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Attempt to suppress Huawei using security as the pretext

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A very interesting move by Google. Looks like Google risks being kicked out of China. As Zelenky jokes in a similar situation,  Google wants not only to take his paperwork, but slippers, coffee and caps from the bar.

The key question is: What if Google  wake up tomorrow and discover that Huawei built a parallel infrastructure with its own store, updates and the search engine ?

Balkanization of Android is not a good thing although I do not like much Google with its cult of surveillance and his operating system (which always was a second rate). It is a kludge designed got a different hardware then we have today.  Google has no clue about how to design consistent interface. Even Microsoft is better.  So there is big space for improvement of Google kludge (aka Android).  I actually do not use Google store much, so I still can get a rooted Huawei phone and be OK :-).  Although I prefer Samsung ...

And I prefer Android 4 to the later versions. It is adequate for my limited needs and I resent overcomplexity of later versions.  Android 7 that I have now is too heavy and it shows. Although the ability to create security zones (essentially virtual machines)  is nice and really opens BYOD possibilities for companies.  But this is the only feature that I like. 

IMHO Huawei might have enough people to accomplish this trick. And they might work with Samsung, who also wants to kick Google out of their phones, at least for non-USA markets as Google produces phones with its name as well, which is big no-no for an OS designer.

I suspect that Putin is laughing hysterically at Trump administration moves in Chinan trade war. Of course Trump is uneducated and rely mostly on "intuition", but  still this is really dangeruous game even at this low level of understanding of international situation.  Trump essentially is forging an alliance of China and Russia despite all huge differences and Russians fears about Chinese immigration to the country, including I think a military alliance (which would be a good thing as the USA spending one trillion dollars, if we count from all sources, on military reminds be Brezhnev's USSR; this level of military spendings is crazy and should be stopped.)

Trump is actually one move from being kicked out of the office with such national security advisers as Bolton.

Chinese language Overseas Minister Wang Yi on referred to as the authorized conflict between Chinese language firm Huawei and the U.S. authorities “deliberate political suppression,” and he vowed to guard the rights of Chinese language corporations and residents overseas.

“It is fairly apparent to any honest and unbiased person who the current motion towards a specific firm and Chinese language particular person is not only a pure judicial case however deliberate political suppression,” Wang mentioned on the sidelines of China’s annual parliament session.

In December, Canadian authorities arrested Meng Wanzhou, Huawei’s chief monetary officer, on U.S. claim that she violated sanctions towards Iran. Since Meng’s arrest, two Canadians have been arrested in China, and a 3rd who was already in Chinese language jail for a drug crime has seen his sentence switched from 15 years to capital sentence.

On Thursday, Huawei announced that it had filed a lawsuit within the U.S., arguing that laws Congress handed final yr proscribing Huawei enterprise in America was “unconstitutional” as a result of it singling out only Huawei for penalties.

The US has additionally warned several Western allies that Huawei know-how might enable Chinese language intelligence to infiltrate their networks.

This "security trap"  will additionally harms  Huawei  market share.

No alternative

Guo mentioned that Huawei was left with no alternative however to take legal actions, noting that neither lawmakers nor the federal government had provided any proof  of supposed backdoors in Huawei products.

Insights Secure-2014 Questions On Current Events - INSIGHTS

  • China and U.S relation can be seen in the lieu of redistribution of power in world geopolitics. China is rising and U.S is a bit stagnant or rising slowly. The world is moving towards balance of power. The trend in U.S-Sino relation has been a bit of animosity. Some of the recent event have put strain in the relationship:
    1. Air Defence zone declaration by China, has infuriated U.S and its allies in Pacific.
    2. U.S apparent support against China with respect to disputed Island in South China Sea.
    3. U.S Asian pivot strategy, which China fears as a strategy to encircle it.
    4. Opposition of U.S in global forum, regarding issues like Sri Lanka, Syria etc.

    However despite of a sort of cold war, U.S China trade has been growing leaps and bounds. Both of them are getting more and more interdependent each day. Thus, China-US relation may have certain flip flops, but it is not a threat to world peace as was the case during cold war.


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    [Dec 02, 2020] China- A Cold Shower by Fred Reed

    That's wishful thinking. While Chinese are making progress, the USA still is the only technological superpower and can cut oxygen to China companies in one minute.
    Dec 02, 2020 | www.unz.com

    Increasingly America does not compete with China, but strongarms it because it cannot compete. For example, in Five G China is ahead in technology, manufacturing capacity, and turnkey systems. Unable to produce an equivalent product, Washington banned Huawei Five G in the US and has twisted arms to keep countries that it controls from using Huawei. Seeing that Huawei had very attractive smartphones that would have competed with Apple, it banned these also. What America can't do, it seeks to keep anybody else from doing.

    WSJ: "US vs. China in Five G: The Battle Isn't Even Close

    HONG KONG -- By most measures, China is no longer just leading the U.S. when it comes to 5G. It is running away with the game. China has more 5G subscribers than the U.S., not just in total but per capita. It has more 5G smartphones for sale, and at lower prices, and it has more-widespread 5G coverage. Connections in China are, on average, faster than in the U.S., too By year's end, China will have an estimated 690,000 5G base stations -- boxes that blast 5G signals to consumers -- up and running across the country ."

    Techies can argue C band versus millimeter waves but I will bet that the Chinese, nothing if not commercially agile, will have Five G up and running in factories and the IoT and everywhere else while American pols rattle on about how China is an Existential Threat and the Pentagon needs more money for Space Command and diversity is more important than schooling anyway.

    The shifting balance may already be visible. For example, America used to make superb aircraft such as the SR-71 and the F-16. Now it has the F-35, an engineering horror. The Boeing 737 MAX, its flagship product, has been grounded internationally because of poor engineering, second-rate software, and corporate lying about both.

    America invented the microcircuit, and once dominated its manufacture. Today, American companies cannot make the seven nanometer chips now used in high-end telephones, and certainly not the five nanometer chips now coming online. Neither can China. Both countries buy them from Taiwan Semiconductor Manufacturing Company, TSMC, Interestingly, the Taiwanese are genetically and culturally Chinese. Washington has strongarmed TSMC into ceasing to sell to Huawei -- the US still can't make high end chips. Recently it strongarmed TSMC into agreeing to build a semiconductor fab in Arizona. Because America can't.

    Then there is TikTok, a hugely popular Chinese video app that threatened to break America's lock on social media. Unable to compete, Washington decided simply to confiscate it on grounds that it might be used to spy on Americans. (Chinese intelligence is deeply interested in your daughter's video of her cat.)

    Parenthetically, technology seems to be shifting toward East Asia, with America being less ahead in things in which it is ahead and behind in others. Did I mention demographics?

    Achmed E. Newman , says: Website November 30, 2020 at 5:37 am GMT • 1.3 days ago

    You can't argue with the real engineering going on over there, especially the Civil Engineering. When you don't have a thousand tax-payer-supported bureaucrats from a hundred different agencies and even "Non-Governmental Organizations" blocking every thought you have, it's hard to get things done. There's no doubt that the huge military spending on "democracy for the world" and the squandering of the huge amount of goodwill and power accumulated at the end of the Cold War is part of America's problem (thanks NotSoFast). Mr. Reed never mentioned the increase in regulation and taxation by the Feral Beast that has turned America into a Can't-Do country.

    It's a great photo essay on the amazing engineering advances out of China, but, as usual, Fred gets major things wrong.

    I don't know what the deal is with Mr. Reed's repetitive harping on Americans' concern for intellectual property rights. The Chinese will do fine without our help now, but it's the theft of the IP of American engineering that has gotten them this far so fast. Why would you not be concerned with your ideas being stolen? Not giving your stuff away for free is not the same as trying to "cripple development. That's water under the bridge now but stupidity by Mr. Reed nonetheless.

    [Aug 08, 2020] All About the Chips- Taiwan is Next Battleground for Trade Fight -

    Aug 08, 2020 | www.theamericanconservative.com

    Home / Articles / Economy / All About The Chips: Taiwan Is Next Battleground For Trade Fight ECONOMY , WORLD All About The Chips: Taiwan Is Next Battleground For Trade Fight

    Vital tech production could put the island back at the center of intensifying Sino-American relations. Global dependence on Taiwan-made memory chips is risky business. (By Shutterstock/stockwars)

    AUGUST 8, 2020

    |

    12:01 AM

    MARSHALL AUERBACK

    The media likes to dabble in war-game fantasies between the 21st-century great powers China and the U.S., but it's a distraction from the hybrid economic warfare that is underway -- from Trump's tariff hikes to the shores of the advanced economy.

    Here in a nutshell is the problem facing the United States. The country that used to be a world leader in all forms of high tech, especially semiconductor chips, now spends its time redesigning chocolate chips. By contrast, Taiwan, officially a "rogue province of China," but in reality operating as an independent nation of 23 million people, ranked 20th as a world economy (right behind Switzerland), is now a leading global player in the production of semiconductor chips. As such it has emerged as the key supply link to a multiplicity of American and Chinese high-tech companies at a time when the Trump administration is working hard to cut China's access to Taiwan's semiconductors.

    https://lockerdome.com/lad/13045197114175078?pubid=ld-dfp-ad-13045197114175078-0&pubo=https%3A%2F%2Fwww.theamericanconservative.com&rid=www.theamericanconservative.com&width=838

    For all of China's significant technological advancements, the country still lags in the production of semiconductor chips.

    Memory chips are principally made by Samsung, SK Hynix (South Korea), and Micron (USA). Intel also makes some memory chips for its own use. Memory chips are a big issue for China. Beijing has deployed considerable fiscal resources into producing them and last year set a goal of producing 5 percent of the world's total production by the end of 2020.

    That's ambitious. It's one thing to produce memory chips, another to get a usable "yield," i.e., the percentage of output that actually works. It is a singularly challenging industry in which to attain industrial self-sufficiency.

    Taiwan Semiconductor Manufacturing Company (TSMC) is a " fabless chip maker " that produces customized semiconductor chips for use in various types of electronics, such as digital cameras, smartphones, and the new technologically sophisticated "smart" cars. They also produce chips for the military, and for 5G base stations. China's leading telecom equipment manufacturer, Huawei, was a large customer, but the Trump administration has now mandated that all semiconductor chip manufacturers using U.S. equipment, IP, or design software will require a license before shipping to Huawei, which has forced TSMC to stop taking fresh orders from Huawei, as it uses U.S. equipment in its own manufacturing processes, such as LAM research and Applied Materials.

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    https://imasdk.googleapis.com/js/core/bridge3.400.1_en.html#goog_567409621 Ad ends in 44s Next Video × Next Video J.d. Vance Remarks On A New Direction For Pro-worker, Pro-family Conservatism, Tac Gala, 5-2019 Cancel Autoplay is paused

    The wisdom of so many companies relying on manufacturing facilities located in Taiwan is debatable. Intel and Micron locate fabs around the world, in part to diversify risk (earthquake, weather, politics) and to access skilled labor pools. Intel has long had production facilities in Ireland, Israel, and China itself; it has also purchased Israeli companies for their research and development. But it also has retained significant production facilities still in the United States. Similarly, Micron has fabs in Boise Idaho, Utah, and Manassas, Virginia (right near the CIA and Pentagon.)

    TSMC is important because it is pretty much the only place to get processor chips fabricated, unless you're Intel. In that regard, Intel's recent 2nd quarter earnings announcement that its planned launch of the company's next generation of chips will be delayed by six months is most concerning. News of the production delay (which now pushes the production of the company's latest central processing unit (CPU) -- aka the "brains" of the laptop -- out to early 2023) generated considerable market anxiety, as evidenced by the 17 percent fall in the share price in the wake of the disclosure. From a long-term perspective, however, the more alarming aspect is Intel's decision to consider outsourcing its manufacturing capacity, a sharp break from the company's historic practice.

    Intel has been one of the few leading American high-tech companies that has hitherto largely resisted the panacea of offshoring its production. Much of this is a product of the corporate culture established by former CEO Andy Grove, who had warned that Silicon Valley risked "squandering its competitive edge in innovation by failing to propel strong job growth in the United States," according to a New York Times op-ed by Teresa Tritch written shortly after his death. Tritch explains that:

    in [Grove's] view, those lower Asian costs masked the high price of offshoring as measured by lost jobs and lost expertise

    Mr. Grove contrasted the start-up phase of a business, when uses for new technologies are identified, with the scale-up phase, when technology goes from prototype to mass production. Both are important. But only scale-up is an engine for job growth -- and scale-up, in general, no longer occurs in the United States. "Without scaling," he wrote, "we don't just lose jobs -- we lose our hold on new technologies" and "ultimately damage our capacity to innovate."

    Intel's decision comes at a time when American policymakers are finally beginning to appreciate the adverse economic and strategic consequences of such moves. Were Intel to follow through on its outsourcing threat, it too would further exacerbate America's strategic reliance on Taiwan for customized semiconductor manufacturing, as well as undermining the impact of recent legislative attempts to rebuild the country's semiconductor manufacturing capacity.

    By contrast, economic competition that degenerates into out-and-out war would be a disaster for all sides. As David Arase, resident professor of International Politics at the Hopkins-Nanjing Center of the Johns Hopkins University School of Advanced International Studies, recently contended in the Asia Times, "Even an unsuccessful invasion of Taiwan would cause a supply chain disruption." By the same token, actively upgrading diplomatic relations with Taiwan to something akin to the old mutual defense treaty that existed prior to Washington's recognition of Beijing in 1979 as the one sovereign government representing China, would almost certainly provoke a more aggressive response from Beijing.

    U.S. goals should be far more modest: not to underwrite the freedom aspirations of another country (even a vibrant multi-party democracy such as Taiwan) but, rather, to fix a key vulnerability in the global supply chain that currently renders the U.S. so reliant on Taiwan. Even TSMC has implicitly acknowledged its own geographical shortcomings, as it has recently announced plans to build a new $12 billion chip manufacturing facility in Arizona. Consider this a form of political risk insurance.

    A full-scale defense of Taiwan would cost thousands of lives, and potentially entrench the U.S. military in a long-term quagmire; it would also represent a logistical nightmare in terms of supplying such a force over so many thousands of miles (versus an opposing Chinese army a mere 100 miles away .) To say nothing of the risks posed to numerous substantial American multinationals already operating in China.

    A key conceptual problem that our policymakers and business leaders have today is an addiction to 19th-century concepts that are anomalous in the context of a 21st-century economy. David Ricardo's " comparative advantage " -- that "refers to an economy's ability to produce goods and services at a lower opportunity cost than that of trade partners" -- has less relevance at a time when such advantage can be largely created as a byproduct of state policy. Countries such as Taiwan, South Korea, and now China itself, can dominate targeted industries by subsidizing them aggressively. Because of increasing returns to scale, there is a winner-take-all pattern in which, at any given time, one nation tends to dominate a huge global market share of the underlying product -- since the 1970s, Japan, South Korea and China in that order. It also creates huge employment opportunities in high-quality jobs for the countries as they scale up production. This was also a key insight of Andy Grove .

    None of these countries had a natural "comparative advantage" in semiconductor production; they just followed the classic pattern of subsidizing their growth via substantial government support, relentlessly driving down cost inputs to push other marginal manufacturers out of the industry.

    The incessant focus on market share usually comes at a cost of short-term profitability (a no-no for Wall Street, which focuses on quarterly earnings as intently as an audience waiting for the white smoke to emerge from a papal election). However, businesses usually recoup these costs later once they've established dominant market share.

    Semiconductors are a high value-added manufacturing platform industry that has a significant multiplier effect on the domestic economy. It represents an area that should be prioritized by the U.S., not de-emphasized (as Intel's proposed move threatens to do). The road back to manufacturing relevance is a long one, but the perpetuation of the current policy risks exacerbating longstanding pathologies in the U.S. economy, while simultaneously creating new national security vulnerabilities.

    Taiwan is a vibrant multiparty democracy that constitutes a model of economic development. But those virtues could be threatened if we try, shortsightedly, to turn it into a U.S. protectorate to address problems that should be resolved much closer to home.

    Marshall Auerback is a market analyst and contributor to the Independent Media Institute .


    Fazal Majid 18 hours ago

    TSMC's Arizona fab is tiny compared to its 12 Taiwan ones, and more of a sop to the Trump administration than a serious effort to diversify. The jugular vein of the semiconductor industry is within easy reach of China's missile arsenal, and indeed the Chinese military can be said to have been designed specifically for the task of retaking Taiwan.

    Steve Smith Fazal Majid 6 hours ago

    China might not even need to invade. If they blockade Taiwan--air and sea--and threaten to destroy ships and aircraft trying to enter or leave Taiwan, they can stop chip export.

    It's similar to Iran saying, "Either everybody can export oil from the Gulf or no one can." China would say, "Either everyone can import chips from Taiwan or no one can. And China is in a much better position to enforce its will than Iran.

    Tradcon 11 hours ago

    The reaction to Auberback's refutation of comparative advantage would be extreme depending on who was reacting. The field of economics is like a cult, with a lot of groupthink and academic homogeneity. In this way failed consensuses are continued and alternatives, even if they have a good historical track record, are railed against as heterodox and fringe.

    Its amazing how in just two or three decades we forgot about basically all of US economic history and policy history up to that point.

    L RNY 10 hours ago

    I completely agree that a supply chains including those for memory chips in Taiwan must be diversified but it is of paramount importance that Taiwan not be left weakened and vulnerable to mainland China by these shifting supply chains because any weakness in Taiwan will be an invitation for Beijing to exploit...and if Beijing exploits that invitation then they could take that invitation all the way to an invasion which will be a detriment of all other nations in the Pacific. Right now China is focused on Hong Kong, Taiwan and India....with Hong Kong and Taiwan gone the China will push its aggressive hegemony to Indonesia, Malaysia, Philippines, etc.

    I also complete agree that we (the US, Japan and any other asian nation that will join) need a treaty protecting Taiwan's independence from mainland China but the very first thing the US should do prior to such a new treaty is to get other nations to start using the name Taiwan again on their maps, plane flights, UN, etc because as you know Beijing has been doing everything possible to not just get nations and businesses to stop recognizing Taiwan and to even stop using its name in an attempt to erase both the existence of Taiwan and any distinction that Taiwan is separate from mainland China. The recognition of Taiwan and the use of its name must be reinforced everywhere in the world as part of the first step in negotiating a security treaty for Taiwan.

    donthomson1 L RNY 3 hours ago

    The USA has a one China policy and recognises the Chinese Government as the Government of China. It's true that it once recognised the Government of Taiwan as the Government of China. It's a completely new policy you're proposing of splitting China into 2 (or more?) states. That needs war, as it would if China was proposing to break up the USA, and the USA would lose a non-nuclear war.

    The USA could win a nuclear war but would lose a lot of its population. I don't know how seriously we should take the US estimate of 90% within a year by starvation and disease with just an EMP attack. Mexico, Canada and Cuba might accept many US refugees even though they would also suffer damage. Not all of the area of those countries would suffer EMP damage. Other countries might also provide some charity.

    Mexico, Canada and Cuba could be rewarded for their charity by dividing the USA between them. That would be a powerful incentive and remove a country fond of wars of aggression. A USA that poses no threat to anybody could continue to exist and be called Hawaii. [email protected]

    Fazal Majid 18 hours ago

    TSMC's Arizona fab is tiny compared to its 12 Taiwan ones, and more of a sop to the Trump administration than a serious effort to diversify. The jugular vein of the semiconductor industry is within easy reach of China's missile arsenal, and indeed the Chinese military can be said to have been designed specifically for the task of retaking Taiwan.

    Steve Smith Fazal Majid 6 hours ago

    China might not even need to invade. If they blockade Taiwan--air and sea--and threaten to destroy ships and aircraft trying to enter or leave Taiwan, they can stop chip export.

    It's similar to Iran saying, "Either everybody can export oil from the Gulf or no one can." China would say, "Either everyone can import chips from Taiwan or no one can. And China is in a much better position to enforce its will than Iran.

    Tradcon 11 hours ago

    The reaction to Auberback's refutation of comparative advantage would be extreme depending on who was reacting. The field of economics is like a cult, with a lot of groupthink and academic homogeneity. In this way failed consensuses are continued and alternatives, even if they have a good historical track record, are railed against as heterodox and fringe.

    Its amazing how in just two or three decades we forgot about basically all of US economic history and policy history up to that point.

    L RNY 10 hours ago

    I completely agree that a supply chains including those for memory chips in Taiwan must be diversified but it is of paramount importance that Taiwan not be left weakened and vulnerable to mainland China by these shifting supply chains because any weakness in Taiwan will be an invitation for Beijing to exploit...and if Beijing exploits that invitation then they could take that invitation all the way to an invasion which will be a detriment of all other nations in the Pacific. Right now China is focused on Hong Kong, Taiwan and India....with Hong Kong and Taiwan gone the China will push its aggressive hegemony to Indonesia, Malaysia, Philippines, etc.

    I also complete agree that we (the US, Japan and any other asian nation that will join) need a treaty protecting Taiwan's independence from mainland China but the very first thing the US should do prior to such a new treaty is to get other nations to start using the name Taiwan again on their maps, plane flights, UN, etc because as you know Beijing has been doing everything possible to not just get nations and businesses to stop recognizing Taiwan and to even stop using its name in an attempt to erase both the existence of Taiwan and any distinction that Taiwan is separate from mainland China. The recognition of Taiwan and the use of its name must be reinforced everywhere in the world as part of the first step in negotiating a security treaty for Taiwan.

    donthomson1 L RNY 3 hours ago

    The USA has a one China policy and recognises the Chinese Government as the Government of China. It's true that it once recognised the Government of Taiwan as the Government of China. It's a completely new policy you're proposing of splitting China into 2 (or more?) states. That needs war, as it would if China was proposing to break up the USA, and the USA would lose a non-nuclear war.

    The USA could win a nuclear war but would lose a lot of its population. I don't know how seriously we should take the US estimate of 90% within a year by starvation and disease with just an EMP attack. Mexico, Canada and Cuba might accept many US refugees even though they would also suffer damage. Not all of the area of those countries would suffer EMP damage. Other countries might also provide some charity.

    Mexico, Canada and Cuba could be rewarded for their charity by dividing the USA between them. That would be a powerful incentive and remove a country fond of wars of aggression. A USA that poses no threat to anybody could continue to exist and be called Hawaii. [email protected]

    [Jul 26, 2020] French limits on Huawei 5G equipment amount to de facto ban by 2028

    Jul 26, 2020 | thenewkremlinstooge.wordpress.com

    ET AL July 23, 2020 at 4:41 am

    Euractiv+Neuters: French limits on Huawei 5G equipment amount to de facto ban by 2028
    https://www.euractiv.com/section/5g/news/french-limits-on-huawei-5g-equipment-amount-to-de-facto-ban-by-2028/

    French authorities have told telecoms operators planning to buy Huawei 5G equipment that they won't be able to renew licences for the gear once they expire, effectively phasing the Chinese firm out of mobile networks, three sources close to the matter said.
    ####

    Quelle surprise that they fall in to line too. No doubt €µ will say something different to Beijing that France values 'friendly ties' with China, but the die is cast. It must be tempting for Beijing to kill two birds with one stone by pulling the plug on UK NPPs as France's EDF is also the project lead. The anti-China crowd want it out of any European NPPs likewise. We'll see

    MARK CHAPMAN July 23, 2020 at 7:44 am

    What a triumph for the global bully. Well, as I have said before – marry in haste, repent at leisure. European countries which commit to an inferior network just for the privilege of having Uncle Sam spy on their every move instead of the Chinese will have many years to ponder their gutlessness. The USA knows now that is in a fight to the finish, and will want to consolidate as much of the globe as possible under its solid control. But those who are in thrall will regularly be reminded who is the boss, with forced concessions to American objectives, so let's have no more of this 'sovereignty' pap. If you're in, you're ALL in.

    It will mess up Huawei's plans and give the iPhone a new lease on life, but it will also sharpen the division between East and West in terms of networks and smartphones. iPhones will be bigger in the west as Huawei fades from competition, but iPhones should all but vanish from the shelves in Asia, which was the growth market, especially China. Loyal American ally Japan might become a bit of an outlier in its own region. Washington will have a much harder time spying on China as the demand for American electronics dries up. What goes around comes around, and the search will be on for neutral companies from whom you can buy a cheap smartphone to use while you're going from one side to the other, which can draw on the networks of both. America has been successful to a significant degree in excluding a competitor who makes a superior product – which, by the bye, goes completely against the blabber America spouts about a level playing field and trade based on merit – but I am confident it will not go unanswered by China and American products in China will suffer as a consequence.

    [Jul 24, 2020] Huawei and the closure of Houston consulate

    Jul 24, 2020 | www.moonofalabama.org

    O , Jul 24 2020 19:30 utc | 17

    The Issue:

    "Much of the focus of the Trump administration's trade dispute with China has centered on the size of the U.S. bilateral trade deficit. Most economists agree that this focus is misdirected, and that the existence or size of bilateral trade deficits should not generally be a matter of concern or a target of public policy. Instead, there is bipartisan agreement regarding a different problem at the core of trade issues with China: China's persistent misappropriation of foreign technology. Forced technology transfer occurs when foreign multinational companies have to provide strategically significant technology to an indigenous entity they do not control in order to gain access to the massive Chinese market."
    https://econofact.org/what-is-the-problem-of-forced-technology-transfer-in-china


    The western oligarchs want the Chinese oligarchs to be more fair, in particular Huawei to transfer their tech the other way in order to play in western markets.


    "The global business community would generally prefer that business with Huawei could just go on as usual. Huawei and its affiliates are the acclaimed leaders in 5G technology, and the rest of the commercial world wants to have access to that technology, and also to be able to interoperate with it. In other words, to the extent that western companies agree with the US administration the risks, they have decided that the rewards outweigh those risks and are willing to accept them -- as most recently evidenced by the news yesterday relating to how many US components are finding their way into Chinese handsets."
    https://www.zdnet.com/article/huawei-changes-its-patent-story/


    Furthermore, Houston is one the main cities where total 5g tech is being implemented first along with L.A and Chicago.


    Houston's a player in the race for 5G dominance
    https://www.houstonchronicle.com/techburger/article/Houston-s-a-player-in-the-race-for-5G-dominance-14484221.php


    O , Jul 24 2020 19:38 utc | 18

    Forced Tech Transfers Are on the Rise in China, European Firms Say
    The practice has become more widespread despite official assurances from Beijing it would be stopped

    https://www.wsj.com/articles/forced-tech-transfers-are-on-the-rise-in-china-european-firms-say-11558344240

    Is the US right to cry foul about forced technology transfer to do business in China – and what is Beijing's position?
    Foreign companies' concerns about having to share their tech secrets are among the matters being discussed in ongoing US-China trade talks
    Beijing's draft foreign investment law could legislate against the practice, but businesses are sceptical about enforcement

    https://www.scmp.com/news/china/diplomacy/article/2181528/us-right-cry-foul-about-forced-technology-transfer-do-business

    This is about trade and tech not lame inconsequential quarantine rules.

    [Jul 16, 2020] China own silicon

    Jul 16, 2020 | www.moonofalabama.org

    A. L. , Jul 15 2020 20:23 utc | 26

    @19

    That is correct. Backdoors were baked into every piece of equipment and random number generator the US and friends are able to influence. Hardware and software.

    Read up on how cisco networking equipments were/are intercepted enroute for 'extra' attention by US Intel depending on where they're going to. With full assistance from cisco. Other manufacturer also play the same game.

    This was the genesis of Huawei, to cut reliance on US network gear and it is also why China is doing its own silicon. Huawei with the Kirin which is an ARM based processor and also x86 via the AMD JV and VIA/Cyrix.

    Fabs aside the Kirin can cut it with the best and the x86 are about 2-6 years behind but rapidly improving depending on who you ask.

    Their achilles heel is the Fabs where China is about 2-3 generations behind. Today Huawei is relying on Taiwanese Fabs to produce its cutting edge chips to Huawei's design.

    However, these are just a function of investment in research and time, China is well past the tipping point for self reliance and they'll get to parity and beyond soon enough. So the west's game is already lost.

    Reading between the lines, when China is cut out of the west's networks who then could the 5 peeping Tom's look at? Yup, the serfs, and that's the game plan all along.

    [May 29, 2020] The Great Disentanglement

    May 29, 2020 | www.counterpunch.org

    ... ... ...

    China's economic shutdown at the onset of the coronavirus pandemic disrupted many global supply chains, prompting a number of countries and corporations to accelerate their strategy of reducing their dependency on China for components.

    ...the trade war between Washington and Beijing had contributed to the U.S. fashion industry and tech firms like Apple rethinking their own supply chains. Japan, heavily dependent on Chinese trade, is using $2 billion in economic stimulus funds to subsidize the move of Japanese firms out of China.

    The Trump administration is thus swimming with the current in its effort to isolate China. It has imposed sanctions because of China's violations of Uyghur human rights. It has levied penalties against China for its cooperation with Iranian firms. And it has threatened to add another set of tariffs on top of the existing ones for China's handling of the coronavirus.

    Its latest initiative has been to tighten the screws on the Chinese technology firm, Huawei. Last week, the administration announced sanctions against any firms using U.S.-made equipment that supply the Chinese tech giant. The chief victim of these new restrictions will be the Taiwanese firm TSMC, which supplies 90 percent of Huawei's smartphone chips.

    In other words, the Trump administration is committed not only to severing U.S. economic connections with China. It wants to put as much pressure on other countries as well to disentangle themselves from Chinese manufacturing. Taiwan, of course, has no particular love for Mainland China. It battles Beijing on a daily basis to get international recognition -- from other countries and from global organizations like the World Health Organization.

    But the Taiwanese economy is also heavily dependent on its cross-strait neighbor. As Eleanor Albert points out :

    China is Taiwan's largest trading partner, accounting for nearly 30 percent of the island's total trade, and trade between the two reached $150.5 billion in 2018 (up from $35 billion in 1999). China and Taiwan have also agreed to allow banks, insurers, and other financial service providers to work in both markets.

    And it probably won't be Huawei but Taiwan that suffers from the U.S. move. As Michael Reilly notes , "Huawei's size in the global market means its Taiwanese suppliers cannot easily find an alternative customer of comparable standing to replace it." China, meanwhile, will either find another source of chips outside the U.S. sphere, or it will do what the United States has been threatening to do: bring production of critical components back closer to home.

    Another key player in the containment of China is India. Trump's friendship with Indian Prime Minister Narendra Modi, a right-wing Hindu nationalist, is more than simply an ideological affection. Trump sealed a $3 billion in military sales deal with India in February, with a trade deal still on the horizon.

    Modi, in turn, is hoping to be the biggest beneficiary of the falling out between Washington and Beijing. "The government in April reached out to more than 1,000 companies in the U.S. and through overseas missions to offer incentives for manufacturers seeking to move out of China," reports Bloomberg . "India is prioritizing medical equipment suppliers, food processing units, textiles, leather, and auto part makers among more than 550 products covered in the discussions."

    Vietnam is another regional competitor that the United States is supporting in its containment strategy. With only a couple hundred reported coronavirus cases and zero deaths, Vietnam is poised to emerge from the current crisis virtually unscathed. With low labor costs and an authoritarian government that can enforce deals, it is already a favored alternative for corporations looking for alternatives to China. But wildcat strikes have been happening in greater numbers in the country, and the Vietnamese government recently approved the country's first independent trade union.

    Yet with a more technologically sophisticated infrastructure, China will continue to look more attractive to investors than India or Vietnam.

    ... ... ...

    Trump administration is, frankly, at a huge disadvantage when it tries to pressure companies to relocate their operations. Writes Manisha Mirchandani:

    The global technology and consumer electronics sectors are especially reliant on China's infrastructure and specialized labor pool, neither of which will be easy to replicate. The Chinese government is already mobilizing resources to convince producers of China's unique merits as a manufacturing location. Zhengzhou, within Henan Province, has appointed officials to support Apple's partner Foxconn in mitigating the disruptions caused by the coronavirus, while the Ministry of Finance is increasing credit support to the manufacturing sector. Further, the Chinese government is likely to channel stimulus efforts to develop the country's high-tech manufacturing infrastructure, moving away from its low-value manufacturing base and accelerating its vision for a technology-driven services economy.

    The Trump administration is playing the short game, trying to use tariffs and anti-Chinese sentiment to hobble a rising power. China, on the other hand, is playing the long game, translating its trade surpluses into structural advantages in a fast-evolving global economy.

    Will the Conflict Turn Hot?

    Despite the economic ravages of the pandemic, the Pentagon continues to demand the lion's share of the U.S. budget. It wants another $705 billion for 2021, after increasing its budget by 20 percent between 2016 and 2020.

    This appalling waste of government resources has already caused long-term damage to the economic competitiveness of the United States. But it's all the money the Pentagon is spending on "deterring China" that might prove more devastating in the short term.

    John Feffer is the director of Foreign Policy In Focus , where this article originally appeared.

    [May 29, 2020] The USA effectively controls world semiconductor industry and this fact will hurt Huaway at least in a short run

    May 29, 2020 | www.theamericanconservative.com

    The administration also took off the gloves with China over U.S. listings by mainland companies that fail to follow U.S. securities laws. This came after the Commerce Department finally moved to limit access by Huawei Technologies to high-end silicon chips made with U.S. lithography machines. The trade war with China is heating up, but a conflict was inevitable and particularly when it comes to technology.

    At the bleeding edge of 7 and 5 nanometer feature size, American tech still rules the world of semiconductors. In 2018, Qualcomm confirmed its next-generation Snapdragon SoC would be built at 7 nm. Huawei has already officially announced its first 7nm chip -- the Kirin 980. But now Huawei is effectively shut out of the best in class of custom-made chips, giving Samsung and Apple a built-in advantage in handsets and network equipment.

    It was no secret that Washington allowed Huawei to use loopholes in last year's blacklist rules to continue to buy U.S. sourced chips. Now the door is closed, however, as the major Taiwan foundries led by TSMC will be forced to stop custom production for Huawei, which is basically out of business in about 90 days when its inventory of chips runs out. But even as Huawei spirals down, the White House is declaring financial war on dozens of other listed Chinese firms.

    President Donald Trump said in an interview with Fox Business News that forcing Chinese companies to follow U.S. accounting norms would likely push them to list in non-U.S. exchanges. Chinese companies that list their shares in the U.S. have long refused to allow American regulators to inspect their accounting audits, citing direction from their government -- a practice that market authorities here have been unwilling or unable to stop.

    The attack by the Trump Administration on shoddy financial disclosure at Chinese firms is long overdue, but comes at a time when the political evolution in China is turning decidedly authoritarian in nature and against any pretense of market-oriented development. The rising power of state companies in China parallels the accumulation of power in the hands of Xi Jinping, who is increasingly seen as a threat to western-oriented business leaders. The trade tensions with Washington provide a perfect foil to crack down on popular unrest in Hong Kong and discipline wayward oligarchs.

