China’s Global Political Shift. No longer does China regard its relationship with the United Sates or even the EU as of highest priority. Rather they have defined a new grouping of priority countries in their carefully-deliberated geopolitical map. It includes Russia, as well as the entire BRICS rapidly-developing economies; it includes China’s Asian neighbors as well as Africa and other developing countries. To give a perspective, as recently as 2012 China’s foreign ptries in the world, including China); Multilateral Organizations (UN, APEC, ASEAN, IMF, World Bank etc.), and public diplomacy which determines which situations to become engaged in around the world. Clearly China has decided those priorities no longer work to her advantageolicy priorities were described in a general framework: Great Powers (principally the USA, EU, Japan, and Russia); Periphery (all countries bordering China); Developing Countries In his address to the meeting, President Xi highlighted a sub-category of developing countries: “Major Developing Powers (kuoda fazhanzhong de guojia). China will “expand cooperation and closely integrate our country’s development” with the designated Major Developing Powers, Xi declared. According to Chinese intellectuals, these are countries now deemed especially important partners “to support reform of the international order.” It includes Russia, Brazil, South Africa, India, Indonesia, and Mexico, that is, China’s BRICS partners, as well as Indonesia and Mexico. China has also ceased calling itself a “developing country,” indicating the changed self-image. Vice Foreign Minister Liu Zhenmin indicated one significant aspect of the new policy when at the conference in Beijing he declared that the “imbalance between Asia’s political security and economic development has become an increasingly prominent issue.” China’s proposal to create an Asian “community of shared destiny” aims to resolve this imbalance. That implies closer economic and diplomatic ties with South Korea, Japan, India, Indonesia, even Vietnam and the Philippines. In other words, although the relationship with the United States will remain highest priority because of America’s military and financial power, we can expect an increasingly outspoken China against what it sees as American interference. This was seen clearly in October when the official China Daily wrote an OpEd during Hong Kong’s “Umbrella Revolution” asking, “Why does Washington Make Color Revolutions?” The article named the Vice President of the US Government-financed regime-change NGO, National Endowment for Democracy as involved. Such directness would have been unthinkable just six years ago when Washington tried to embarrass Beijing by stirring up violent protests by the Dalai Lama Movement in Tibet just before the 2008 Beijing Olympics. China is openly rejecting the usual Western criticism on human rights and recently declared a freeze in China-UK diplomatic relations following a meeting by the Cameron government with the Dalai Lama and to Norway over its recognition of dissident Liu Xiaobo. Over the past year, step-by-step Beijing has dismissed Washington’s criticism of its reclamation of its historical claims in the South China Sea. But perhaps most significant, in recent months, China has boldly moved an agenda to build alternative institutions to the US-controlled IMF and World Bank, a potentially devastating blow to US economic power if it succeeds. To counter the US attempt to economically isolate China in Asia through creation of a US Trans-Pacific Partnership (TPP), Beijing has announced its own Chinese vision of a Free Trade Area of the Asia-Pacific (FTAAP), an “all inclusive, all-win” trade deal that really promotes Asia-Pacific cooperation. Elevating Russian Relations At present, what clearly emerges is China’s decision to make its relation with Putin’s Russia central to this new priority strategy. Despite decades of mistrust following the 1960 Sino-Soviet split, the two countries have begun a depth of cooperation unprecedented. The two great land powers of Eurasia are welding economic bonds that create the only potential “challenger” to future American global supremacy, as US foreign policy strategist, Zbigniew Brzezinski described it in his The Grand Chessboard in 1997. At a time when Putin was engaged in a full-scale NATO economic sanctions war aimed at toppling his regime, China signed not one, but several gigantic energy deals with Russian state companies Gazprom and Rozneft, allowing Russia to offset the growing threat to her west European energy exports, a life-and-death issue for the Russian economy. During the November APEC meeting in Beijing, where Obama was given an unmistakable Chinese diplomatic downgrade for the official photo by being told to stand next to the wife of one of the Asian presidents while Putin stood beside Xi. In politics symbols, especially in China carry great import as an essential part of communication. During the same occasion, Xi and Putin agreed To build a West Route Gas Pipeline from Siberia to China, as an addition to the historic East Route Pipeline agreed with Russia in May. When both are completed, Russia will deliver 40% of China’s natural gas. At the same occasion in Beijing the Chief of the Russian General Staff announced significant new areas of cooperation between Russian Armed Forces and the Chinese PLA. Now, in the midst of Washington’s full-scale currency war against the Russian ruble, China has announced its readiness, if asked, to help its Russian partner. On December 20 amid a record fall in the Ruble to the dollar, Foreign Minister Wang Yi said that China will provide help if needed and is confident Russia can overcome its economic difficulties. At the same time Commerce Minister Gao Hucheng said expanding a currency swap between the two nations and making increased use of yuan for bilateral trade would have the greatest impact in aiding Russia. There are other synergies between Russia and China where both coordinate more closely, including Putin’s decision to meet in Spring with the North Korean President, as well as with India, a long-time Russian ally with whom China has had fragile relations since the 1950’s. As well Russia has a strong position with Vietnam going back to the Cold War and development by Russian oil companies of Vietnam’s offshore oil discoveries. In short, for both, once in a harmonized geopolitical strategy, Brzezinski’s worst geopolitical nightmare is taking on a life of its own, thanks, largely, to the very stupid policies of Washington’s neo-conservative warhawks, President Obama, and the very rich, loveless families who pay their bills. All of these moves, while fraught with danger, signal that China has deeply understood the Washington geopolitical game and the strategies of the neo-conservative US warhawks