Strategic choices for great nations

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Europe

Editor’s note: Chen Jiahe is a chief strategist at Cinda Securities, Oxon. The article reflects the author's opinion, and not necessarily the views of CGTN.

From individuals to companies to nations, everyone needs strategic choices. There are always the right strategies versus wrong strategies. The former brings prosperity, and the latter brings mediocrity.

Sadly, it is only the wise that can tell the differences between the two, before the consequences of choices become a reality.

The United States is now picking some "obviously" correct strategies. However, if you know enough about history, you shall be able to discover the problems.

As far as I know, none of the great nations in history were forged through these types of strategies, nor was today’s United States built this way.

Other countries are now gradually being blocked from trading freely with the United States. This phenomenon is claimed as a means of "earning money for the American people".

However, this theory clearly forgets one thing, that the gold standard has been abandoned for tens of years. This means money is no longer "money".

Today’s money is not the natural rare gold. Today’s global currency is mainly dominated by the United States dollar, something that has almost no intrinsic value at all.

As long as the United States is the leader of this world, American people do not have to earn this money, they can just print it. The keeping of the dominant position of the nation is a much more important task for the US, than earning money from the market.

The US dollar./ VCG Photo

Looking back at history, you can find the causes behind the United States’ leading global position today.

Its contribution to world wars, its generous economic gesture after the war that was represented by the Marshall Plan, the world’s largest free market for decades, its creative invention of its marvelous technology industry, etc.

None of this was earned with methods like adding tariffs to earn back money.

When politicians now claim that they will bring jobs back to America by adding tariffs, they are making another big mistake. What kind of jobs can be earned back by adding tariffs? You don't bring programming jobs back to the states by adding a tariff to foreign-produced computers or mobile systems.

There are only four dominant operating systems in the world, Windows, Mac OS, Android and iPhone OS. None of these are produced outside of the United States, so tariffs have nothing to do with relevant jobs.

What kind of jobs can be brought back by adding tariffs? Well, the cloth making jobs, the steel production jobs, the agricultural jobs, etc.

Is the United States’ economy great in the 21st century because it produces a lot of good cloth, steel, and food, or is it because it has the world’s best technology industry?

The national flag of the United Stated seen outside the US Consulate General at Furstatskaya Street in St Petersburg./ VCG Photo

Regarding the technology industry, American’s policymakers are now also choosing another thoughtless strategy with its immigration policy. Claiming that jobs shall be kept for the Americans and technology secrets shall not be leaked, the government is now tightening its acceptation of immigrants and international workers.

However, the decision makers seem to forget that it was just the "untrustworthy foreigners" who built a great part of the Silicon Valley.

In 1999, over one-third of the high technology workers in the Silicon Valley were foreigners. If you restrict the calculation to those who worked in the Silicon Valley and had PhD degrees, the number was over 50 percent.

If the immigration policy that we see today was conducted in the 1990s, the United States might not have such a great technology industry at all, which brings the nation the most profitable part of the global trade.

From Rome to the Tang Dynasty, none of the world’s greatest nations were built through rejecting their neighbors and closing their gates. Not cooperating and isolation are actions of the scared and great nations do not scare.

It was free markets and creative people that pushed forward our civilizations and built great nations. The policymakers who forget about these principles will definitely make inaccurate strategic choices.