    The latest moves by Beijing to take full control in Hong Kong are part of the more general retrenchment visible in China. "[P]rivate entrepreneurs are increasingly nervous about their future," writes Henny Sender in the Financial Times . "In many cases, these entrepreneurs have U.S. passports or green cards and both children and property in America. To be paid in U.S. dollars outside China for their companies must look more tempting by the day." A torrent of western oriented Chinese business leaders is exiting before the door is shut completely.

    The fact is that China's position in U.S. trade has retreated as nations like Mexico and Vietnam have gained. Mexico is now America's largest trading partner and Vietnam has risen to 11th, reports Qian Wang of Bloomberg News . Meanwhile, China has dropped from 21 percent of U.S. trade in 2018 to just 18 percent last year. A big part of the shift is due to the U.S.-Mexico-Canada trade pact, which is expected to accelerate a return of production to North America. Sourcing for everything from autos to semiconductors is expected to rotate away from China in coming years.

    China abandoned its decades-old practice of setting a target for annual economic growth , claiming that it was prioritizing goals such as stabilizing employment, alleviating poverty and preventing risks in 2020. Many observers accept the official communist party line that the impact of the Covid-19 pandemic made it almost impossible to fix an expansion rate this year, but in fact the lasting effects of the 2008 financial crisis and the aggressive policies of President Trump have rocked China back on its heels.

    As China becomes increasingly focused inward and with an eye on public security, the economic situation is likely to deteriorate further. While many observers viewed China's "Belt & Road" initiative as a sign of confidence and strength, in fact it was Beijing's attempt to deal with an economic realignment that followed the 2008 crisis. The arrival of President Trump on the scene further weakened China's already unstable mercantilist economic model, where non-existent internal demand was supposed to make up for falling global trade flows. Or at least this was the plan until COVID-19.

    "Before the Covid-19 outbreak, many economists were expecting China to set a GDP growth target of 6% to 6.5% to reflect the gradual slowdown in the pace of expansion over the past few years," reports Caixin Global . "Growth slid to 6.1% in 2019 from 6.7% in 2018. But the devastation caused by the coronavirus epidemic -- which saw the economy contract 6.8% year-on-year in the first quarter -- has thrown those forecasts out of the window."

    Out of the window indeed. Instead of presiding over a glorious expansion of the Chinese sphere of influence in Asia, Xi Jinping is instead left to fight a defensive action economically and financially. The prospective end of the special status of Hong Kong is unlikely to have any economic benefits and may actually cause China's problems with massive internal debt and economic malaise to intensify. Beijing's proposed security law would reduce Hong Kong's separate legal status and likely bring an end to the separate currency and business environment.


    M Orban 20 hours ago

    I honestly don't know if this article is or is not correct... But I wonder...
    AmConMag publishes a major anti-China article on most days now. What is happening? What is the mechanics of this... "phenomenon"?
    chris chuba M Orban 12 hours ago
    For any of their flaws AmConMag was a sweet spot.

    A place where where Americans opposed to U.S. hegemony because it's harm on everyone without being overwhelmed by the Neocon acolytes where can we go, anyone ever try to get a word in on foxnews ?

    If you try to reach out to twitter on Tom Cotton or Mike Waltz dismisses you as a 'Chinese govt / Iranian / Russian bot'

    You know what, God will judge us and we will all be equal in he eyes of Him
    Why should I be afraid. Why should I be silent. And thank you TAC for the opportunity to post.

    M Orban chris chuba 6 hours ago
    I too came here for interesting commentary, - and even better comments... five years ago or so?
    I found the original articles mostly okay, often too verbose, meandering for my taste but the different point of view made them worthwhile. The readers' comments, now that is priceless. That brings the real value. That's where we learn. That's where I learn, anyway. :)
    It never occurred to me to message to any politician, I think my voice would be lost in the cacophony.
    The target of my curiosity is that when all these articles start to point in one direction (like belligerence toward China) how does it happen? Is there a chain of command? It seems coordinated.
    MPC M Orban 2 hours ago • edited
    It's possible to be anti-neocon, for their being too ideological, and not pacifist. That is basically my position.

    I agree with most here on Russia and Iran. They are not threats, and in specific cases should be partners instead. Agree on American imperialism being foolish and often evil. I believe in a multipolar world as a practical matter. I don't take a soft view of China however. I believe they do intend to replace nefarious American hegemony with their own relevant, but equally nefarious, flavor of hegemony. There are few countries in the world with such a pathological distrust of their own people. I truly believe that country is a threat that needs to be checked at least for a couple of decades by the rest of the world.

    As to the editorial direction, I think it is merely capitalism. China's perception in the world is extremely bad lately. I would fully expect the always somewhat Russophile environment here to seize the moment to say 'see! Russia is not a true threat! It's China!' RT itself soon after Trump's election I recall posted an article complaining about total disregard for Chinese election meddling.

    Barry_II M Orban 7 hours ago
    You can see when the people holding the leash give a tug on the collar. And it's clear that the GOP is feeling the need for a warlike political environment.

    The most blatant presstitution example, of course, was the National Review, going from 'Never Trump' to full time servicing.

    M Orban Barry_II 6 hours ago
    In case of AmConMag, who is holding the leash?

    [May 28, 2020] By arresting Meng, Trump administration just driving a hedge between inside the "Capitalist International"

    May 28, 2020 | www.moonofalabama.org

    vk , May 27 2020 20:28 utc | 17

    @ Posted by: james | May 27 2020 18:51 utc | 8

    Of all the options in the Western arsenal against China, arresting Huawei's heir apparent on blatantly forged charges is easily one of the worst.

    Chinese or not Chinese, fact is Meng is a member of the bourgeoisie. She is one of them. It doesn't matter if Huawei only became big and prosperous thanks to the CCP: bourgeoisie is bourgeoisie, and having a strong one within communist China's belly is essential for the long term success of capitalism in its war against communism.

    By arresting Meng, the capitalists (i.e. Americans) are just driving a hedge between inside the "Capitalist International". The Chinese capitalist class - who was certainly very interested in ganging up with their western counterparts to, in the long term, topple the CCP - is now completely at the mercy of the CCP, as the CCP is now the only guarantor of their own class status.

    The correct strategy would be for the Western bourgeoisie to woo the Chinese bourgeoisie with as many tax breaks, green cards and other kinds of flattery, so that, withing the course of some generations, the Chinese bourgeoisie become fully liberal (westernized). It would then make the infamous "middle class insurgence" theory feasible.

    But (and there's always a "but" in the real world), it seems that capitalism itself is in crisis. It seems that, all of a sudden, the pot became too small to make every alpha male happy. The international bourgeoisie is now devouring its children (the petite-bourgeoisie, the "small business owners") and is beginning to devour itself.


    A.L. , May 27 2020 20:48 utc | 20

    @Kadath 15

    Meng is a high profile scalp but won't change anything. it'll just up the ante in this game of chicken.

    in regards to HK's special trading rights, it's horseshit really. HK hasn't made anything anyone needed for decades. the biggest use of this special relationship (cough cough) is to move mainland product through Hong Kong to skirt quota and tariff restrictions. as an inhabitant I won't be sorry to see it go. it hasn't and doesn't benefit the people here anyway.

    as to it's status as a financial hub, do you really think the bankers will leave if there are money to be made? c'mon who are we kidding here. actually, if it means driving away a few expat bankers who does nothing except creating glass ceilings and hanging out in various golf and aristocratic clubs in hk, I'm all for it too.

    as to visa free travel, again it's a non issue as well. I remember before the 1997 handover having to get visas to go pretty much anywhere with my HK British passport it was an utterly useless 3nd class citizen passport. so nothing changes. ironically all of the visa free agreement came after the handover with no thanks to the Brits.

    if USA start freezing assets of individuals and businesses it'll be a sloppily slope for Trumpville. For one freezing individuals assets won't hurt China on the whole one iota, second, China can play that game too. US businesses and assets can all be nationalised.

    I'm still waiting for China to cancel all Boeing and GE orders because they're defense suppliers of USA, just as USA is claiming huawei to be as the reason for sanctions.

    so yeah it'll get worse.

    A.L. , May 27 2020 21:06 utc | 23
    @vk 17

    "The Chinese capitalist class - who was certainly very interested in ganging up with their western counterparts to, in the long term, topple the CCP - is now completely at the mercy of the CCP, as the CCP is now the only guarantor of their own class status."

    I think you nailed it on the head there. it's not just capitalists, a lot of party officials shipped their families to the 5 eye countries thinking it's their plan B (often with obscene, questionable wealth and under fake identities as dual citizenship is not allowed in China). now it's becoming clear to them they're now in the pocket of uncle Sam, their loved ones to be sacrificed and used against them in any moment.

    Kadath , May 27 2020 21:15 utc | 25
    Re: 20 A.L.

    I agree, stripping HK of its' special trading agreement isn't going to hurt China in any meaningful way and I don't think the financial elite of HK are going to flee from China over this. However, the way in which the US is doing this is an insult to the Chinese (not just the government, but the Chinese people themselves). The US claiming to have the right to adjudicate over the domestic policies of other countries is not just an insult but also an implied threat. In international politics claiming that you have a right of approval over another nation's internal policies is in effect a claim of superior authority over that country than that country's own government and it logically brings up all sorts of questions about what happens if they refuse to accept your claim, do you impose sanctions or go to war over it?

    The bigger threats are coming over Taiwan and Tibet, the US suggesting that it might pass legislation recognizing them as independent countries means that the US feels it has the right to unilaterally impose new boarders on countries - that only happens if you win a war, so the US feels it is at war with China and that it has already won or is so certain to win that it can announce what it wants the new boarders to look like. That is crazy. What's next, will the US do what they did with Venezuela and declare some random oligarch the new Chinese President then sign agreements with him and insist that they are real legal documents (that might very well be the plan for the leader of the HK protests Joshua Wong).

    The US was stupid or crazy or both to try this path with Venezuela to try this with China means war.

    james , May 27 2020 21:19 utc | 26
    @ 25 kadath... isn't this what the usa is doing with the huawei case in canada? they are essentially saying - our rules 'trump' all of yours... this is how exceptional nations work ya know... either that or the bullying tactics are wearing thin with me...
    Anonymous , May 27 2020 21:29 utc | 28
    Since the subject of Meng Wanzhou's court case came up, I thought I'd post more detail.

    "Meng's lawyers argued that the fact Canada does not have economic sanctions against Iran meant her alleged actions would not have been considered a crime in Canada because no bank would have suffered a loss in an identical set of circumstances.

    But the judge said Meng's lawyers were trying to make the scope of her analysis too narrow.

    "Canada's law of fraud looks beyond international boundaries to encompass all the relevant details that make up the factual matrix, including foreign laws that may give meaning to some of the facts," Holmes said.
    ____

    OK, so that's settled but there is a lot more to come:

    "The judge still has to hold hearings to determine whether there is sufficient evidence to warrant extradition, and Meng has also claimed that her rights were violated at the time of her arrest.

    Holmes pointed out that Canada's minister of justice will also have a chance to weigh in on whether a decision to commit Meng for extradition would be contrary to Canadian values.

    The ministry confirmed in a statement that extradition proceedings will go ahead "as expeditiously as possible."

    Links:

    https://www.cbc.ca/news/canada/british-columbia/meng-wanzhou-extradition-decision-1.5585737

    https://www.thestar.com/news/canada/2020/05/27/huaweis-meng-wanzhou-faces-court-decision-that-could-set-her-free.html

    https://www.bccourts.ca/jdb-txt/sc/20/07/2020BCSC0785.htm

    Kadath , May 27 2020 21:36 utc | 29
    Re:26 James,

    The extraterritoriality the US is claiming over everything related to international finance and sanctions (not just Iran, but also Cuba, Russia, roughly 1/3 of the world is under some form of US sanctions) is a constant crime which kills thousands of people per year. But what the US has been doing over the past few years, changing boarders unilaterally without evening going to war is a step towards pure insanity. The US "declares" that the "Golan heights" belong to Israel, the US hates the current President of Venezuela so they declare some random guy the new President and bully other countries into pretending his is as well. Ultimately, this is a sign of growing weakness, when the US wanted to change the government of Iraq they invaded (and failed), when they wanted to breakup Syria they bankrolled a bunch of mercenaries (and failed again). Now the US isn't even confident enough to invade Venezuela and impose a new government, so instead they play make-believe with Guaido. Despite this, Venezula isn't strong enough to punish the US for its' delusions but if the US insists on playing make-believe with China they will learn some very painful lessons because China is strong enough to push back.

    bevin , May 28 2020 0:46 utc | 41
    The Meng case has always been part of the Trump campaign to put pressure on China. The Judge's ruling today is quite ludicrous but wholly consistent with Canada's historic tradition of carrying out instructions from the Imperial capital, whether that be in London or Washington.
    It is sad to see a national ruling class prostituting itself and sadder still when it does so out of fear rather than for profit.
    It is all about China, which is in an invulnerable position thanks to Washington having spent the last twenty years forcing Russia and Iran into Beijing's arms. Having given up diplomacy in order to concentrate on gangster bullying tactics the US has ended up, the way all declining empires do, with no friends except those countries so weak that they still crave the Emperor's favour.

    https://peoplesdispatch.org/2020/05/26/why-irans-fuel-tankers-for-venezuela-are-sending-shudders-through-washington/

    dh , May 28 2020 1:24 utc | 43
    @41 "....it does so out of fear rather than for profit."

    Basic economic survival surely. Canada is in no position to upset the current administration in Washington....much as many Canadians would like to.

    [May 27, 2020] An important ruling in the Canada-US extradition case of Huawei CFO Meng Wanzhou will be announced shortly

    May 27, 2020 | www.moonofalabama.org

    jayc , May 27 2020 17:38 utc | 2

    An important ruling in the Canada-US extradition case of Huawei CFO Meng Wanzhou will be announced shortly. A Canadian court will rule if the case has suitable "double-criminality" - i.e. an act illegal in both countries - and Men will either be free or one step closer to being delivered to the Americans. While it is claimed the arrest was political in nature due to an off-the-cuff comment by Trump, the politicized nature of the charge and extradition request goes back ten years as revealed in the New York Times in December 2018 (How A National Security Investigation of Huawei Set Off an International Incident Dec 14, 2018):


    "The details of the criminal charges against Ms. Meng, filed under seal, remain murky. But court filings in Canada and interviews with people familiar with the Huawei investigation show that the events leading to her arrest were set in motion years ago.

    How a National Security Investigation of Huawei Set Off an International Incident - The New York Times 2018-12-15, 4*50 PM
    They grew out of an Obama administration national security investigation into Chinese companies -- including Huawei -- that act as extensions of the country's government, according to the people familiar with the investigation. The focus only recently shifted to whether Huawei, and specifically Ms. Meng, deceived HSBC and other banks to get them to keep facilitating business in Iran. Former federal prosecutors said pursuing Ms. Meng, 46, for alleged bank fraud proved to be a better line of attack than trying to build a case on national security grounds...

    Counterintelligence agents and federal prosecutors began exploring possible cases against Huawei's leadership in 2010, according to a former federal law enforcement official. The effort was led by United States attorney's offices in places where Huawei has facilities, including Massachusetts, Alabama, California, New York and Texas."

    In other words, the Americans had decided to use its courts against Huawei many years before any charges directed at Meng came to pass. They were literally in search of a crime.

    Some of the uglier features of the Canadian political establishment and media have been pounding the drums for expanded hostilities directed at China, in concert with other Five Eyes partners.


    james , May 27 2020 18:51 utc | 8

    cbc article on it here - Huawei CFO Meng Wanzhou loses major court battle as B.C. judge rules extradition bid should proceed
    Kadath , May 27 2020 20:15 utc | 15
    Well now that it's 95% sure that Meng will be extradited to the US by the Canadian poodle courts, we should now consider how China will respond as the full court press against China has really heated up in the past month. If Meng is extradited to the US, she'll almost certainly be kept in a high security prison, as I can't imagine the US allowing her to remain free on bail during the trial and then given a 10-15yr prison sentence which will be used as a bargaining chip in the US-China trade war. US intelligence agencies will constantly interrogate/torture/bribe her in efforts to get her to flip against the Chinese government or provide them some intelligence. Given her high status I think China may want to consider the following options

    1. Arrest some more Canadian "diplomats" (i.e. spies) and perhaps even up the ante by arresting a US spy.
    2. Pull an Assange and have Meng flee to the Chinese Consulate in Vancouver, I've seen the Consulate and it is much roomier than the Ecuadorian embassy that Julian was stuck in. This would ensure her protection and bypass the corrupt Courts, making it purely a question of diplomacy between states (not that Canada has good diplomacy skills, but if China was also holding a bunch of Canadian spies it would make sense to make this problem go away).

    6 months ago, I think the Chinese would have allowed her to be extradited to the US and then fought it out in backdown diplomacy with the US. But will all of the crazy things the US has done in the past 2 months I think China has had enough and will start pushing back. Heck, in the past 48 hours a congressman put forth a motion to declare Tibet an independent country illegally occupied by China and the Whitehouse is threatening to strip Hong Kong of special trading rights.

    vk , May 27 2020 20:28 utc | 17
    @ Posted by: james | May 27 2020 18:51 utc | 8

    Of all the options in the Western arsenal against China, arresting Huawei's heir apparent on blatantly forged charges is easily one of the worst.

    Chinese or not Chinese, fact is Meng is a member of the bourgeoisie. She is one of them. It doesn't matter if Huawei only became big and prosperous thanks to the CCP: bourgeoisie is bourgeoisie, and having a strong one within communist China's belly is essential for the long term success of capitalism in its war against communism.

    By arresting Meng, the capitalists (i.e. Americans) are just driving a hedge between inside the "Capitalist International". The Chinese capitalist class - who was certainly very interested in ganging up with their western counterparts to, in the long term, topple the CCP - is now completely at the mercy of the CCP, as the CCP is now the only guarantor of their own class status.

    The correct strategy would be for the Western bourgeoisie to woo the Chinese bourgeoisie with as many tax breaks, green cards and other kinds of flattery, so that, withing the course of some generations, the Chinese bourgeoisie become fully liberal (westernized). It would then make the infamous "middle class insurgence" theory feasible.

    But (and there's always a "but" in the real world), it seems that capitalism itself is in crisis. It seems that, all of a sudden, the pot became too small to make every alpha male happy. The international bourgeoisie is now devouring its children (the petite-bourgeoisie, the "small business owners") and is beginning to devour itself.

    [May 26, 2020] Huawei Warns of 'Terrible Price' If U.S.-China Tensions Escalate - Bloomberg

    Notable quotes:
    "... Bloomberg News ..."
    "... Guo was far less vocal than colleague Richard Yu, who runs the consumer division responsible for smartphones. The outspoken executive said the restrictions that ostensibly aim to allay U.S. cybersecurity concerns are really designed to safeguard American dominance of global tech. ..."
    "... "The so-called cybersecurity reasons are merely an excuse," Yu, head of the Chinese tech giant's consumer electronics unit, wrote in a post to his account on messaging app WeChat earlier on Monday. "The key is the threat to the technology hegemony of the U.S." posed by Huawei, he added. ..."
    May 26, 2020 | www.bloomberg.com

    ‎May‎ ‎17‎, ‎2020‎ ‎10‎:‎25‎ ‎PM Updated on ‎May‎ ‎18‎, ‎2020‎ ‎6‎:‎00‎ ‎AM 2:44

    ... ... ...

    China's largest technology company said it will be "significantly affected" by a Commerce Department decree barring any chipmaker using American equipment from supplying Huawei without U.S. government approval. That means companies like Taiwan Semiconductor Manufacturing Co. and its rivals will have to cut off the Chinese company unless they get waivers -- effectively severing Huawei's access to cutting-edge silicon it needs for smartphones and networking gear.

    ... ... ...

    "Our business will significantly be impacted," Guo said at a company briefing with analysts in Shenzhen. "Given the changes in the industry over the past year, it dawned on us more clearly that fragmented standards and supply chains benefit no one. If further fragmentation were to take place, the whole industry would pay a terrible price," he added.

    Huawei is still assessing the potential fallout of the latest restrictions and couldn't predict the impact on revenue for now, Guo said. On Monday, a swathe of Huawei's suppliers from TSMC to AAC Technologies Holdings Inc. plunged in Asian trading.

    QuickTake: How Huawei Landed at the Center of Global Tech Tussle

    Guo was far less vocal than colleague Richard Yu, who runs the consumer division responsible for smartphones. The outspoken executive said the restrictions that ostensibly aim to allay U.S. cybersecurity concerns are really designed to safeguard American dominance of global tech.

    "The so-called cybersecurity reasons are merely an excuse," Yu, head of the Chinese tech giant's consumer electronics unit, wrote in a post to his account on messaging app WeChat earlier on Monday. "The key is the threat to the technology hegemony of the U.S." posed by Huawei, he added.

    Yu also posted a link to a Chinese article circulating on social media with part of its headline asking: "Why Does America Want to Kill Huawei?"

    The U.S. is leveraging its own technological strengths to crush companies outside its own borders, spokesman Joe Kelly told analysts, reading from a prepared statement. "This will only serve to undermine the trust international companies place in U.S. technology and supply chains," Kelly said. "Ultimately, this will harm U.S. interests."

    Read more: Global Chipmaking Kingpin Gets Dragged into U.S.-China Trade War

    -- With assistance by Colum Murphy, Yuan Gao, and Debby Wu

    ( Updates with more details from the Huawei briefing with analysts )

    [May 24, 2020] Trump's 'Uncreative Destruction' of the U.S.-China Relationship - FPIF by John Feffer

    May 20, 2020 | fpif.org

    Trump's economic war on China comes in the shadow of an even deadlier military escalation. And it may not stop after November, no matter who wins the election.

    Economists like to think of the wreckage caused by stock market downturns, widespread bankruptcies, and corporate downsizing as "creative destruction." As it destroys the old and the dysfunctional, the capitalist system continually spurs innovation, much as a forest fire prepares the ground for new growth.

    Or so the representatives of the dismal science argue.

    Donald Trump, who is neither economist nor scientist, has his own version of creative destruction. He is determined to destroy the Affordable Care Act and replace it with his own health insurance alternative. He has torn up the Iran nuclear deal in favor of negotiating something brand new with Tehran. He has withdrawn from the Paris climate accord and argues that the United States is reducing carbon emissions in its own superior manner.

    The problem, of course, is that Trump is very good at destruction but, despite his previous job as a real estate mogul, exceedingly bad at construction. Indeed, there's abundant evidence that he never intended to replace what he is destroying with anything at all. Trump has never offered any viable alternative to Obamacare or any new negotiating framework with Iran. And prior to the recent economic downturn, U.S. carbon emissions were increasing after several years of decline.

    Perhaps the most dangerous example of Trump's uncreative destruction is his approach to China.

    Previously, Trump said that he simply wanted to level the playing field by placing trade with China on a fairer and more reciprocal basis, strengthening the regime of intellectual property rights, and stopping Beijing from manipulating its currency.

    He was willing to go to great lengths to accomplish this goal. The tariffs that Trump imposed on Chinese products precipitated a trade war that jeopardized the livelihoods of millions of American farmers and workers. The initial trade deal that the United States and China signed in January, even though many of the U.S. tariffs remain in place, was supposed to be the grand alternative to the old and dysfunctional trade relationship.

    But here again, Trump is not telling the truth. He and his team have a very different set of objectives. As with so many other elements of his domestic and foreign policy, Trump wants to tear apart the current system -- in this case, the network of economic ties between the United States and China -- and replace it with absolutely nothing at all.

    Oh sure, Trump believes that U.S. manufacturers can step up to take the place of Chinese suppliers. More recently, as the administration "turbocharges" its efforts to isolate China in response to its purported pandemic mistakes , it has talked of creating an Economic Prosperity Network of trusted allies like South Korea, Australia, India, and Vietnam. But this is all whistling in the dark, because the administration doesn't really understand the consequences -- for the world economy, for the U.S. economy -- of tearing apart the global supply chain in this way.

    Just how poorly Trump understands all this is reflected in his statement last week that "we could cut off the whole relationship" with China and "save $500 billion." This from the president who erroneously believes that China is paying the United States "billions and billions of dollars of tariffs a month." What else do you expect from a man who received a BS in economics from Wharton?

    Unlike many of the administration's other policies, however, its hardline approach to China has some bipartisan support. Engagement with China has virtually disappeared as a policy option in the Democratic Party. Joe Biden, the Democrats' presumptive presidential candidate, has attempted to present himself as the tougher alternative when it comes to China, a misguided effort to fend off charges of his bedding down with Beijing.

    Finger to the wind, Biden is crafting policies in response not just to Trump but to public opinion. In 2017, 44 percent of Americans had a favorable view of China, compared to 47 percent who held an unfavorable opinion of the country, according to Pew. In this year's survey , only 26 percent looked at China positively versus 66 percent who viewed it negatively. The latter category includes 62 percent of Democrats.

    Writing for the Atlantic Council, Michael Greenwald sums up the new conventional wisdom of the centrists:

    The United States can no longer remain content with the notion of a Chinese economic threat arising in the distant future. The advent of COVID-19 has made it more apparent than any other time including the US-China trade war that now is the moment for the United States, European Union, and other like-minded countries to diversify supply chains away from China.

    That's what makes Trump's uncreative destruction vis a vis China so dangerous. It may not stop after November, no matter who wins the election.

    The Great Disentanglement

    China's economic shutdown at the onset of the coronavirus pandemic disrupted many global supply chains, prompting a number of countries and corporations to accelerate their strategy of reducing their dependency on China for components.

    Rising labor costs in China, concerns over human rights abuses there, but especially the trade war between Washington and Beijing had contributed to the U.S. fashion industry and tech firms like Apple rethinking their own supply chains. Japan, heavily dependent on Chinese trade, is using $2 billion in economic stimulus funds to subsidize the move of Japanese firms out of China.

    The Trump administration is thus swimming with the current in its effort to isolate China. It has imposed sanctions because of China's violations of Uyghur human rights. It has levied penalties against China for its cooperation with Iranian firms. And it has threatened to add another set of tariffs on top of the existing ones for China's handling of the coronavirus.

    Its latest initiative has been to tighten the screws on the Chinese technology firm, Huawei. Last week, the administration announced sanctions against any firms using U.S.-made equipment that supply the Chinese tech giant. The chief victim of these new restrictions will be the Taiwanese firm TSMC, which supplies 90 percent of Huawei's smartphone chips.

    In other words, the Trump administration is committed not only to severing U.S. economic connections with China. It wants to put as much pressure on other countries as well to disentangle themselves from Chinese manufacturing. Taiwan, of course, has no particular love for Mainland China. It battles Beijing on a daily basis to get international recognition -- from other countries and from global organizations like the World Health Organization.

    But the Taiwanese economy is also heavily dependent on its cross-strait neighbor. As Eleanor Albert points out :

    China is Taiwa n's largest trading partner, accounting for nearly 30 percent of the island's total trade, and trade between the two reached $150.5 billion in 2018 (up from $35 billion in 1999). China and Taiwan have also agreed to allow banks, insurers, and other financial service providers to work in both market s.

    And it probably won't be Huawei but Taiwan that suffers from the U.S. move. As Michael Reilly notes , "Huawei's size in the global market means its Taiwanese suppliers cannot easily find an alternative customer of comparable standing to replace it." China, meanwhile, will either find another source of chips outside the U.S. sphere, or it will do what the United States has been threatening to do: bring production of critical components back closer to home.

    Another key player in the containment of China is India. Trump's friendship with Indian Prime Minister Narendra Modi, a right-wing Hindu nationalist, is more than simply an ideological affection. Trump sealed a $3 billion in military sales deal with India in February, with a trade deal still on the horizon.

    Modi, in turn, is hoping to be the biggest beneficiary of the falling out between Washington and Beijing. "The government in April reached out to more than 1,000 companies in the U.S. and through overseas missions to offer incentives for manufacturers seeking to move out of China," reports Bloomberg . "India is prioritizing medical equipment suppliers, food processing units, textiles, leather, and auto part makers among more than 550 products covered in the discussions."

    Vietnam is another regional competitor that the United States is supporting in its containment strategy. With only a couple hundred reported coronavirus cases and zero deaths, Vietnam is poised to emerge from the current crisis virtually unscathed. With low labor costs and an authoritarian government that can enforce deals, it is already a favored alternative for corporations looking for alternatives to China. But wildcat strikes have been happening in greater numbers in the country, and the Vietnamese government recently approved the country's first independent trade union.

    Yet with a more technologically sophisticated infrastructure, China will continue to look more attractive to investors than India or Vietnam.

    Don't Count Out China

    If your image of the Chinese economy is stuck in the 1980s -- cheap toys and mass-produced baubles -- then you probably think that severing economic ties with the country is no big deal. America can produce its own plastic junk, right?

    But China is no longer hurrying to catch up to the West. In some ways, the West is already in China's rearview mirror.

    Huawei is well-known for the part it's playing in the rollout of 5G networks worldwide. China is not only ahead of the curve in upgrading to 5G domestically, it is busy manufacturing all the new tech that will run on these high-speed networks, like virtual reality and augmented reality and AI-driven devices.

    Perhaps more to the point, China is not simply part of the global supply chain. It is using these new technologies to revolutionize the global supply chain.

    For instance, it's using 3-D modeling to shorten product development. It has long integrated drones into its distribution networks. "Chinese supply chain companies are incorporating groundbreaking technologies like cloud-based systems, data analytics, and artificial intelligence (AI) and using them to redesign supply chain operations," writes Adina-Laura Achim.

    And don't discount the role of a well-financed, centralized, authoritarian government. The Trump administration is, frankly, at a huge disadvantage when it tries to pressure companies to relocate their operations. Writes Manisha Mirchandani:

    The global technology and consumer electronics sectors are especially reliant on China's infrastructure and specialized labor pool, neither of which will be easy to replicate. The Chinese government is already mobilizing resources to convince producers of China's unique merits as a manufacturing location. Zhengzhou, within Henan Province, has appointed officials to support Apple's partner Foxconn in mitigating the disruptions caused by the coronavirus, while the Ministry of Finance is increasing credit support to the manufacturing sector. Further, the Chinese government is likely to channel stimulus efforts to develop the country's high-tech manufacturing infrastructure, moving away from its low-value manufacturing base and accelerating its vision for a technology-driven services economy.

    The Trump administration is playing the short game, trying to use tariffs and anti-Chinese sentiment to hobble a rising power. China, on the other hand, is playing the long game, translating its trade surpluses into structural advantages in a fast-evolving global economy.

    Will the Conflict Turn Hot?

    Despite the economic ravages of the pandemic, the Pentagon continues to demand the lion's share of the U.S. budget. It wants another $705 billion for 2021, after increasing its budget by 20 percent between 2016 and 2020.

    This appalling waste of government resources has already caused long-term damage to the economic competitiveness of the United States. But it's all the money the Pentagon is spending on "deterring China" that might prove more devastating in the short term.

    The U.S. Navy announced this month that it was sending its entire forward-deployed sub fleet on "contingency response operations" as a warning to China. Last month, the U.S. Navy Expeditionary Strike Group sailed into the South China Sea to support Malaysia's oil exploration in an area that China claims. Aside from the reality that oil exploration makes no economic sense at a time of record low oil prices, the United States should be helping the countries bordering the South China Sea come to a fair resolution of their disputes, not throwing more armaments at the problem.

    There's also heightened risk of confrontation in the Taiwan Strait, the East China Sea, and even in outer space . A huge portion of the Pentagon's budget goes toward preparing for war with China -- and, frankly, provoking war as well.

    What does this all have to do with the Great Disentanglement?

    The close economic ties between the United States and China have always represented a significant constraint on military confrontation. Surely the two countries would not risk grievous economic harm by coming to blows. Economic cooperation also provides multiple channels for resolving conflicts and communicating discontent. The United States and Soviet Union never had that kind of buffer.

    If the Great Disentanglement goes forward, however, then the two countries have less to lose economically in a military confrontation. Trading partners, of course, sometimes go to war with one another. But as the data demonstrates , more trade generally translates into less war.

    There are lots and lots of problems in the U.S.-China economic relationship. But they pale in comparison to World War III. Share this:

    John Feffer is the director of Foreign Policy In Focus.

    Issues: Labor, Trade, & Finance , War & Peace

    Regions: Asia & Pacific , China , India , North America , United States , Vietnam

    Tags: 5G , Donald Trump , global supply chain , globalization , great disentanglement , huawei , Joe Biden , tariffs , trade war , U.S. military spending

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    [May 23, 2020] China is still in great danger: it is still greatly dependent on the West to development and still is a developing country.

    May 23, 2020 | www.moonofalabama.org

    vk , May 22 2020 21:02 utc | 27

    China is still in great danger. Of the existing 30 or so high-tech productive chains, China only enjoys superiority at 2 or 3 (see 6:48). It is still greatly dependent on the West to development and still is a developing country.

    So, yes, the West still has a realistic chance of destroying China and inaugurating a new cycle of capitalist prosperity.

    What happens with the "decoupling"/"Pivot to Asia" is that, in the West, there's a scatological theory [go to 10th paragraph] - of Keynesian origin - that socialism can only play "catch up" with capitalism, but never surpass it when a "toyotist phase" of technological innovation comes (this is obviously based on the USSR's case). This theory states that, if there's innovation in socialism, it is residual and by accident, and that only in capitalism is significant technological advancement possible. From this, they posit that, if China is blocked out of Western IP, it will soon "go back to its place" - which is probably to Brazil or India level.

    If China will be able to get out of the "Toyotist Trap" that destroyed the USSR, only time will tell. Regardless, decoupling is clearly not working, and China is not showing any signs so far of slowing down. Hence Trump is now embracing a more direct approach.

    As for the USA, I've put my big picture opinion about it some days ago, so I won't repeat myself. Here, it suffices to say that, yes, I believe the USA can continue to survive as an empire - even if, worst case scenario, in a "byzantine" form. To its favor, it has: 1) the third largest world population 2) huge territory, with excellent proportion of high-quality arable land (35%), that basically guarantees food security indefinitely (for comparison, the USSR only had 10% of arable land, and of worse quality) 3) two coasts, to the two main Oceans (Pacific and Atlantic), plus a direct exit to the Arctic (Alaska and, de facto, Greenland and Canada) 4) excellent, very defensive territory, protected by both oceans (sea-to-sea), bordered only by two very feeble neighbors (Mexico and Canada) that can be easily absorbed if the situation asks to 4) still the financial superpower 5) still a robust "real" economy - specially if compared to the micro-nations of Western Europe and East-Asia 6) a big fucking Navy, which gives it thalassocratic power.

