In 1898, Omdurman was a village north of Khartoum in Sudan, 3,100 miles from London as the crow flies. English General Kitchener led a force of 8,000 Brits (including a young Lieutenant Winston Churchill) supported by an army of 17,000 Egyptians & Sudanese against a Madhist army of about 50,000 Muslim warriors (called Dervishes by the English).
This was in part a campaign of reprisal against the forces of the Madhi who had previously inflicted defeats on the Brits, and in part an element in the competition between England and France for colonial possessions. However, the wider geopolitical considerations need not detain us here.
Although outnumbered 2-to-1, the battle was a resounding success for the English, who carried the field by killing 12,000 Muslims for the loss of only 47 Brits – a kill ratio of 255 to 1. The key was the technological superiority of the English, who had the new 600 rounds per minute Maxim guns, artillery support from Nile riverboats, and logistic support from a 385 mile long railway they had rapidly built south from Egypt to support this campaign in the Sudan.
Omdurman might be a particularly lop-sided example, but the message is clear: when a technologically-advanced society meets a less-advanced society, the outcome is not in doubt.
The relevance of that message to the West today is that there will be consequences from surrendering technological leadership to China. In today’s world, those consequences are less likely to be fields of dead Europeans, and more likely to be drastically reduced European & North American populations supplying raw materials & food to China and hawking gewgaws to wealthy Chinese tourists in exchange for the power stations and cell phones they can no longer build themselves.
A point which seems to elude the Masters of Western Finance is that, in the long run, all international trade is barter – the exchange of real goods & services.
Superficially, China has built up massive financial surpluses with Europe & North America by exchanging real goods for financial IOUs. Seen from the Chinese side, the important thing China has gained from these prolonged apparently unbalanced trade surpluses is not the (probably ultimately worthless) financial balances – it is all the factories and technologies which were originally developed in the West. The transformation of China into the Workshop of the World along with China’s massive investment in educating their brightest in Western universities is rapidly putting China on course for a technologically superior position analogous to the English at Omdurman – and leaving Westerners in the unfortunate position of the Madhists.
Today, if we in the West choose to listen, we can hear echoes of the 1930s: obvious challenges are developing which will have existential consequences, but we mostly occupy ourselves with irrelevant trivia.
It took Germany & Japan about 3 decades (with generous US help) to recover from the destruction of World War II. It has taken China about the same length of time to transform from a backwards peasant society into the pre-eminent manufacturing economy in the world (with the unwitting help of short-term focused Western industrialists). If we in the West focused our efforts, it is a reasonable guess we could regain technological & manufacturing parity with a still-advancing China within about a quarter of a century. But there are no signs that we are taking the challenge seriously.