Man in the middle

 

Image Credit: Emilio Morenatti

Man in the middle usually means a particular kind of cyber attack whereby the attacker secretly relays and possibly alters the communications between two parties who believe that they are directly communicating with each other, as the attacker has inserted themselves between the two parties.

An illustration of the man-in-the-middle attack

But this blurb isn't about Man in the middle but rather China being the man in the middle in terms of where it sits in terms of Russia, the US and the connect to Putin's atrocity of the unprovoked invasion of Ukraine.

It's all about the money yet again. Always has been, always will be.

To whit ...

But now there is what you might call a China question. Russia basically keeps China’s lights on — it is China’s biggest supplier of electricity, one of its biggest suppliers of gas and coal and food and so forth. China pays for all that by selling us the cheap household goods which it’s become synonymous in the West with — everything from computers to plastic trays.

We are paying China, and China is paying Russia. That triangular trade has to come to an end, as war in Europe breaks out, for the simple reason that it finances Putin’s war machine. So now what happens? Well, we try to talk sense into China. But China needs power and food more than it needs to sell us cheap junk. We’re indebted to China, remember. Do we tear up the rules of our own order, and tell China we won’t repay our debt to it, in order to stop financing Putin’s war machine? If we do that, China probably joins Russia’s axis. But we can’t let it go on effectively paying Russia money which it turns into tanks and missiles, either. We don’t have a good way out. Sanctions? Again, China probably just joins Russia.

This is the great and fatal problem at the heart of our global economy right now. Nobody much understands it enough, because it is an impolite problem to raise. “Hey, do you realise we’re paying China…and China’s paying Russia…and that’s how Russia’s making war on us?”

Transformation 101

I really want you to understand this point clearly. China is effectively the middleman of the global economy right now. It takes Russian power, electricity, coal, raw materials, iron, steel, nickel, and turns them into stuff like computers and vacuum cleaners and plastic dish trays and sponges. We buy them by the millions. China transforms Russian natural resources into what we call “the economy.”

That is why China is being so cagey right about now. What can it really do? It doesn’t want to have make a choice — any choice. It’s in a deeply uncomfortable position. It’s caught in between us and Russia, in a way that the average person has very little idea about — it literally transforms Russian power and steel and gas into “the economy” the West depends and relies on.

And so, for now, it’s not choosing either side, really. But what happens if and when it has to?

Well, then we have to think very clearly about which side it’s likely to end up on. On the one hand, we pay it immense sums to undertake the role of global transformer, if you will, transforming Russian oil and coal and steel into what we call “the economy” — such immense sums that we owe it debt. On the other hand, Russia is who keeps its lights on and its people fed, and without Russian electricity and coal and gas and so forth, China doesn’t have an economy.

Which choice would you make?