Supporting Friends: How to Lose Trading Partners and Isolate Nations

The supply chain crisis is an ongoing scourge that has contributed greatly to inflation. Treasury Secretary Janet Yellen promoted the idea “Support Friends” more than a year. Not to be confused with onshoring or near-shoring, friend-shoring will somewhat limit the supply chain to allied countries. Why on earth would we want to limit the supply chain to any degree at this time?

Yellen said Russia and COVID, the main political scapegoats for everything that goes wrong, are to blame for reshaping “the contours of global supply chains and trade.” Recall that China is America’s main trading partner, although it is considered “unfriendly.” Russia, the birthplace of energy, also falls on this unfriendly list, which is likely to be in line with what would later become the modern Axis powers.

BRAZIL, BRAZIL – NOVEMBER 13: (RUSSIA OUTSIDE) Russian President Vladimir Putin (left) greets Chinese President Xi Jinping (right) during their bilateral meeting on November 13, 2019 in Brasilia, Brazil. The leaders of Russia, China, Brazil, India and South Africa have gathered in Brazil for the BRICS leaders’ summit. (Photo by Mikhail Svetlov/Getty Images)

“We don’t want to back away from the world by forcing us to forego the benefits it brings to the American people and markets for business and exports,” Yellen said, speaking in South Korea. “By doing so, we can help insulate both US and Korean households from price increases and disruptions caused by geopolitical and economic risks… in that sense, we can continue to strengthen the international system that we have all benefited from, as well as protect ourselves from fragility.” global trading networks.

Her comments came the same week that President Biden turned to Saudi Arabia for help, a country that clearly shares US morality. Yellen said in April that friendship could strengthen sanctions as “friendly countries” would stand united in ostracizing one economy. Her comments about Russia quickly turned into anti-Chinese sentiment. Yellen stated:

China recently confirmed a special relationship with Russia. I fervently hope that China will make something positive out of this relationship and help end this war. Going forward, it will become increasingly difficult to separate economic issues from broader considerations of national interests, including national security. The world’s attitude towards China and its willingness to pursue further economic integration may well be influenced by China’s response to our call for decisive action against Russia.”

Just as those responsible for the collapse of the euro believed that this would prevent all European wars, the idea of ​​supporting friends is based on the belief that trade between the united countries will become unhindered. “Preferring supply chain friendliness with a large number of trusted countries so that we can continue to securely expand market access will reduce the risks to our economy as well as our trusted trading partners,” Yellen said in April before making the call. on the same countries to introduce a global tax.

Yes, it will force foreign investment to look beyond the US and this Western trading bloc. What happens when vital resources are outside these areas? Now everyone is begging for oil from “unfriendly countries” and buying it at a premium from neutral countries who sell it to the West at a higher price. Bad business around. The West is essentially telling Russia and China that they are being kicked out of trade in the mistaken belief that they are gaining the upper hand.