    I don't see the USA losing its territorial integrity anytime soon. There are separatist movements in places like Texas and, more recently, the Western Coast. Most of them exist only for fiscal reasons and are not taken seriously by anyone else. The Star-and-Stripes is still a very strong ideal to the average American, and nobody takes the idea of territory loss for real. If that happens, though, it would change my equation on the survival of the American Empire completely.

    As for Hong Kong. I watched a video by the chief of the PLA last year (unfortunately, I watched it on Twitter and don't have the link with me anymore). He was very clear: Hong Kong does not present an existential threat to China. The greatest existential threat to China are, by far, Xinjiang and Tibet, followed by Taiwan and the South China Sea. Hong Kong is a distant fourth place.

    Those liberal clowns were never close.


    Jen , May 22 2020 21:55 utc | 32

    VK @ 28:

    One problem with your scenario is that the US navy may be over-extended in parts of the world where all the enemy has to do is to cut off supply lines to battleship groups and then those ships would be completely helpless. US warships in the Persian Gulf with the Strait of Hormuz sealed off by Iran come to mind.

    Incidents involving US naval ship collisions with slow-moving oil tankers in SE Asian waters and some other parts of of the the world, resulting in the loss of sailors, hardly instill the notion that the US is a mighty thalassocratic force.

    It's my understanding also that Russia, China and maybe some other countries have invested hugely in long-range missiles capable of hitting US coastal cities and areas where the bulk of the US population lives.

    And if long-range missiles don't put paid to the notion that projecting power through sending naval warships all over the planet works, maybe the fact that many of these ships are sitting ducks for COVID-19 infection clusters might, where the US public is concerned.

    vk , May 22 2020 22:16 utc | 33
    @ Posted by: Jen | May 22 2020 21:55 utc | 33

    I agree the new anti-ship missile technology may have changed the rules of naval warfare.

    However, it's important to highlight that, contrary to the US Army, the USN has a stellar record. It fought wonderfully against the Japanese Empire in 1941-1945, and successfully converted both the Pacific and the Atlantic into "American lakes" for the next 75 years. All the Americans have nowadays it owes its Navy.

    But you may be right. Maybe the USN is also susceptible to degeneration.

    Richard Steven Hack , May 22 2020 23:51 utc | 38
    Posted by: vk | May 22 2020 21:02 utc | 28

    Of the existing 30 or so high-tech productive chains, China only enjoys superiority at 2 or 3 (see 6:48). It is still greatly dependent on the West to development and still is a developing country.

    Based on what I've read, China is on a fast track to develop technology on their own. In addition, technology development is world-wide these days. What China can not develop itself - quickly enough, time is the only real problem - it can buy with its economic power.

    "if China is blocked out of Western IP, it will soon "go back to its place" - which is probably to Brazil or India level."

    Ah, but that's where hackers come in. China can *not* be blocked out of Western IP. First, as I said, China can *buy* it. Unless there is a general prohibition across the entire Western world, and by extension sanctions against any other nation from selling to China - which is an unenforceable policy, as Iran has shown - China can buy what it doesn't have and then reverse-engineer it. Russia will sell it if no one else will.

    Second, China can continue to simply acquire technology through industrial espionage. Every country and every industry engages in this sort of thing. Ever watch the movie "Duplicity"? That shit actually happens. I read about industrial espionage years ago and it's only gotten fancier since the old days of paper files. I would be happy to breach any US or EU industrial sector and sell what I find to the Chinese, the Malaysians or anyone else interested. It's called "leveling the playing field" and that is advantageous for everyone. If the US industrial sector employees can't keep up, that's their problem. No one is guaranteed a job for life - and shouldn't be.

    "1) the third largest world population"

    Which is mostly engaged in unproductive activities like finance, law, etc. I've read that if you visit the main US universities teaching science and technology, who are the students? Chinese. Indians. Not Americans. Americans only want to "make money" in law and finance, not "make things."

    "2) huge territory, with excellent proportion of high-quality arable land (35%), that basically guarantees food security indefinitely"

    In military terms, given current military technology, territory doesn't matter. China has enough nuclear missiles to destroy the 50 Major Metropolitan Areas in this country. Losing 100-200 millions citizens kinda puts a damper on US productivity. Losing the same number in China merely means more for the rest.

    "3) two coasts, to the two main Oceans (Pacific and Atlantic)"

    Which submarines can make irrelevant. Good for economic matters - *if* your economy can continue competing. China has one coast - but its Belt and Road Initiative gives it economic clout on the back-end and the front-end. I don't see the US successfully countering that Initiative.

    "4) excellent, very defensive territory, protected by both oceans (sea-to-sea)"

    Which only means the US can't be "invaded". That's WWI and WWII thinking the US is mired in. Today, you destroy an opponent's military and, if necessary, his civilian population, or at least its ability to "project" force against you. You don't "invade" unless it's some weak Third World country. And if the US can't "project" its power via its navy or air force, having a lot of territory doesn't mean much. This is where Russia is right now. Very defensible but limited in force projection (but getting better fast.) The problem for the US is China and Russia are developing military technology that can prevent US force projection around *their* borders.

    "bordered only by two very feeble neighbors (Mexico and Canada) that can be easily absorbed if the situation asks"

    LOL I can just see the US "absorbing" Mexico. Canada, maybe - they're allies anyway. Mexico, not so much. You want a "quagmire", send the US troops to take on the Mexican drug gangs. They aren't Pancho Villa.

    "4) still the financial superpower"

    Uhm, what part of "Depression" did you miss? And even if that doesn't happen now, continued financial success is unlikely. Like pandemics, shit happens in economics and monetary policy.

    "a big fucking Navy, which gives it thalassocratic power."

    That can be sunk in a heartbeat and is virtually a colossal money pit with limited strategic value given current military technology which both China and Russia are as advanced as the US is, if not more so. Plus China is developing its own navy quickly. I read somewhere a description of one Chinese naval shipyard. There were several advanced destroyers being developed. Then the article noted that China has several more large shipyards. That Chinese long coast comes in handy for that sort of thing.

    China Now Has More Warships Than the U.S.
    But sometimes quantity doesn't trump quality. [My note: But sometimes it does.]
    https://tinyurl.com/y7numhef

    That's just the first article I found, from a crappy source. There are better analyses, of course.

    "I don't see the USA losing its territorial integrity anytime soon. There are separatist movements in places like Texas and, more recently, the Western Coast. Most of them exist only for fiscal reasons and are not taken seriously by anyone else."

    I'd agree with that. I hear this "California secession" crap periodically and never believe it. However, for state politicians, the notion of being "President" of your own country versus a "Governor" probably is tempting to these morons. State populations are frequently idiots as well, as the current lockdown response is demonstrating. All in all, though, if there are perceived external military threats, that is likely to make the states prefer to remain under US central control.

    [May 23, 2020] HK is protected against US tarrifs imposed on China goods. China exports a good chunk of goods through HK. If Trump were really serious he would remove HK's protected status.

    May 23, 2020 | www.moonofalabama.org

    Kay Fabe , May 23 2020 0:09 utc | 42

    "Britain had to agree to the pact because it had lost the capability to defend the colony.".."

    That was the excuse. I believe HK was offered to China in return for Deng to open up and turn China capitalist. Deng was not the one who
    demanded HK return. Britain initiated the discussions. Deng gladly accepted although he insisted on maintaining their authoritarian form of undemocratic government and left HK's fate ambiguous so Britain could get support from their people and the HK elite. The party elites were happy to be able to join the Western Elites in accumulating an unequal share of the wealth. The Soviet elites led by the US Globalist puppet Gorbachev chose the same path although they chose Fake Democracy and rule of the oligarchs as in the US rather than party control of China

    HK is protected against US tarrifs imposed on China goods. China exports a good chunk of goods through HK. If Trump were really serious he would remove HK's protected status.

    vk , May 23 2020 0:30 utc | 47

    @ Posted by: Kay Fabe | May 23 2020 0:09 utc | 42

    The timing doesn't add up. China opened up in 1972 (the famous Nixon-Mao handshake), while the UK's agreement to give HK back was from 1984 - well into the Thatcher Era.

    The most likely reason for the UK to decide to obey the lease deal was of military nature: the valuable land necessary to defend HK was the flatland adjacent to the city proper, where potable water comes from. It already part of the Mainland, thus rendering the defense of HK virtually impossible without an outright invasion of the Mainland itself.

    Margaret Thatcher probably didn't want to obey the treaty (99-year lease), as a good neoliberal she was, but her military advisors probably warned her of the practical difficulties, and, since it was a 99-year lease anyway, she must've agreed to simply allow the treaty to be followed.

    It is important to highlight that, in 1984, there were a lot of reasons the capitalist world should be optimist about China becoming capitalist. After all, it really got off the Soviet sphere after 1972, and Deng's reforms were - from the point of view of a vulgar (bourgeois) economist - indeed a clear path to a capitalist restoration. It didn't cross Thatcher's mind that China could stand its ground and remain socialist - at least not in 1984. If you read the sources of the time, you will easily see the Western elites treated China's return to capitalism as a given.

    [May 23, 2020] China is still in great danger. Of the existing 30 or so high-tech productive chains, China only enjoys superiority at 2 or 3

    Highly recommended!
    May 23, 2020 | www.moonofalabama.org

    vk , May 22 2020 21:02 utc | 28

    China is still in great danger. Of the existing 30 or so high-tech productive chains, China only enjoys superiority at 2 or 3 (see 6:48).

    It is still greatly dependent on the West to development and still is a developing country.

    So, yes, the West still has a realistic chance of destroying China and inaugurating a new cycle of capitalist prosperity.

    What happens with the "decoupling"/"Pivot to Asia" is that, in the West, there's a scatological theory [go to 10th paragraph] - of Keynesian origin - that socialism can only play "catch up" with capitalism, but never surpass it when a "toyotist phase" of technological innovation comes (this is obviously based on the USSR's case). This theory states that, if there's innovation in socialism, it is residual and by accident, and that only in capitalism is significant technological advancement possible. From this, they posit that, if China is blocked out of Western IP, it will soon "go back to its place" - which is probably to Brazil or India level.

    If China will be able to get out of the "Toyotist Trap" that destroyed the USSR, only time will tell. Regardless, decoupling is clearly not working, and China is not showing any signs so far of slowing down. Hence Trump is now embracing a more direct approach.

    As for the USA, I've put my big picture opinion about it some days ago, so I won't repeat myself. Here, it suffices to say that, yes, I believe the USA can continue to survive as an empire - even if, worst case scenario, in a "byzantine" form. To its favor, it has: 1) the third largest world population 2) huge territory, with excellent proportion of high-quality arable land (35%), that basically guarantees food security indefinitely (for comparison, the USSR only had 10% of arable land, and of worse quality) 3) two coasts, to the two main Oceans (Pacific and Atlantic), plus a direct exit to the Arctic (Alaska and, de facto, Greenland and Canada) 4) excellent, very defensive territory, protected by both oceans (sea-to-sea), bordered only by two very feeble neighbors (Mexico and Canada) that can be easily absorbed if the situation asks to 4) still the financial superpower 5) still a robust "real" economy - specially if compared to the micro-nations of Western Europe and East-Asia 6) a big fucking Navy, which gives it thalassocratic power.

    I don't see the USA losing its territorial integrity anytime soon. There are separatist movements in places like Texas and, more recently, the Western Coast. Most of them exist only for fiscal reasons and are not taken seriously by anyone else. The Star-and-Stripes is still a very strong ideal to the average American, and nobody takes the idea of territory loss for real. If that happens, though, it would change my equation on the survival of the American Empire completely.

    As for Hong Kong. I watched a video by the chief of the PLA last year (unfortunately, I watched it on Twitter and don't have the link with me anymore). He was very clear: Hong Kong does not present an existential threat to China. The greatest existential threat to China are, by far, Xinjiang and Tibet, followed by Taiwan and the South China Sea. Hong Kong is a distant fourth place.

    Those liberal clowns were never close.

    [May 22, 2020] They Saw This Day Coming - Huawei Forges Alliances With Rival Chipmakers As Washington's Crackdown Intensifies

    May 22, 2020 | www.zerohedge.com

    "They Saw This Day Coming" - Huawei Forges Alliances With Rival Chipmakers As Washington's Crackdown Intensifies by Tyler Durden Fri, 05/22/2020 - 18:05 The US Commerce Department's latest move to block companies from selling products to Huawei that were created with American technology, equipment or software has undoubtedly hurt the Chinese telecoms giant. But it won't be nearly enough to take it down.

    Since Washington launched its campaign against Huawei two years ago (when the trade tensions between the US and China started to heat up, as President Trump started slapping more tariffs on foreign goods) the company has been strengthening ties with contract chipmakers in Taiwan and elsewhere, while ramping up its own microchip-technology arm, known as HiSilicon Technologies.

    On Friday, Nikkei reported that Huawei had initiated conversations with other mobile chipmakers to try and figure out where it might source certain essential components for its handsets (remember, Huawei is the second-largest cellphone maker by sales volume) and other products.

    Of course, the crackdown cuts both ways, as several American companies relied heavily on Huawei's business (they can still apply for licenses to continue selling to Huawei...so long as Commerce approves).

    As we reported earlier this week , it's not just American chipmakers that are distancing themselves from Huawei: some Taiwan-based chipmakers are also dropping the telecoms giant for fear of being targeted by Treasury sanctions, including TSMC, the world's largest contract chipmaker.

    Now, Huawei is reportedly in talks with MediaTek, the world's second-largest contract chip producer.

    Huawei Technologies is seeking help from rival mobile-chip makers to withstand a U.S. clampdown aimed at crippling the Chinese company, sources familiar with the matter told the Nikkei Asian Review.

    Huawei is in talks with MediaTek, the world's second-largest mobile chip developer after Qualcomm of the U.S., and UNISOC, China's second-largest mobile chip designer after Huawei's HiSilicon Technologies unit, to buy more chips as alternatives to keep its consumer electronics business afloat, the sources said.

    To work with a contract chipmaker, Huawei would still need to design its own chips. Over the past two years, Huawei has expanded its team of engineers working on chip design to more than 10,000, Nikkei said.

    To be sure, MediaTek already makes low- and medium-end chips for Huawei, evidence that the company, which was founded by a veteran of China's PLA, and purportedly maintains strong links to the Chinese military, has been bracing for the other shoe to drop. MediaTek, meanwhile, is still trying to figure out if it can meet Huawei's latest bid.

    "Huawei has foreseen this day coming. It started to allocate more mid- to low-end mobile chip projects to MediaTek last year amid its de-Americanization efforts," one of the sources said. "Huawei has also become one of the key clients for the Taiwanese mobile chip developer's mid-end 5G mobile chip for this year."

    MediaTek is evaluating whether it has sufficient human resources to fully support Huawei's aggressive bid, as the Chinese company is asking for volume 300% above its usual procurement in the past few years, another source familiar with the talks said.

    The situation has also created an opportunity for small Chinese chipmakers (working, we imagine, mostly with technology stolen from American and Taiwanese companies) to expand.

    Huawei also seeks to deepen its collaboration with UNISOC, a Beijing-backed mobile chip developer that relies mostly on smaller device makers as customers and mainly supports entry-level products and devices for emerging markets. Previously, Huawei used only very few UNISOC chips for its low-end smartphone and tablet offerings, sources said.

    "The new procurement deals would be a great boost to help UNISOC further upgrade its chip design capability," said a chip industry executive. "In the past, UNISOC was struggling quite a bit, because it could not really secure big contracts with global leading smartphone makers as these top smartphone makers could find better offerings elsewhere. This time could be an opportunity that it could really seek to match the international standard."

    UNISOC last year accelerated its 5G chip development to catch up with Qualcomm and MediaTek, Nikkei has reported. More recently, the company received 4.5 billion yuan ($630 million) from China's national integrated circuit fund, the so-called Big Fund.

    UNISOC is preparing to list on the Shanghai STAR tech board, the Chinese version of Nasdaq, later this year. Qualcomm has needed a license from the U.S. Department of Commerce to supply Huawei since mid-May of 2019.

    Huawei has already expanded production of in-house mobile processors for its smartphone business to 75%, up from 69% in 2018 and 45% in 2016, according to to data from GF Securities cited by Nikkei. Huawei shipped 240 million smartphones in 2019. And with China now throwing caution to the wind and cracking down on Hong Kong, we wouldn't be surprised to see more Huawei drama in the headlines next week, with serious market repercussions for the US semiconductor industry.

    [May 21, 2020] Pompeo Lays Out the Case For Cold War II With China by Matthew Petti

    That will be an interesting chess party. The USA moved way to many plants to Chine to get out of this conflict without major losses
    Notable quotes:
    "... Secretary of State Mike Pompeo slammed China as “hostile to free nations,” portraying Beijing as fundamentally opposed to the United States, on Wednesday. ..."
    "... But the Secretary of State pointed to deeper issues in the relationship, claiming that “the nature of the regime is not new.” “For several decades, we thought the regime would become more like us through trade, scientific exchanges, diplomatic outreach, letting them in the [World Trade Organization] as a developing nation,” he said. “That didn’t happen.” ..."
    May 20, 2020 | nationalinterest.org

    'The regime is ideologically and politically hostile to free nations.'

    Secretary of State Mike Pompeo slammed China as “hostile to free nations,” portraying Beijing as fundamentally opposed to the United States, on Wednesday.

    Tensions between the United States and China have reached a fever pitch during the coronavirus pandemic. Pompeo’s speech at a Wednesday morning press conference laid out a vision of a global clash between two fundamentally different societies.

    “China’s been ruled by a brutal, authoritarian regime, a communist regime since 1949,” he said. “We greatly underestimated the degree to which Beijing is ideologically and politically hostile to free nations. The whole world is waking up to that fact.”

    He added that a focus on the coronavirus pandemic “risks missing the bigger picture of the challenge that’s presented by the Chinese Communist Party.”

    The pandemic has accelerated U.S.-China tensions.

    Last week, a Chinese Communist Party news threatened sanctions against U.S. lawmakers for attempting to sue the Chinese government for the pandemic, and U.S. law enforcement accused Chinese hackers of cyberattacks against U.S. researchers.

    But the Secretary of State pointed to deeper issues in the relationship, claiming that “the nature of the regime is not new.” “For several decades, we thought the regime would become more like us through trade, scientific exchanges, diplomatic outreach, letting them in the [World Trade Organization] as a developing nation,” he said. “That didn’t happen.”

    Pompeo accused the World Health Organization’s director-general Dr. Tedros Adhanom Ghebreyesus of “unusually close ties to Beijing” that “started long before this current pandemic.”

    The Trump administration has accused China of covering up information about the novel coronavirus—even implying that the virus emerged from a lab accident in Wuhan, China—and pointed the finger at the World Health Organization for aiding China’s coverup.

    The Secretary of State slammed the public health group for excluding Taiwan in his Wednesday speech, touching on a sensitive topic for Beijing.

    Taiwan, an island that was once ruled by China, has ruled itself since the end of the Chinese Civil War in 1950. Beijing considers the island a breakaway Chinese province that must be reunited with the mainland, while Taiwan’s ruling Pan-Green Alliance leans towards independence.

    “The democratic process in Taiwan has matured into a model for the world,” Pompeo said, congratulating President Tsai Ing-wen on her re-election. “Despite great pressure from the outside, Taiwan has demonstrated the wisdom of giving people a voice and a choice.”

    But he shied away from changing U..S. policy towards Taiwan..

    Pompeo said that work that “comports with the history of the agreements between the United States and China is the right solution to maximize the stability there in the straits.”

    The United States acknowledged the Chinese position that “there is but one China and Taiwan is part of China” as part of a 1979 joint communique with Beijing, and does not officially recognize Taiwan as a state, but maintains close informal ties with the Taiwanese government and opposes attempts to change the island’s government by force.

    “The President talked about how we’re going to respond [to China], how he’s beginning to think about responding to the calamity that has befallen the world as a result of the actions of the Chinese Communist Party,” Pompeo said. “I don’t want to get ahead of him in terms of talking about how the administration will respond to that, but you can already begin to see the outlines of it.”

    Matthew Petti is a national security reporter at the National Interest. Follow him on Twitter: @matthew_petti. This article initially stated that the United States “recognized that ‘there is but one China and Taiwan is a part of China’ in a 1979 joint communique.” The communique actually states that the United States “acknowledges” this as the Chinese position. The article has been updated to more correctly reflect the communique. Image: Reuters.

    [May 20, 2020] Washington wants to prevent Russia and China supplanting US interests but The China-US relationship is the most important bilateral relationship in the world and involves huge interests of the two countries, as well as the rest of the world. Therefore, it is not something Trump can cut off emotionally

    Notable quotes:
    "... The Chinese will not start a shooting war and the US has no guts for one. Its industry has been hollowed out not just by outsourcing but by corruption as well. The campaign of demonization against China is very obvious, how far it is working I have no way of telling. Among the 5-eyes probably quite well, in the rest of the World rather less well, I would imagine. Notably, the British economy has been hollowed out in exactly the same manner as the US's. Canada's, Australia's, NewZealand's? Could they, would they support a war? ..."
    "... Right now, China is leading the vaccine race and has developed an antibody treatment for Covid-19 that should be ready this year. ..."
    "... Interesting article by Escobar. If one cares to notice, this anti-China cold war is a neocon based aggression. The primary movers of it are mostly neocons or the sorts who follow the neocon lead. ..."
    "... "Again! Trump is talking nonsense." Trump seems to be losing his mind right now. Even he has such crazy ideas of cutting ties with China, US politicians, businessmen and Americans would not allow him to do so, Xin Qiang, deputy director of the Center for US Studies at Fudan University, told the Global Times. ..."
    "... Jin Canrong, the associate dean of Renmin University of China's School of International Studies in Beijing, told the Global Times on Thursday that Trump made very irresponsible and emotional remarks in the interview. ..."
    "... "For Trump, fantasy is power; bluffing is power, so he might use the future of his country to gamble with China. Although China always believes cooperation is the only right choice for the two countries to solve the problems together, if the US unilaterally and irrationally chooses all-out confrontation, China also needs to be prepared." ..."
    May 20, 2020 | www.unz.com

    peter mcloughlin , says: Show Comment May 19, 2020 at 6:02 pm GMT

    Washington wants to prevent Russia and China supplanting US interests. Moscow and Beijing pursue what they see as their own legitimate interests. What we face is not a "hybrid" war or "New Cold War" but a world war.
    https://www.ghostsofhistory.wordpress.com/
    foolisholdman , says: Show Comment May 19, 2020 at 8:09 pm GMT
    @peter mcloughlin

    What we face is not a "hybrid" war or "New Cold War" but a world war.

    Honestly, I don't see it. My reasoning is simple, maybe too simple. The Chinese will not start a shooting war and the US has no guts for one. Its industry has been hollowed out not just by outsourcing but by corruption as well. The campaign of demonization against China is very obvious, how far it is working I have no way of telling. Among the 5-eyes probably quite well, in the rest of the World rather less well, I would imagine. Notably, the British economy has been hollowed out in exactly the same manner as the US's. Canada's, Australia's, NewZealand's? Could they, would they support a war?

    The other reason I think a shooting war is less likely than might appear, is that the the MIC is doing so well with the current cold war; that it would seem stupid to allow the massive disruption and uncertainty that a shooting war would cause to interrupt the torrent of cash being shoveled its way at the moment.

    d dan , says: Show Comment May 19, 2020 at 8:34 pm GMT
    "Hard landing" vs "Well and alive". Who wins?

    source: comment #313 by Godfree Roberts
    https://www.unz.com/article/objections-to-an-independent-investigation-of-china/

    [Hide MORE]
    1990. China's economy has come to a halt. The Economist
    1996. China's economy will face a hard landing. The Economist
    1998. China's economy's dangerous period of sluggish growth. The Economist
    1999. Likelihood of a hard landing for the Chinese economy. Bank of Canada
    2000. China currency move nails hard landing risk coffin. Chicago Tribune
    2001. A hard landing in China. Wilbanks, Smith & Thomas
    2002. China Seeks a Soft Economic Landing. Westchester University
    2003. Banking crisis imperils China. New York Times
    2004. The great fall of China? The Economist
    2005. The Risk of a Hard Landing in China. Nouriel Roubini
    2006. Can China Achieve a Soft Landing? International Economy
    2007. Can China avoid a hard landing? TIME
    2008. Hard Landing In China? Forbes
    2009. China's hard landing. China must find a way to recover. Fortune
    2010: Hard landing coming in China. Nouriel Roubini
    2011: Chinese Hard Landing Closer Than You Think. Business Insider
    2012: Economic News from China: Hard Landing. American Interest
    2013: A Hard Landing In China. Zero Hedge
    2014. A hard landing in China. CNBC
    2015. Congratulations, You Got Yourself A Chinese Hard Landing. Forbes
    2016. Hard landing looms for China. The Economist
    2017. Is China's Economy Going To Crash? National Interest
    2018. China's Coming Financial Meltdown. The Daily Reckoning.
    2019 China's Economic Slowdown: How worried should we be? BBC
    2020. Coronavirus Could End China's Decades-Long Economic Growth Streak. NY Times

    =========

    source: b
    https://www.moonofalabama.org/2020/05/this-illusion-is-alive-and-well.html#more

    Godfree Roberts , says: Website Show Comment May 19, 2020 at 11:26 pm GMT
    Chinese strategists like Liu He publicly acknowledge that epidemics can catalyze geopolitical changes.

    Right now, China is leading the vaccine race and has developed an antibody treatment for Covid-19 that should be ready this year.

    If development is successful and if it donates the cure to the world as Xi promised and if WHO's investigation shows China is not the source of the virus, and if China's economy is firing on all cylinders in November, it's game over: 3-0 China.

    I put the odds of that conjunction at 2:1.

    FB , says: Website Show Comment May 20, 2020 at 4:28 am GMT
    @d dan LOLOLOL

    You gotta love these headline fails I mean how is it even possible to be so spectacularly WRONG about everything time after time after time ?

    Folks if you want to know why the US is screwed, it's because the same kind of geniuses that write these headlines are in charge of EVERYTHING

    One day these people will be studied by psychologists dealing with MASSIVE DELUSION

    anon [161] Disclaimer , says: Show Comment May 20, 2020 at 4:39 am GMT
    @Godfree Roberts Do you have any odds on Trump v. Biden?
    vot tak , says: Show Comment May 20, 2020 at 4:54 am GMT
    Interesting article by Escobar. If one cares to notice, this anti-China cold war is a neocon based aggression. The primary movers of it are mostly neocons or the sorts who follow the neocon lead. China is one country the zionazi-gays have not been able to dominate. Coupled with China's economic rise and appeal to developing countries, these zionazi oligarchs are going apeshit trying to bring China down. In addition to other articles referenced in the article, see also this Global Time report:

    Chinese ridicule Trump's China 'cut-off' threat

    https://www.globaltimes.cn/content/1188437.shtml

    "Americans will suffer

    [MORE]
    "Again! Trump is talking nonsense." Trump seems to be losing his mind right now. Even he has such crazy ideas of cutting ties with China, US politicians, businessmen and Americans would not allow him to do so, Xin Qiang, deputy director of the Center for US Studies at Fudan University, told the Global Times.

    He noted that Trump is bluffing and acting tough toward China to win more support. Fox News, which has been regarded as Trump's defender and is notorious for a lack of professionalism, is also making eye-catching news to draw attention.

    Jin Canrong, the associate dean of Renmin University of China's School of International Studies in Beijing, told the Global Times on Thursday that Trump made very irresponsible and emotional remarks in the interview.

    "The China-US relationship is the most important bilateral relationship in the world and involves huge interests of the two countries, as well as the rest of the world. Therefore, it is not something he can cut off emotionally," Jin said.

    "If the US unilaterally cuts off ties, the American people will pay a heavier price than us, because China's domestic market is huge and 75-80 percent of Chinese manufacturers are supplying China's market, and the 2 to 5 percent that supply the US can also be absorbed by the domestic market," he noted.

    China has nothing to be afraid of as "in the past, we didn't solve the Taiwan question because we wanted to maintain the China-US relationship, and if the US unilaterally cuts it off, we can just reunify Taiwan immediately since the Chinese mainland has an overwhelming advantage to solve this long-standing problem."

    "Trump is like a giant baby on the brink of a meltdown as he faces tremendous pressure due to massive failures that caused such a high death toll," Shen Yi, an expert from Fudan University, told the Global Times. "It's like someone who wants to show his guts when he passes by a cemetery in midnight. He needs to shout to give himself the courage," he said.

    Shen also noted that the American companies and industries would suffer the most severe consequences, because the supply chain has been integrated with China.

    "The Chinese public would only take such bluffing as a joke," Shen said, adding that there has been no US president in the history who has made such a ridiculous statement against China, not even during the Cold War.

    Yuan Zheng, a research fellow at the Chinese Academy of Social Sciences (CASS), said he could not even remember any US leader who took a similar action. "His flip-flop rhetoric is unprecedented, but we need to take a look at whether Trump will take real action," he said, noting that there is no need to pay attention to claims that are unrealistic and meaningless.

    "For Trump, fantasy is power; bluffing is power, so he might use the future of his country to gamble with China. Although China always believes cooperation is the only right choice for the two countries to solve the problems together, if the US unilaterally and irrationally chooses all-out confrontation, China also needs to be prepared."

    Change that Matters , says: Show Comment May 20, 2020 at 5:11 am GMT
    @Godfree Roberts China's economy won't be firing on all cylinders by November, but the important parts of it will be. The manufacturers I talk to have weathered the worst of it, and their order books for Q4 are more or less back to what they were in January (or at least healthy enough to prevent soft skill losses). Many are upbeat about the future. (Not all of them will survive, and the ones that die probably should have done so years ago.)

    Compare this to the rest of Asia (Bangladesh, Pakistan, India, Cambodia, Myanmar, and others): they are a mess. Bangladesh put all its eggs in the huge volume low quality basket and will now pay a fatal price. Pakistan was dead before corona, and is now in a manufacturing death spiral. India has the capacity to succeed, but is hamstrung by a caste-based barbarism that has jettisoned all pretense of decency by throwing migrant workers in the informal economy to their deaths. This will not be forgotten and I predict years of trouble. The others only have a manufacturing sector because the Chinese moved their factories there. Vietnam has some chance, and should be a big winner as China moves out of low- to middle-end manufacturing.

    Countries in South America have lost their opportunity. China passed them by years ago. It's a tragedy, but they really have themselves to blame for it. And Africa, the last frontier, is already dominated by China (15 years ago I'd bump into Chinese businessmen who'd ship a 40-foot container of – 'insert any product you can think of' – to some back of beyond place in Africa and refuse to come home until everything was sold). They've moved up the ladder since then. Ethiopia, the fastest-growing economy on the continent, is essentially an industrial zone for Chinese manufacturing.

    Australia has become a mine/farm for China. New Zealand and Canada likewise, and a nice place to send your teenagers to get educated and perhaps for retirement.

    The EU, led by Germany, will be back on track soon. The winners here should be the former USSR countries, with low labor costs and strong soft skills. With EU companies wanting to bring the supply chain closer to home, this is their moment. If they screw it up, they will spend another 30 years wondering what went wrong. I hope they won't, but if you spend any time working with these people you know they often fail at the final hurdle (as though on purpose – the psychology of self-destruction is their Achilles heel).

    It's China's game to lose. And quite frankly, at this point, I don't see how. This has been in the making since the late 70s. Perhaps earlier. I admire them for their intelligence, their work ethic, their organizational capacity, their can-do spirit, and – yes – their creativity (if you think China is Japan in the 60s, you need to spend some serious time with younger Chinese in China).

    The Chinese problem is, of course, its culture of responsibility avoidance. But even with this issue, they are on track for a knockout victory. Most people in the West have no idea what going on, which is exactly how You Know Who likes it.

    I have no intention of letting my tribe be overrun by Chinese. But I have enough experience to know they're smarter than my tribe, and it would be a wise thing to start thinking more strategically and tactically about how to carve out a space in a new world most people are unable to imagine (which is less than 10 years away).

    Weston Waroda , says: Show Comment May 20, 2020 at 5:19 am GMT
    @Godfree Roberts

    The center of gravity of global economic power keeps moving, inexorably, toward Asia.

    it's game over

    While the U.S. spent recent decades policing the world in pointless wars, China was about the business of building an infrastructure in which all roads lead to Beijing, railroad cars and boatloads of wealth. Just keep it coming, folks. Those roads and railroads and shipping are linking nothing less than Eurasia, Sir Halford's World Island. It took this coronavirus to show the imperial subjects that the Empire is naked and that China had already surpassed it economically several years ago. It seems like it really is game over. I'm sad in a way, but I would rather have a normal country than a hegemon; that is, if normalcy is still a possibility.

    Bronze Age Persecutor , says: Show Comment May 20, 2020 at 5:35 am GMT
    What about the biggest hybrid war going on since centuries ago: jews (including crypto-jews, hybrids and minions) versus everybody else?
    The chinese had the full cooperation of diaspora jews (and their sayanim network) and israelis. Specially the Chabad Lubavich.
    Miro23 , says: Show Comment May 20, 2020 at 6:09 am GMT
    From the referenced Global Times article, the US attack on Huawei (with its 5G leadership + NSA proof encryption ) is at the heart of the story:

    Based on Global Times sources, if the US further pinches Chinese telecommunication giant Huawei by blocking companies such as TSMC from providing chips to the company, China will carry out countermeasures, such as including certain US companies into its list of "unreliable entities," imposing restrictions on or investigating US companies such as Qualcomm, Cisco and Apple, and suspending purchases of Boeing aircraft.

    The US would lose this fight. Apple for example manufactures in China with only a small percentage of the sales price staying in China. If Apple manufacturing is shut down then Apple is the big loser. They're already trying to move manufacturing to India but that's not going to work.

    We must be clear that coping with US suppression will be the key focus of China's national strategy. We should enhance cooperation with most countries. The US is expected to contain China's international frontlines, and we must knock out this US plot and make China-US rivalry a process of US self-isolation.

    China has plenty of alternative markets. US corporations mostly only sell to the US using (now very sophisticated) Chinese manufacturing. Take this away, and Apple for example, have no alternative supplier for the volumes, quality, sub-contractor network and export infrastructure required.

    General Qiao dismisses the possibility that Vietnam, the Philippines, Bangladesh, India and other Asian nations may replace China's cheap workforce: "Think about which of these countries has more skilled workers than China. What quantity of medium and high level human resources was produced in China in these past 30 years? Which country is educating over 100 million students at secondary and university levels? The energy of all these people is still far from being liberated for China's economic development."

    True.

    This will imply a concerted offensive, trying to enforce embargoes and trying to block regional markets to Chinese companies. Lawfare will be the norm. Even freezing Chinese assets in the US is not a far-fetched proposition anymore.

    If the US steals the $ trillions China has invested in US treasuries, then the US dollar also forfeits its claim to be the world reserve currency (safe place to hold international trade balances).

