Afghanistan Déjà Vu

Published on August 23, 2021, 2:42 pm
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The fall of Afghanistan is the latest sad chapter in America’s futile effort to impose its own vision of the perfect democratic society upon hapless non-Western countries. America has tried to make the world safe for democracy whether the world wants this or not. Korea, Vietnam, Iraq, Syria, Libya, now Afghanistan– America never learns. It is déjà vu over and over.

Actually, we can go back further than Korea. The following is a quote from renowned historian John Fairbank regarding the Chinese civil war which ended in 1949.

When peace broke out in August 1945, the Nationalist armed forces were at least twice the size of the CCP’s (Chinese Communist Party) and moreover had the advantage of American equipment and supplies plus the assistance of the US Navy in transporting troops and the US Marines in the Tianjin-Beijing area. The Nationalists held all of China’s major cities and most of its territory. The spirit of the Cold War was emerging in the United States as well as in China, and so American backing would obviously continue. In these circumstances, for Jiang Jieshi (Chang Kai-shek) and the Nationalists to lose the civil war was a remarkable achievement.

The Taliban followed the same strategy as the CCP. With its ragtag army, take over the countryside and choke the cities.The optical parallel with the fall of Vietnam in 1976 has been noted in the media. In both cases the world was treated to the spectacle of American helicopters descending on the roofs of abandoned American embassies. In what is just bad luck or a total obliviousness to appearances, Vice President Kamala Harris has been summoned out of hiding and is off visiting Vietnam of all places. I guess this trip was planned before the fall of Kabul and is part of America’s anti-China crusade. It is unlikely she will be talking about America making reparations for all the destruction and deaths reined on Vietnam during the American war nor will she talk about removing all the unexploded American ordnance still strewn over the Vietnamese countryside.

What Does China Get Out of the Fall of Afghanistan?

Many have argued that China would have preferred that the US stay in Afghanistan. China would prefer to let the Americans deal with this incorrigible non-country and kept it from being a terrorist threat to the world including China.

But the Americans are leaving. There are two schools of thought on what China should do. They both assume that resistance to the Taliban will fade and the country will not be in a continuous civil war. That could turn out not to be the case as resistance to the Taliban is reportedly emerging.

Assuming for the moment that the Taliban consolidates control and Afghanistan and the country does not become a haven for terrorists, the first possibility is that this is a bonanza for China. Afghanistan has an abundant supply of rare earth minerals including lithium which is needed for batteries. Assuming things settle down, under this scenario China will recognize the Taliban government and perhaps supply technical and financial assistance. China will expand its Belt and Road program into Afghanistan. All the while the US will follow its usual head in the sand pattern and refuse to recognize the Taliban regime, freeze its dollar assets and heap all kinds of sanctions on it.

Of course if Afghanistan became a haven for terrorists as it was before, China in my opinion would not back it. China would not want to put itself in the position where it was held responsible for Taliban bad behavior.

The second alternative is that the Taliban will link up with Moslem extremists in neighboring countries and, besides becoming a haven for terrorists like ISIS and AlQaida, stir up trouble with China’s Uighurs in its Xinjiang province. The neighboring countries (along with Afghanistan) are known as the “stans”—Pakistan, Kazakhstan, Turkmenistan, Tajikistan, Uzbekistan, and Kyrgyzstan. The majority of these countries are dirt poor and presumably potential targets for radical Islam. That would be a most unwelcome development from China’s point of view.

To repeat, a Taliban Afghanistan is going to need financial and technical assistance. Running a country is different from running a guerilla war. The Taliban do not have a clue as to how to run a country and they claim they have changed for the better. Unless the US wants to go back in, neighboring China is the logical country to do this. History has its ironies.

Has the American President Been Weakened?

I am asking this question from the parochial perspective of the American stock market. President Biden and the progressive Democrats have some big tax and spend plans. In my opinion if enacted these will be harmful for the stock market and the dollar. The Republicans are of course opposed. Will these have to be scaled back? In my opinion a weakened President Biden is good for the US stock market and the dollar.

Right now the debacle in Afghanistan has brought shame to America’s image and a loss of trust in the United States. Taiwan is now frequently cited as one important place where American support cannot be relied upon. Still, America’s so-called allies do not vote in American elections. The American people wanted out of Afghanistan and America’s longest war (actually the Korean Civil War is America’s longest war as it is only suspended per the 1953 armistice.) The American people may overlook Biden’s clumsy and ill thought-out withdrawal from Afghanistan. America soon will be out of Afghanistan and the 2300 American servicemen’s lives lost and over 2 trillion dollars spent are regrettable but sunk costs. Most Americans do not give a damn about the nuances of foreign policy or about how their country has ruined lives around the world.

We will see.

Author, speaker, analyst and editor for The Dismal Optimist, a global macro economic blog.