone and other nations are expected dutifully to follow along. The US is only a member of the UN when the international body gives Trump what he wants.

For the purpose of ensuring his re-election, Trump is acting on the premise that he needs to make an adversary of China every which way possible. Trump's anti-China team seems to believe in the economic law of comparative disadvantage - a novel idea that no matter how much hurt America suffers, China will hurt more.

So far, the "mutual hurt" idea, rather than being revolutionary, has turned out revoltingly for the American people.

Levying tariffs on imports from China has backfired. The trade imbalance with China has not changed but continues to favor

China - not an unexpected outcome according to the law of comparative advantage - simply because the country that can make a product cheaper and better sells more.

Bloomberg Businessweek has already declared China the winner of the trade war.

American businesses cry uncle As Reuters reported, 3,500 US companies have joined in a legal suit against the Trump administration for "unlawful escalation of the US trade war with China." In other words, American businesses are saying the waterboarding they have endured from the trade war has gone on long enough.

China has effectively brought Covid-19 under control and is resuming its economic growth. The US, unsurprisingly given its failure to bring the pandemic under control, is experiencing drastic economic shrinkage; the backsliding of its economy is likely to persist for the rest of this year and beyond.

An important consequence is that foreign direct investments are pouring into China from all directions as investors make sure they do not miss out on the world's most significant booming consumer economy.

Former US vice-president Joe Biden appears to be winning the race to the White House. As I stated in my last commentary, it will be in Biden's interest to drop the zerosum confrontation and find ways to collaborate with China, because America's economic recovery will depend on a mutually beneficial relationship going forward.

But getting along with China will be only one of many challenges a Biden administration will face. The current secretary of state, Mike Pompeo, has made a mess of America's relations with the world community of nations, alienating friend and foe alike. The wreckage he is leaving behind will take a Herculean effort and reassurance to restore the US position as a trusted leader of the world.

For example, as Asia Times has noted, somehow Pompeo has pressured Australia into leading an attack on China repeating baseless accusations from Washington, despite China being Australia's most important customer and most vital contributor to its economy. The author of that op-ed can't understand why Australia is willingly digging its own grave, except possibly that their leaders are not too bright.

Canada is in a somewhat similar position as Australia, but its reluctant slitting of its own throat is more explicable.