Beware the green dragon, not the red one

by Crispin Hull on March 5, 2018

As China’s President Xi Jinping came closer this week to becoming the next Emperor of China for Life, western leaders wrung their hands and worried about China’s military power; cyber power and soft power – meanwhile naively surrendering, without a scintilla of opposition, primacy the one field that made the British and then the American empires world dominant – energy.

It is quite weird that the US, with Australia clutching its coat-tails, has gotten all worked up about China spreading its communist, illiberal, ideological dogma to all parts of the world, suspecting a communist plot for China to dominate the world. And got worked up about expansion of military presence into the South China and soft power into the heartland of US and Australian cities. Yet, at the same time, blind ideological adherence to the coal, gas and oil industries and climate-change denial is handing to China on a plate world dominance in the one thing than really matters when it comes to empire building in the industrial and post-industrial world – energy.

Look at the history. The British empire was built on coal. The American empire was built on oil. Both were sustained by taking their soft and hard power beyond their boundaries, but the control of vast amounts of energy was the key.

So why now is the US (and Australia on its coat-tails) ideologically clinging to last century’s energy sources and technology while being blind to China’s embraces of this century’s energy sources? How dumb are we?

Forget the South China Sea and the Silk Belt and Road. Forget China’s foray into gaining influence in smaller nations through fair means or foul. Forget Xi’s classic strengthening of anti-democratic forces and weakening of democratic ones through concentrating power in his own hands. These are the sideshows which have dominated discussion about China’s direction while the real source of future Chinese world power should be staring us in the face and about which we should be doing our utmost to dilute – energy.

Again, look at the history.

In the late 1990s China wheedled its way into the capitals of oil-rich states, especially those whose relationship with the US had soured – Iran, Iraq, Sudan, Russia, Venezuela Ethiopia, Libya and Nigeria. It spent billions and it came to nothing. China supplied arms and money and got no oil.

Enter President Xi. In 2012, he essentially said, “forget oil”, let’s go for renewables. Ever since he has been weaning China off fossil fuels to make it energy independent. More importantly, he wants to make China the world’s greatest producer and exporter of renewable energy and the wherewithal to create it: solar panels and wind turbines.

On offer to other countries here is the possibility of freeing themselves from importing oil from the Middle East, Russia or anywhere else, and freeing themselves of importing coal or uraniaum from Canada or Australia or anywhere else.

And the US, Australia and Canada are watching, doing nothing, instead of leading the solar and wind charge themselves.

Forget the red dragon. Worry about the green one. And our blind ideology is letting it happen while the communist country ignores ideology and goes for industrial and market reality. And it is not just panels and turbines. It is also batteries and electric cars.

China sees the future. If it did nothing on renewables its demand for fossil fuel imports would rise while the US becomes increasingly less import-dependent as domestic production booms. If nothing changes the US will become a net exporter before too long.

China sees that the best way to under-cut this short-sighted US concentration on fossils is to go for the renewables.

Not only that. It sees the mistakes of fossil dependency in pollution and other environmental and human costs.

The side benefit, of course, is the international political gain from being seen as a good international citizen in combatting climate change. The economic advantage, of course, is that it sells renewable goods and services to help other countries avoid its environmental mistakes.

And the ideologically blinded US (and Australia) are allowing it to happen. Surely it is one of the greatest economic ironies for the past century – pragmatic, capitalist states shooting themselves in the foot with an ideological bullet while the supposedly ideology-driven communists seize the moment to gain market domination.

In the newar future, when the US and Australia try to sell liquefied natural gas or coal to countries in Asia and Europe, they will be competing (if they can) with Chinese solar panels and batteries.

China is just turning off coal. The International Energy Agency says China will invest more than $6 trillion in renewable power by 2040. Direct government funding provides the lion’s share.

China has seen the fossil future – pollution and import dependency – and does not like it.

There is another irony here. Xi is doing what his people want – clean prosperity. He knows that if he does not keep them content, violent dissent is just under the surface. Even now it sometimes emerges and has to be put down. But by and large, the Chinese people are more content with their government and trust it more than the people in many democracies, according to Pew and other international research.

Meanwhile, in the democracies, leaders are less concerned with what the people want and more concerned with doing the bidding of their corporate donors.

It is disturbing to see the democracies allow a totalitarian communist state:

1. Take leadership on the greatest threat to global peace and prosperity – climate change.

2. Get the international kudos for doing it and get international legitimacy for its pernicious form of government.

3. Get the huge economic advantages for doing it.

And 4. Improve its own security by lessening its dependence on energy imports.

It is disturbing to watch the democracies (particularly the US and Australia):

1. Flounder on climate change and carbon reduction.

2. Debase their moral superiority by allowing multi-nationals to dictate policy while not paying the tax they should to nourish these societies.

3. Condemn their people to high energy costs and perhaps the devastating costs of climate change unless China saves us by flooding the world with profitable renewables.

That’s why we should worry about China. And it is all because we allow it.
This article was first published in The Canberra Times and other Fairfax Media on 3 March 2018.

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