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December 11, 2018 | The Real Origin of Trump’s Fight With China

Is an American author of books and articles on economic and financial subjects. He is the founder and president of Agora Publishing, and author of the daily financial column, Diary of a Rogue Economist.

BALTIMORE, MARYLAND – Yesterday’s trading was inconclusive, like an argument between a husband and wife that has been going on for years.

Sellers opened with an attack that sent the Dow down 500 points. Buyers defended themselves… forcing the Dow back up to end the day with nothing decided, one way or the other.

But let’s get back to the story we were following yesterday…

 

 

Failure to Salute

As we reported yesterday, the arrest of a high-profile foreign citizen in a foreign country was an eye-opener.

Ms. Meng Wanzhou, a Chinese citizen, was jailed in Vancouver for political reasons. When the U.S. gave her Chinese company – tech giant Huawei – its marching orders, she failed to salute.

That arrest – unless it is undone quickly – will surely block any efforts to secure a “win-win” deal with the Chinese. And this will leave the Trump team with no attractive alternatives.

It could go ahead with its silly trade war, but that would bring about the stock market selloff Mr. Trump wants to avoid.

Or the president could back down and look like a chump.

Most likely, he will go with the third option: declare victory… and let trade continue more or less as before. That was the solution in the NAFTA deal; it seemed to work.

But China is not Canada. Ms. Meng is still in the hoosegow. And America’s economy still depends on China’s economy. The two function like a machine. One pumps fake money into the world economy. The other cranks out cheap products.

Alas, the arrest of Huawei’s CFO looks like the kind of grit that could wear out the gears and break the drive shaft.

 

 

Origin of the Species

But today, we look beyond the machine… to the animals that run it. We give the devil his due, in other words.

That is, we look at the origins of our species. We look at why, for all the success of win-win deals, win-lose deals are still popular.

Let us begin by backtracking a million years. There, perhaps on the banks of the Jordan River, pre-man – a form of Homo erectus – was throwing a party.

When a new couple arrived, the males at the party eyed the new fellow… They may have looked for a smile… or perhaps for the relaxed posture of someone who posed no threat.

Then, they turned to the female and looked her up and down, too, with longer, more careful leers… She was the one that really interested them.

The other females scarcely bothered with the male at all. They looked at the female, gauging the competition.

The same phenomenon was evident at our office party on Friday night. Men looked mostly at women. Women looked mostly at women, too. And women, in their colorful fabrics, sparkling jewelry, and painted nails, wanted to be looked at.

What gives?

The concept of the “rugged individualist” is mostly myth… and a dead end. Man is a social animal. With no one to stand beside us, we might as well not stand at all. Only in groups are people able to get their bearings.

Man was able to survive on the savannas of Africa only because he communicated and cooperated with others. Together, they could drive off stronger, faster predators with sticks and stones. Alone, he was dead meat.

But working together to hunt, to defend themselves, and to divide up the work so they could be more productive, mankind flourished… and eventually, dominated the whole planet.

 

 

Eat and Produce

All of us alive today are the descendants of people who wanted to mate and reproduce. That desire is, in addition to survival itself, the sine qua non of existence. If you don’t want to eat or procreate, your genes will not be passed along.

Obviously, we are the products of those whose appetites were satisfied… at least for a while. That is why most of us have appetites, too. We inherited them.

Both procreation and eating involve competition. The world’s natural food resources are not infinite. In any given area, there are only so many ripe fruits and slow animals.

During the millions of years in which human evolution made us what we are today, there must have been many proto-humans who were too slow, too dumb, or too unlucky to get enough to eat.

Whole tribes… perhaps whole subsets of primates… disappeared. Homo neanderthalensis, for example, survived for hundreds of thousands of years.

Then, Homo sapiens (we) arrived on the scene. Within a few thousand years, Neanderthals were history, leaving only a trace of their DNA – in us.

They may have starved. They may have been killed. Either way, competition took its toll.

There is also competition to mate. Women can only have a few children. At the margin, the women whose children survived were probably those who were most selective about their mates. They chose men who were strong, fast, smart, and successful. This increased the odds that their children would get those traits, too.

And thus do men and women look at each other at parties. They have one eye out for suitable mates… and the other for the competition. Who’s strongest? Who’s fastest? Who’s smartest? Who’s most attractive?

That’s why we put on nice clothes and make-up, even if we have no current intention of mating; “flaunting it” is embedded in our genes as an instinct.

Since the agricultural revolution some 5,000 years ago, survival has been man’s number one concern only episodically. Famines came from time to time. But mating… finding, attracting, forcing, or seducing… was always on his mind.

He wanted to make things better, so he would have more mating opportunities. It was a relative “better” that he wanted, not an absolute “better.” He only had to get richer, smarter, and more able – compared to his rivals.

And there were two ways to do it. He could improve himself – work harder to make himself more attractive. Or he could try to take the competition down a peg.

So, in addition to becoming a cooperative, win-win dealmaker, he also became fiercely jealous, competitive, power-mad, ruthless, murderous, and vengeful.

In the purest, simplest, crudest form of competition, he could simply kill his rival. Voilà – he was then the best available mate.

It was upon those dark ears – formed over so many thousands of years by evolution and competition – that news of Ms. Meng’s arrest arrived.

Stay tuned…

Regards,

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Bill

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December 11th, 2018

Posted In: Bill Bonner's Diary

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