    Still, scores of nations are being asked, bluntly, by the hegemon to position themselves once again in a "you're with us or against us" global war on terror imperative.

    9/11 was fakery pumped up by the MSM to target Iraq/Iran and Covid-19 is more of the same – this time targeting China. European states are getting tired of this game. For example they were all dragged into supporting the Venezuela CIA coup that fizzled, and are now trying to disentangle from it.

    General Qiao counsels, "Don't think that only territorial sovereignty is linked to the fundamental interests of a nation. Other kinds of sovereignty – economic, financial, defense, food, resources, biological and cultural sovereignty – are all linked to the interests and survival of nations and are components of national sovereignty."

    If the US public look carefully at General Qiao's list they will realize that they have already lost more than 50% of these sovereignties.

    Anon [392] Disclaimer , says: Show Comment May 20, 2020 at 6:10 am GMT
    " General Qiao dismisses the possibility .. India and other Asian nations may replace China's c: "Think about which of these countries has more skilled "

    Everyday US. news are amplifying the bipartisan chorus against China . India is begging for favors from USA while serenading USA with reinforcing American position.

    India is stealing land from Nepal and Indian media thinks that ultranationalist of Nepal are to blame for questioning Indian stance .

    China is under a real threat of concerted attacks by the US 's opportunistic vassals. There will be a seismic change affecting the alliances and the future .
    Can China persuade Nepal Bangladesh Pakistan Sri Lanka Afghanistan Iran and Myanmar to work together and persuade them move out of India's hegemony ?.

    Natt , says: Show Comment May 20, 2020 at 6:42 am GMT
    Nice fluff piece. China is fucked. Demographically, economically and militarily.
    Carlos22 , says: Show Comment May 20, 2020 at 7:06 am GMT
    They are probably looking past Trump as they think he may not get back in.

    Nov is just a few months away.

    The question is what will the democrats do?

    Not that I particularly want that of course.

    carlusjr , says: Show Comment May 20, 2020 at 7:48 am GMT
    It's always astounding to read a geopolitical analysis by a journalist who completely ignores the climate pollution crisis with it's impending effects overhanging every strategy any state may envision to dominate the planet. It's as if the writer lives in an imaginary world devoid of nature, along with his supposed expert sources and well placed powerful state movers and shakers. This is delusional. China's cheap forced labor, making more crap for the planet's shrinking population of affluent consumers, competing with other countries with equally desperate workers. Countries competing to build the most dangerous bio-weapons in their unsafe, leaky level 4 labs. All the while the atmosphere is being polluted to the point of melting all the ice on the planet, the air is being degraded to the point of being disgusting to see and carcinogenic to breath, the fresh water supply is being depleted and polluted, the oceans degraded into radioactive chemical cesspools (soon to be a brown sludge inhabited by only bacteria, viruses and fungus), the land ceded with thousands of chemicals that have no purpose other than to kill. The existential threshold is within a few years. The geopolitical strategy of the US and China can be summarized as a strategy to kill all sentient life on the planet in order to have a some sort of imaginary strategic dominance. It is mass psychosis.
    Biff , says: Show Comment May 20, 2020 at 7:58 am GMT
    @anon

    Do you have any odds on Trump v. Biden?

    I've got 2 to 1 odds the voting machines will be electing Biden. They got this far didn't they?

    paranoid goy , says: Website Show Comment May 20, 2020 at 8:13 am GMT
    @foolisholdman Old man, don't be foolish, they all hate us human scum, and will gladly go to war, are at war. Remember how, in Catch 22, the opposing sides eventually saved a crap load of money by geting Milo de Milo to bomb their own airfields using his supply planes? Its already happening, us plebs are just in the way. In the end, the Protocols calls for one government ruling what's left of mankind "with an iron staff." I cannot tell you (yet) what Zion's hold on Beijing is, but be assured, "bring on the war" is the swill of Zion being lapped up by little globalist piggies trying to get to the trough.
    People think 'hybrid warfare" is some kind of technological term. Zion chooses its words very carefully, and your first defence is your dictionary. The USAGE of words change with time, the MEANING is constant. Now let's go find them hybrids, before Bill Gates can create enough microcephalics to man his man/machine interfaced battle 'droids armed with depleted uranium bullets and virally-delivered vaccines.
    paranoid goy , says: Website Show Comment May 20, 2020 at 8:28 am GMT
    @carlusjr Pollution sure is an important issue, one of the most important of our time, yes. The subject matter at hand though, is mostly military, with economics as a condiment to explain the sour taste. China might be the one manufacturing plastic turds, but it is the so-called western media that is teaching your children the dire need to own the latest version of plastic poop. China would not bother with plastic poop, but you voted for people who decided China makes the best poo at the lowest cost and highest profit. Don't blame China for taking advantage of YOUR leadership's desire to disown YOU and hand your habitat over to those who "know how to make a profit" from your suffering, while dangling a piece of plastic poop in front of you, calling it ambition, and deplatforming you if you refuse their offer of improved turdiness.
    But yah, now we know you hate pollution. Soon we will close down all the factories, and ban all cars, and only those on "official business" will be alowed on aeroplanes, and then you can breathe freely, as you stand in line, so the Special Agents can see if you have the Bill Gates vaccine licence to visit the plastic poop and soylent green depository that we used to call a supermarket.
    Buzz Mohawk , says: Show Comment May 20, 2020 at 9:04 am GMT

    A toxic racism-meets-anti-communism matrix is responsible for the predominant anti-Chinese sentiment across the US, encompassing at least 66% of the whole population.

    No it isn't.

    A hint of what is responsible is this from the same article:

    "They have state of the art technology, but not the methods and production capacity. So they have to rely on Chinese production."

    Our jobs, our industry, our hard-earned intellectual property, and our money have all gone to China. Our own leaders of industry and government are to blame for our predicament, but our anger at China is the result.

    Funny this from the Chinese General Qiao:

    "as a producing country, we still cannot satisfy our manufacturing industry with our own resources and rely on our own markets to consume our products."

    No kidding, General. Your country built itself up by selling to us! We made you into our own rival. Thanks are in order, but instead you plot to weaken us.

    Tor597 , says: Show Comment May 20, 2020 at 9:10 am GMT
    Just wanted to point out the excellent concept of cultural sovereignty as something that is akin to territorial sovereignty.

    Both are needed, but cultural sovereignty is ever more important to inoculate your citizens against globe homo.

    Half-Jap , says: Show Comment May 20, 2020 at 9:14 am GMT
    @Godfree Roberts Sounds like a man who has no understanding of the science regarding the matter, but so doesn't most of the world. Vaccine? Anti-body treatment? Does anybody know what they are and how they work (or doesn't) or mean? From those tests to those invasive ventilators, it shows me how people can easily be herded towards slaughter, for their safety, ofc, because "science." And just over a mild cold no less.
    So much for China's brilliance; they are as dumb or brainwashed by 'accepted science' as the next moronic authority figure.
    But exploiting the situation, that's something else that should be appreciated.
    anon [232] Disclaimer , says: Show Comment May 20, 2020 at 9:17 am GMT
    @Godfree Roberts

    China is leading

    Godfree, we will bury you and your beloved CCP.

    Wood Stove , says: Show Comment May 20, 2020 at 9:42 am GMT
    @carlusjr Ok Karen
    Adûnâi , says: Show Comment May 20, 2020 at 9:45 am GMT

    This will be China's contribution to ensuring vaccine accessibility and affordability in developing countries." The Global South is paying attention.

    Do the underdeveloped (hate the PC term "developing") countries even want a vaccine? They have too many people anyway, any moderate dying will be an advantage to their societies. And another point is that the anti-vaxxer movement there might be on the rise, just as it is in America – remember how the Philippines government was watching a conspiracy video about evil Bill Gates? I have talked to anti-vaxxer people in my Ukrainian university!

    "Containment" will go into overdrive. A neat example is Admiral Philip Davidson – head of the Indo-Pacific Command – asking for $20 billion for a "robust military cordon" from California to Japan and down the Pacific Rim, complete with "highly survivable, precision-strike networks" along the Pacific Rim and "forward-based, rotational joint forces" to counteract the "renewed threat we face from great power competition."

    My prediction is the US goes into a civil war > the liberals start losing > the liberals invite the Chinese into California > the Chinese exterminate all Americans and get a large Lebensraum in the East.

    Anon [397] Disclaimer , says: Show Comment May 20, 2020 at 9:50 am GMT
    a Korea War pictorial. Nice.
    It's long long ago since China made the last movie about Korea War. Too long ago that they are in black and white.
    Recently someone is preparing for a new movie: The Chosin Lake.
    I really hope it will be well made. I love war movies, especially the ones on historical big wars.
    Just Passing Through , says: Show Comment May 20, 2020 at 10:13 am GMT
    @Natt I think you are mistaken and are describing America.
    Just Passing Through , says: Show Comment May 20, 2020 at 10:28 am GMT
    @Buzz Mohawk I think the Western globalists though that China would be subservient to them and not get any funny ideas, this virus is just a cover for antipathy that was building up for years, similar to how the poor Jews being persecuted in Germany was used by propagandists to whip up Germany sentiment, because of German economic prowess.

    Western thinking is dominated by this balance of power mentality, the same mentality such caused it to enter into two fratricidal wars not too long ago.

    One can only hope this is good news for us, but I fear the globalists will just use this time to move manufacturing to other Third World countries instead of bringing it back home.

    I agree that it was a huge mistake transferring our IP to China, they would simply have not got to this point if we hadn't. This is also why the Chinese are not taking any chances in their BRI, and are using Chinese labour instead of doing the more sustainable thing and training up local workers, that would mean a destruction of their market! Sadly this will continue, on top of the terrible policy of mass Third World immigration, we let Chinese into out top companies and research facilities, some of whom no doubt pass this information back home.

    https://time.com/5596066/emory-fires-chinese-researchers/

    In terms of realpolitik, I think it is very smart that China is using its diaspora as a fifth column.

    padre , says: Show Comment May 20, 2020 at 10:36 am GMT
    @Natt Do you know, how many times in their short history of about roughly 5000 years were Chinese doomed ?
    Really No Shit , says: Show Comment May 20, 2020 at 10:50 am GMT
    So the Global South is going to be "grateful" to China for coming up with vaccination after innudating it with the Chinese virus in the first place Pepe, lay of the Mezcal because is clouding your opaque thinking!
    John Hagan , says: Show Comment May 20, 2020 at 11:07 am GMT
    Let me make this clear. America is self-destructing. A malignant narcissist in charge and a man who cannot construct a sentence is an alternative. A stock market devoid of reality and a 1 percent devoid of conscience. Any remote consideration of the other 99 percent is soley based on profit. Any civilization that cannot reverse itself is doomed. China maybe a shortterm factor yet not a factor in the longer considerations.
    Avery , says: Show Comment May 20, 2020 at 11:10 am GMT
    @foolisholdman {Honestly, I don't see it.}

    Agree.

    { .. and the US has no guts for one. Its industry has been hollowed out not just by outsourcing but by corruption as well.}

    Even in the 50s when US industry was not hollowed out ( ran supreme) and China had no nukes, US was unable to defeat China in a ground war in Korea. Of course there was talk in US of using nukes against China (Gen. MacArthur), but cooler heads prevailed, arguing that, that would trigger USSR to use nukes too, resulting in world wide nuclear conflagration.

    Now China has nukes, and delivery systems, and US cannot possible defeat China conventionally, so US will huff-and-puff, try to damage China financially, or steal its holdings in US*, but nothing will come out of it.

    Sad that US screwed itself over the years so badly that it is in this predicament now.

    _____________________________
    * There has been semi-serious talk in US of just taking $ hundreds of billions of Chinese holdings in US as payment for ' damages' China has supposedly caused US by Covid-19.

    Big Daddy , says: Show Comment May 20, 2020 at 11:28 am GMT
    All this big nation state fluff stinks today as it did when the first two Western ones, England and France had a 100 Years War and it has stunk throughout history.

    We humans are born naked, helpless, and totally ignorant. We also have an evil streak in us; vide Adam and Eve. And as Shakespeare stated we must consign ourselves to a willing death each eve or we die. We are so haughty yet the first thing we must do upon wakening from our nightly death is evacuate waste.

    We have never respected Nature. Now we spray aluminum and plastic microns in the upper atmosphere which we all breathe as they fall and have virtually destroyed the ozone layer and the biosphere. We live in 1984 right now!

    True libertarianism which is no aggression against person or property and backed up by cheap, Natural Law arbitration courts works. It is that or sayonara humans.

    Realist , says: Show Comment May 20, 2020 at 11:42 am GMT
    @Natt

    Nice fluff piece. China is fucked. Demographically, economically and militarily.

    Is that you Trump?

    You're new around these here parts aren't you boy?

    Parfois1 , says: Show Comment May 20, 2020 at 11:45 am GMT
    @foolisholdman

    My reasoning is simple, maybe too simple. The Chinese will not start a shooting war and the US has no guts for one.

    You may be right about the Chinese (their government looks after 1,3 billion people) and that the US has no guts. But what is the "US"? If you mean the (mostly Jewish) ruling cabal and their goyim political clowns and puppets, you have no reason to be so sanguine about the "no guts". It's not their guts that will be on the line, for they will be quite happy so sacrifice millions of the plebes for the greater good of Israel and rebooting the "economy". War devastations (and pandemics) are the greatest source for immiserating and culling the masses and channeling wealth to the banksters.

    Facing the demise of the Jewish-led hegemony through its PNAC's "full-spectrum dominance" – and what that could do to the SHITIS (shit-state of Israel) – it is reasonable (in their twisted minds) to step to the brink and beyond. Besides, the most recent great wars (the greatest carnages in the world's history) were not intended to end the way the warhawks wanted (neither Hitler not Chamberlain wished the destruction of country or empire) but the power dynamics unleashed by geopolitical gamesmanship suppresses reason.

    JohnPlywood , says: Show Comment May 20, 2020 at 11:49 am GMT
    @paranoid goy Non-CO2 pollution is a non-issue. It was far worse in the USA and China 50 years ago (air and water), and in Europe/East coast USA over 200 years ago. Wildlife populations are also rebounding. Every time I hear some retard complaining about pollution on the internet, I want to reach through the monitor and pepper spray them.
    bigduke6 , says: Show Comment May 20, 2020 at 11:52 am GMT

    A toxic racism

    You're a "toxic racist" cries the yellow supremacist as he shills for Beijing

    GeeBee , says: Show Comment May 20, 2020 at 12:05 pm GMT
    @Natt In other news, the USA's Ministry of Plenty has announced that the weekly chocolate ration is to be increased from 70 gms to 40 gms
    ld , says: Show Comment May 20, 2020 at 12:19 pm GMT
    @d dan The American Dream is Live and well.

    If they keep saying it like a mantra maybe it will come true.

    Trust the media.

    ld , says: Show Comment May 20, 2020 at 12:25 pm GMT
    @anon They say that Biden is Israel's pick so it will likey be Biden.
    His senility will make him easier to control than Trump.
    Desert Fox , says: Show Comment May 20, 2020 at 12:37 pm GMT
    The zionists are in control of China and the ZUS and Russia and Europe and India and everywhere in central and South America, and the fact is the zionist control was proven by every country that forced their people into the forced lockdown, using this scam of a coronavirus as an excuse.

    These wars are a deversion, as the zionist install their global prison.

    AWM , says: Show Comment May 20, 2020 at 1:16 pm GMT
    "When will the Communist "clenched fist" attack America?"

    Stanislav Lunev: "As soon as they can't steal from you anymore."

    Guess what folks, the "Combloc Flu" was the first strike.

    450.org , says: Show Comment May 20, 2020 at 1:31 pm GMT

    General Qiao dismisses the possibility that Vietnam, the Philippines, Bangladesh, India and other Asian nations may replace China's cheap workforce: "Think about which of these countries has more skilled workers than China. What quantity of medium and high level human resources was produced in China in these past 30 years? Which country is educating over 100 million students at secondary and university levels? The energy of all these people is still far from being liberated for China's economic development."

    Once again, I must caveat this with the proclamation I was not and I am not an advocate for Obama's TPP. The reason I'm not an advocate is for environmental purposes. I believe growth is killing the living planet and soon enough will extinct humans as well as many, most even, other species on the planet. The TPP did nothing to address growth and instead enabled it further by enhancing global trade versus diminishing it.

    That being said, the TPP was a strategy to contain China's growing influence. It was intended to put global trade eggs in many baskets and not just in the basket labeled China. What does Trump do? He puts all the trade eggs in China's basket under the aegis/rubric of repatriating manufacturing to America. He put a knife in TPP and killed it but he never brought manufacturing back to America. Now America is truly good and fucked. Over a barrel. No options. Can you believe this moron and the cabal that's using him as a foil? Like I said before, if Trump didn't exist, the CCP would have to invent him because more than any other power player, be it Russia or Saudi Arabia or Israel, Trump has been extremely beneficial to China. Under Trump's watch, China is now the most powerful country in the world. Because of Trump, China is now the leader of the world. America, finally, has been knocked from its perch just as England was over 100 years prior. Once knocked from the perch, there is no regaining the status you once enjoyed. I suspect that within five years the dollar will no longer be the world's currency. When that happens, it's lights out for America FOR REAL. All this banter is whistling past the graveyard. What's done is done.

    https://www.japantimes.co.jp/opinion/2015/06/21/commentary/japan-commentary/chinas-the-reason-why-u-s-needs-the-tpp/#.XsUuMS-z17M

    House Democrats who've been interfering with President Barack Obama's ability to negotiate the Trans-Pacific Partnership are missing something very important: The trade deal isn't primarily significant because of the economy. It matters because it's part of the broader American geostrategic goal of containing China -- which pointedly hasn't been invited to join the TPP.

    In the new cool war, China's rising economic influence is giving it greater geopolitical power in Asia. The TPP is, above all, an effort to push back on China's powerful trade relationships to reduce its political clout. By weakening Obama's ability to pursue it, congressional Democrats had been unintentionally weakening the U.S. side in the cool war.

    In all this, China is using its close economic relationship with its neighbors as leverage to build its geopolitical position. Its ultimate goal is to displace the U.S. as the regional hegemon. President Xi Jinping's slogan of the "Chinese dream" requires nothing less.

    The TPP aims to reduce some of China's geopolitical resurgence by damping down the extent of China's regional trade dominance. China itself has a proposed regional trade alliance, the Regional Comprehensive Economic Partnership, that would include 16 members and exclude the U.S. Australia, Japan and South Korea are all involved in negotiations to become members. The TPP is a direct, competitive counterpart to the RCEP.

    Fyi, the following cartoon is per China Daily , a publication owned and run by the CCP. It's favorable to Trump. It's clear by virtue of Trump's cozy relationship with Putin and Xi that Trump is a communist in capitalist clothing. He is a communist trojan horse in the oval office. But he's even more than that. He has many hats. He's a tool, a self-promoting front man, for any tyrant or tyranny that expands his brand masquerading as a man of the people. As if. He's a man, albeit an insane moron, of the extractive elite and the extractive elite are transnational and transcultural. The extractive elite are a nation and culture unto themselves and the rest of us are their slaves on this global plantation.

    Astuteobservor II , says: Show Comment May 20, 2020 at 1:34 pm GMT
    @Weston Waroda Once reserved currency status of dollar is over n done with, there would be zero need for the huge military budget. That is the silver lining of this whole thing. The wars might finally stop. But living standards will take a hit from the devaluation of the dollar. But but, Jobs would return through that weakened dollar as off shoring jobs would no longer make sense. And just maybe, our political class might finally focus on domestic issues and improve the country after 4 decades of stagnation.
    Astuteobservor II , says: Show Comment May 20, 2020 at 1:38 pm GMT
    @Miro23 Apple follows every single law in China. Apple makes a lot of money in China, but also pays alot of taxes. I highly doubt it would be a target of retaliation. But other companies are fair game. Just something I noticed.
    450.org , says: Show Comment May 20, 2020 at 1:47 pm GMT
    @carlusjr Spot on. Humans are drowning in their own filth. There's an adage, "don't shit where you eat." Humans invented the saying but apparently don't abide by it and in fact zealously defy it. Here we are. It will be one pandemic after another from now until human is no more. Rapid pace, like automatic weapon fire. The center cannot hold and is not holding. Civilization is going down. Will the Samson Option be utilized? Man's last act? Destroy the planet entirely if he can't have it entirely? My bet is this is how it will go down. All you have to do is extrapolate the curve.
    Sick of Orcs , says: Show Comment May 20, 2020 at 1:51 pm GMT
    As long as America's Most Important Ally™ is safe
    Cowboy , says: Show Comment May 20, 2020 at 1:54 pm GMT
    Another bubblegum pop song from Lil Peepee and the chinks
    Just Passing Through , says: Show Comment May 20, 2020 at 1:59 pm GMT
    @bigduke6 It is quite obvious why they are doing, they are using Europeans' own liberal ideology against them. In today's Western world, nothing is worse than being a "racist" (except maybe, just maybe a paedophile necrophiliac, but even that is a close one) as such they will use these terms to beat down Europeans. Erdogan recently likened Greece to "Nazis", due to their brave defiance to Third World invaders.

    https://www.theguardian.com/world/2020/mar/11/erdogan-compares-greek-border-crackdown-to-nazi-atrocities

    As if they genuinely give a shit about Nazis, a particularly European obsession due to decades of brainwashing by the Jewish media elite. Even if one believes the textbooks in relation to Nazi atrocities, the fact is that such things are normal for history. No other people's beat themselves down over bad stuff they've done, hell, the Mongolians have erected a big statue of Genghis Khan, one of the greatest mass murderers in history!

    Hegar , says: Show Comment May 20, 2020 at 2:07 pm GMT
    Extremely misleading headline. Since the Asia Times story is actually about economic and political sovereignity – always a big issue for China ever since the Eight Powers carved up the nation in the past: Germany, Japan, Russia, Britain, France, Italy, Austria-Hungary, and the U.S.

    It doesn't speak about warfare against the U.S. It speaks about meeting a threat from the U.S. It does speak of taking Taiwan, though by avoiding outright warfare. This is not something we should desire, but it is not war against the U.S., as the misleading headline is intended to make people believe.

    As usual most of the rubes will only read the headline and look at the pictures, maybe skim through the text a bit, before typing out an angry post based on whether they like or dislike whatever nation is mentioned. Much like cruzbots and Bush lovers use Breitbart comments to screech against Iran and praise Israel. No facts needed.

    [May 20, 2020] China Updates its 'Art of (Hybrid) War'

    Notable quotes:
    "... An example, referring to Covid-19, is the capacity to produce ventilators: "Out of over 1,400 pieces necessary for a ventilator, over 1,100 must be produced in China, including final assembly. That's the US problem today. They have state of the art technology, but not the methods and production capacity. So they have to rely on Chinese production." ..."
    "... The gold standard expression has come in a no-holds barred Global Times editorial : "We must be clear that coping with US suppression will be the key focus of China's national strategy. We should enhance cooperation with most countries. The US is expected to contain China's international front lines, and we must knock out this US plot and make China-US rivalry a process of US self-isolation." ..."
    "... An inevitable corollary is that the all-out offensive to cripple Huawei will be counterpunched in kind, targeting Apple, Qualcom, Cisco and Boeing, even including "investigations or suspensions of their right to do business in China." ..."
    "... So, for all practical purposes, Beijing has now publicly unveiled its strategy to counteract U.S. President Donald Trump's "We could cut off the whole relationship" kind of assertions. ..."
    "... The politicians controlling US foreign policy are leading us straight into the 19th century, with their updated gunboat diplomacy ..."
    May 20, 2020 | consortiumnews.com

    Dancing with Wolves

    The bulk of his argument concentrates on the shortcomings of U.S. manufacturing: "How can the US today want to wage war against the biggest manufacturing power in the world while its own industry is hollowed out?"

    An example, referring to Covid-19, is the capacity to produce ventilators: "Out of over 1,400 pieces necessary for a ventilator, over 1,100 must be produced in China, including final assembly. That's the US problem today. They have state of the art technology, but not the methods and production capacity. So they have to rely on Chinese production."

    ... ... ...

    Gloves Are Off

    Now compare General Qiao's analysis with the by-now-obvious geopolitical and geo-economic fact that Beijing will respond tit for tat to any hybrid war tactics deployed by the United States government. The gloves are definitely off.

    The gold standard expression has come in a no-holds barred Global Times editorial : "We must be clear that coping with US suppression will be the key focus of China's national strategy. We should enhance cooperation with most countries. The US is expected to contain China's international front lines, and we must knock out this US plot and make China-US rivalry a process of US self-isolation."

    An inevitable corollary is that the all-out offensive to cripple Huawei will be counterpunched in kind, targeting Apple, Qualcom, Cisco and Boeing, even including "investigations or suspensions of their right to do business in China."

    So, for all practical purposes, Beijing has now publicly unveiled its strategy to counteract U.S. President Donald Trump's "We could cut off the whole relationship" kind of assertions.

    A toxic racism-meets-anti-communism matrix is responsible for the predominant anti-Chinese sentiment across the U.S., encompassing at least 66 percent of the whole population. Trump instinctively seized it – and repackaged it as his re-election campaign theme, fully approved by Steve Bannon.

    The strategic objective is to go after China across the full spectrum. The tactical objective is to forge an anti-China front across the West: another instance of encirclement, hybrid war-style, focused on economic war.

    This will imply a concerted offensive, trying to enforce embargoes and trying to block regional markets to Chinese companies. Lawfare will be the norm. Even freezing Chinese assets in the U.S. is not a far-fetched proposition anymore.

    Every possible Silk Road branch-out – on the energy front, ports, the Health Silk Road, digital interconnection – will be strategically targeted. Those who were dreaming that Covid-19 could be the ideal pretext for a new Yalta – uniting Trump, Xi and Putin – may rest in peace.

    "Containment" will go into overdrive. A neat example is Admiral Philip Davidson – head of the Indo-Pacific Command – asking for $20 billion for a "robust military cordon" from California to Japan and down the Pacific Rim, complete with "highly survivable, precision-strike networks" along the Pacific Rim and "forward-based, rotational joint forces" to counteract the "renewed threat we face from great power competition."

    Davidson argues that, "without a valid and convincing conventional deterrent, China and Russia will be emboldened to take action in the region to supplant U.S. interests."

    ... ... ...

    From the point of view of large swathes of the Global South, the current, extremely dangerous incandescence, or New Cold War, is mostly interpreted as the progressive ending of the Western coalition's hegemony over the whole planet.

    Still, scores of nations are being asked, bluntly, by the hegemon to position themselves once again in a "you're with us or against us" global war on terror imperative.

    ... ... ...

    For the first time in 35 years, Beijing will be forced to relinquish its economic growth targets. This also means that the objective of doubling GDP and per capita income by 2020 compared with 2010 will also be postponed.

    What we should expect is absolute emphasis on domestic spending – and social stability – over a struggle to become a global leader, even if that's not totally overlooked.

    ... ... ...

    Internally, Beijing will boost support for state-owned enterprises that are strong in innovation and risk-taking. China always defies predictions by Western "experts." For instance, exports rose 3.5 percent in April, when the experts were forecasting a decline of 15.7 percent. The trade surplus was $45.3 billion, when experts were forecasting only $6.3 billion.

    Beijing seems to identify clearly the extending gap between a West, especially the U.S., that's plunging into de facto New Great Depression territory with a China that's about to rekindle economic growth


    Zhu , May 20, 2020 at 00:34

    "A toxic mixture of racism and anti-communism" sounds about right. The Chinese government is not submissive and the "Chinks" are getting too prosperous. That's bound to infuriate both elite and grass-roots Americans.

    Drew Hunkins , May 20, 2020 at 00:34

    "For the first time in 35 years, Beijing will be forced to relinquish its economic growth targets. This also means that the objective of doubling GDP and per capita income by 2020 compared with 2010 will also be postponed. "

    Good, good, just wonderful. This will really endear the United States to the Chinese people.

    All that the Chinese govt did for its people over the last 30 years is totally eliminate poverty, that's all. Gotta love how our Western mass media won't shut their mouths about this small achievement.

    Drew Hunkins , May 20, 2020 at 00:15

    "Those who were dreaming that Covid-19 could be the ideal pretext for a new Yalta – uniting Trump, Xi and Putin – may rest in peace."

    Rest in peace, no doubt. Washington is all about unilateralism, period. This is the crux of the issue, the rapacious capitalist-imperialists who infest Wall St, the military contractors and corporate mass media want nothing to do with a multi-polar world. This could lead to putting the far east on a dangerous path with U.S. warships provocatively traversing the area.

    gcw , May 19, 2020 at 21:08

    The politicians controlling US foreign policy are leading us straight into the 19th century, with their updated gunboat diplomacy . Never a thought to the impending disaster of climate change and unparalleled social and environmental chaos, they dream instead of yet another Cold War (Yellow-Peril 2.0), all the time sustaining a gargantuan military establishment which is draining the life-blood from American society. The Covid-19 virus is just a warning to us: we have about 5% of the world's population, yet lead the pack in deaths from the virus. If this monumental display of incompetence doesn't wake us up, what will?

    [May 20, 2020] The best argument I have read from the anti China camp has been that if China succeeds, US dollar will be kaput, living standard in the USA will tanked

    May 20, 2020 | www.unz.com

    ,

    Ann Nonny Mouse , says: Show Comment May 6, 2020 at 9:33 pm GMT
    @utu ... He produces evidence, evidence in response to highly-coordinated anti-China propaganda, the mountains of belligerent lies that are all that remain today of the failed state the USA. Those lies plus its military killing millions all over the world, incessantly destroying or attempting to destroy states simply for being independent.

    Enormous thanks to Godfree Roberts.

    Realist , says: Show Comment May 6, 2020 at 10:49 pm GMT
    @Astuteobservor II

    The best argument I have read from the anti China camp has been that if China succeeds, US dollar will be kaput, living standard in the USA will tanked to shit levels compare to right now.

    Why would China succeeding reduce our living standard?

    Realist , says: Show Comment May 6, 2020 at 11:07 pm GMT
    @Ron Unz

    Well, American propaganda is certainly vastly superior to the Chinese variety

    American propaganda is certainly more effective but that is because of the stupidity of most Americans.

    Yes the video is accurate and that means the Chinese know us well much better than we know them.

    Astuteobservor II , says: Show Comment May 6, 2020 at 11:13 pm GMT
    @Realist If China succeeds, that means dollar as reserve currency is kaput. Without the reserved currency status, dollar will devalue by 50% or more. Living standard auto lowers by 50% or more.

    [May 18, 2020] A new way to make America great

    May 18, 2020 | www.moonofalabama.org

    JC , May 17 2020 20:31 utc | 28

    Just a thought: what if people like Gordon Guthrie Chang, Jennifer Zeng, Peter Navarro or even Maria Bartiromo suggest to the two dude Trump and Pompeo sending FBI, CIA agents or even national guard to American's rural areas, small isolate farming communities in Pennsylvania, Oregon ripping off every Huawei and ZTE hardwares 2G, 3G, 4G and maybe 5G if any, cell towers and replaced it with Ericsson and Nokia. Would it make America great again ?

    [May 17, 2020] TSMC a Taiwan chip's foundry not permitted to sell any chips to Huawei

    May 17, 2020 | www.moonofalabama.org

    JC , May 17 2020 18:03 utc | 16

    Almost every freaking day Trump and Pompeo bashing China including Huawei.. Not a day of peace without china bashing.

    Days earlier ZeroHedge, SCMP and other media reported freaking Trump and Pompeo... no companies inside or outside USA can sell American software or technology items or chips made with USA properties or machines to Huawei.

    Meaning TSMC a Taiwan chip's foundry not permitted to sell any chips to Huawei, TSMC has been the world's dedicated semiconductor foundry. "curtailing its chip supply, an escalation of its campaign against the Chinese company that may also hurt Taiwan Semiconductor Manufacturing Co."

    "China has the most fab projects in the world.... 30 facilities planned, including 10/7nm processes, but trade war and economic factors could slow progress...... SMIC 's move would put it on par with some of its foreign rivals. In addition, SMIC has obtained $10 billion in funding to develop 10nm and 7nm. Semiconductor Manufacturing International Corporation (SMIC) is a publicly held semiconductor foundry company, and the largest in China.

    "Wuhan Hongxin Semiconductor Manufacturing (HSMC), a logic IC foundry founded in late 2017, is gearing up for 14nm and 7nm process manufacturing eyeing to be China's most advanced contract chipmaker.....Shang-yi Chiang, the former executive VP and co-chief operating officer overseeing R&D for Taiwan Semiconductor Manufacturing Company (TSMC), will join a Wuhan-headquartered foundry in China. "<

    [May 17, 2020] India can serve as the USA ally in US-china trade war

    May 17, 2020 | astutenews.com

    BRICS Is Broken

    Gone are the "good 'ole days" of BRICS bonhomie when the Alt-Media Community used to sing the praises of this nascent trade bloc and portray it as a game-changing development in International Relations. Although promising on paper, BRICS was always destined to be disappointing due to the irreparable differences between India and China that were either downplayed or outright ignored by this organization's loudest advocates. The author has been consistently warning for over the past four years that " India Is Now An American Ally " after it clinched the Logistics Exchange Memorandum Of Agreement (LEMOA) with the US to allow the latter to use its military infrastructure on a case-by-case "logistical" bases. Since then, India has fully submitted to the Pentagon's "Indo-Pacific" strategy of empowering the South Asian state as a "counterweight" China, with even Russian Foreign Minister Lavrov loudly warning his country's strategic partner of the pitfalls of this scenario as recently as early January of this year while speaking at a conference in their country.

    Modi's Military Madness

    Alas, whether due to long-lasting ignorance of the situation, unchecked professional incompetence, and/or shadowy motives that can only be speculated upon, the majority of the Alt-Media Community still refuses to recognize these facts, though the latest developments pertaining to Indian-Chinese relations might finally cause them to reconsider their inexplicable stance of always "covering up" for New Delhi. India has recently clashed with China along the Line of Actual Control (LAC) in Indian-Occupied Kashmir 's Ladakh region and close to the Donglang Plateau (described as "Doklam" by India and thus widely reported upon with this name in the Western Mainstream Media and among the members of the Alt-Media Community sympathetic to New Delhi) near Sikkim where they had their infamous three-month-long standoff in summer 2017 (which threatened to repeat itself in 2018). So tense has the situation become in Ladakh that China reportedly flew several helicopters near the scene while India flew a few fighter jets, significantly upping the ante.

    India's Attempt To "Poach" Chinese-Based Companies

    The backdrop against which these clashes are transpiring is India's aggressive attempt to "poach" foreign companies from the People's Republic, which the author analyzed last month in his piece about how " India's Selective Embrace Of Economic Nationalism Has Anti-Chinese Motivations ". Of relevance, India has also set aside land twice the size of Luxembourg for such companies to exploit in the event that they decide to re-offshore from the East Asian state to the South Asian one.

