Fresh from a hollow U.S.-Russia summit in Geneva, and a failed attempt to round up European allies to confront Moscow and Beijing, the White House is reportedly planning to set up a U.S.-China summit on the margins of a G20 meeting in Italy next October.

Washington’s obsession with summitry is a weird notion of national priorities.

The U.S.-Russia high-level confab was not necessary to deal with cyber security issues. That’s what regular diplomatic channels are for. Apart from that, there was no danger of a military confrontation. Such events among nuclear-armed adversaries have been emphatically ruled out long ago – as underscored in a joint U.S.-Russia declaration virtually preceding the negotiating sessions last Wednesday, June 16, 2021.

Aha, but that was an occasion to hit Russians with human rights issues. Yes, a beautiful event for President Vladimir Putin to tell the world media, during his press conference in Geneva, that Russia wanted no BLM, LGBTQ, social strife, racial violence …. Those things, in his view, are not part of Russian culture, traditions and social values the country wants to live by.

Cal Coolidge: “The Business of America Is Business”

With China, America’s most important bilateral issues are trade and investments. And those are not problems for summit discussions; they are items for cabinet-level consultations. All the rest, such as human rights, China’s contested maritime borders, administration of Hong Kong and Taiwan are considered by Beijing as its own internal problems, where the country would never allow – dixit a finger wagging President Xi Jinping -- any foreign interference.

So, why the summit? Another glad-handing photo op the U.S. media would tear up as an opportunity offered to the Chinese leader to shine on the world stage – as, in their view, was the case with Russia’s president at Villa La Grange last week?    

Logically, all that should be a damaging distraction from the systemic contest where Western democracies want to show that the world’s prosperity is best served by free market economies operating in law-and-order liberal societies.

It follows, then, that Washington’s priority should have been to co-ordinate North American, EU and Japanese economic policies for optimal economic growth and employment creation to underpin the Pax Americana – aka the rules-based Western world order.

Sadly, the G7 and the EU meetings did nothing of the sort.

Why? Because the U.S. did not lead in that direction.

To see the urgent need for such an action, you just have to take a look at the latest U.S. trade numbers released on June 8, 2021 -- three days before the G7 Cornwall jamboree on June 11-13, 2021.

What you see there is that a debt-ridden and exhausted U.S. economy was driving the wealthy EU and Japanese economies. And an allegedly hostile and worried Washington was also sending huge amounts of money to China and Russia – countries labeled as dangerous systemic and strategic adversaries.

Let’s take a look at the EU and Japan first.

Led by Germany, the Europeans were running in the first four months of this year a merchandise trade surplus with the U.S. at an annual rate of $205 billion. That was 20% above their year earlier surplus -- on exports twice the amount of U.S. sales to that trading bloc. The rich Germany accounted for nearly half of America’s trade deficit with the EU.

Hold the allies’ feet to the fire

By comparison, the Japanese were more cooperative allies. Their trade surplus with the U.S. during the January-April interval was $60 billion (at an annual rate) – 9% higher than in 2020. But that was on exports to the U.S. that were nearly double the amount of Japan’s purchases of American goods.

The U.S. should have never allowed that to happen. The former President Donald Trump called the Europeans (Germans, in particular) and the Japanese out on their “beggar-thy-neighbor” trade policies – and they hated him with passion.

Indeed, according to long-standing rules of international trade adjustment, the U.S., a chronic deficit country (and, incidentally, an ally underwriting the existential security of EU and Japan), should not be making those huge wealth transfers to systematic and excessive surplus runners. The EU and Japan should be vigorously stimulating their domestic demand (household consumption, government spending, housing and business investments). That would lead to more balanced U.S. trade accounts by spurring American exports. In the process, the U.S. jobs and incomes would be propped up, and the soaring external debts kept down.

But the sad irony does not stop there. In the first four months of this year, the U.S. allowed China to pocket a whopping net income of $104.4 billion on American trades, a 37% increase from the year before -- on export sales three times the amount of Chinese purchases in the U.S.

How is that for a strategic competition with China? The Middle Kingdom loves it. And you can easily picture the Chinese laughing and singing all the way to the bank.

With that sort of record, how can the U.S. push the Europeans and the Japanese to shun Beijing’s business deals, and toe the Washington’s line on containing China’s global reach to demonstrate the supremacy of the world run by Western democracies?

Predictably, Germany, France and Italy demurred and begged to differ. Washington knew that even before President Joe Biden spent an entire week in Europe to build an allied bloc against China.

Biden was more successful in getting the allegiance of viscerally Russophobe East Europeans against Moscow, but that did not help him toward his central objective of driving a wedge between Russia and China. Quite the opposite. The Russians and the Chinese set out to build an “International Lunar Research Station,” in addition to an expected raft of new deals during the celebrations of the 20th anniversary of their “Treaty of Good-Neighborliness, Friendship and Cooperation” on July 16, 2021.

All that left the impression in Europe that Washington was incorrectly reading the course of global events, leaving Biden pretty much empty-handed on the way back home.

An extravagant mission indeed for a leader who does not realize that he cannot win his standoff with China while 18 million of his people struggle without stable employment, and more than 100 million of them are out of the labor force – wasted lives of unskilled and virtually unemployable Americans.

And instead of holding the allies’ feet to the fire in a joint effort to win a crucial battle for Western democracies, Biden is showering them with huge trade incomes and open access to American markets.