Submitted by Tyler Durden on 05/17/2015 14:15 -0400
One story that’s been covered extensively in these pages over the past several months is the emergence of the China-led Asian Infrastructure Investment Bank. The bank began to attract quite a bit of attention in early March when the UK decided, much to Washington’s chagrin, to make a bid for membership. The dominoes fell quickly after that and within a month it was quite clear that The White House’s effort to discourage its allies from supporting the new institution had failed in dramatic fashion.
Since then, China has been careful not to jeopardize the overwhelming support the bank has received. While Beijing is keen on expanding China’s regional influence and promoting the widespread use of the yuan, downplaying the idea that the new bank will become a tool of Chinese foreign policy is critical if it hopes to enjoy the long-term support of the many traditional US allies who have become early adopters so to speak. Similarly, China must be sensitive to the perception that the AIIB is the first step towards usurping the dollar as the world’s reserve currency and although Beijing has dispelled the notion of “yuan hegemony” as nonsensical, it’s clear that the renminbi will play a key role in loans made from the new bank.
So while the AIIB certainly represents an attempt on China’s part to realize its regional ambitions (what we’ve described as the establishment of a Sino-Monroe Doctrine) and carve out a foothold for the yuan on the global stage, it’s also a product of Washington’s failure to adapt to a changing world. That is, the establishment of new supranational lenders suggests the US-dominated multilateral institutions that have characterized the post-war world are proving unable (for whatever reason) to meet the needs of modernity.
Nowhere is this more apparent than the IMF, where reforms aimed at making the Fund more reflective of its membership have been stymied by Congressional ineptitude for years. As Bloomberg reports, the US has apparently learned very little from the AIIB experience:
The Obama administration signaled it won’t jeopardize the U.S. power to veto IMF decisions to achieve its goal of giving China and other emerging markets more clout at the lender, according to people familiar with the matter.
That message was delivered at the International Monetary Fund’s spring meetings in Washington last month, the people said, where officials discussed how to overcome congressional opposition to a 2010 plan to overhaul the lender’s voting structure.
A solution backed by Brazil would have enabled an end-run around Congress — while potentially sacrificing the veto the U.S. has held since World War II. With that option off the table, the people said, IMF member nations are considering a watered-down proposal that risks alienating China and India, which are already challenging the postwar economic order by setting up their own lending and development institutions…
The 2010 plan calls for increasing the emerging markets’ sway through a doubling of the IMF’s capital, with the U.S. contribution subject to approval by Congress. Without that approval, the plan wouldn’t have the support of the required 85 percent of members’ voting shares, because the U.S. has 16.7 percent. Voting rights are proportional to capital shares at the fund.
China, the world’s second-largest economy, currently ranks sixth in its voting shares at the IMF, behind Japan, Germany, France and the U.K. Under the 2010 plan, China would jump to third, while India would climb to eighth from 11th and Brazil would move up four spots to 10th.
The option backed by Brazil and other countries would have pushed through the changes without requiring Congress to ratify them. The catch was that the U.S. veto over major IMF decisions may have been at risk if Congress failed to react by approving the 2010 plan, because America’s voting share would potentially fall below the 15 percent threshold needed to maintain the power…
The fund is now considering a capital increase of just 10 percent, said the people familiar with the matter, who asked not to be identified because the discussions are confidential. Most of the boost would go to emerging nations that are underrepresented based on the size of their economies.
The solution is unlikely to satisfy some emerging economies because the capital increase is too small, said Truman, now a senior fellow at the Peterson Institute for International Economics in Washington.
In a column last month, former U.S. Treasury Secretary Lawrence Summers cited Congress’s failure to pass the IMF reforms as one of the reasons why China is pushing to reshape the global economic order with new institutions such as the Asian Infrastructure Investment Bank.
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In many ways, the above represents everything that’s wrong in Washington. First, Congress’ famous inability to do what they were elected to do (i.e. legislate) is on full display. Second, the President is unwilling to bypass an ineffectual group of lawmakers in the name of accomplishing something worthwile because the end-around would require the US to give up absolute control over an institution that by its very nature should not be controlled by one nation. Finally, you have yet another example of the US learning absolutely nothing from egregious foreign policy mistakes even when they occurred less than two months ago.