    This perfectly dovetails with Trump's " trade war " plans to encourage foreign companies to leave his country's rival and either return home or set up shop in a friendly pro-American country instead. Of note, India is also vehemently opposed to China's Belt & Road Initiative ( BRI ) behind the US on the basis that its flagship project of the China-Pakistan Economic Corridor ( CPEC ) traverses through territory that New Delhi claims as its own per its maximalist approach to the Kashmir Conflict . Obviously, the US couldn't have found a better ally than India to thwart China's economic plans.

    The US Might Rule The WHO Via Its Indian Proxy

    On the soft power front, India is slated to assume leadership of the World Health Assembly (WHA, the governing body of the World Health Organization, WHO) from Japan later this month, and it's already being widely speculated in Indian media that the country might be seriously considering taking the US' side in respect to investigating the WHO for its alleged pro-Chinese bias . Not only that, but India might even be receptive towards Taiwan's request to participate in the organization's meetings, the scenario of which has already concerned China so much that its embassy in New Delhi felt compelled to remind the Indian leadership that doing so would violate the One China principle. From the American perspective, this is an unprecedented opportunity for Washington to exercise proxy leadership of the WHO through its "junior partner" of India, which could add a speciously convincing degree of credibility to its anti-Chinese claims in an attempt to win back the many hearts and minds that it's lost to its rival throughout the course of World War C .

    The Indo-American Hybrid War On China

    Taken together, India is indisputably intensifying its American-backed Hybrid War against China as a sign of fealty to its new ally, especially considering that it's only officially been the US' " comprehensive global strategic partner " since Trump's landmark visit to the country a few months back in February and thus feels like it has something to prove. Both countries share the grand strategic goal of "containing" China, to which end they're working hand-in-glove with one another to carry out this concerted campaign against the People's Republic.

    Building off of the idiom, the American hand is unquestionably controlling the Indian glove after Trump cracked the whip on Modi by forcing him to export hydroxychloroquine to the US last month, which asserted his country's dominance as India's neo-imperial master. Whether across the military, economic, or soft power domains, the US-Indian alliance is doing its utmost to create serious difficulties for China. With India now suspecting China of building an island off of its coast, ties will likely continue to worsen to the US' benefit.


    By Andrew Korybko

    Source: One World

    [May 15, 2020] China Ready To Target Apple, Qualcomm, Cisco and Boeing in Retaliation Against US' Huawei Ban - Slashdot

    May 15, 2020 | apple.slashdot.org

    An anonymous reader shares a report: China is ready to take a series of countermeasures against a US plan to block shipments of semiconductors to Chinese telecom firm Huawei , including putting US companies on an "unreliable entity list," launching investigations and imposing restrictions on US companies such as Apple and suspending the purchase of Boeing airplanes, a source close to the Chinese government told the Global Times. The Trump administration on Friday moved to block shipments of semiconductors to Huawei from global chipmakers. The US Commerce Department said it was amending an export rule and the Entity List to "strategically target Huawei's acquisition of semiconductors that are the direct product of certain US software and technology," according to a statement on its website. "China will take forceful countermeasures to protect its own legitimate rights," if the US moves forward with the plan to bar essential suppliers of chips, including Taiwan-based TSMC, from selling chips to the Chinese tech giant, the source told the Global Times in an exclusive interview.


    Brain-Fu ( 1274756 ) , Friday May 15, 2020 @02:58PM ( #60064610 ) Homepage Journal

    All chips have backdoors. ( Score: 5 , Insightful)

    Every hardware vendor has clear and strong incentives to bake backdoors into their hardware. The only difference is to whom they are loyal.

    sehlat ( 180760 ) , Friday May 15, 2020 @02:20PM ( #60064454 )
    Universal Rule of Economic Warfare ( Score: 1 )

    Both sides lose ... BIG.

    bodog ( 231448 ) writes:
    Re: ( Score: 1 )

    BIGLY. tftfy.

    UnknowingFool ( 672806 ) , Friday May 15, 2020 @02:45PM ( #60064558 )
    Re:Universal Rule of Economic Warfare ( Score: 3 )

    Well people on both sides lose. The leaders on both sides do not lose as much. Concisely Put.

    Alain Williams ( 2972 ) writes: < [email protected] > on Friday May 15, 2020 @02:31PM ( #60064502 ) Homepage
    Is anyone surprised ? ( Score: 5 , Interesting)

    China will also put a lot of money into making things that it has, up to now, obtained from the USA. It might take a few years, but China's government set up (ie one party always in power) means that it does not have to do things to an electoral cycle.

    [May 14, 2020] The USA fake democracy vs inverted totalitarism with Chinese characteristics

    Notable quotes:
    "... Sad but true. We are all given our illusions. In US its the illusion of democracy which is a fake democracy cloaking our totalitarian reality. In China they give the people the illusion of moving towards socialism, a fake socialism to be sure, never mind all the billionaire party members (and they don't have universal health care either, its insurance based) .The people have long accepted the reality of totalitarianism so they are one step ahead. ..."
    May 14, 2020 | www.unz.com

    Pft , says: Show Comment May 14, 2020 at 6:41 am GMT

    Sad but true. We are all given our illusions. In US its the illusion of democracy which is a fake democracy cloaking our totalitarian reality. In China they give the people the illusion of moving towards socialism, a fake socialism to be sure, never mind all the billionaire party members (and they don't have universal health care either, its insurance based) .The people have long accepted the reality of totalitarianism so they are one step ahead.

    Since China doesn't have another party to blame they must blame external enemies like the US and we happily play along with tarrifs paid for by us dumb sheep who cry out in satisfaction "take that". Lol

    A fake Cold War works for us too. Trump says we are in a race for 5G and AI/Robotics with China. We must win or all is lost to China. Social credit scores, digital ID and digital currency along with Total Information Awareness and Full Spectrum Dominance over the herd.

    Health effects of 5G will be blamed on CoVID. Fake Science is a great tool. Scientists never lie, they can be trusted, just like Priests . They are the Priests of the New Technocratic World Order. Global Warming and COVID- We must believe. They say Vaccines and 5G are good for you, just like DDT and Tobacco were said to be Good by Scientists of another time. We must believe. Have Faith and you will earn social credit bonus points.

    Reality is Fake Wrestling. Kayfabe all the way baby. Who is the face and who is the heel? We are free to choose. So who says we don't have freedom?

    [May 14, 2020] If we discard xenophobia, China is not natural ally of the USA

    But it was natural target of offshoring manufacturing during neoliberal globalization frenzy. Now the USA needs to pay the price for the betryal of its elite.
    Notable quotes:
    "... China is not a natural ally of the US. It was helped for decades as a counterweight to the USSR and that policy continued after the Cold War ended because the Western elite reaped vast profits from the entry of a billion Chinese into the world labour markets. We have created a monster of arrogance and economic dynamism that refuses to take measures against novel coronaviruses springing out of their peculiar eating and aphrodisiac medicine habits. ..."
    May 14, 2020 | www.unz.com

    Sean , says: Show Comment May 14, 2020 at 6:22 am GMT

    The USA is under no obligation whatsoever to be friendly to Russia, and especially not to China which rather owes America for everything and has repaid it in death. Capital and technology has flowed to China from America for decades. In return they sent profit to Wall St, Wuhan made Fentanyl the death of choice for whites desperate as a result of the policies that made China did so well out of, and now they send us a deadly epidemic.

    RussiaGateRussiaGateRussiaGateChinaDidItChinaDidItChinaDidItIranIsEvilIranIsEvil

    China is not a natural ally of the US. It was helped for decades as a counterweight to the USSR and that policy continued after the Cold War ended because the Western elite reaped vast profits from the entry of a billion Chinese into the world labour markets. We have created a monster of arrogance and economic dynamism that refuses to take measures against novel coronaviruses springing out of their peculiar eating and aphrodisiac medicine habits.

    It was coffee made from beans taken from civet faeces that led to the SARS-CoV bat/ civet recombination virus and the 2002 Sars outbreak, during which China lied about what was happening as they subsequently admitted. The SARS-CoV 2 receptor-binding domain from pangolins ( world's most trafficked animal, is in demand by Chinese as a male enhancer) and it recombined with a bat virus was hundreds of times more effective a pathogen in humans than the one from bat–civet recombination of eighteen years ago.

    But that is not what the Chinese said. Researchers in Wuhan on December 31st told the world about the Wuhan disease having been identifies as a coronavirus but said, 'It's not highly transmissible'. As late as the the 24th of January, Doctor Fauci w gave a briefing for senators in which he said there was very little danger to the US from the Wuhan disease. Later that day he repeated that opinion at a press conference.

    So China said it was not infectious between people and there was nothing much to worry about. When Trump began to restrict travel into the US from China on the 31st January there was uproar about this supposed further evidence of his xenophobia,.

    [May 14, 2020] How Beijing will respond to the anti-China fervor sweeping the US by Sam Bresnick & Lucas Tcheyan

    May 13, 2020 | responsiblestatecraft.org

    President Trump has used his executive power to take a hatchet to 40 years of America's China policy. His administration has called for a "whole-of-government" approach to counter Beijing's unfair economic practices, initiated a damaging trade war, banned Chinese telecommunication equipment from domestic networks, and implemented stringent regulations to vet Chinese investments in sensitive industries.

    In a novel development, the administration has begun coaxing individual states to aid the federal government in its anti-China fervor. Speaking to the National Governors Association in early February, Secretary of State Mike Pompeo warned that "competition with China is not just a federal issue It's happening in your states with consequences for our foreign policy, for the citizens that reside in your states, and indeed, for each of you."

    The administration's enlisting of states in the broader U.S.-China competition has significant economic implications for subnational actors. Increasingly hawkish incumbents, as well as congressional candidates, could provoke economic pushback from Beijing. Many of these officials have bought into the Republican Party's strategy of carrying out an " anti-China assault " on the campaign trail, scapegoating Beijing for the coronavirus outbreak in the United States instead of acknowledging the Trump administration's central role in the country's failure to prepare itself properly.

    While Washington is correct to scrutinize Chinese investments in sensitive technologies and pursue reciprocal trade and economic relations, politically motivated, opportunistic anti-China rhetoric could threaten individual states' cooperation with China, one of the few remaining productive aspects of the bilateral relationship. Indeed, as Hu Xijin, editor of Chinese tabloid Global Times, tweeted , "Beijing is already preparing to take necessary punishment measures against some members of the US Congress, the state of Missouri, and relevant individuals and entities."

    China-skeptic sentiment in the U.S. government and on the campaign trail is not a new phenomenon , but the coronavirus pandemic and resultant economic crisis have afforded many politicians the cover to push hawkish policies. Some of their proposals would benefit the United States, including reducing U.S. reliance on Chinese-made pharmaceutical products , a motion broadly backed by both Republicans and Democrats. But many of their arguments are politically motivated and risk further inflaming U.S.-China tensions and painting Beijing as an enemy, à la the Soviet Union during the Cold War, rather than a competitor.

    Senator Tom Cotton made waves last month by arguing that U.S. universities should not accept Chinese STEM students given the chance they might return home and use their training to drive China's scientific advances. Senators Josh Hawley and Marco Rubio have also joined the fray, advocating that the United States reduce its reliance on China and punish the country for failing to contain the COVID-19 outbreak. The attorneys general of Missouri and Mississippi have filed lawsuits seeking damages from Beijing for the coronavirus.

    Incumbents, however, are not the only ones wagering their political futures on China. Senate candidates in Tennessee , Arizona , and Alabama , among other states, have adopted overtly hawkish stances toward Beijing, blaming China for the pandemic, painting their opponents as soft on the country, and using the China threat to push anti-immigration policies .

    Amid Washington's anti-China turn, preserving cooperation at the state level will be critical to maintaining any semblance of productive bilateral ties going forward. As Los Angeles Deputy Mayor of International Affairs Nina Hachigian said at a Brookings panel last year, "cities and states can take advantage of the trade, investment, students, climate change cooperation, culture, and tourism China offers without really having to balance the broader national security, geopolitical, and human rights questions."

    It is no coincidence that three of the past four U.S. Ambassadors to Beijing previously served as governors of states with deep links to China: Terry Branstad (Iowa), Gary Locke (Washington), and John Huntsman (Utah).

    The aforementioned politicians may be fighting to relocate supply chains outside of mainland China and decouple vast sections of the two countries' economies, but their rhetoric may also lead Beijing to move Chinese-owned businesses out of the United States or cut imports from the country. Despite bilateral tensions, there is clear evidence that Chinese investments in the United States can be beneficial. In the midst of the trade war, a Chinese takeover of a failing paper mill in Maine helped revitalize a local community. In Tennessee, Chinese investments in automotive parts , mattresses , and porcelain manufacturing have benefited the state's economy. There is a real risk that Chinese companies, seeing both politicians' and the American public's growing distaste for China, could simply up and leave.

    A more likely outcome of the growing antagonism, however, is for Beijing to engage in economic coercion , which it uses to try to force nations, companies, and officials into doing its bidding and punish those who do not. The Chinese Communist Party (CCP) has developed a wide-ranging and flexible toolkit of coercive measures that it has used strategically throughout the world.

    When South Korea agreed to host the United States' Terminal High Altitude Area Defense (THAAD) missile defense system, Beijing did not impose tariffs on Seoul despite its displeasure. China instead restricted flights to South Korea, drummed up nationalist sentiment among the Chinese public to boycott South Korean goods, and even shut down China-based outlets of Lotte Group, the Korean company on whose land THAAD was installed.

    China took a similar approach with the Philippines following a 2012 dispute over claims in the South China Sea. In order to cause significant economic pain, Beijing tightened quality controls on agriculture exports from Manila while stemming the flow of Chinese tourists to the Philippines. And most recently, Beijing threatened and then followed through on a boycott of Australian beef after Canberra called for an independent investigation into the origins of the coronavirus.

    Beijing coerces not only countries but also private companies for perceived transgressions. Marriott, Delta Airlines, and Zara all faced the prospect of losing business in China after listing Taiwan, Hong Kong, or Tibet as sovereign nations. Last fall, Beijing suspended broadcasts of NBA games after Houston Rockets general manager Daryl Morey tweeted his support for pro-democracy protestors in Hong Kong.

    If public sentiment across the United States continues to turn against China, Beijing may begin adapting its methods of economic coercion to retaliate against states and politicians it perceives as hostile to its interests.

    Indeed, China is clearly paying attention to U.S. domestic politics and state officials' views of China. A think tank in Beijing recently ranked all 50 governors on their attitudes toward China, information the CCP values as it attempts to mold the views of officials outside of Washington. As Dan Blumenthal has noted , Beijing "split[s] Americans into 'friends of China' who might lobby on their behalf and others who refuse to do so [and] will not be granted access to China's massive market."

    In recent years, Beijing has provided glimpses of what economic coercion in the United States might look like. During the initial stages of the trade war, China's retaliatory tariffs disproportionally targeted Red states critical to Trump's 2016 election victory. Furthermore, China identified key officials able to influence U.S. policy, such as then-Wisconsin Representative Paul Ryan and Senate Majority Leader Mitch McConnell, and levied tariffs that threatened jobs in and exports from their states in a bid to pressure the politicians to split with Trump.

    These actions are possible harbingers of economic pressures to come. Beijing may be tempted to pressure local officials to influence policy from the bottom up. As the aforementioned think tank report explicitly notes , Beijing believes that "State-level officials 'enjoy a certain degree of diplomatic independence,'" and that "Governors can ignore orders from the White House."

    Recent downturns in public opinion in both countries, the result of several years of increasing competition, and an emerging view that the other views the pandemic as a strategic opportunity, could even see Beijing move beyond tariffs and drum up anti-U.S. sentiment. It could even encourage citizens to boycott American products, the political and economic effects of which could be devastating.

    While the United States imports more from China than it exports, China-bound exports supported around one million U.S. jobs in 2018. According to the U.S.-China Business Council, 42 states counted China among their top five export destinations in 2019. Chinese FDI, which peaked at $46.5 billion in 2016, dropped to just over $3 billion in 2019 -- a decline of over 90 percent. Industries ranging from energy, agriculture, and manufacturing could be negatively affected by an exodus of Chinese investment, a freeze on new Chinese FDI into the United States, or increased tariffs on or bans of imports.

    Given the astronomically high unemployment rate and ballooning federal and state debt levels, U.S. states are in no position to lose more investments or export-supporting jobs. Senator McConnell's recent call for states to file bankruptcy highlights their increasingly gloomy economic prospects, and already over 25 percent of state revenues have disappeared due to the coronavirus.

    The United States certainly needs to diversify its supply chains so as not to depend so much on China. Washington has already rolled out several measures to better screen Chinese investments in the country and limit sensitive technology exports. The increasingly prevalent and politically expedient one-size-fits-all anti-China position espoused by many state-level politicians, however, could endanger China-state ties, the locus of the two countries' economic relationship, and threaten China-owned U.S.-based companies that pose no national security threats and provide hundreds of thousands of jobs.

    Written by
    Sam Bresnick
    Lucas Tcheyan

    [May 13, 2020] The Chinese Mindset in a Hybrid War With the US by Xiaoran Tong

    While some observationare valid, the main drawback is that the guy does not understand the term "neoliberalism"
    May 13, 2020 | original.antiwar.com
    I recently came across a Facebook comment from a Hongkonger, arguing that the Chinese Communist Party (CCP) is nothing communist given China's prosperous private sector after 1979's reform . He then linked a video to mock the western electoral democracy that put Trump and Hitler into the office, leading to the conclusion that the West has no credential to criticize the one-party system of China for the lack of democracy. His comment represents the contemporary Chinese sentiment and is quite understandable given the ongoing color revolution in Hong Kong 2019 , which is still lukewarm to this day, and the unrelenting blame of COVID19 on China . Although the hybrid war waged on China is unjust, the current Chinese mindset does not help to diffuse but only fuels the conflict even further.

    The Facebook comment was right about CPP not being Communist that seeks total control of the economy by the state. Yet, China is state capitalism, an oligarchy, or crony capitalism. China is a plutocracy by the marriage between the party leadership (the state), and the monopolizing mega-corporations (the money) like Huawei, Ali, the four state-owned commercial banks , and Sinopec Group .

    It is far from a free-market where the only way to win a competition is to provide excellent products, where the state has no role in deciding the winner and no ability to finance itself by forcing the circulation of central-banknotes. China does have a private sector – the semi-free-market, the good part of our bad plutocracy. Still, even that part is weathering after supreme leader Xi took power, and most Chinese do no realize that we are marching back into a more planned, more communism, more Mao Zedong like system, slowly but surely. In China, life is artificially expensive under the tightening state control that imposes layers upon layers of covert taxation, to the point of causing hesitation to have more children .

    However, the west, in general, is fundamentally the same, albeit having a façade electoral democracy where no crucial issues (i.e., war and peace, monetary policy, and downsizing the government) are allowed into a debate.

    The real private sector (not the likes of Google and Lockheed Martin) is also dying. The states interfere with the market relentlessly, in the name of safety, welfare, and stimulating the economy, which achieved the opposite (i.e., the 1929 great depression, 2000 dot com bubble, and 2008 housing bubble). The Federal Reserve finances the government spending via debt, encourages malinvestment by atrocious QE packages , which all translate into taxing away people's purchasing power by creating tons of money out of thin air.

    We see the same unholy marriage between the state and the money like big techs, big pharma, and, most disgustingly, the Military-Industrial Complex. People are either covertly forced, or duped into funding the nonsense by paying tax, no matter which party they elect.

    Therefore, the Chinese are right about the West not in the position of a critic, but for the wrong reason. We either fail to realize or willfully deny that we are living under a harsh plutocracy. Instead, we are distracted by the never losing fake debate about which system elects the better government, since the "one-party system" is most attacked by western pro-democracy voices.

    Strangely though, both systems have seemingly good intentions, either emphasizing a person's moral conduct and experience in low-tier office (the Chinese internal nomination), or the people's direct control of the government (the West electoral democracy). Strangely, both unanimously favor the use of "government power" the "right way."

    Yet, power always corrupts its user by attracting the money, no matter how well-disciplined, how experienced he/she was. A system that operates on coercive power always finds its way to circumvent any laws and regulations meant to promote meritocracy. Both have tried to fight cronyism rigorously with new agencies and new legislation, but in the end, cronyism always prevails, for both. For the most part of history, the essence of the Chinese system is not much different from the West, since they are all plutocracies that conned the people into helplessly relying on more power to solve problems caused by power until it collapses.

    In a 1979 Chinese opera broadcasted nationwide, the protagonist, a low tier official, finds himself risking his political career to enforce the law on the aristocrats who made the law; intoxicated, he yelled in desperation "谁做管官的官," which literally is " Quis custodiet ipsos custodes " in Chinese; in the end, he left his career behind – adding no more to the bloated, self-conflicting bureaucracy, to preserve his integrity. Maybe this was a coincidence, 1979 was the year the Chinese leadership decided to let the government govern less – kudos to them.

    The year 1979, and the economic boom that followed, is one of the most common counter-arguments from a Chinese when you criticize the draconian practices of CCP. Admittedly, there are times the state power is not insane. In 1979 Deng Xiaoping at least gave up some government mandate to allow the private sector to grow , resulting in the exploitative system we see today, nonetheless a society much more productive than Mao Zedong's total state dominance. Some state heads refrained from moving the government "muscle" too much, such as Jimmy Carter's resistance to wars and money supply that reduced overspending and inflation since the Vietnam War. In these "less bad, more sensible" eras, it is easier for people's entrepreneurial spirit and creativity to overcome the innate irresponsibility of centralized capital management. As a result, we saw significant progress like the Chinese miracle, and the upswing during the Reagan presidency (even if he turned up wars, debt, and the Fed's money machine again). Sadly, the leaderships are eager to claim credits, creating the impression that it is the right administration resulting in progress and recovery when it is the lack of governing that allows the people to make sensible decisions on their own, achieving faster growth.

    If we Chinese and the American attack each other's electoral system, it is like the two worst kids in the class picking on each other over their looks rather than their poor study and bullying of other kids, which only makes them both worse. In the real world, we leave the unhinged growth of government power – the real enemy of all people, Chinese and American alike, unattended.

    Like that Hongkonger, most Chinese learned to mock Trump's personal, and naively conclude that the democracy that put him (and Hilter) in the office is a joke. Some more informed Chinese mock the media's clownish, unfair treatment of Trump, and naively conclude that the freedom of the press is a joke. However, a bombastic president, the democracy, and the media are not the problems; neither are the aggressive sino-phobic policies of which Trump pretends to be in charge. The actual problem is the monstrous government, married with big money, capable of waging costly war, funding wasteful programs that drain the middle class to enrich a selected few, no matter who is in the office. It can either be the well-spoken Obama loved by the media, who started seven wars and won the Nobel peace prize, or the bombastic, scandalous New Yorker hated by the press, who nonetheless continued these wars. People coerced into funding this abusive machine themselves are part of, with their hard-earned tax dollars, is the problem. Yet, you do not see the Chinese majority mocking this miserable setup and come to realize that we are under the same situation!

    For us, the Chinese, the real issue is not the superficial corruption that the supreme leader XI fiercely fought, nor the insanity, the incompetence, and the betrayal of the oath of some party members. It is our innate reliance on authorities and the love of collective glory, a part of our culture passing down through generations over more than 2400 years, being the problem. We can never break the dynastic cycle if we do not see the path to the self-destruction of unhinged state power, such as Mao's era . If we are still yearning for a "just leader" to solve issues like retirement, education, and medication, still admiring exhaustive achievements such as the Belt and Road, the South China Sea, and Taiwan, we then have learned nothing from the downfall of thirteen dynasties and countless hegemonies throughout the history of China. The collective conscious of the Chinese have so far failed to realize the force driving the rise and fall of a dynasty is not the moral and intellect of the leaders, but the people's economic freedom relatively untouched or infringed at times, by a mixture of chance, sanity, and imperialism vainglory. The blind reliance on leaders and the love of collective grandiosity is only compounded when the Americans fail to take back their power from the government, who is warring with China and covertly overtaxing them. The collective enlightenment of the Chinese population is nearly impossible, since the tyrants in Beijing have no shortage of strawman to throw at the people and say "that is the problem, blame the belligerent Trump and the jealous Americans", and the Communist Dynasty will always enjoy the " mandate of heaven ".

    Even with a sheep's mindset, the Chinese economy will overtake the US, despite the slow death of its most productive private sector. The sheer momentum of the slight right turn to liberty 40 years ago is good enough for China, since the Americans do not restore their free-market and liberty that had made them an exceptionally productive civilization for a long time. But then what? We Chinese are just molecules burnt to fuel the blinding flash of a new empire not far from its fourteenth dynastic downfall, just like the Achaemenids, the Romans, the Umayyads, the Ottomans, Napoleon's France, the British, and the Americans before us.

    Xiaoran Tong has a Ph.D. in Epidemiology from the Michigan State University (MSU). He is originally from Kunming, Yunan, China and arrived in the US in 2014 to pursue his Ph.D. at MSU. He is Interested in the history of America and its similarities with ancient and contemporary China.

    [May 12, 2020] A Tsunami Of Anger Chinese Officials Call For Renegotiation Of Phase One Trade Deal

    May 11, 2020 | www.zerohedge.com
    Amid the ongoing diplomatic spat between Washington DC and Beijing, which now also includes the deployment of B-1B bombers and warships in the South China Sea , late on Monday (local time) China's Global Times reported , citing sources close to the Chinese government, that some "hawkish" officials in China are calling for a renegotiation the the "phase one" trade deal with Washington as well as a "tit-for-tat approach on spiraling trade issues after US' malicious attacks on China ignited a tsunami of anger among Chinese trade insiders."

    The calls to renegotiate the current version of the deal - which has yet to be actively implemented - emerge amid dissatisfaction because "China has made compromise for the deal to press ahead."

    While in the past, these same trade negotiators "believed that it would be worthwhile to make certain compromise to reach a partial truce in the 22-month trade war and ease escalating tensions", given what the Global Times called "President Donald Trump's hyping an anti-China conspiracy that aims to cover up his mishandling of the COVID-19 pandemic", advisors close to the trade talks have suggested Chinese officials rekindling the possibility of invalidating the trade pact and negotiating a new one to tilt the scales more to the Chinese side, sources close the matter told the Global Times.

    A former Chinese trade official told the Global Times on condition of anonymity on Monday that China could complete such procedures based on force majeure provisions in the pact.

    "It's in fact in China's interests to terminate the current phase one deal. It is beneficial to us. The US now cannot afford to restart the trade war with China if everything goes back to the starting point," another trade advisor to the Chinese government told the Global Times, pointing to the staggering US economy and the coming of the US presidential election this year.

    "After signing the phase one deal, the US intensifies crackdown in other areas such as technology, politics and the military against China. So if we don't retreat on trade issues, the US could be trapped," the former official noted.

    Some could disagree, and counter that Trump can certainly restart the trade war especially since it suits his pre-election agenda - after all, now that the fate of the market is entirely in the hands of the Fed which has gone full MMT, Trump is no longer afraid by the market's response to a renewed trade war. In fact, with over 60% of the US population seeking to distance US from China, it would appear that Trump's best bet to winning independent votes is precisely to keep hammering China.

    Confirming this, Trump said on Friday that he was "very torn" about whether to end the China-US phase one deal, Fox News reported, with some observers interpreting his words as equating to a threat from the US to re-launch a trade war against China.

    Then again, over the weekend, the SCMP reported that US source familiar with recent discussions stated US officials acknowledged China was largely delivering its pledges on structural issues such as opening market access and improving IP protection but they have yet to agree in some details including IP action plan and easing equity caps for foreign investors. Furthermore, the source stated fallout from the virus meant agreement on purchasing US goods has become much more important and that many believe China needs to increase pace on purchases.

    Meanwhile, Gao Lingyun, an expert at the Chinese Academy of Social Sciences who advises the government on trade issues, told the Global Times on Monday that China has "well documented" Washington's usual threats after previous rounds of confrontation. That means if the trade war restarts, "China knows how to respond, and it is able to retaliate quickly and inflict serious harm on the US economy," Gao said.

    Still, as the Global Times concludes, analysts noted that terminating the phase one trade deal would be China's "last option" and one that China would only resort to under extremely hostile conditions.

    [May 11, 2020] Note on US-China decoupling: it will be tough because the train had left the station and Chinese acted first

    Notable quotes:
    "... What does a developing country like China, still mired in socio-economic inequality, technological dependence, political corruption and environmental degradation do? Concentrate on its own hinterland while bidding its time? Confront the hegemon head-on which would lead to military conflict? Or control its responses while cultivating partnerships with ALL peace-loving countries, whether rich or poor, First World or Third World, Western or non-Western? ..."
    May 08, 2020 | www.unz.com
    antibeast , says: Show Comment May 9, 2020 at 5:46 pm GMT
    Unlike Escobar, Roberts, et al, I am much more sanguine about the prospects of China's rise which has threatened the indispensable nation of Yankistan because China was not supposed to rise above its assigned role as the cheap cog of the globalist economy serving the Capitalist Oligarchy of the NWO. By dint of hard work, sly cunning and shrew tactics, China outgrew its role by becoming the hub of the international economy via its New Silk Road and the BRI.

    What does a developing country like China, still mired in socio-economic inequality, technological dependence, political corruption and environmental degradation do? Concentrate on its own hinterland while bidding its time? Confront the hegemon head-on which would lead to military conflict? Or control its responses while cultivating partnerships with ALL peace-loving countries, whether rich or poor, First World or Third World, Western or non-Western?

    The rapid decoupling of China's economy away from the USA started with the GFC 2008 but has since accelerated with Obama's "Pivot to Asia" and Trump's trade war with China. Exports to the USA account for less than 3% of China's GDP today with 60% of those exports being either US or foreign goods manufactured in China. So the real figure is 1% of China's GDP consists of Chinese goods exported to the US market, consisting mostly of industrial commodities or consumer products.

    As China has already charted its own independent path of building trading/investment partnerships with Europe, Asia, Africa and Latin America, the USA has become threatened by China's successful decoupling from its export dependence on the US market as proven by its hostile reaction to Xi's BRI and China's New Silk Road. In addition, the US was caught off-guard by the sudden rise of Chinese tech firms such as Huawei which is the world's number one vendor of telecommunications equipment with undisputed world leadership in 5G technology.

    Shocked to find its manhood as no longer exceptional, Uncle Sam feels the need to show off to the world: "Me Gringo! Big Dick!"

    [May 10, 2020] Watch Is China Merely a Competitor of the U.S., or an Adversary or Even an Enemy

    May 10, 2020 | theintercept.com

    China has become, over the past two decades, the planet’s second-most powerful nation after the United States. Booming economic growth has lifted millions of its citizens out of poverty and catapulted it to the world’s second-largest economy, while increased military spending has made it the second-largest military power (though its military spending, and nuclear stockpile, are still a small fraction of the U.S.’s).

    That growth — in both economic and military power — has led U.S. officials to conclude that they must do more to counteract what they regard as China’s growing influence. President Obama, early in his administration, memorably vowed an “Asia pivot,” whereby the U.S. would devote fewer resources and less attention to the Middle East and more toward China’s growing power in its own region.

    That led to some moderate escalation in adversarial relations between the two countries — including the Trans Pacific Partnership trade agreement (TPP) and other regional skirmishes — but nothing approaching direct military confrontation. President Trump, since taking office, has largely heaped praise on the Chinese government and its leader President Xi Jinping, siding with Xi over democracy protests in Hong Kong and even Beijing’s handling of the coronavirus outbreak.

    But this pandemic has seriously escalated tensions between the two countries given the increasingly hostile rhetoric emanating from various sectors of the west, making it more urgent than ever to grapple with the complex relations between the two countries and how China ought to be perceived.

    The question is far more complex than the usual efforts to create a new U.S. Enemy because numerous power centres in the U.S. and the west generally — particularly its oligarchs, Wall Street, and international capital — are not remotely hostile to Beijing but, quite the contrary, are both fond of it and dependent upon it. That’s why — unlike with other U.S. enemies such as Saddam Hussein, Fidel Castro, the Iranian government or Nicolas Maduro — one finds very powerful actors, from Bill Gates to Michael Bloomberg to the consulting giant McKinsey to Trump himself, defending Chinese officials and urging better relations with them.

    That, in turn, reflects a critical reality about U.S./China relations that defies standard foreign policy frameworks: while hawkish, pro-war political elements in both parties speak of China as an adversary that must be confronted or even punished, the interests of powerful western financial actors — the Davos crowd — are inextricably linked with China, using Chinese markets and abusive Chinese labor practices to maximize their profit margins and, in the process, stripping away labor protections, liveable wages and jobs from industrial towns in the U.S. and throughout the west.

    That is why standard left-wing anti-imperialism or right-wing isolationism is an insufficient and overly simplified response to thinking about China: policy choices regarding Beijing have immense impact on workers and the economic well-being of citizens throughout the west.

    Today’s new episode of SYSTEM UPDATE is devoted to sorting through the complexities of this relationship and how to think about China. I’m joined by two guests with radically different views on these questions: the long-time Singeporean diplomat who served as President of the U.N. Security Council, Kishore Mahbubani, whose just-released compelling book “Has China Won?” argues that the U.S. should view China as a friendly competitor and not as a threat to its interests; and Matt Stoller, who has worked on issues of economic authoritarianism and the U.S. working class in multiple positions in Congress and in various think tanks, culminating in his 2019 book “Goliath,” and who argues that China is a threat to the economic well-being of the U.S. working class and to civil liberties in the west.

    The show, which I believe provides excellent insight into how to think about these questions, debuts this afternoon at 2:oo pm ET on the Intercept’s YouTube channel or can be viewed on the player below at 2:30 p.m. As always, a transcript of the program will be added shortly thereafter.

    Update: May 7, 1:54 p.m. EDT

    The debut time for this episode has been moved by 30 minutes; it will not debut on the Intercept’s YouTube channel at 2:30 pm ET.

    [May 10, 2020] Trump and decoupling from China

    Highly recommended!
    May 10, 2020 | www.moonofalabama.org
    I have been watching China's gradual rise in the world's GDP– as well as GDP-per-capita– charts and a concomitant fall in the United States' position in these charts, for nearly 20 years now. The United States' decline is still relative rather than absolute. In absolute terms, its GDP is still "Number 1!" But the decline was accelerated from 2003 on, when successive US presidents decided to pour massive amounts of government revenues into large-scale and always disastrous military adventures all around the world. As of last November, Brown University's "Costs of War" project tallied the U.S. budgetary costs of these wars, FY2001-2020, to be $6.4 trillion. These were funds that could have been invested, instead, in repair and upgrading of vital infrastructure here at home– including vital health infrastructure. But no. Instead, the money was shoveled into the pockets of the large military contractors who then used a portion of it on expensive lobbying operations designed to ensure that the sow of military spending continued feeding her offspring (them.)