and, like Putin’s Russia, have little intention of bending their knee to what they see as a Washington global tyranny. The year 2015 shapes to be one of the most decisive and interesting in modern history. informationclearinghouse.info/article40686.htm Hundreds of thousands of US layoffs expected as oil boom unravels. The precipitous drop in the price of oil has prompted oil companies to prepare mass layoffs in 2015 as sections of the industry become unprofitable. According to a variety of sources, hundreds of thousands of jobs in the US alone could disappear this year if oil prices remain low. The boom led to the addition of some 150,000 jobs in the industry, according to Citi Research. The slowdown could wipe out even more as jobs are slashed in exploration, construction, refining and the tens of thousands of jobs that service the industry and its workers. The job cuts, which are occurring worldwide, will be most pronounced in regions where “unconventional” oil production has recently developed. In Texas, for instance, where a large oil boom has occurred at the Eagle Ford shale formation, the Dallas Federal Reserve predicts that 128,000 jobs could be lost in the state by mid-2015 if West Texas Intermediate (WTI) crude oil remains around $55.00 a barrel. As of this writing, WTI crude is going for $48.52 a barrel. “Unconventional” fields, such as shale formations, which require hydraulic fracturing or fracking, tar sands, and deep-sea offshore reserves, have costs of production far higher than “conventional” oil. While the average Saudi Arabian field has a price of production close to $1 a barrel, an average shale field in the United States only begins to break even at $69 a barrel, according to a recent Scotia Bank estimate. The drop in price has caused oil producers, where they can, to halt or slow down activity at their least profitable rigs. Reuters received data from Drilling Info Inc. that shows approved new oil well permits in the US dropping from 7,227 to 4,520 between October and November, a drop of 37.5 percent in a single month. The Wall Street Journ al quotes Susan Murphy, an oil and steel analyst, saying that spending on oil production and exploration will fall by 20 percent in the US this year. Total land rigs will decline by as much as 500 according to Murphy. Rocky Mountain Oil Journal quotes Dave Galt of the Montana Petroleum Association, who predicts a 50 percent decline in the drilling of new oil wells this year in the Bakken Shale formation, which underlies parts of Montana, North Dakota, Saskatchewan and Manitoba. “Demand for rigs is falling off the cliff,” Joseph Triepke, a financial analyst and managing director of Oilpro, an industry publishing company, told the New York Times. “Exploration and production budgets are down anywhere from 30 to 40 percent and the cuts are happening faster than we thought.” Over the next six months, Triepke told the Times, the big three land drilling companies—Helmerich & Payne, Nabors Industries and Patterson-UTI Energy—are “likely to cut approximately 15,000 jobs out of the 50,000 people they currently employ.” The oil service giant Halliburton announced in December that it would cut 1,000 jobs from its division in the “eastern hemisphere.” Halliburton’s multimillionaire CEO, Dave Lesar, sent an e-mail out to employees informing them that further layoffs could follow. The international oil giant BP announced in December it would lay off an unspecified number of workers as part of a $1 billion cost-cutting campaign. A host of other oil companies are shutting down development projects and slashing spending. In Mexico, 10,000 workers were laid off last week. The majority of the workers operated rigs in the offshore formations of the Bay of Campeche in the Gulf of Mexico. Like many oil workers, they worked for smaller oil service companies that contracted out to a giant oil company, in this case state-owned Petroleo Mexicanos (Pemex). In a phone interview with Bloomberg, Gonzalo Hernandez, the secretary of the Ciudad del Carmen Economic Development Chamber, said job losses could go much higher, all the way to 50,000 this year. In Bakersfield, California, the Employment Development Department was given notice by Ensign Energy Services that it would be axing 700 jobs. Edgar Salazar, who was fired just before Christmas by the company, spoke to Bakersfieldnow. Fighting off tears, he told the news agency, “I’ve never seen it this bad…. I’ve got six kids. It’s stressful…. I have to support my family some way or another.” Edgar had worked in the oil industry for 14 years and, up until now, has always been employed. The comment section of Bakersfieldnow was filled with hundreds of comments expressing the sentiment of oil workers and sympathetic workers. “Kirsty Darren King Clark” wrote, “I have been Human Resources at a drilling company for 13 years…. I have never seen it this bad and I don’t expect it to get better…. I was laid off. I hope and pray every oilfield man/women will get through this rough patch….” Arlene Aninion wrote, “Wouldn’t it be nice, though, if these oil companies would forego their HUGE profits every now and then so the employees could keep their jobs and provide for their families?” It is not just oil workers who are affected by the price fall. US Steel, whose most profitable wing has been supplying steel pipes for the burgeoning shale industry in the US, recently fired 756 workers. The company is idling steel mills that specialize in Oil Country Tubular Goods in McKeesport, Pennsylvania; Lorain, Ohio; and Houston and Belleville, Texas. Its stock has fallen by about 20 percent over the past year. Civeco, which operates camps for oil workers in undeveloped areas, saw its stock plummet by 53 percent on a single day of trading in December. The resultant job loss is not known. Overall, the Energy Select Sector (XLE) stock index, which houses major energy companies, has dropped by more than 25 percent in the past six months. Many states will be devastated by the decline in oil price. Alaska depends on oil taxes for 90 percent of its revenue and is expected to cut its expenditures by 50 percent to deal with the price decline. Louisiana is expecting a $1.4 billion funding shortfall for the 2015-2016 budget and has begun enacting cuts. Oklahoma, North Dakota, and Texas are the three other states whose budgets will be significantly hurt by the fall in oil prices. Oil has plunged by more than 55 percent since its previous peak in July 2014. The last time the oil price dropped so starkly was in 2008 during the global financial crisis, when West Texas crude went from $145.29 in July 2008 to as low as $30.81 in December 2008, a 79 percent drop. wsws.org/en/articles/2015/01/15/oils-j15.html
Posted on: Thu, 15 Jan 2015 17:49:42 +0000
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