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Cool rationality replaced by US-China fight club

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It was once affectionately known as the global rules-based order. Now we could better call it Fight Club. The US is throwing punches wildly at smaller powers, imposing trade penalties in breach of the global rules. China is grabbing the maritime territories of smaller neighbours and building military bases on them, in stunning disregard of the international order.

"Neither the current occupant of the White House nor of Zhongnanhai is convinced of the merits of the rules based order," says the Lowy Institute head, Michael Fullilove, in measured understatement. Zhongnanhai is Beijing's red-walled leadership compound.

Chinese Defence Minister General Wei Fenghe salutes attendees of the ShangriLa forum in Singapore.Credit:AP

And, not content to hit smaller nations, the two biggest powers increasingly are going at each other. Not only are they directly hitting each other with trade sanctions and bulking up for actual warfare, they are starting to wall off the world economy into competing blocs.

It's not a Cold War, where two separate ideological spheres stand in readiness to annihilate each other. The flow of commerce between the US and China remains the biggest on earth. But the trend is all one way. Not yet a Cold War but a cooling peace is under way. Quite abruptly, globalisation is a quaint old notion.

Washington and Beijing now move towards a decoupling. It started with telecoms firms Huawei and ZTE but it's widening and accelerating by the day. Each side is beginning to blacklist each other's firms. In the last two weeks, companies in the US, Japan and Germany which supply electronic components or software have been forced to choose to do business........

© The Age