    When Donald Trump became president, in 2017, one of his early instincts was to pull back from the foreign wars. (This was about his only sound instinct.) The military-industrial complex then proved able to slow-walk a lot of the military-retraction moves he wanted to make One of the other abiding themes of Trump's presidency has been his desire to "decouple" the U.S. economy from the tight integration it had developed at many levels with the economy of China, as part of broader push to halt or slow the rise of China's power in the global system. At the economic level, we have seen the "tariff wars" and the campaign against Huawei. At the military level, we have seen a slight escalation in the kinds of "demonstration operations" the U.S. Navy has been mounting in the South China Sea. Mobilizing against "Chinese influence" also seems to come naturally to a president who shows no hesitation in denigrating anyone– even US citizens and politicians– who happens not to be of pale-complected European-style hue.

    With the eruption of Covid-19 in U.S. communities nationwide, Pres. Trump's pre-existing proclivity to demonize and denigrate anything Chinese has escalated considerably– spurred on, it seems, by his evident desire to find an external scapegoat to blame for the terrible situation Covid-19 has inflicted on Americans and to detract voters' attention from the grave responsibility he and his administration bear for their plight.

    He and his economic advisors clearly realize that, with the supply chains of major US industries still inextricably tied up with companies located in China and with China still holding $1.1 trillion-worth of U.S. government debt, he can't just cut the cord and decouple from China overnight. Yesterday, his Treasury Secretary and the US Trade Representative held a phone call with China's Vice Premier Liu He, the intent of which was to reassure both sides that a trade deal concluded four months ago would still be adhered to.

    But today, less than 12 hours after the reassuring joint statement released after the phone call, Trump told Fox News that he was "very torn" about the trade deal, and had "not decided" whether to maintain it. This, as he launches frequent verbal tirades against China for having "caused" the coronavirus crisis. US GDP is highly inflated by counting financial moves on Wall Street (extracting money from suckers and moving money from one hand to another) as productive activity. China's purchasing power parity already exceeds the US and I suspect its actual GDP does as well. Only US financialization is able to mask the lack of actual productivity in the US economy.

    likbez , May 9 2020 17:12 utc | 10

    I am somewhat skeptical about China chances in this race. That will be much tougher environment for China from now on. And other major technological powers such as Germany, Korea and Japan are still allied with the USA.

    The major problem for China is two social systems in one box: state capitalism part controlled by completely corrupt Communist Party (which completely abandoned the communist doctrine and became essentially a religious cult ) + no less corrupt neoliberalism part created with the help of the West.

    The level of corruption inherent in the current setup (first adopted in Soviet NEP -- New Economic Policy) is tremendous, as the party has absolute political power and controls the major economic and financial areas while the entrepreneurs try to bribe state officials to get the leverage and/or enrich themselves at the state expense or bypass the bureaucratic limitations/inefficiencies imposed by the state, or offload some costs. So mafia style relationship between party officials and entrepreneurs is not an aberration, it is a norm. And periodic "purges" of corrupt Party officials do not solve the problem. Ecological problems in China are just one side effect of this.

    The fact that a Chinese scientist from a biolab got 12 years jail sentence is pretty telling. https://www.nature.com/articles/d41586-020-00051-2

    Add to this the certain pre-existing tendencies within Chinese society to put greed above everything else, the tendency clearly visible in some emigrants and to which Yen devoted one post recently. Riots in some Asians countries against Chinese diaspora are often at least partially caused by this diaspora behavior, not only by xenophobia. Note that several African countries with Chinese investments now intent to sue China for damages from COVID-19. This is not accidental.

    Technologically the USA and its G7 satellites are still in the lead although outsourcing manufacturing to China helped Chinese tremendously to narrow the gap. For example, Intel CPUs still dominate both desktops and servers. All major operating systems (with the exception of some flavors of Linux) are all USA developed.

    I do not see the possibility for China to quickly narrow this gap as the technology transfer might now be controlled in the same way it the USA controlled the trade with the USSR via COCOM ( https://en.wikipedia.org/wiki/Coordinating_Committee_for_Multilateral_Export_Controls )

    Looks how easily the USA managed to kick Huawei in the butt and essentially deprive it of the major market.

    vk , May 9 2020 17:48 utc | 12
    @ Posted by: likbez | May 9 2020 17:12 utc | 10

    You rise important points, but I respectfully disagree with all of them.

    1) I don't think China is a "State capitalism" country. The term "State capitalism" was first coined by Lenin for a very specific situation the USSR was in. Yes, the similarities are striking - and Deng Xiaoping's reforms were clearly inspired by Lenin's NEP - but it is important to state that the CCP actively avoided the term and built upon the concept both theoretically and in practice. Besides, we don't need to read Lenin's works critically, an not take him as the second coming of Jesus: when he used the term "State capitalism", he used it in a clearly desperate moment of the USSR, almost by improvisation. Lenin's last years were definitely desperate times.

    Besides, the NEP didn't culminate with the capitalist restoration of the USSR. On the contrary: it collapsed in 1926 (after another bad harvest) and gave way to the rise of Stalin and the radical faction of the CPSU. The Five-year plans were born (1928), and agriculture would be fully collectivized by the end of the 1930s (a process which catapulted Molotov to the second most powerful man in the USSR during the period). By the end of WWII, the USSR had a fully collectivized economy.

    2) The corruption hypothesis is an attractive one - specially for the liberal middle classes of the post-war and for the Trotskyists - but it doesn't stand the empirical test. The USA was an extremely corrupt nation from its foundation to pre-war, and it never stopped it from growing and reaching prosperity. The Roman Empire and Republic were so corrupt that it was considered normal. There's no evidence the PRC is historically exceptionally corrupt. However, I can see why the CCP is worried about corruption, as it is a flank through which the West can sabotage it from within.

    3) The COCOM tactic will be much harder to apply against China than against the USSR. For starters, the USSR lost circa 35% of its GDP in WWII. This gave it a delay from which it never recovered. Second, the USSR fought against capitalism when capitalism was at its apex. Third, the USSR collectivized and closed its economy too early, not taking into account that it still lived in a capitalist world.

    China doesn't have that now. It is fighting against capitalism in a phase where it is weakened. It is open and intimately integrated economically with its capitalist enemies. It closed or is about to close the technological gap in many strategic sectors during a stage where the capitalists have low retaliation capacity. It found time to close at least the GDP gap. It found time to recover fully from its civil war and the Japanese Invasion of the Northeast.

    Germany, South Korea and Japan are not technologically more advanced than the USA. This is a myth. Plus, they are too small. They may serve as very useful - even essential - pawns for the USA-side, but I don't see any of the three ever achieving Pax .

    [May 09, 2020] Huawei's HiSilicon becomes first mainland Chinese chip company to enter top 10 in global sales, says IC Insights South China

    Notable quotes:
    "... Over 90 per cent of Huawei phones in China now use HiSilicon processors, according to CINNO ..."
    May 09, 2020 | www.scmp.com

    HiSilicon , Huawei Technologies ' in-house semiconductor and integrated circuit design company, has surpassed US chip giant Qualcomm in terms of smartphone processor shipments in China for the first time amid coronavirus-linked disruptions that have hit most major players, according to a report.

    In the first quarter of 2020, HiSilicon shipped 22.21 million smartphone processors, according to Chinese research firm CINNO's latest monthly report on China's semiconductor industry. Although HiSilicon's shipments only increased slightly from the 22.17 million units it shipped in the first quarter of last year, it was the only major company that did not see a year-on-year decline in the quarter, CINNO said in a summary of the report posted on its official WeChat account.

    As a result, the Huawei subsidiary's market share surged to 43.9 per cent, from 36.5 per cent during the same period last year, and beat Qualcomm for the first time to become China's top smartphone processor supplier. HiSilicon's steady performance comes at a time when the Chinese smartphone industry is being battered by delayed product launches and dampened consumer sentiment linked to the coronavirus pandemic. Smartphone shipments in the country slumped by 34.7 per cent – more than a third – to 47.7 million units in the first quarter of 2020, according to a report released earlier this month by the China Academy of Information and Communications Technology.

    CINNO's report showed that there was a similar plunge in processor shipments, with overall smartphone processor shipments in the country dropping by 44.5 per cent in the first three months of 2020, compared to the same period last year. Huawei makes end-run around US trade ban by turning to its own chips 2 Mar 2020

    US-based Qualcomm, the long-time market leader, fell to second place in the latest quarter with a year-on-year decline in its market share from 37.8 per cent to 32.8 per cent. Taiwan's Mediatek maintained its third-place position, but also saw its market share slide year-on-year from 14 per cent to 13.1 percent

    . Table showing the market share of smartphone processor supplies according to CINNO Research. Source: CINNO Research / WeChat

    Table showing the market share of smartphone processor supplies according to CINNO Research. Source: CINNO Research / WeChat

    Huawei, HiSilicon's parent company, is at the centre of a high-profile US-China tech war. The Trump administration added the company to its Entity List last year, citing the risk that Huawei could give Beijing access to sensitive data from telecommunications networks. The trade blacklist effectively bars Huawei from buying US products and services. In response, the Chinese company, which has denied the allegations, is ramping up its own capabilities to produce more American component-free network gear, including through HiSilicon.

    Huawei is also reportedly shifting production of HiSilicon-designed chips away from Taiwan Semiconductor Manufacturing Co (TSMC) and towards Shanghai-based Semiconductor Manufacturing International Corp (SMIC) as Washington readies new rules which would require foreign companies using US chipmaking equipment to obtain a license before supplying chips to Huawei – a move that would directly affect TSMC.

    Over 90 per cent of Huawei phones in China now use HiSilicon processors, according to CINNO. However, Huawei founder Ren Zhengfei said in an interview with Yahoo Finance last year that the company would continue using chips from US vendors such as Intel and Qualcomm as long as it is still allowed by US regulators.

    [May 08, 2020] Post-pandemic animosity by US - Global Times

    May 08, 2020 | www.globaltimes.cn

    In the face of the upcoming presidential elections, Republicans launched a new China Task Force committee in US Congress on Thursday to attract attention despite its futile efforts to pass the buck amid the pandemic. But this not-so-surprising move only shows how hysterical and desperate Republicans have become as criticism of the government's mishandling of the domestic coronavirus outbreak increases, experts said.

    Following a series of anti-China moves the Trump administration has made when its epidemic prevention spiraled out of control with more than 1.2 million infections - the world's largest number - to date, House Minority Leader Kevin McCarthy announced on Thursday a proposal to set up a new "China Task Force" which will develop legislative policies to curtail Chinese influence. The committee currently consists of 15 Republicans with no Democrats joining.

    McCarthy said the pandemic made it apparent "for a national strategy to deal with China." The task force will hold meetings and briefings on China-related issues, which include China's influence inside the US, presence on American campuses and control over important supply chains, the Washington Post reported.

    A search for the members in the China Task Force revealed their antagonism toward China. One of them is Rep. Elise Stefanik, who in late April asked Secretary of State Mike Pompeo and the attorney general to bring China to the International Court of Justice for the handling of COVID-19, according to a report by The Adirondack Daily Enterprise.

    Analysts said setting up the new China committee is the Republicans' new tactic to fuel anti-China sentiment, but this won't help stop power from shifting from the West to East, which was happening before the pandemic. The pandemic is very likely to speed up this process.

    Democrats not joining the committee does not mean they are more China-friendly, but they don't want Republicans to shift the focus of President Donald Trump's failure to handle the pandemic. Since last year, both parties passed several bills regarding China's Xinjiang and Hong Kong, interfering in China's internal affairs, Diao Daming, an associate professor at the Renmin University of China in Beijing, told the Global Times on Friday.

    Diao noted the Democrats in the Congress won't endorse the legislation but will support other anti-China measures that the new committee aims to push forward.

    "The pandemic will very likely further weaken the US and strengthen China," he said.

    A man covering his face walks in Manhattan, New York on April 6 amid the serious outbreak of COVID-19 in the US. Photo: AFP

    Treating China as equals

    In the past months, certain American politicians, including Pompeo, kept passing the buck, making groundless accusations that China was responsible for the outbreak, and hyped conspiracy theories by calling it the "China virus" to claim the virus originated from a Wuhan lab. At Friday's media briefing, Chinese Foreign Ministry spokesperson Hua Chunying joked that the press conference was almost all about refuting Pompeo's lies.

    The extreme atmosphere has made many people in the US worry for a return of the McCarthy era, where free speech in the country was curtailed. A former US Ambassador to China pointed out in a CNN interview the US is now similar to Germany in the 1930s.

    Li Haidong, a professor at the Institute of International Relations of the China Foreign Affairs University, told the Global Times on Friday the task force will fuel the existing unfriendly atmosphere toward China at the local level in the country.

    Trump administration's China policy focuses on conflicts, and the task force could further aggravate tensions, he said.

    Former US Ambassador to China Max Baucus said in an interview with CNN that "The [Trump] administration's rhetoric is so strong against China. It's over the top. We're entering a kind of an era which is similar to Joe McCarthy back when he was red-baiting the State Department, attacking communism."

    "A little bit like Hitler in the 30s. A lot of people knew what was going on was wrong. They knew it was wrong, but they didn't stand up and say anything about it. They felt intimidated," he said.

    Analysts warned that China needs to stay alert as the US is trying to create a new McCarthy era of international repression on China.

    But, on the other hand, we should be aware that most countries won't follow the US, Li said.

    "It's difficult for the US to mobilize the world against China. People know how selfish and self-centered the US is. So only a few of its allies will join," he told the Global Times.

    The US interception of other countries' anti-virus medical supplies and pointing a finger at the WHO when international cooperation is urgently needed occupied world headlines.

    Meanwhile, the Chinese government had provided over 150 countries and international organizations with supplies, hosted over 120 video conferences with health experts from more than 160 members of the international community, and dispatched 19 medical groups to 17 countries, according to the Zhang Ming, Chinese Ambassador to the European Union, at a Coronavirus Global Response pledging event on Monday.

    Li told the Global Times that most countries, including its traditional allies, such as Germany and France, have different demands from the US. So they won't join this wave.

    As early as February 1, the European Union had dispatched tons of medical supplies to assist China. And in March when the continent was hit hard, China immediately provided more than 2 million protective masks and sent medical groups. Positive reactions were constantly heard in Europe on China.

    Meanwhile, it has been reported that China faces a rising wave of hostility led by the US amid the pandemic. The discrimination against Chinese people is growing in some parts of the world.

    Li said "The rising hostility shows some Western countries are not accustomed to a rising China. It's a challenge for them to learn to see China on an equal footing, which adds to their anxiety."

    He added that they need to learn to respect differences and deal with other countries equally.

    Analysts noted that China should step up efforts to enhance its own capabilities in high-tech, military and other fields. It should also conduct far-reaching international cooperation and uphold multilateralism to share its benefits with other countries, rather than being distracted by the anti-China wave.

    Cooperation amid competition

    The task force on China is not the first one in the West. On April 24, several UK Conservative MPs launched a "China Research Group" to promote "factual debate" in dealing with the "rapidly changing nature of the relationship" between China and the UK. The group would attempt to look "beyond" the coronavirus pandemic to "examine China's long-term economic and diplomatic aims," BBC reported.

    Kevin Hollinrake, an MP and a member of the group, told the Global Times that the group will make some inquiries on specific policy areas. The group will look at, for example, how the Chinese political system and business work.

    It will look at certain work streams and develop fact-based reports based on those work streams. "They may be reported back to parliament or published in the public domain," Hollinrake said.

    Although the group was set up at a time when the virus was rampant in the UK, "the pandemic itself is not the underlying issue," Hollinrake noted.

    The China Research Group is likely to "lobby for a less cooperative approach to China, and for the UK to align more with the US on China policy," Tim Summers, senior consulting fellow on the Asia-Pacific program at Chatham House, told the Global Times.

    However, Chris Wood, the British Consul General in Shanghai, told the Global Times that "We will see continued discussions and collaboration. There is no global challenge that can be solved without China's participation. We recognize that we very much want to work with China on these big global issues, and that will continue."

    In the post-coronavirus era, China and Europe might continue to seek cooperation amid competition, analysts said, pointing out that Europe's anxieties are, to a large extent, provoked by the US.

    In the early stages of the pandemic, despite old disputes, cooperation was the mainstream in China-Europe interactions. But things have changed since the US became the new epicenter, Sun Keqin, a research fellow at the China Institutes of Contemporary International Relations, told the Global Times.

    Sun told the Global Times that to reduce the negative influence from the US on European countries, China needs to make efforts to let its voice heard in international public opinion and seek cooperation opportunities. What the US is advocating is nothing but rumors and conspiracy, and China must smash these lies with sound and reasonable evidence and awaken European countries, Sun said.

    [May 07, 2020] So, is it correct that the DNC had some kind of Obama-era "chi-merica" project to further their globalist, neolib project -- as it became obvious that the US was never going to be able to pull off the unipolar Empire -- into the new century with a sort of US/China alliance, with a substantial US aligned fifth-column (if that's the right phrase) working in China to further the project?

    May 07, 2020 | smoothiex12.blogspot.com

    Casey19 hours ago So, is it correct that the DNC had some kind of Obama-era "chi-merica" project to further their globalist, neolib project -- as it became obvious that the US was never going to be able to pull off the unipolar Empire -- into the new century with a sort of US/China alliance, with a substantial US aligned fifth-column (if that's the right phrase) working in China to further the project? Then Trump came in a screwed that all up, trying to pretend to be friendly to Russia, which the DNC promptly scuttled. And now the net result is Russia and China growing relations, which is a very real nightmare for the US, the absolute worst possible outcome for the globalists? Probably I have this all ass-backwards. Also, really, how long would it take to relocate important industries to the US? Wouldn't that need to be a multi-generational project because you can;t turn baristas into machinists over night? Also, what prevents the US from taking over Venezuela right now, militarily, instead of those apparently poorly organized attempts to infiltrate with mercenaries, as was recently revealed?

    [May 05, 2020] I don't think the bankster parasites will sit on their hands and let the Trump idiots blow up their entire system. I think there would be a palace coup d'etat first.

    May 05, 2020 | www.moonofalabama.org

    Trailer Trash , May 4 2020 20:55 utc | 33

    If Uncle Sam defaults on his debts, that would be the biggest own goal ever. The whole financial system is based on US Treasury bonds, and a default would send their value to zero. The US Social Security Trust Fund is still worth almost three trillion dollars, most of it in US Treasury bonds. Default means Goodbye Social Security Pensions, or at least a huge "haircut".

    I think Pompous Ass is bluffing. One reason is that Wall Street parasites have been salivating over the Social Security trust fund for decades, and GW Bush was working on a plan to give it to them. I don't think the bankster parasites will sit on their hands and let the Trump idiots blow up their entire system. I think there would be a palace coup d'etat first.

    [May 04, 2020] 'Turbocharging' exodus: US beats trade war drums to remove supply chains out of China

    May 04, 2020 | www.rt.com

    The US wants to сut industrial and supply dependence on China amid rising tensions between the two powers. However, not everyone is eager to pack their bags and leave the lucrative Chinese market in the midst of the previous row. The Trump administration has long been pushing American firms to get back to US soil, especially when trade tensions were flaring between the two biggest global economies. Now the US has revived the trade war rhetoric again. Read more Asian markets plunge amid escalating US-China tensions

    "We've been working on [reducing the reliance of our supply chains in China] over the last few years but we are now turbo-charging that initiative," Under Secretary for Economic Growth, Energy and the Environment at the US State Department Keith Krach told Reuters.

    Krach as well as other officials told the agency that some critical and essential manufacturing should be moved from the country, and the government may take steps on it soon. Apart from the US' seemingly favorite options of tariffs and sanctions, the plans may include tax incentives and potential reshoring subsidies as well as closer relations with Taiwan – a move which has always angered Beijing.

    Washington is also mulling the creation of what one of the officials called 'Economic Prosperity Network' which would include companies and groups from some "trusted partners." The network is set to share the same standards "on everything from digital business, energy and infrastructure to research, trade, education and commerce."

    China's vital role in global supply chains was felt sharply amid the coronavirus pandemic as many international giants – from tech to car industries – are reliant on the country. The pandemic has forced some US companies to seriously consider at least partial relocation and changing supply chain strategy, according to one of the latest polls conducted by the American Chamber of Commerce in China and its sister organization in Shanghai. However, the majority of firms said that the outbreak does push them to turn their backs on China.

    Nevertheless, one of the "China hawks" told Reuters that the virus created "a perfect storm" as it "crystallised all the worries that people have had about doing business with China" and the damages from Covid-19 have eclipsed possible profits.

    Also on rt.com 'No mass exodus': Most US firms don't want to wind down operations in China over pandemic

    When the trade war showed no signs of abating last year and the US and China were still hitting each other with tariffs, another AmCham poll showed that the punitive measures were hurting US businesses operating in China. While over forty percent of the 250 respondents were "considering or have relocated" production facilities outside China, some 35 percent of companies said they would rather source within China and target the domestic market. Fewer than six percent wanted to move or already shifted their factory operations to the US.

    Set aside the enormous relocation costs – which the White House has recently pledged to cover should an American company decide to ditch China – there is still another massive hurdle in this plan. China is still the world's top producer of rare earth metals – the group of elements vital for production of multiple devices, from cell phones to some advanced military gear. Should all the production be moved from China, it could ban exports of these materials. Last year Chinese media said the option was already being mulled by Beijing, and it could consider the drastic measure again if trade war tensions further escalate.

    For more stories on economy & finance visit RT's business section

    [May 02, 2020] The USA makes an expected move in trade war with china: complites access of china companies to US produced chips

    May 02, 2020 | thenewkremlinstooge.wordpress.com

    et Al April 28, 2020 at 2:17 am

    Euractiv mit Neuters: US imposes new rules on exports to China to keep them from its military
    https://www.euractiv.com/section/defence-and-security/news/us-imposes-new-rules-on-exports-to-china-to-keep-them-from-its-military/

    The new rules will require licenses for US companies to sell certain items to companies in China that support the military, even if the products are for civilian use. They also do away with a civilian exception that allows certain US technology to be exported without a license.

    They come as relations between the United States and China have deteriorated amid the new coronavirus outbreak
    ####

    It's far too late and will be significantly damaging to US companies. No doubt Washington still expects Beijing to buy Boeing airliners. If Beijing were to pull that plug, then it would take out Arbus, P&W, GE, CFM all the suppliers, MRO ventures and collapse the whole western airline supply chain. It would obviously kill any Chinese or Russian airline program that has any western content . I doubt Beijing will go that far so they'll be looking at actions, not words.

    t-Rump and co need to show something sym-bollox to the American electorate that yet again they are being 'tough on China' during this erection year but it requires China to play along. It simply might not. It is reported that China is currently purchasing large quantities of American LNG to fulfill 'Phase one' of t-Rump's Deal of the Century with China.

    Maybe that is the obvious counter, threatening to pull the whole DoC, starting with dumping LNG purchases as a direct warning. t-Rump's Administration has pushed itself into a smaller and smaller box, all of its own making. As I've always said and I still believe to be true, the biggest threat to t-Rump's re-erection is t-Rump himself.

    Like Like

    Mark Chapman April 28, 2020 at 9:22 am
    Paradoxically, the more Trump's belligerence and 'gut-based' trade policies damage international trade, the more convinced his supporters become that only Trump can handle increasingly-complicated trade relationships. This probably stems from his going into a meeting under difficult conditions, emerging to fire off a miracle tweet, "China will now buy massive quantities of our agricultural products", and ducking out the back without elaboration. This leads to a misplaced belief that Trump can perform miracles, as much of a jerk as he can be, because his loyalists rarely pay attention long enough for the rebuttal which always comes, laying out his serial exaggerations. Remember when U.S. Steel was building three new steel plants, on the strength of Trump's hard-ass negotiations in the Canada-Mexico-USA Free Trade deal? Lighthizer's hard-ass negotiations, actually. Anyway, yeah; totally made it up. He doesn't see anything wrong with making optimistic projections which have no basis in fact.

    Mind you, it would be a bit of a downer to have to explain again to Biden what 'oil' is, every single time the subject comes up. But I wouldn't be too worried about that.

    LNG is pretty cheap right now, like all energy products. I see China behaving much like Russia; once it strikes an international bargain, it will stick to it until the terms play out. But Trump might find a different China when he tries to strike the next agreement.

    Like Like

    et Al April 29, 2020 at 3:43 am
    China can also take similar measures, sic (I read that) Alibaba and other gigantic Chinese companies that rely on server farms are switching over to Chinese made chippery and not buying foreign. Simply in lost sales for the foreseeable future is gigantic.

    Like Like

    Mark Chapman April 29, 2020 at 9:54 am
    I imagine you are too young to remember Victor Kiam (he died in 2001) former president of the Remington Razor Company. He had a popular line of commercials in the late 80's in which he would say "I liked it so much, I bought the company".

    https://www.youtube.com/embed/3NlMTkfI8Sc?version=3&rel=1&fs=1&autohide=2&showsearch=0&showinfo=1&iv_load_policy=1&wmode=transparent

    The Chinese must have heard him, because they took his method to heart; Alibaba doesn't just buy Chinese-made chips, they bought the company. Right after the United States started up its we-have-to-keep-priceless-American-technological-secrets-out-of-the-hands-of-the-thieving-Chinks policies. Suit yourself, Sam.

    https://www.reuters.com/article/us-csky-m-a-alibaba-idUSKBN1HR0VY

    Shanghai-based Semiconductor Manufacturing International, a $5.4 Billion company and one of the largest such companies in China, pulled its listing from the NYSE.

    https://www.cnbc.com/2019/05/24/major-chinese-chipmaker-delisting-from-the-nyse-but-says-it-has-nothing-to-do-with-trade-war.html

    In 2018, Skyworks Solutions had 83% of its business in China. Apple had 20%, but 20% of Apple's revenue is a shitload of money. I had to laugh at the line, "Investors are increasingly concerned over the prospect of rising global protectionism." 'Global protectionism' pretty much covers The Donald's act.

    https://www.cnbc.com/2018/04/04/chipmakers-may-have-the-most-to-lose-in-a-trade-war-with-china.html

    [May 01, 2020] Assuming that the US did indeed seed the virus in Wuhan, then we might speculate that the seeding was timed to coincide with the flu season in China and with mass preparations for Chinese New Year.

    May 01, 2020 | www.moonofalabama.org

    Jen , Apr 29 2020 23:21 utc | 69

    Jackrabbit @ 21, 53:

    Justin GLyn @ 65 is correct: New Zealand Prime Minister Jacinda Ardern instituted a Stage 4 lockdown in her country in mid-to-late March with the aim of eliminating the virus from Kiwi shores. That goal is no longer feasible but the country has begun relaxing its lockdown to Stage 3 in an effort to revive its economy.

    The US failure to anticipate blowback can be understood in one way: assuming that the US did indeed seed the virus in Wuhan, then we might speculate that the seeding was timed to coincide with the flu season in China and with mass preparations for Chinese New Year. The thinking was that the virus would spread through public transportation networks throughout the country and Beijing would have a full-time job on its hands just dealing with massive viral outbreaks all over the country, and fail to deal with them even adequately, leading to mass riots and eventually widespread resistance to Beijing, and maybe even the eventual disintegration of the CCP and its overthrow. US and other expatriates would be trapped in the country, and foreign embassies and consulates might even be torched, prompting a US-led coalition to invade parts of the country (like the south and the southeast) and take over in a start to the balkanisation of the country cunningly disguised as foreign help to keep order.

    The US certainly did not anticipate that Chinese people trusted enough in Beijing to be willing to carry out whatever orders Beijing issued; the US assumption seems to be that everywhere around the planet, people yearn to be just as individualistic and suspicious of Big Government as Americans are, and that what they think of their local councils and regional governments is the same as what they think of their national governments.

    The reality is that in many countries, whatever people think of their local councils and regional (state, provincial) governments may not be true of what they think of their national governments, because the functions of the three tiers of government in their countries may not overlap to the extent that they might do in the Anglocentric world.

    Neither did the US anticipate that Chinese society could be advanced in its own way technologically with various functions such as public health, public transport and others integrated enough that the Chinese could respond to a rapidly spreading crisis in the way they did. That is in part because US society and values are based on competition, mutual suspicion and top-down orders among other things, rather than co-operation, collective behaviour and willingness to consider solutions based on ideas from divergent yet integrated sources.


    Vasco da Gama , Apr 29 2020 23:47 utc | 75

    Very good comment! Jen@69

    That is a very plausible working hypothesis, and I mean it working, the main assumption is still to be proven but it explains many other observations of fact. But I will append a variable in the main assumption: we could even replace the initiative's agent with some non-state actor, ie Big Pharma. I am unable to "decide" between these possibilities. Are the Imperial forces conflicting to the extent implied? Are we yet at the point that a non-state actor is bold enough for such an action? I really don't want to stretch a perfectly good hypothesis but am I?

    David KNZ , Apr 30 2020 1:39 utc | 90
    ===> Jen @ 69 Good Post; astute observations

    I was in China at the time when this unfolded and note the following: 1: The Chinese cultural mindset is totally different from the Western one, and the gap much greater than most Westerners realise. Look at the videos of the 75th Anniversary of Modern China for a few clues 2: As the worlds largest atheist nation, death is considered final, rituals notwithstanding So they are motivated to survive..( and focus on delicious food to this end) 3: They talk. Incessantly. It is no accident that WeChat has grown exponentially.. What happens in one part of China is pretty quickly spread to other parts And on the Flipside, there are surveillance cameras everywhere

    So when this unfolded, Mid Spring festival when the cities were emptied, the memory of the SARS epidemic sprang to forefront of the official mind. Xi JingPing appeared on most TV Channels, making it clear that he was taking responsibility for the government response. And implicitly, that if he failed, he would be gone, in keeping with the long tradition of Chinese leadership.

    At this point we decided to bail, being prime targets to host the virus. Avoided getting quarantined in HongKong by 4 hours, and quarantine in Manus Island, Aus by one phone call.

    There were 6 temperature checks and 4 police checks on route to HongKong Airport; arriving in New Zealand expecting some major medical checks. None. Just 2 nurses at a deck asking if we felt OK - handed a pamphlet and sent on our way. I did try to follow up but given official discouragement. So NZ was asleep at the wheel for weeks, and just plain lucky. However, once NZ woke up, the response was excellent; PM Jacinda Adern's speech was masterful and the response excellent. We had only two CoVid cases yesterday, as we move into level 3.

    There are big problems in economic recovery here, but the alternative scenarios would have been far worse. And theres got to be a reason why various luxury private jets are turning up unannounced and often unmarked at the airports here :-)

    Jackrabbit , Apr 30 2020 6:11 utc | 113
    Jen @Apr29 23:21
    karlof1 @Apr30 0:34

    Each of your explanations are compelling in their own way.

    A few things that your explanations left out (this is not meant to be a comprehensive list):


    IMO any theory of deliberate release should consider these points.

    Bolton's was asked to leave the administration because he was involved in pushing development of a virus which accidentally escaped the lab -OR- willingly left to give Trump/Deep State a scapegoat in case it became known that the use of the virus was deliberate? In either case, the virus was already "in the wild" ...

    ... which would explain why no medical professional resigned in Feb/March. It was never going to be possible to contain the virus in the West.

    This would also explain why virus discussion were classified.

    Trump did a trade deal with China that he knew they would have trouble to satisfy the terms of. The ARAMACO IPO - which had been delayed several times - came just about 6 weeks before the new virus was identified. And it was done despite the Houthi attack on ARAMACO facilities two months before (investors should've been very wary of the continuing war at the super high valuation).

    <> <> <> <> <>

    PS I do know that New Zealand had a lock-down but they did that as soon as they found 'community spread' and their vigilance has allowed them to start lifting the lock-down after only a short period.

    !!

    [Apr 30, 2020] No Weapon Left Behind The American Hybrid War on China by Pepe Escobar

    Feb 21, 2020 | www.strategic-culture.org

    Branding BRI as a "pandemic"

    As the usual suspects fret over the "stability" of the Chinese Communist Party (CCP) and the Xi Jinping administration, the fact is the Beijing leadership has had to deal with an accumulation of extremely severe issues: a swine-flu epidemic killing half the stock; the Trump-concocted trade war; Huawei accused of racketeering and about to be prevented from buying U.S. made chips; bird flu; coronavirus virtually shutting down half of China.

    Add to it the incessant United States government Hybrid War propaganda barrage, trespassed by acute Sinophobia; everyone from sociopathic "officials" to self-titled councilors are either advising corporate businesses to divert global supply chains out of China or concocting outright calls for regime change – with every possible demonization in between.

    There are no holds barred in the all-out offensive to kick the Chinese government while it's down.

    A Pentagon cipher at the Munich Security Conference once again declares China as the greatest threat , economically and militarily, to the U.S. – and by extension the West, forcing a wobbly EU already subordinated to NATO to be subservient to Washington on this remixed Cold War 2.0.

    The whole U.S. corporate media complex repeats to exhaustion that Beijing is "lying" and losing control. Descending to sub-gutter, racist levels, hacks even accuse BRI itself of being a pandemic , with China "impossible to quarantine".

    All that is quite rich, to say the least, oozing from lavishly rewarded slaves of an unscrupulous, monopolistic, extractive, destructive, depraved, lawless oligarchy which uses debt offensively to boost their unlimited wealth and power while the lowly U.S. and global masses use debt defensively to barely survive. As Thomas Piketty has conclusively shown, inequality always relies on ideology.

    We're deep into a vicious intel war. From the point of view of Chinese intelligence, the current toxic cocktail simply cannot be attributed to just a random series of coincidences. Beijing has serial motives to piece this extraordinary chain of events as part of a coordinated Hybrid War, Full Spectrum Dominance attack on China.

    Enter the Dragon Killer working hypothesis: a bio-weapon attack capable of causing immense economic damage but protected by plausible deniability. The only possible move by the "indispensable nation" on the New Great Game chessboard, considering that the U.S. cannot win a conventional war on China, and cannot win a nuclear war on China.

    A biological warfare weapon?

    On the surface, coronavirus is a dream bio-weapon for those fixated on wreaking havoc across China and praying for regime change.

    Yet it's complicated. This report is a decent effort trying to track the origins of coronavirus. Now compare it with the insights by Dr. Francis Boyle, international law professor at the University of Illinois and author, among others, of Biowarfare and Terrorism . He's the man who drafted the U.S. Biological Weapons Anti-Terrorism Act of 1989 signed into law by George H. W. Bush.

    Dr. Boyle is convinced coronavirus is an

    "offensive biological warfare weapon" that leaped out of the Wuhan BSL-4 laboratory, although he's "not saying it was done deliberately."

