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China and Russia will hold their first joint military exercise next year, the Chinese government has announced, and President Hu Jintao is calling for further expansion of the rapidly growing alliance between the former Cold War rivals.

The announcement came during a visit this week to Beijing by Russian Defense Minister Sergei Ivanov, who was expected to discuss expanding Russia's multibillion-dollar annual arms sales to China.

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http://edition.cnn.com/2004/WORLD/asiapcf/12/13/china.russia.ap/

There may be a crisis with the American dollar, now reliant on stockpiling of reserves by Japan and China. Alan Greenspan will try to steer the Federal Reserve between inflation and a sagging labour and economy. Labour is responsible for two-thirds of all spending in the American economy, but the right wing in America has chosen to, once again, ignore them as a source of economic recovery with the bulk of tax cuts going to those whose spending habits are affected the least by such federal stimulus.

This regime's agenda is most similar to that of the late 19th century's William Mckinley who furthered the cause of the rich in the States while experiments in social Darwinism were on the wane. Politician's fought over plutocracy, rising unemployment, consumption taxes, rising poverty, the funding of wars of conquest and at a time when the world's economies were defined by the commodity cycle and financial panic.

It took another decade or two to break the cycle of rising poverty and absolute rule by the corporate rich. Efforts by this right wing regime to bring back that guilded age can only bring misery and more abject poverty among American's who already own the highest child poverty andinfant mortality rates among richest nations.

Perhaps most interestingly, China has been siding with the EU on a number of major geopolitical plays lately. Iraq saw a France-Germany-Russia-China alliance. Most recently, the ITAR experimental fusion reactor proposal has seen an EU-Russia-China v. Japan-Korea-US alignment.

This is big stuff. Much geopolitical speculation has presumed that East Asia would eventually form some kind of more or less coherent block on its own, in geostrategic competition with the EU, and in partnership with the US. If the East Asia block were actually to split, China (possibly drawing ASEAN with it) partnering with the EU and Japan with the US, this could decisively swing world leadership to the EU, rather than (as most have expected) Japan.