A U.S. PROMISE to Taiwan has quietly imploded after the dramatic collapse of German industry.
Researchers at the Brookings thinktank said Taiwan’s economy would survive the shock of war in the same way that Germany’s industrial economy would survive the shock of losing its gas pipeline from Russia.
But it’s now clear that the German economy hasn’t survived the loss at all.
Germany’s industrial output figures fell for seven months in a row, and a Bloomberg headline this week summed up the situation: “Germany’s Days as an Industrial Superpower Are Coming to an End”.
So Taiwan’s economy, too, would be doomed.
CONFLICT CREATION
Here’s the full story. In 2021, the US put its infamous and much-used conflict creation plan into action in Europe. It increased the tension around Ukraine by stepping up rhetoric about “the west” (indicating both NATO and the European Union) expanding to Russia’s borders, despite decades of promises that it would not threaten Russia’s security by doing such a thing.
The move had three clear aims.
- DRIVE A WEDGE BETWEEN GERMANY AND RUSSIA
The first was to destroy the powerful win-win relationship between Germany and Russia. Germany was getting 55% of its gas from Russia at a price that kept both economies healthy, and had excellent relations with the eastern former superpower.
2. CREATE FEAR USING “DOMINOES” STRATEGY
The second aim was create a conflict that would spread fear, so as to prompt peaceful, neutral countries to join US-led NATO. This would require them to divert two per cent of all public funds on weapons—most of which were made in the US. Congress members held defence stocks and would directly profit. This has been traditionally done using the “dominoes” fearmongering technique. “Russia attacked Ukraine! All other countries are next! Better buy weapons now!”
3. WEAKEN RUSSIA
The third was to weaken Russia, and provide an excuse for sanctions and a demonization operation to isolate that country globally. Russia had to be kept in a condition where it could never rise to become a regional or global super-power, as specified in the Wolfowitz Doctrine.
WELL KNOWN TO DIPLOMATS
The three-part plan, although rarely mentioned in the media, is well known to diplomats, researchers and historians. In this case, it worked. The operation to goad Russia into invading Ukraine was a success—and the US in early 2022 told Germany to stop buying gas from Russia.
But then came a twist. Germany was very reluctant to do so, having been told by its own economists that the ensuing energy crisis would damage output and could end its role as an industrial superpower.
ENTER BROOKINGS
So Germany’s leadership was told that a detailed study by a team overseen by the Brookings think tank showed that German researchers were wrong, and the country would quickly recover from a change of energy supplier. The researchers were Benjamin Moll of the London School of Economics; Moritz Schularick of the Kiel Institute for the World Economy; and Georg Zachmann of Bruegel, a think tank.
When Germany continued to show reluctance to run full-tilt into joining the war, the US said that it wanted Russia’s Nord Stream gas delivery service stopped, it had the power to stop it, and it would stop it.
The Russian pipelines were duly blown up in an astonishing act of industrial terrorism, with the US government at first blaming the victim, then declaring it “a mystery”. Germany became desperate for power, and the US starting selling LNG to the country.
MESSAGE FOR TAIWAN
But here’s the key point for the future. Brookings said its research report authors had a message for Taiwan. The data implied that Germany did what the US wanted, becoming a US partner in the war, and Germany’s economy was fine. The implication was that Taiwan should also follow US instructions and it too would be fine.
The Brookings summary of the research said: “The authors write that Germany’s ability to adapt to the cut-off of Russian gas holds important lessons for similar cases in the future, such as China and Taiwan. ‘Market economies have a tremendous ability to adapt that we should not underestimate again,’ they write.”
They were saying that Germany’s quick recovery shows that Taiwan will also recover quickly in “similar cases in the future”—ie, if and when the US used Taiwan to successfully goad China into a war.
THEN IT WENT WRONG
But here’s the problem. Germany didn’t recover quickly. On the contrary, there has been seven months of industrial decline in a row—and analysts now say that Germany cannot recover.
That’s a problem for Germany, but there’s also a problem for the wider world. The facts are clear, and business people, economists, and diplomats can see what the dangers are for peaceful Asia. But no one in the western media will write about it—so the majority of people will be kept in the dark.
THAT BLOOMBERG REPORT
In the Bloomberg article about Germany’s economic tragedy, for example, the finger is pointed, absurdly, at China, which had nothing to do with it: “China is becoming a bigger rival and is no longer an insatiable buyer of German goods,” the agency said.
But even Bloomberg couldn’t seriously blame China, nor could it avoid identifying the real problem. “The final blow for some heavy manufacturers was the end of huge volumes of cheap Russian natural gas,” it said.
And that’s the simple, unavoidable story. Germany had a great relationship with Russia. The US was unhappy with it. The US destroyed that relationship, using the peerless conflict-creation techniques it has refined over more than seven decades. Ukraine was sacrificed. But all three US goals have been successfully achieved.
Now the US has its eye on Taiwan.
Illustration at the top from fridayeveryday.