    Dr. Boyle adds, "all these BSL-4 labs by United States, Europe, Russia, China, Israel are all there to research, develop, test biological warfare agents. There's really no legitimate scientific reason to have BSL-4 labs." His own research led to a whopping $100 billion, by 2015, spent by the United States government on bio-warfare research: "We have well over 13,000 alleged life science scientists testing biological weapons here in the United States. Actually this goes back and it even precedes 9/11."

    Dr. Boyle directly accuses "the Chinese government under Xi and his comrades" of a cover up "from the get-go. The first reported case was December 1, so they'd been sitting on this until they couldn't anymore. And everything they're telling you is a lie. It's propaganda."

    The World Health Organization (WHO), for Dr. Boyle, is also on it: "They've approved many of these BSL-4 labs ( ) Can't trust anything the WHO says because they're all bought and paid for by Big Pharma and they work in cahoots with the CDC, which is the United States government, they work in cahoots with Fort Detrick ." Fort Detrick, now a cutting-edge bio-warfare lab, previously was a notorious CIA den of mind control "experiments".

    Relying on decades of research in bio-warfare, the U.S. Deep State is totally familiar with all bio-weapon overtones. From Dresden, Hiroshima and Nagasaki to Korea, Vietnam and Fallujah, the historical record shows the United States government does not blink when it comes to unleashing weapons of mass destruction on innocent civilians.

    For its part, the Pentagon's Defense Advanced Research Project Agency (DARPA) has spent a fortune researching bats, coronaviruses and gene-editing bio-weapons. Now, conveniently – as if this was a form of divine intervention – DARPA's "strategic allies" have been chosen to develop a genetic vaccine.

    The 1996 neocon Bible, the Project for a New American Century (PNAC), unambiguously stated, "advanced forms of biological warfare that can "target" specific genotypes may transform biological warfare from the realm of terror to a politically useful tool."

    There's no question coronavirus, so far, has been a Heaven-sent politically useful tool, reaching, with minimum investment, the desired targets of maximized U.S. global power – even if fleetingly, enhanced by a non-stop propaganda offensive – and China relatively isolated with its economy semi paralyzed.

    Yet perspective is in order. The CDC estimated that up to 42.9 million people got sick during the 2018-2019 flu season in the U.S. No less than 647,000 people were hospitalized. And 61,200 died.

    This report details the Chinese "people's war" against coronavirus.

    It's up to Chinese virologists to decode its arguably synthetic origin. How China reacts, depending on the findings, will have earth-shattering consequences – literally.

    Setting the stage for the Raging Twenties

    After managing to reroute trade supply chains across Eurasia to its own advantage and hollow out the Heartland, American – and subordinated Western – elites are now staring into a void. And the void is staring back. A "West" ruled by the U.S. is now faced with irrelevance. BRI is in the process of reversing at least two centuries of Western dominance.

    There's no way the West and especially the "system leader" U.S. will allow it. It all started with dirty ops stirring trouble across the periphery of Eurasia – from Ukraine to Syria to Myanmar.

    Now it's when the going really gets tough. The targeted assassination of Maj. Gen. Soleimani plus coronavirus – the Wuhan flu – have really set up the stage for the Raging Twenties. The designation of choice should actually be WARS – Wuhan Acute Respiratory Syndrome. That would instantly give the game away as a War against Humanity – irrespective of where it came from.

    [Apr 24, 2020] The USA is entering its Byzantine Empire phase

    Apr 24, 2020 | www.unz.com

    anonymous [589] Disclaimer , says: Show Comment April 23, 2020 at 8:52 pm GMT

    YOU are completely MISreading the events so yo miss the target by 90% NO it wasnt the Russians . neither the Chinese..

    IT was the FREEtraders NEOcons from Wallstreet and CFR, that transfer all american manufacturing overseas (china) deabsing the dollar into fiat money, banktupted the USA traesury The USA is entering its Byzanntyne Empire pahse a Spartan roque millitary nation while inploding intrenally the Angloamerican zionists already ecided toi amke China de first world power

    [Apr 24, 2020] Sometime before the 20th century closed, there was a term coined: the "Princelings". These were the extravagantly wealthy offspring of many of the leadership of the CCP, and grandchildren of the men who endured the "Long March".

    Apr 24, 2020 | www.unz.com

    anachronism , says: Show Comment April 23, 2020 at 8:20 pm GMT

    @Anonymous How should I describe it? The Chinese Communist Party has formed a plutarchy and an oligopoly "with Chinese characteristics".

    Sometime before the 20th century closed, there was a term coined: the "Princelings". These were the extravagantly wealthy offspring of many of the leadership of the CCP, and grandchildren of the men who endured the "Long March".

    "Genocide" is a term that is broadly applied to what is more accurately described as "ethnic cleansing". The Hans have taken over Tibet and Xin Jiang, and have oppressed the locals in a ruthless manner, that is comparable to what the Jews have done to Palestinians.

    Systematically, the Chinese are converting the indigenous populations of poorer countries into indentured servants. These countries are so indebted to their Chinese "benefactors" that they have no hope for redemption, unless the Chinese are prepared to forgive the loans. So far, the Chinese have not been disposed to do so.

    The effect and the consequence of these developments are close enough to warrant the comparison.

    [Apr 10, 2020] Global Times blasts Outlaw US Empire COVID response:

    Apr 10, 2020 | www.globaltimes.cn
    Global Times blasts Outlaw US Empire COVID response :

    "The vicious virus, the polarization of US politics and deepening international divergences have plunged humanity into unprecedented uncertainties. A jumbled, irresponsible and impulsive US greatly enhanced the risks the world is facing.

    "What's worse, the US did not engage in any reflection, and the inability of its government was only attributed to partisanship. The anti-China element in its public opinion has been brewing with the instigation of the administration and some politicians. This has greatly crumbled the US' self-correction ability.

    "The harm on humanity caused by a virus, no matter how frightening it is, only remains at the physical level. But the US destruction at the political level is amplifying this crisis that endangers global governance. Even if the pandemic is put under control, humanity has to face the turbulence post-pandemic. Such dual uncertainties have gone beyond the imagination of people even with their decades of living experience."

    IMO and contrary to the editorial's conclusion, "populist politics" had nothing to do with Trump's beyond mediocre response; rather, it's all been ideological beginning with the utter lack of preparation.

    Posted by: karlof1 | Apr 9 2020 17:22 utc | 108

    [Mar 27, 2020] Senior officials in the Trump administration agreed to new measures to restrict the global supply of chips to China's Huawei Technologies, sources familiar with the matter said, as the White House ramps up criticism of China over coronavirus.

    Mar 27, 2020 | www.moonofalabama.org

    Likklemore , Mar 26 2020 21:56 utc | 66

    Is the troop deployment along the Canadian border is to stop anyone interfering in the coming chaos?

    Posted by: Ian2 | Mar 26 2020 20:34 utc | 36

    You have a point there --the coming chaos after the COVID-19 Health crisis.

    Wondering if Trudeau knows about the fences that were erected this morning?

    Maybe I missed Trump's tweet on his declaration of War.

    - He has imposed more sanctions on Iranians.
    - Indicted Maduro of Venezuela on narco trafficking, sponsor of terrorism; placed a $15 million bounty on his head --straight from the Panama playbook.

    and this beauty - continues his trade war on China because -----

    Exclusive: U.S. prepares crackdown on Huawei's global chip supply - sources

    (Reuters) - Senior officials in the Trump administration agreed to new measures to restrict the global supply of chips to China's Huawei Technologies, sources familiar with the matter said, as the White House ramps up criticism of China over coronavirus.

    The move comes as ties between Washington and Beijing grow more strained, with both sides trading barbs over who is to blame for the spread of the disease and an escalating tit-for-tat over the expulsion of journalists from both countries.

    Under the proposed rule change, foreign companies that use U.S. chipmaking equipment would be required to obtain a U.S. license before supplying certain chips to Huawei. The Chinese telecoms company was blacklisted last year, limiting the company's suppliers.[.]
    "This is going to have a far more negative impact on U.S. companies than it will on Huawei, because Huawei will develop their own supply chain," trade lawyer Doug Jacobson said. "Ultimately, Huawei will find alternatives."[.]

    Huawei has been doing just that - finding alternatives. Trade wars have been proven to end badly. They end up going hot.

    [Mar 19, 2020] Much of the US elite is sinecured in the media, foreign policy, and national security state establishments

    Mar 19, 2020 | www.unz.com

    Anonymous [252] Disclaimer , says: Show Comment March 18, 2020 at 6:53 pm GMT

    @Sean

    Here was me thinking the Western elites wanted to continue making money on Chinese growth.

    Much of the US elite is sinecured in the media, foreign policy, and national security state establishments, whose status depends on the relative power and prestige of the US state. The relative power and prestige of the US state is jeopardized by the continued growth of China.

    If you follow US coverage of China in the US, you'll find that this US elite is generally critical of China, although style and presentation vary. The liberal "China watchers" among the US elite in the media and foreign policy establishment tend to focus on human rights, democracy promotion, and liberalism as vectors to attack the Chinese state. They tend to be polished and more subtle rather than explicitly hostile.

    The US elite in the national security establishment tend to be more overt about military containment and or confrontation with China, and on developing an anti-China coalition in the Pacific.

    [Mar 09, 2020] COVID-19 burst the asset price bubble. In a new low, Pompeo passes buck to Beijing

    Mar 09, 2020 | www.moonofalabama.org

    CitizenX , Mar 9 2020 2:58 utc | 57

    "Perhaps this will finally burst the out-of-control asset price bubble and drop-kick the Outlaw US Empire's economy into the sewer as the much lower price will rapidly slow the recycling of what remains of the petrodollar. Looks like Trump's reelection push just fell into a massive sinkhole as the economy will tank."

    Posted by: karlof1 | Mar 9 2020 1:29 utc | 49
    ....

    Call me crazy- but this Virus provides great cover as to why the economy plummets, the Murikan sheeple will eat it up. Prepare for the double media blitz on the virus AND the economy tanking as its result.

    Don't worry...just continue to go shopping and take those selfies.


    vk , Mar 9 2020 3:37 utc | 60

    Pompeo accuses China of giving "imperfect data" on COVID-19, blame it for US failure in containing the virus:

    In new low, Pompeo passes buck to Beijing

    It will be hard for the American people to swallow that one. From day 1 I've read a lot of "articles" and "papers" from know-it-all Western doctors and researchers from commenters here in this blog, all of them claiming to have very precise and definitive data on what was happening. A lot of bombastic conclusions I've read here (including one that claimed R0 was through the roof - it's funny how the R0 is being played down after it begun to infect the West; suddenly, it's all just a stronger cold...).

    And that's just here, in MoA's comment section. Imagine what was being published in the Western MSM. I wouldn't be surprised there was a lot of rednecks popping their beers celebrating the fall of China already.

    --//--

    China to back global virus fight with production boost

    Since China allegedly had a lot of idle industrial capacity - that is, if we take the Western MSM theories seriously (including the fabled "ghost towns" stories) - then boosting production wouldn't be a problem to China.

    Disclaimer: it's normal for any kind of economy - socialist or capitalist - to have a certain percentage of idle capacity. That's necessary in order to insure the economy against unexpected oscillations in demand and to give space of maneuvre for future technological progress. Indeed, that was one of the USSR's mistakes with its economy: they instinctly thought unemployment should be zero, and waste should also be zero, so they planned in a way all the factories always sought to operate at 100% capacity. That became a problem when better machines and better methods were invented, since the factory manager wouldn't want to stop production so that his factory would fall behind the other factories in the five-year plan's goals. So, yes, China indeed has idle capacity - but it is mainly proposital, not a failure of its socialist planning.

    --//--

    ... ... ...

    vk , Mar 9 2020 3:56 utc | 61
    This is important. The only reason I didn't comment about it is I hadn't the data:

    Follow the money: Understanding China's battle against COVID-19

    By the latest count, in addition to yuan loans worth 113 billion U.S. dollars granted by financial institutions and more than 70 billion U.S. dollars paid out by insurance companies, the Chinese government has allocated about 13 billion U.S. dollars to counter fallout from the outbreak.

    The numbers could look abstract. However, breaking the data down reveals how the money is being carefully targeted. The government is allocating the money based on a thorough evaluation of the system's strengths.

    ...

    Local governments are equipped with more local knowledge that allows them to surgically support key manufacturers or producers that are struggling.

    Together, they have borne the bulk of the financial responsibility with an allocation of equivalently more than nine billion U.S. dollars. It is carefully targeted, divided into hundreds of thousands of individual grants that are tailor-made by and for each county, town, city and business.

    This is the mark of a socialist system.

    The affected capitalist countries will simply use monetary devices (so the private sector can offset the losses) and burn their own reserves with non-profitable palliatives such as masks, tests, other quarantine infrastructure etc.

    Pft , Mar 9 2020 4:44 utc | 64
    Sounds like US socialism. Basically corporate socialism. Loans are just dollars created out of thin air, same as in US. Insurance payouts come from premiums, nothing socialist about that, pure capitalism. Government hand outs to provinces, cities, state owned corporations,well all of these are run by the party elite, its called pork. US handed out a lot of pork during the last financial crisis. None of it trickled down to the little people. I doubt it does in China either.

    All crisis are opportunities for the elite to get richer. Those Biolake firms in Wuhan will make out like bandits. Chinese firms will double the price of API's sold to India and US. China will knock out the small farmer in the wake of concurrent chicken and swine flu so the big enterprises take over, a mimicry of the US practice over the last century. China tech firms will double up on surveillance apps, censoring tools, surveillance and toughen up social credit restrictions. 5G will allow China to experiment with nanobots to monitor citizens health from afar (thanks to Harvards Dr Leiber).

    Oh yes, socialism with Chinese characteristics is a technocratic capitalists dream. Thats why the West has never imposed sanctions on China since welcoming them to the global elites club. Sanctions are reserved for those with true socialism, especially those who preach equality and god forbid, democracy.

    uncle tungsten , Mar 9 2020 8:35 utc | 83

    CitizenX #57

    Call me crazy- but this Virus provides great cover as to why the economy plummets, the Murikan sheeple will eat it up. Prepare for the double media blitz on the virus AND the economy tanking as its result.


    Don't forget the Russians.. They have to be to blame. See they just kept the price of oil low so now the rest of the world gets gas cheaper than the USA. The USA motorist now has to bail out the dopey frackers and shale oil ponzis.

    Global envy will eat murica. Maybe they will just pull out all their troops and go home. ;)

    [Mar 06, 2020] Over eighty percent of the medicines used in the United States are manufactured in China

    Mar 06, 2020 | www.unz.com

    Anon 2 , says: Show Comment February 25, 2020 at 5:39 am GMT

    As far as I know, no one here has mentioned that because of the globalization drive by Clinton, Bush, and Obama, 85% of the medicines used in the United States are manufactured in China. Even U.S. troops depend on medicines from China! China could bring the entire health system in the U.S. to a stop in a matter of months. This is what our inept elites have done to America – they gave away the shop. People are beginning to realize that manufacturing our own medicines is a matter of national security but it'll take years to bring the factories back to the U.S. So much for globalization.

    Rod Dreher's blog IMHO is the best source for quick info on the coronavirus because he is in touch with American M.D.'s who are married to women from China who in turn are in contact with relatives at home and the Chinese media. Of course, Rod himself can be hysterical at times but, apparently, that's what it takes to have a successful blog. The M.D.'s are reporting that the U.S. is already beginning to run out of certain medications, and recommend stocking up on the basic necessities, i.e., recommend assuming the mental framework of the survivalists – have plenty of canned goods, etc and refill your prescriptions ASAP. This is what many people here seem to forget – the coronavirus's indirect effects due to having no access to medications may be much worse than the direct pathogenic effects.

    [Feb 29, 2020] A very interesting and though provoking presentation by Ambassador Chas Freeman "America in Distress: The Challenges of Disadvantageous Change"

    Highly recommended!
    Notable quotes:
    "... the American-led takedown of the post-World War II international system has shattered long-standing rules and norms of behavior. ..."
    "... The combination of disorder at home and abroad is spawning changes that are increasingly disadvantageous to the United States. With Congress having essentially walked off the job, there is a need for America's universities to provide the information and analysis of international best practices that the political system does not. ..."
    Feb 29, 2020 | angrybearblog.com

    likbez , February 29, 2020 7:38 pm

    A very interesting and though provoking presentation by Ambassador Chas Freeman "America in Distress: The Challenges of Disadvantageous Change"

    https://www.youtube.com/watch?v=mvILLCbOFo4

    I think this would be very informative for anybody seriously interested in the USA foreign policy. Listening to him is so sad to realize that instead of person of his caliber we have Pompous Pompeo, who forever is frozen on the level of a tank repair mechanical engineer, as the Secretary of State.

    Published on Feb 24, 2020

    In the United States and other democracies, political and economic systems still work in theory, but not in practice. Meanwhile, the American-led takedown of the post-World War II international system has shattered long-standing rules and norms of behavior.

    The combination of disorder at home and abroad is spawning changes that are increasingly disadvantageous to the United States. With Congress having essentially walked off the job, there is a need for America's universities to provide the information and analysis of international best practices that the political system does not.

    Ambassador Chas W. Freeman, Jr. is a senior fellow at Brown University's Watson Institute for International and Public Affairs, a former U.S. Assistant Secretary of Defense, ambassador to Saudi Arabia (during operations Desert Shield and Desert Storm), acting Assistant Secretary of State for African Affairs, and Chargé d'affaires at both Bangkok and Beijing. He began his diplomatic career in India but specialized in Chinese affairs. (He was the principal American interpreter during President Nixon's visit to Beijing in 1972.)

    Ambassador Freeman is a much sought-after public speaker (see http://chasfreeman.net ) and the author of several well-received books on statecraft and diplomacy. His most recent book, America's Continuing Misadventures in the Middle East was published in May 2016. Interesting Times: China, America, and the Shifting Balance of Prestige, appeared in March 2013. America's Misadventures in the Middle East came out in 2010, as did the most recent revision of The Diplomat's Dictionary, the companion volume to Arts of Power: Statecraft and Diplomacy. He was the editor of the Encyclopedia Britannica entry on "diplomacy."

    Chas Freeman studied at the Universidad Nacional Autónoma de México and in Taiwan, and earned an AB magna cum laude from Yale University as well as a JD from the Harvard Law School.

    He chairs Projects International, Inc., a Washington-based firm that for more than three decades has helped its American and foreign clients create ventures across borders, facilitating their establishment of new businesses through the design, negotiation, capitalization, and implementation of greenfield investments, mergers and acquisitions, joint ventures, franchises, one-off transactions, sales and agencies in other countries.

    He is the author of several books including the most recent

    Interesting times: China, America, and the shifting balance of prestige (2013)

    [Feb 20, 2020] China denounces US lies at the Munich Security Conference by Peter Symonds

    Feb 19, 2020 | www.wsws.org

    In unusually blunt statements, top Chinese officials hit back during last weekend's Munich Security Conference at Washington's confrontational stance toward Beijing on a range of issues, including the Chinese tech giant Huawei and China's response to the coronavirus.

    Trump administration officials, supported to the hilt by top Democrats, took a particularly aggressive attitude at the conference, warning European powers that intelligence sharing could end if Huawei equipment were used in building 5G telecommunications networks.

    US Secretary of State Mike Pompeo branded "Huawei and other Chinese state-backed tech companies" as "Trojan horses for Chinese intelligence." In his speech, US Defence Secretary Mark Esper accused Beijing of carrying out a "nefarious strategy" through Huawei.

    In a bid to intensify its pressure on its European allies, the US last week announced new charges of racketeering and theft of trade secrets against Huawei. These follow the arrest of the company's chief financial officer, Meng Wanzhou, in Canada last year after the US filed charges of fraud and sanctions evasion, and sought her extradition.

    Esper made clear that the US attack on China was across the board. He declared that under President Xi Jinping's rule, "the Chinese Communist Party is heading even faster and further in the wrong direction -- more internal repression, more predatory economic practices, more heavy-handedness, and most concerning for me, a more aggressive military posture."

    Asked about the speeches by Pompeo and Esper, Chinese Foreign Minister Wang Yi did not mince words, branding the US allegations as "lies." He said their remarks were part of "a common scenario" everywhere they went. "I don't want to waste our time responding to each and every thing they've said. The thing I want to say is that all these accusations against China are lies and not based on facts."

    Wang pointed to the driving force behind the confrontation -- the US drive to ensure its continued global domination by every available means. "The root cause of all these problems and issues is that the US does not want to see the rapid development and rejuvenation of China, still less would they want to accept the success of a socialist country, but that is not fair, China has the right to develop."

    China, with its burgeoning markets, stock exchanges, billionaires and deep social divide, is not a socialist country. In fact, Huawei, as Wang said in countering US criticism, is a privately-owned company: the world's largest telecommunications equipment provider with nearly 200,000 employees.

    Wang described the US attack on Huawei as "immoral" and asked: "Why can't America accept that other countries' companies can also display their talent in the economy, in technology? Perhaps deep down, it doesn't hope to see other countries develop." He accused the US of resorting to rumours to defame Huawei and declared there was no credible evidence that the company has a so-called back door that harms US security.

    The US accusations against China and Huawei are utterly hypocritical. The revelations by the whistleblower Edward Snowden demonstrated that the US routinely spies electronically on the world's population, including governments and government leaders, allies and rivals alike, as well as its own citizens.

    The US intelligence establishment has long relied on electronic "back doors" provided by American tech corporations to gather intelligence. The use of Huawei equipment not only threatens the economic position of US companies, but could undermine US spying operations.

    China's forthright push back against heavy US criticism in Munich stems firstly from the relentless campaign by Washington, not only in propaganda, but through trade war measures and a huge military build-up in Asia against Beijing. Secondly, the Chinese regime is seeking support from the European powers. Wang's comments gained traction in Munich amid deepening conflicts between the US and its erstwhile European allies.

    Britain has given the go-ahead for the inclusion of Huawei components in non-core aspects of its 5G rollout, while Germany and France have signaled they will do the same. The European decisions are largely driven by technical and economic factors, as Huawei is a leader in 5G technology and produces at a lower cost.

    Washington's threats to end intelligence-sharing arrangements with the European powers could end up affecting US spying operations as much as those of its European rivals. The New York Times

    The US has sought to exploit the coronavirus outbreak in China to add to the barrage of criticism against Beijing. Trump's economic adviser Larry Kudlow last week complained about the lack of Chinese transparency over the disease. He declared that Washington was disappointed that American health experts had not been allowed into China, and questioned Chinese statistics.

    A considerable portion of Wang's speech to the Munich Security Conference was devoted to defending China's handling of the outbreak. He said the coronavirus largely had been confined to the city of Wuhan and Hubei Province, and the number of cases outside China was a small percentage of the total. Wang said this was the outcome of the rapid development of a test for the virus, the dispatch of 20,000 health workers to the area and the building of new health facilities.

    Wang said: "In the spirit of openness and transparency, we promptly notified the world about the outbreak and shared the genetic sequence of the virus. We have been working closely with WHO [World Health Organisation], invited international experts to join our ranks, and provided assistance and facilitation to foreign nationals in China."

    In comments to Reuters, the Chinese foreign minister effectively criticised the harsh travel restrictions imposed by the US on any foreign nationals coming from China. "Some countries have stepped up measures, including quarantine measures, which are reasonable and understandable, but for some countries they have overreacted which has triggered unnecessary panic," he said.

    If Washington expected European support on the issue, its hopes were dashed. Conference chairman Wolfgang Ischinger praised China's response to the epidemic and declared it was "not getting a very fair deal I think China deserves a little bit of compassion and cooperation, and encouragement rather than only criticism."

    China's reaction to the US criticisms in Munich underscores again the sharpening geo-political rivalries and break-up of longstanding alliances being fueled by worsening global economic conditions. Far from responding to the lack of support from Europe against China by moderating its confrontation, the US will intensify its provocative campaign, not just against Beijing, but any threat to its global position, including from its European allies.

    [Feb 14, 2020] US Warms Up Its Own Old Spy Stories To Bash Putative Chinese Espionage

    Feb 14, 2020 | www.moonofalabama.org

    That such cynicism was wholly justified became evident when Edward Snowden revealed the NSA machinations. Soon thereafter Juniper Networks, a provider of large backbone equipment, was found to have at least two NSA backdoors in its operation system. Other 'western' telecommunication equipment companies were similarly manipulated :

    Even neutral countries firms are not off-limits to NSA manipulations. A former Crypto AG employee confirmed that high-level US officials approached neutral European countries and argued that their cooperation was essential to the Cold War struggle against the Soviets. The NSA allegedly received support from cryptographic companies Crypto AG and Gretag AG in Switzerland, Transvertex in Sweden, Nokia in Finland, and even newly-privatized firms in post-Communist Hungary. In 1970, according to a secret German BND intelligence paper, supplied to the author, the Germans planned to "fuse" the operations of three cryptographic firms-Crypto AG, Grattner AG (another Swiss cipher firm), and Ericsson of Sweden.

    So why was the allegedly secret CIA history of an already known story leaked right now? And why was it also leaked to a German TV station?

    Sanho Tree points to the likely reason:

    If you want to understand why the US intelligence community is so freaked out about Huawei, it's because they've been playing the same game for decades.

    The WaPo story itself also makes that connection :

    There are also echoes of Crypto in the suspicions swirling around modern companies with alleged links to foreign governments, including the Russian anti-virus firm Kaspersky , a texting app tied to the United Arab Emirates and the Chinese telecommunications giant Huawei .

    The warmed up Crypto AG story is a subtle smear piece against Huawei and Kapersky.

    The U.S. wants to convince European countries to not buy Huawei products for their 5G networks. It wants to remind them that telecommunication products can be manipulated. It wants to instill fear that China would use Huawei to spy on foreign countries just like the U.S. used Crypto AG.

    This is also the reason for this recent misleading Reuters headline which the story itself debunked:

    Germany has proof that Huawei worked with Chinese intelligence: Handelsblatt

    "At the end of 2019, intelligence was passed to us by the U.S., according to which Huawei is proven to have been cooperating with China's security authorities," the newspaper quoted a confidential foreign ministry document as saying.

    'U.S. intelligence' that is handed over to manipulate someone is of course not 'proof' for anything.

    The U.S. is pressing its allies on a very high level:

    Secretary of State Mike Pompeo declared the Chinese Communist Party "the central threat of our times" on Thursday, even as he sought to talk up the prospects of a United States trade deal with Britain, which rebuffed American pressure to ban a Chinese company from future telecommunications infrastructure.

    The scathing criticism of the Chinese government was the strongest language Mr. Pompeo has used as the Trump administration seeks to convince American allies of the risks posed by using equipment from Huawei, a Chinese technology giant.

    A week after Pompeo's panic message Trump took to the phone to convince Boris Johnson who was not impressed :

    Donald Trump's previously close relationship with UK Prime Minister Boris Johnson looks close to collapse, following new revelations that the president slammed down the phone on him.

    Trump's behaviour during last week's call was described by officials as „apoplectic," and Johnson has now reportedly shelved plans for an imminent visit to Washington.
    ...
    The call, which one source described to the Financial Times as „very difficult," came after Johnson defied Trump and allowed Chinese telecoms company Huawei the rights to develop the UK's 5G network.

    Trump's fury was triggered by Johnson backing Huawei despite multiple threats by Trump and his allies that the United States would withdraw security co-operation with the UK if the deal went ahead.

    Trump's threats reportedly „irritated" the UK government, with Johnson frustrated at the president's failure to suggest any alternatives to the deal.

    Huawei products are pretty good, relatively cheap and readily available. They are just as buggy as the products of other equipment providers. The real reason why the U.S. does not want anyone to buy Huawei products is that it is the one large network company the U.S. can not convince to provide it with backdoors.

    European countries do not fear China or even Chinese spying. They know that the U.S. is doing similar on a much larger scale. Europeans do not see China as a threat and they do not want to get involved in the escalating U.S.-China spat:

    "Whose side should your country take in a conflict between the US and China?"

    Source - bigger

    The U.S. just indicted four Chinese military officers for the 2017 hacking of Equifax during which millions of addresses and financial data were stolen. The former CIA Director General Michael Hayden had defended such pilfering as "honorable espionage" and Equifax had made it laughably easy to get into its systems :

    [J]ust five days after Equifax went public with its breach -- KrebsOnSecurity broke the news that the administrative account for a separate Equifax dispute resolution portal catering to consumers in Argentina was wide open, protected by perhaps the most easy-to-guess password combination ever: "admin/admin."

    To indict foreign military officers for spying when they simply pilfered barely protected servers is seen as offensive. What will the U.S. do when China does likewise?

    Every nation spies. It is one of the oldest trades in this world. That the U.S. is making such a fuss about putative Chinese spying when it itself is the biggest sinner is unbecoming.

    Posted by b on February 11, 2020 at 18:52 UTC | Permalink

    [Feb 14, 2020] Why the USA is fighting Huawei without offering any super alternative

    Feb 14, 2020 | www.moonofalabama.org

    james , Feb 11 2020 20:13 utc | 13

    thanks b...no shortage of hypocrisy in all this...

    regarding @ 4 mike r which @8 ian2 linked properly to, i enjoyed the last paragraph which i think sums it up well.. here it is..

    "I continue to believe that the United States cannot effectively restrict the spread of a technology under Chinese leadership without offering a superior product of its own. The fact that the United States has attempted to suppress Huawei's market leadership in the absence of any American competitor in this field is one of the oddest occurrences in the history of US foreign policy. If the US were to announce something like a Manhattan Project for 5G broadband and solicit the cooperation of its European and Asian allies, it probably would get an enthusiastic response. As matters stand, America's efforts to stop Huawei have become an embarrassment."


    Petri Krohn , Feb 11 2020 20:38 utc | 16

    The reason European customers trust Huawei is because Huawei uses open-source software or at least makes their code available for inspection by customers.

    Closed-source software cannot provide secrecy or security. This was vividly demonstrated last month when NSA revealed a critical vulnerability in Windows 10 that rendered any cryptographic security worthless.

    Critical Windows 10 vulnerability used to Rickroll the NSA and Github

    Rashid's simulated attack exploits CVE-2020-0601, the critical vulnerability that Microsoft patched on Tuesday after receiving a private tipoff from the NSA. As Ars reported, the flaw can completely break certificate validation for websites, software updates, VPNs, and other security-critical computer uses. It affects Windows 10 systems, including server versions Windows Server 2016 and Windows Server 2019. Other versions of Windows are unaffected.

    The flaw involves the way the new versions of Windows check the validity of certificates that use elliptic-curve cryptography. While the vulnerable Windows versions check three ECC parameters, they fail to verify a fourth, crucial one, which is known as a base point generator and is often represented in algorithms as 'G.' This failure is a result of Microsoft's implementation of ECC rather than any flaw or weakness in the ECC algorithms themselves.

    The attacker examines the specific ECC algorithm used to generate the root-certificate public key and proceeds to craft a private key that copies all of the certificate parameters for that algorithm except for the point generator. Because vulnerable Windows versions fail to check that parameter, they accept the private key as valid. With that, the attacker has spoofed a Windows-trusted root certificate that can be used to mint any individual certificate used for authentication of websites, software, and other sensitive properties.

    I do not believe this vulnerability was a bug. It is more likely a backdoor intentionally left in the code for NSA to utilize. Whatever the case, NSA must have known about it for years. Why did they reveal it now? Most likely someone else had discovered the back door and may have been about to publish it.

    (I commented on these same issues on Sputnik a few weeks ago.)

    Piotr Berman , Feb 11 2020 23:04 utc | 25
    The other possible US objection is that Huawei will only let their customers spy, not third countries.

    Posted by: Paul Cockshott | Feb 11 2020 21:57 utc | 24

    It reminds me a joke about Emperor Napoleon arriving in a town. The population, the notables and the mayor are greeting him, and the Emperor says "No gun salute, hm?". Mayor replies "Sire, we have twenty reasons. Fist, we have canons", "Enough", replied Napoleon.

    Isn't the "other possible US objection" exactly "Enough"? Of course, USA is not a mere "third country", USA is the rule maker of rule based international order.

    [Feb 14, 2020] Last year I was so mad at USA bulling Huawei and ZTE, decided to buy a Huawei Honor View V20 PCT-L29 Smartphone.

    Feb 14, 2020 | www.moonofalabama.org

    JC , Feb 13 2020 0:11 utc | 90

    Last year I was so mad at USA bulling Huawei and ZTE, decided to buy a Huawei Honor View V20 PCT-L29 Smartphone. Global version on T-Mobile network . Still fumbling at the setting. This smartphone installed GPS and BeiDou (BDS). I never used Google searches but instead DuckDuckGo long ago

    [Feb 14, 2020] I'm amazed that Chief Poodle Boris did not obediently obey His Master's Voice.

    Feb 14, 2020 | www.moonofalabama.org

    Ash Naz , Feb 12 2020 0:20 utc | 32

    I'm amazed that Chief Poodle Boris did not obediently obey His Master's Voice.

    What is going on?

    I could understand if this was DNC/CIA-MI6 passing orders down the line (a la Skripal) to upset Trump but the US Intel Community has no interest in such a snub from the UK Govt.

    Obviously this isn't the UK Govt asserting their independence from US instruction because such a thing has never happened in my lifetime.

    Wierd.

    Anyway, too bad I won't be able to read the thread on my phone tomorrow as Bruce has just broken the thread with his million-character link. :-(


    Piotr Berman , Feb 12 2020 3:11 utc | 33

    I'm amazed that Chief Poodle Boris did not obediently obey His Master's Voice.

    What is going on?

    Posted by: Ash Naz | Feb 12 2020 0:20 utc | 39

    However I cringe and the obedient vassals, and Boris who may well be the Chief Poodle, given that exceedingly cute Justin is from another breed, Newtrumplander. But even poodles have privacy concerns, you know? What you web surf, what you buy, whom do you send gifts and WHAT gifts (dominatrix set?). However you trust NSA to use all that info solely for good causes, well, you know, not everyone is an exhibitionist...

    Laguerre , Feb 12 2020 9:23 utc | 49
    I'm amazed that Chief Poodle Boris did not obediently obey His Master's Voice.

    Posted by: Ash Naz | Feb 12 2020 0:20 utc | 32

    The reason is said to be that they've already bought and installed a lot of the Huawei equipment, and the new decision is just a fake, to justify the position.

    https://www.theguardian.com/commentisfree/2020/jan/28/huawei-security-boris-johnson

    Ash Naz , Feb 12 2020 13:17 utc | 52

    @Laguerre:

    The reason is said to be that they've already bought and installed a lot of the Huawei equipment, and the new decision is just a fake, to justify the position.

    The financial angle makes sense, but what is the price of disobedience?

    @Piotr Berman:

    But even poodles have privacy concerns

    The preventing blackmail angle makes sense too

    And how useful to be able to use blackmail to get allies to jump when ordered? It's often said that Washington has no real friends, just obedient vassals.

