Friday, September 4, 2015

Labor Day Weekend in America's Unique Nation of Equals ... Russia and China ... BFF or a Marriage of Convenience?

Labor Day weekend is upon us, and that spells the end of summer. It's the time to relax with family and friends and reflect on all the hard work that has helped make America the greatest and most caring nation in the history of the world.

Things have changed in the world, and issues such as debt, deflation, demographics, income inequality, educational opportunity and cost, government and globalization are new to many of us 'senior citizens.' But the most important things haven't changed, and what it means to be an American is among the most important, at least for me.

After first being jilted by Hitler and only then joining forces with the U.S. during WWII, Russia had become the big bad guy when I entered high school. Sputnik started the space race in 1957 after Khrushchev said "We will bury you!" to America in 1956.

Many in the world began to wonder if the Russian way was perhaps the winning way. And lately many have wondered if it's the Chinese that will someday lead the world economically, take all our jobs and join with Russia to 'rule the world.' Along the way, they've seemingly become close 'friends.'

Should we worry about this Russian and Chinese hook-up? No, we shouldn't.

Instead we should take care of our own business, work together to build a better society, encourage and help each other be all that we each can be, and let history take care of itself.

In fact, Russia and China have worked hard to present an image to the world of being BFF (best friends forever), as the kids like to say. But are they really BFF? Or is their relationship instead a marriage of convenience where high oil prices support Russia's energy driven economy and
assure an abundant energy supply for China's until now rich and ever expanding economy?

And if China isn't growing so much these days or in the foreseeable future, what will that do to the need for Russian oil? And if global energy prices stay low due to expanding U.S. supplies and lower Chinese demands, what will this portend for Russia's oil dependent economy? And will the BFF stay best friends?

I vote for the marriage of convenience relationship, and that the marriage will be greatly strained going forward. And that's a good thing.

Friendship Between Putin and Xi Becomes Strained as Economies Falter offers this update:

"They have met more than a dozen times and stood shoulder to shoulder during Thursday’s military parade here. But the once-vaunted relationship between the Chinese president, Xi Jinping, and Russia’s leader, Vladimir V. Putin, has come under strain as the economies of their countries have faltered.

Two landmark energy deals signed last year for Russian natural gas to flow to China have made little progress and were barely mentioned when the two men met for talks after watching the show of weapons Thursday on Tiananmen Square. The bilateral trade that was predicted to amount to more than $100 billion this year instead reached only about $30 billion in the first six months, largely because of a reduced Chinese demand for Russian oil. . . .
In Moscow, similarly, optimism about China substantially helping Russia out of its economic problems has faded.

“The big hope that China is going to provide a lifeline to sustain Russia through the sanctions and the falling oil price is not working,” said Alexander Gabuev, an analyst of Russian-Chinese relations at the Carnegie Moscow Center.

“It is a symbolic relationship — with a small, volatile economic base,” he said. The Kremlin elite was “disappointed that nothing has materialized as quickly as the Russians hoped.”

Russian demand for Chinese manufactured goods is down 40 percent, and for clothing 50 percent, from this time last year, . . .

The big energy deals are not the only victim of the economic slowdowns.

A fast rail link that China had said it would build to Beijing from Moscow is in doubt because China, which is an expert at such construction, is demanding that Russia pay for it. The nearly 500-mile first leg, between Moscow and Kazan, was scheduled to open before the 2018 World Cup in Russia. But work has yet to start, and it is unlikely to, Ms. Hill said. “The Russians won’t have the money to pay for it, and the Chinese are not going to do it for free,” she said.

The friendship between Mr. Putin and Mr. Xi has been striking and captured the attention of both countries, because each man likes to project an image of power and even daring. At global gatherings, they almost strut on the stage together. . . .

“There has never been a close relationship until recently,” Ms. Hill said. “The success of China has bred the interest of Russia.” Even though Chinese growth was slowing, China still seemed “brighter” to the Russians relative to the downswings in Europe and Ukraine and to their own economic problems, she said."

Summing Up
This all helps to remind me that America is indeed a special nation of equals.
We the People aren't short term partners in an economic marriage of convenience, and neither are we all BFF.
Instead we have a responsibility to do what's right and moral for ourselves and our families, as well as for each other and the future generations of Americans who will follow.
Whether the issues concern government growth, economic growth, politics, public vs. private sector, labor vs. management, ISIS, police, LBGT, race relations, immigration, vouchers for education or countless other matters which tend to divide us, it's of vital importance that we make a determined and continuing effort to remind ourselves of all that unites us.

We the People isn't a slogan. It's a fact.
There are bad guys among us, of course, but the vast majority of our fellow Americans aren't our enemies.
Instead our fellow Americans are our real and lasting friends. And friends take the time to listen to each other and do what they can to help each other. They even have fun together.

Happy Labor Day weekend.
Thanks. Bob.

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