This is all par for the course in Washington so we suppose the real question is what this means for China’s IMF SDR bid. That is, will Beijing simply lose interest if the US-controlled IMF can’t agree on a structure which reflects China’s growing influence on the world stage?
US is a hijacked nation and China is a NWO laboratory, stripped down and rebuilt from scratch via the yat-sen, kai-shek, tse-tung arc, all individuals who, like hitler, were INSTALLED by the NWO and its global banking cartel that engineers all wars, all market “crises.” The RMB is effectively gold backed, gold flows have actually just been a massive li-lo by institiutionals to the new main base (China – go watch ridley scott’s Blade Runner for some choice predictive programming) – this not officially gold-backed unit is being used to ramp into SDR as we speak and the enemy has been OPENLY telling us for years.
BRICS is more about getting at Russia underbelly (Brezinski Doctrine encirclement campaign – see: Syria, Turykey Ukraine, etc.) and AIIB was cooked up by the exact same people who created the IMF (I know, big shock right?).
Gentlemen, let us face facts: the US and CHina are merely wholly-owned operating subsidiaries of the New World Order, a criminal, collusive, supra-national enterprise and holding company into whose control all of the planet’s assets are being placed via receivership, engineered through wars, hijacking governments, installation of puppets, rigging of markets, etc.
To quote George Carlin “its a big club, AND YOU AINT IN IT.”
“The belligerent US” – this is part of the engineered bad PR that is essential to dismantling “the west” – we are too fat and wealthy and have guns, therefor\e we must be japanized until the boys dont want to start families or own homes – its a softkill – it is eugenics via debt-based monetary systems. This is why they use the US as a pitbull, it generates negative PR for us, so when the time comes to pull down “the west” and uhser in a new global structure, the organizers of that move can play the hero! ORDO AB CHAO, Hegelian Dialectic…
I love ZH and the tylers – but this article is a classic example of a lack of real codifying synthesis.
AFRICOM is a good microcosm and lensing system through which to observe the reality of the global system as it exists today: NATO (mind you, France is an RMB offshore now with no economy) provides the military umbrella and China gets all the contracts.
USD is not being killed or removed, it is being Retired from GRC status so it can be used as tier3 slave paper for debtconomies.
A carefully executed stage play for people to eat up – complete with antagonist and protagonist – behind the scenes at the supranational level? the magic makers and dreamers of dreams who create your reality for you. Another vector on BRICS is clear if you look at CFR white papers from mid to late 2014, the whole pviot SA strategy – CAPEX is done in China you see, ME is being mopped up, RUS FEd encircled, Africa will never be allowed to develop – SA is all that is left “to do.”
My problem with the perspective of the author is that it plays right into the hands of the enemy and their whole “america the great satan, lets tear them down shall we?” meme – yes, we get it NWO, you used us up and now we are being sent to the glue factory – but did you really have to teach the entire planet and even our own shitizens to stand up on their hind legs and cheer to tear down Magna Carta and the Constitution/BoR? well… i guess you Had to, didn’t you?
China will be the new king monkey once handed the football – price discovery in monetary metals hand-off to SGE is already taking place – theyve are building artilects in Beijing now for over a decade – ahh moden “China” where human life isnt just cheap, its worthless, where you are born in a Foxconn walled city and never leave, and you were one of the lucky ones not processed into incinerator fuel via the in-factory abortion clinic. China will be used to really usher in the transhuman ramping strategy and cyberization – a future that as Billy Joy said “does not need us” – prepare your anus for the post-human borg beehive my fellow debt hologram residents.
No dis, <3 the ZH.
I leave you with a choice bit of predictive programming from the film Network, which, while it doesnt actually show people the entire plan, nevertheless gives the game away, and feels like a Walter Lippmann manifesto come to life on the big screen.
Network (1976) – Ned Beatty speech – The World is a Business