    Jon_in_AU , Feb 12 2020 14:50 utc | 54

    Ash Naz|Feb 12 2020 0:20 utc|32 & Posted by: Laguerre|Feb 12 2020 9:23 utc|47

    It would appear to me that the UK, by allowing Huawei (limited) access to their market, are achieving several advantageous outcomes.

    1) They are preventing potential for a duopoly of Eriksson & Nokia on the hardware by allowing a third player into the market.
    2) By only allowing a maximum of 35% of the market share, they prevent Huawei from quickly out-competing the others on price and capturing a monopoly.
    3) They are only allowing access to the network comm's market, and not the core of the system, which may or may not protect against unwanted data capture and intrusion (by exactly whom remains the question - as per the article above).
    4) It allows the four main network providers (especially EE, owned by BT) and the accompanying state surveillance apparatus the ability to familiarise themselves with Huawei tech/code/vulnerabilities which may be invaluable going forward. On this point alone, the USA (and Australia, among others) are doing themselves a great disservice by missing out on a learning experience from arguably the world leader in this technology.

    As md|Feb 12 2020 8:29 utc|44 alluded to, they are claiming to allow clintele access to all code (and the freedom to modify it as desired). So denying them access to a particular market only hinders the technical understanding of the technology and its implementation, leaving such states behind.

    The USA (and its' vassal client states) once again shoot themselves in the foot in a vain attempt to create and re-create the archetypal "boogeyman" for the populace to wring their hands over and keep them up at night. Fools.

    Ps. Thank you B for another illuminating read.

    [Feb 14, 2020] Trump and US has a horrible hand to play regarding Huawei. It's desperation time!

    Feb 14, 2020 | www.moonofalabama.org

    daffyDuct , Feb 12 2020 3:51 utc | 35


    Trump and US has a horrible hand to play regarding Huawei. It's desperation time!

    Mike Pence tries to link UK/US trade deal with Trump Huawei ban.

    https://www.politicshome.com/news/world/united-states/donald-trump/news/109751/mike-pence-hints-us-uk-trade-deal-risk-because


    Among Huawei, Ericsson, Nokia, looks like Nokia's way behind.

    https://www.itnews.com.au/news/fearing-huawei-curbs-deutsche-telekom-tells-nokia-to-shape-up-537710

    U.S. to review new curbs on Huawei, China in Feb. meeting: sources (The Commerce Dept is keeping their potential "rules" vague to buy time)

    https://uk.reuters.com/article/us-usa-huawei-tech-meeting/u-s-to-review-new-curbs-on-huawei-china-in-feb-meeting-sources-idUKKBN1ZZ01H?rpc=401&

    Pentagon Cites Supply Chain Sustainability For Opposing Huawei Sanctions

    https://wccftech.com/pentagon-huawe-sanctions-supply-chain/


    Barr scoffs at White House's anti-Huawei 5G approach
    https://www.axios.com/barr-scoffs-at-white-houses-anti-huawei-5g-proposal-e3afb2c2-7f21-4609-a02e-ae3753f514f5.html

    To counter Huawei, U.S. could take 'controlling stake' in Ericsson, Nokia: attorney general

    https://www.reuters.com/article/us-usa-china-espionage/to-counter-huawei-u-s-could-take-controlling-stake-in-ericsson-nokia-attorney-general-idUSKBN2001DL

    (Jan 2018) Scoop: Trump team considers nationalizing 5G network
    https://www.axios.com/trump-team-debates-nationalizing-5g-network-f1e92a49-60f2-4e3e-acd4-f3eb03d910ff.html

    I enjoy David Goldman (Spengler) article at Asia Times. He accurately notes the vast lead Huawei/China has and then provides "but we can do something" bromides. What do mean "we", kimosabe?


    daffyDuct , Feb 12 2020 3:55 utc | 36

    Per a quote from Newt Gingrich's book ""Trump vs. China: Facing America's Greatest Threat", quoted recently by David Goldman. Gingrich didn't say who was the greatest threat, Trump or China.

    "It is not China's fault that in 2017, 89% of Baltimore eighth graders couldn't pass their math exam

    "It is not China's fault that too few Americans in K-12 and in college study math and science to fill the graduate schools with future American scientists

    "It is not China's fault that, faced with a dramatic increase in Chinese graduate students in science, the government has not been able to revive programs like the 1958 National Defense Education Act

    "It is not China's fault the way our defense bureaucracy functions serves to create exactly the 'military-industrial complex' that President Dwight Eisenhower warned about

    "It is not China's fault that NASA has been so bureaucratic and its funding so erratic that there is every reason to believe that China is catching up rapidly and may outpace us. This is because of us not because of them

    "It is not China's fault that the old, bureaucratic, entrenched American telecommunications companies failed to develop a global strategy for 5G over the 11 years that the Chinese company Huawei has been working to become a world leader "

    farm ecologist , Feb 12 2020 3:59 utc | 37
    I feel less uncomfortable about the possibility of being spied on by the Chinese than I do about the probability of being spied on by the US.
    ak74 , Feb 12 2020 6:09 utc | 42
    Here is another Orwellian irony that has been forgotten down the MemoryHole.

    Way back in 2014, Edward Snowden revealed that the Americans (and the NSA in particular) were spying on Huawei dating back to at least 2007.

    This American spying occurred before the current national security hysterics about Huawei, indeed, before most people in the USA had even heard of the company itself.

    As this article states,

    "In the final analysis, the NSA spying campaign against Huawei has two fundamental purposes. First, Huawei (unlike the American telecommunications companies) does not allow the NSA free access to its infrastructure to conduct spying on its products' users. Accordingly, as part of its mission of spying on the entire world's population, the NSA hacked into Huawei's systems in order to gather information traveling through its infrastructure.

    Second, the spying campaign against Huawei is part of broader efforts to protect the profits and interests of American telecommunications companies at the expense of Huawei. This is the purpose of the NSA's particular interest in Huawei's executives and their 'leadership plans and intentions.'"

    Edward Snowden exposes NSA spying against Chinese telecom firm Huawei
    https://www.wsws.org/en/articles/2014/03/24/huaw-m24.html?view=print

    md , Feb 12 2020 8:29 utc | 46
    The other possible US objection is that Huawei will only let their customers spy, not third countries.
    Posted by: Paul Cockshott | Feb 11 2020 21:57 utc | 20

    So it seems. In the words of Ren Zhengfei 'When we transfer the tech, they can modify code on top of my tech, once that's through, it's not only shielded from me, it's shielded from everyone else in the world US 5G will be their own thing, there's no security concern, the only concern will be the U.S. keeping American companies (which bought it) in check.'

    https://www.youtube.com/watch?v=LUUwK3DxGlA&feature=youtu.be

    [Feb 03, 2020] Numerical illiteracy of the modern world

    The Western MSM is relentlessly trying to sell this coronavirus epidemic as a China failure
    Feb 03, 2020 | www.moonofalabama.org
    Jeff Harrison , Feb 2 2020 17:24 utc | 9
    This corona virus panic is interesting. RT has an interesting piece that points out that corona virus has been officially recognized in some 8,000 odd people and 200 odd people have died from it, we need a sense of perspective. World wide seasonal flu, kills between 350,000 and 600,000 people each year. Tuberculosis kills over 1,000,000 people each year. Malaria kills a similar number. AIDS killed over 500,000 last year. And we're panicking about 200 or so?

    TJ , Feb 2 2020 19:11 utc | 23

    Just had an email from a company I deal with in China, the relevant passages-

    2. The company has been following instructions from the Chinese government to postpone the Spring Festival holiday to Feb. 9th, 2020 if not any further postpone. But, we believe most of our services should be provided as usual since then.

    5. We also would like your attention that there's yet no evidence or cases to support the transmission of the novel coronavirus through packages or imported goods. According to the Centers for Disease Control and Prevention (CDC) of the US, because of poor survivability of these coronaviruses on surfaces, there is likely very low risk of spread from products or packaging that are shipped over a period of days or weeks at ambient temperatures. The National Health Commission of the People's Republic of China advises that coronavirus is spread most often by respiratory droplets from one person to another, regular packages from Wuhan can be received as usual. Reference links are attached as the footnote below for your references.[1]
    6. The Company will take proactive measures like ultraviolet light to ensure a safe and healthy environment of its warehouse. Disinfection work will be conducted before each delivery.

    [Jan 21, 2020] How a Hidden Parliamentary Session Revealed Trump's True Motives in Iraq by Whitney Webb

    Notable quotes:
    "... The Americans are the ones who destroyed the country and wreaked havoc on it. They have refused to finish building the electrical system and infrastructure projects. They have bargained for the reconstruction of Iraq in exchange for Iraq giving up 50% of oil imports. So, I refused and decided to go to China and concluded an important and strategic agreement with it. Today, Trump is trying to cancel this important agreement. ..."
    "... After my return from China, Trump called me and asked me to cancel the agreement, so I also refused, and he threatened [that there would be] massive demonstrations to topple me. Indeed, the demonstrations started and then Trump called, threatening to escalate in the event of non-cooperation and responding to his wishes, whereby a third party [presumed to be mercenaries or U.S. soldiers] would target both the demonstrators and security forces and kill them from atop the highest buildings and the US embassy in an attempt to pressure me and submit to his wishes and cancel the China agreement." ..."
    "... It could also explain why President Trump is so concerned about China's growing foothold in Iraq, since it risks causing not only the end of the U.S. military hegemony in the country but could also lead to major trouble for the petrodollar system and the U.S.' position as a global financial power. Trump's policy aimed at stopping China and Iraq's growing ties is clearly having the opposite effect, showing that this administration's "gangster diplomacy" only serves to make the alternatives offered by countries like China and Russia all the more attractive. ..."
    Jan 21, 2020 | www.unz.com

    ... ... ...

    After the feed was cut, MPs who were present wrote down Abdul-Mahdi's remarks, which were then given to the Arabic news outlet Ida'at . Per that transcript , Abdul-Mahdi stated that:

    The Americans are the ones who destroyed the country and wreaked havoc on it. They have refused to finish building the electrical system and infrastructure projects. They have bargained for the reconstruction of Iraq in exchange for Iraq giving up 50% of oil imports. So, I refused and decided to go to China and concluded an important and strategic agreement with it. Today, Trump is trying to cancel this important agreement. "

    Abdul-Mahdi continued his remarks, noting that pressure from the Trump administration over his negotiations and subsequent dealings with China grew substantially over time, even resulting in death threats to himself and his defense minister:

    After my return from China, Trump called me and asked me to cancel the agreement, so I also refused, and he threatened [that there would be] massive demonstrations to topple me. Indeed, the demonstrations started and then Trump called, threatening to escalate in the event of non-cooperation and responding to his wishes, whereby a third party [presumed to be mercenaries or U.S. soldiers] would target both the demonstrators and security forces and kill them from atop the highest buildings and the US embassy in an attempt to pressure me and submit to his wishes and cancel the China agreement."

    "I did not respond and submitted my resignation and the Americans still insist to this day on canceling the China agreement. When the defense minister said that those killing the demonstrators was a third party, Trump called me immediately and physically threatened myself and the defense minister in the event that there was more talk about this third party."

    Very few English language outlets reported on Abdul-Mahdi's comments. Tom Luongo, a Florida-based Independent Analyst and publisher of The Gold Goats 'n Guns Newsletter, told MintPress that the likely reasons for the "surprising" media silence over Abdul-Mahdi's claims were because "It never really made it out into official channels " due to the cutting of the video feed during Iraq's Parliamentary session and due to the fact that "it's very inconvenient and the media -- since Trump is doing what they want him to do, be belligerent with Iran, protected Israel's interests there."

    "They aren't going to contradict him on that if he's playing ball," Luongo added, before continuing that the media would nonetheless "hold onto it for future reference .If this comes out for real, they'll use it against him later if he tries to leave Iraq." "Everything in Washington is used as leverage," he added.

    Given the lack of media coverage and the cutting of the video feed of Abdul-Mahdi's full remarks, it is worth pointing out that the narrative he laid out in his censored speech not only fits with the timeline of recent events he discusses but also the tactics known to have been employed behind closed doors by the Trump administration, particularly after Mike Pompeo left the CIA to become Secretary of State.

    For instance, Abdul-Mahdi's delegation to China ended on September 24, with the protests against his government that Trump reportedly threatened to start on October 1. Reports of a "third side" firing on Iraqi protesters were picked up by major media outlets at the time, such as in this BBC report which stated:

    Reports say the security forces opened fire, but another account says unknown gunmen were responsible .a source in Karbala told the BBC that one of the dead was a guard at a nearby Shia shrine who happened to be passing by. The source also said the origin of the gunfire was unknown and it had targeted both the protesters and security forces . (emphasis added)"

    U.S.-backed protests in other countries, such as in Ukraine in 2014, also saw evidence of a " third side " shooting both protesters and security forces alike.

    After six weeks of intense protests , Abdul-Mahdi submitted his resignation on November 29, just a few days after Iraq's Foreign Minister praised the new deals, including the "oil for reconstruction" deal, that had been signed with China. Abdul-Mahdi has since stayed on as Prime Minister in a caretaker role until Parliament decides on his replacement.

    Abdul-Mahdi's claims of the covert pressure by the Trump administration are buttressed by the use of similar tactics against Ecuador, where, in July 2018, a U.S. delegation at the United Nations threatened the nation with punitive trade measures and the withdrawal of military aid if Ecuador moved forward with the introduction of a UN resolution to "protect, promote and support breastfeeding."

    The New York Times reported at the time that the U.S. delegation was seeking to promote the interests of infant formula manufacturers. If the U.S. delegation is willing to use such pressure on nations for promoting breastfeeding over infant formula, it goes without saying that such behind-closed-doors pressure would be significantly more intense if a much more lucrative resource, e.g. oil, were involved.

    Regarding Abdul-Mahdi's claims, Luongo told MintPress that it is also worth considering that it could have been anyone in the Trump administration making threats to Abdul-Mahdi, not necessarily Trump himself. "What I won't say directly is that I don't know it was Trump at the other end of the phone calls. Mahdi, it is to his best advantage politically to blame everything on Trump. It could have been Mike Pompeo or Gina Haspel talking to Abdul-Mahdi It could have been anyone, it most likely would be someone with plausible deniability .This [Mahdi's claims] sounds credible I firmly believe Trump is capable of making these threats but I don't think Trump would make those threats directly like that, but it would absolutely be consistent with U.S. policy."

    Luongo also argued that the current tensions between U.S. and Iraqi leadership preceded the oil deal between Iraq and China by several weeks, "All of this starts with Prime Minister Mahdi starting the process of opening up the Iraq-Syria border crossing and that was announced in August. Then, the Israeli air attacks happened in September to try and stop that from happening, attacks on PMU forces on the border crossing along with the ammo dump attacks near Baghdad This drew the Iraqis' ire Mahdi then tried to close the air space over Iraq, but how much of that he can enforce is a big question."

    As to why it would be to Mahdi's advantage to blame Trump, Luongo stated that Mahdi "can make edicts all day long, but, in reality, how much can he actually restrain the U.S. or the Israelis from doing anything? Except for shame, diplomatic shame To me, it [Mahdi's claims] seems perfectly credible because, during all of this, Trump is probably or someone else is shaking him [Mahdi] down for the reconstruction of the oil fields [in Iraq] Trump has explicitly stated "we want the oil."'

    As Luongo noted, Trump's interest in the U.S. obtaining a significant share of Iraqi oil revenue is hardly a secret. Just last March, Trump asked Abdul-Mahdi "How about the oil?" at the end of a meeting at the White House, prompting Abdul-Mahdi to ask "What do you mean?" To which Trump responded "Well, we did a lot, we did a lot over there, we spent trillions over there, and a lot of people have been talking about the oil," which was widely interpreted as Trump asking for part of Iraq's oil revenue in exchange for the steep costs of the U.S.' continuing its now unwelcome military presence in Iraq.

    With Abdul-Mahdi having rejected Trump's "oil for reconstruction" proposal in favor of China's, it seems likely that the Trump administration would default to so-called "gangster diplomacy" tactics to pressure Iraq's government into accepting Trump's deal, especially given the fact that China's deal was a much better offer. While Trump demanded half of Iraq's oil revenue in exchange for completing reconstruction projects (according to Abdul-Mahdi), the deal that was signed between Iraq and China would see around 20 percen t of Iraq's oil revenue go to China in exchange for reconstruction. Aside from the potential loss in Iraq's oil revenue, there are many reasons for the Trump administration to feel threatened by China's recent dealings in Iraq.

    The Iraq-China oil deal – a prelude to something more?

    When Abdul-Mahdi's delegation traveled to Beijing last September, the "oil for reconstruction" deal was only one of eight total agreements that were established. These agreements cover a range of areas, including financial, commercial, security, reconstruction, communication, culture, education and foreign affairs in addition to oil. Yet, the oil deal is by far the most significant.

    Per the agreement, Chinese firms will work on various reconstruction projects in exchange for roughly 20 percent of Iraq's oil exports, approximately 100,00 barrels per day, for a period of 20 years. According to Al-Monitor , Abdul-Mahdi had the following to say about the deal: "We agreed [with Beijing] to set up a joint investment fund, which the oil money will finance," adding that the agreement prohibits China from monopolizing projects inside Iraq, forcing Bejing to work in cooperation with international firms.

    The agreement is similar to one negotiated between Iraq and China in 2015 when Abdul-Mahdi was serving as Iraq's oil minister. That year, Iraq joined China's Belt and Road Initiative in a deal that also involved exchanging oil for investment, development and construction projects and saw China awarded several projects as a result. In a notable similarity to recent events, that deal was put on hold due to "political and security tensions" caused by unrest and the surge of ISIS in Iraq, that is until Abdul-Mahdi saw Iraq rejoin the initiative again late last year through the agreements his government signed with China last September.

    Chinese President Xi Jinping, center left, meet with Iraqi Prime Minister Adil Abdul-Mahdi, center right, in Beijing, Sept. 23, 2019. Lintao Zhang | AP

    Notably, after recent tensions between the U.S. and Iraq over the assassination of Soleimani and the U.S.' subsequent refusal to remove its troops from Iraq despite parliament's demands, Iraq quietly announced that it would dramatically increase its oil exports to China to triple the amount established in the deal signed in September. Given Abdul-Mahdi's recent claims about the true forces behind Iraq's recent protests and Trump's threats against him being directly related to his dealings with China, the move appears to be a not-so-veiled signal from Abdul-Mahdi to Washington that he plans to deepen Iraq's partnership with China, at least for as long as he remains in his caretaker role.

    Iraq's decision to dramatically increase its oil exports to China came just one day after the U.S. government threatened to cut off Iraq's access to its central bank account, currently held at the Federal Reserve Bank of New York, an account that currently holds $35 billion in Iraqi oil revenue. The account was set up after the U.S. invaded and began occupying Iraq in 2003 and Iraq currently removes between $1-2 billion per month to cover essential government expenses. Losing access to its oil revenue stored in that account would lead to the " collapse " of Iraq's government, according to Iraqi government officials who spoke to AFP .

    Though Trump publicly promised to rebuke Iraq for the expulsion of U.S. troops via sanctions, the threat to cut off Iraq's access to its account at the NY Federal Reserve Bank was delivered privately and directly to the Prime Minister, adding further credibility to Abdul-Mahdi's claims that Trump's most aggressive attempts at pressuring Iraq's government are made in private and directed towards the country's Prime Minister.

    Though Trump's push this time was about preventing the expulsion of U.S. troops from Iraq, his reasons for doing so may also be related to concerns about China's growing foothold in the region. Indeed, while Trump has now lost his desired share of Iraqi oil revenue (50 percent) to China's counteroffer of 20 percent, the removal of U.S. troops from Iraq may see American troops replaced with their Chinese counterparts as well, according to Tom Luongo.

    "All of this is about the U.S. maintaining the fiction that it needs to stay in Iraq So, China moving in there is the moment where they get their toe hold for the Belt and Road [Initiative]," Luongo argued. "That helps to strengthen the economic relationship between Iraq, Iran and China and obviating the need for the Americans to stay there. At some point, China will have assets on the ground that they are going to want to defend militarily in the event of any major crisis. This brings us to the next thing we know, that Mahdi and the Chinese ambassador discussed that very thing in the wake of the Soleimani killing."

    Indeed, according to news reports, Zhang Yao -- China's ambassador to Iraq -- " conveyed Beijing's readiness to provide military assistance" should Iraq's government request it soon after Soleimani's assassination. Yao made the offer a day after Iraq's parliament voted to expel American troops from the country. Though it is currently unknown how Abdul-Mahdi responded to the offer, the timing likely caused no shortage of concern among the Trump administration about its rapidly waning influence in Iraq. "You can see what's coming here," Luongo told MintPress of the recent Chinese offer to Iraq, "China, Russia and Iran are trying to cleave Iraq away from the United States and the U.S. is feeling very threatened by this."

    Russia is also playing a role in the current scenario as Iraq initiated talks with Moscow regarding the possible purchase of one of its air defense systems last September, the same month that Iraq signed eight deals, including the oil deal with China. Then, in the wake of Soleimani's death, Russia again offered the air defense systems to Iraq to allow them to better defend their air space. In the past, the U.S. has threatened allied countries with sanctions and other measures if they purchase Russian air defense systems as opposed to those manufactured by U.S. companies.

    The U.S.' efforts to curb China's growing influence and presence in Iraq amid these new strategic partnerships and agreements are limited, however, as the U.S. is increasingly relying on China as part of its Iran policy, specifically in its goal of reducing Iranian oil export to zero. China remains Iran's main crude oil and condensate importer, even after it reduced its imports of Iranian oil significantly following U.S. pressure last year. Yet, the U.S. is now attempting to pressure China to stop buying Iranian oil completely or face sanctions while also attempting to privately sabotage the China-Iraq oil deal. It is highly unlikely China will concede to the U.S. on both, if any, of those fronts, meaning the U.S. may be forced to choose which policy front (Iran "containment" vs. Iraq's oil dealings with China) it values more in the coming weeks and months.

    Furthermore, the recent signing of the "phase one" trade deal with China revealed another potential facet of the U.S.' increasingly complicated relationship with Iraq's oil sector given that the trade deal involves selling U.S. oil and gas to China at very low cost , suggesting that the Trump administration may also see the Iraq-China oil deal result in Iraq emerging as a potential competitor for the U.S. in selling cheap oil to China, the world's top oil importer.

    The Petrodollar and the Phantom of the Petroyuan

    In his televised statements last week following Iran's military response to the U.S. assassination of General Soleimani, Trump insisted that the U.S.' Middle East policy is no longer being directed by America's vast oil requirements. He stated specifically that:

    Over the last three years, under my leadership, our economy is stronger than ever before and America has achieved energy independence. These historic accomplishments changed our strategic priorities. These are accomplishments that nobody thought were possible. And options in the Middle East became available. We are now the number-one producer of oil and natural gas anywhere in the world. We are independent, and we do not need Middle East oil . (emphasis added)"

    Yet, given the centrality of the recent Iraq-China oil deal in guiding some of the Trump administration's recent Middle East policy moves, this appears not to be the case. The distinction may lie in the fact that, while the U.S. may now be less dependent on oil imports from the Middle East, it still very much needs to continue to dominate how oil is traded and sold on international markets in order to maintain its status as both a global military and financial superpower.

    Indeed, even if the U.S. is importing less Middle Eastern oil, the petrodollar system -- first forged in the 1970s -- requires that the U.S. maintains enough control over the global oil trade so that the world's largest oil exporters, Iraq among them, continue to sell their oil in dollars. Were Iraq to sell oil in another currency, or trade oil for services, as it plans to do with China per the recently inked deal, a significant portion of Iraqi oil would cease to generate a demand for dollars, violating the key tenet of the petrodollar system.

    Chinese representatives speak to defense personnel during a weapons expo organized by the Iraqi defense ministry in Baghdad, March, 2017. Karim Kadim | AP

    As Kei Pritsker and Cale Holmes noted in an article last year for MintPress :

    The takeaway from the petrodollar phenomenon is that as long as countries need oil, they will need the dollar. As long as countries demand dollars, the U.S. can continue to go into massive amounts of debt to fund its network of global military bases, Wall Street bailouts, nuclear missiles, and tax cuts for the rich."

    Thus, the use of the petrodollar has created a system whereby U.S. control of oil sales of the largest oil exporters is necessary, not just to buttress the dollar, but also to support its global military presence. Therefore, it is unsurprising that the issue of the U.S. troop presence in Iraq and the issue of Iraq's push for oil independence against U.S. wishes have become intertwined. Notably, one of the architects of the petrodollar system and the man who infamously described U.S. soldiers as "dumb, stupid animals to be used as pawns in foreign policy", former Secretary of State Henry Kissinger, has been advising Trump and informing his China policy since 2016.

    This take was also expressed by economist Michael Hudson, who recently noted that U.S. access to oil, dollarization and U.S. military strategy are intricately interwoven and that Trump's recent Iraq policy is intended "to escalate America's presence in Iraq to keep control of the region's oil reserves," and, as Hudson says, "to back Saudi Arabia's Wahabi troops (ISIS, Al Qaeda in Iraq, Al Nusra and other divisions of what are actually America's foreign legion) to support U.S. control of Near Eastern oil as a buttress of the U.S. dollar."

    Hudson further asserts that it was Qassem Soleimani's efforts to promote Iraq's oil independence at the expense of U.S. imperial ambitions that served one of the key motives behind his assassination.

    America opposed General Suleimani above all because he was fighting against ISIS and other U.S.-backed terrorists in their attempt to break up Syria and replace Assad's regime with a set of U.S.-compliant local leaders – the old British "divide and conquer" ploy. On occasion, Suleimani had cooperated with U.S. troops in fighting ISIS groups that got "out of line" meaning the U.S. party line. But every indication is that he was in Iraq to work with that government seeking to regain control of the oil fields that President Trump has bragged so loudly about grabbing. (emphasis added)"

    Hudson adds that " U.S. neocons feared Suleimani's plan to help Iraq assert control of its oil and withstand the terrorist attacks supported by U.S. and Saudi's on Iraq. That is what made his assassination an immediate drive."

    While other factors -- such as pressure from U.S. allies such as Israel -- also played a factor in the decision to kill Soleimani, the decision to assassinate him on Iraqi soil just hours before he was set to meet with Abdul-Mahdi in a diplomatic role suggests that the underlying tensions caused by Iraq's push for oil independence and its oil deal with China did play a factor in the timing of his assassination. It also served as a threat to Abdul-Mahdi, who has claimed that the U.S. threatened to kill both him and his defense minister just weeks prior over tensions directly related to the push for independence of Iraq's oil sector from the U.S.

    It appears that the ever-present role of the petrodollar in guiding U.S. policy in the Middle East remains unchanged. The petrodollar has long been a driving factor behind the U.S.' policy towards Iraq specifically, as one of the key triggers for the 2003 invasion of Iraq was Saddam Hussein's decision to sell Iraqi oil in Euros opposed to dollars beginning in the year 2000. Just weeks before the invasion began, Hussein boasted that Iraq's Euro-based oil revenue account was earning a higher interest rate than it would have been if it had continued to sell its oil in dollars, an apparent signal to other oil exporters that the petrodollar system was only really benefiting the United States at their own expense.

    Beyond current efforts to stave off Iraq's oil independence and keep its oil trade aligned with the U.S., the fact that the U.S. is now seeking to limit China's ever-growing role in Iraq's oil sector is also directly related to China's publicly known efforts to create its own direct competitor to the petrodollar, the petroyuan.

    Since 2017, China has made its plans for the petroyuan -- a direct competitor to the petrodollar -- no secret, particularly after China eclipsed the U.S. as the world's largest importer of oil.

    As CNBC noted at the time:

    The new strategy is to enlist the energy markets' help: Beijing may introduce a new way to price oil in coming months -- but unlike the contracts based on the U.S. dollar that currently dominate global markets, this benchmark would use China's own currency. If there's widespread adoption, as the Chinese hope, then that will mark a step toward challenging the greenback's status as the world's most powerful currency .The plan is to price oil in yuan using a gold-backed futures contract in Shanghai, but the road will be long and arduous."

    If the U.S. continues on its current path and pushes Iraq further into the arms of China and other U.S. rival states, it goes without saying that Iraq -- now a part of China's Belt and Road Initiative -- may soon favor a petroyuan system over a petrodollar system, particularly as the current U.S. administration threatens to hold Iraq's central bank account hostage for pursuing policies Washington finds unfavorable.

    It could also explain why President Trump is so concerned about China's growing foothold in Iraq, since it risks causing not only the end of the U.S. military hegemony in the country but could also lead to major trouble for the petrodollar system and the U.S.' position as a global financial power. Trump's policy aimed at stopping China and Iraq's growing ties is clearly having the opposite effect, showing that this administration's "gangster diplomacy" only serves to make the alternatives offered by countries like China and Russia all the more attractive.

    anonymous [331] Disclaimer , says: Show Comment January 18, 2020 at 5:54 am GMT

    One can see how all these recent wars and military actions have a financial motive at their core. Yet the mass of gullible Americans actually believe the reasons given, to "spread democracy" and other wonderful things. Only a small number can see things for what they really are. It's very frustrating to deal with the stupidity of the average person on a daily basis.

    This is not Trump's policy, it is American policy and the variation is in how he implements it. Any other person would have fallen in line with it as well. US policy has it's own inner momentum that can't change course. The US depends upon continuation of the dollar as the world's reserve currency. Were that to be lost the US likely would descend into chaos without end. When the USSR came apart it was eventually able to downsize into the Russian state. We don't have that here; there is no core ethnicity with it's own territory left anymore, it's just a jumble. For the US it's a matter of survival.

    John Chuckman , says: Website Show Comment January 18, 2020 at 3:04 pm GMT
    Yes, but we also have this

    It is reported this morning (CNN) that Trump bragged about the killing to a crowd at a big fundraising dinner.

    Just sick, official state murder for campaign donations.

    That's what America is reduced to.

    [Jan 21, 2020] Trump Is Pulling the Wool Over Voters' Eyes About What Is in the China Deal

    Return to quote-based trade means total bankruptcy of neoliberalism ideology and practice. Another nail in the coffin so to speak.
    Jan 21, 2020 | www.anti-empire.com

    The Chinese, for now, are not contradicting the Trump administration on the promise of Chinese mega-purchases, because when Trump is more amicable their interests align. If an empty promise that wasn't even made means the trade war de-escalation goes on, that is fine with them. They would like to calm the markets as much as Trump would, and in this way they have added leverage on Trump. Should they change their minds they can always explode the fiction later on and injure Trump, perhaps strategically right around October.


    Now that the dust has settled on the US-China trade deal and analysts have had some time to pore over its 90+ pages, various chapters and (non-binding) terms that comprise the body of the agreement, one high-level observation noted by Rabobank, is that the agreement foresees the total amount of goods exports from the US to China to reach above $ 290BN by end-2021.

    The implication of this is that the chart for US exports to China should basically look like this for the next two years:

    As Rabobank's senior economist Bjorn Giesbergen writes, t here are probably very few economists that would deem such a trajectory feasible (except for the perpetually cheerful economics team at Goldman , of course), seeing that it took the US more than 15 years to raise exports from around USD16bn in 2000 to USD 130bn in 2017.

    Moreover, the Chinese purchases of goods are beneficial to US companies, but at the cost of other countries, and the agreement is only for two years. If China will buy more aircraft from the US, that could be to the detriment of the EU.

    According to the document "the parties project that the trajectory of increases will continue in calendar years 2020 through 2025." But "to project" does not sound as firm as "shall ensure." So, as the Rabo economist asks, "are we going to see a repetition of the 2019 turmoil caused by the phase 1 trade negotiations after those two years? Or is this supposed to be solved in the phase 2 deal that is very unlikely to be made? What's more, while the remaining tariffs provide leverage for US trade negotiators, they are still a tax on US importers and US consumers of Chinese goods."

    But before we even get there, going back to the chart shown above, Bloomberg today points out something we have pointed out in the past, namely that China's $200 billion, two-year spending spree negotiated with the Trump administration appears increasingly difficult to deliver, and now a $50 billion "hole" appears to have opened up : that is the amount of U.S. exports annually left out and many American businesses still uncertain about just what the expectations are.

    Some background: while Trump officials stressed the reforms aimed at curbing intellectual-property theft and currency manipulation that China has agreed to in the "phase one" trade deal signed Wednesday, the Chinese pledge to buy more American exports has become an emblem of the deal to critics and supporters alike.

    The administration has said those new exports in manufactured goods, energy, farm shipments and services will come over two years on top of the $130 billion in goods and $57.6 billion in services that the U.S. sent to China in 2017 -- the year before the trade war started and exports were hit by Beijing's retaliatory measures to President Donald Trump's tariffs.

    And while Goldman said it is certainly feasible that China can ramp up its purchases of US goods , going so far as providing a matrix "scenario" of what such purchases could look like

    that now appears virtually impossible, because as Bloomberg notes, the list of goods categories in the agreement covers a narrower group of exports to China that added up to $78.8 billion in 2017, or $51.6 billion less than the overall goods exports to the Asian nation that year. The goods trade commitment makes up $162.1 billion of the $200 billion total, with $37.9 billion to come from a boost in services trade such as travel and insurance.

    Here, the math gets even more ridiculous:

    The target for the first year that the deal takes effect is to add $63.9 billion in manufactured goods, agriculture and energy exports. According to Bloomberg economist Maeva Cousin's analysis, that would be an increase of 81% over the 2017 baseline. In year two, the agreement calls for $98.2 billion surge in Chinese imports, which would require a 125% increase over 2017.

    Importantly for China, the deal requires those purchases to be "made at market prices based on commercial considerations," a caveat which spooked commodities traders, and led to a sharp drop in ags in the day following the deal's announcement.

    Can China pull this off? Yes, if Beijing tears up existing trade deals and supply chains and imposes explicit procurement targets and demands on China's local business. As Bloomberg notes, "critics argue that such pre-ordained demand amounts to a slide into the sort of government-managed trade that U.S. presidents abandoned decades ago" and the very sort of act of central planning that U.S. officials have , paradoxically, spent years trying to convince China to walk away from.

    This may also explain why a key part of the trade deal will remain secret: the purchase plan is based on what the administration insists is a specific – if classified – annex of Chinese commitments. "The 20-page public version of that annex lists hundreds of products and services from nuclear reactors to aircraft, printed circuits, pig iron, soybeans, crude oil and computer services but no figures for purchases."

    Going back to the critics, it is this convoluted mechanism that has them arguing that China's stated targets will likely never be met: "This is ambitious and it will create some stresses within the supply system," said Craig Allen, the president of the U.S.-China Business Council.

    That's not all: as Allen said, among the outstanding questions was whether China would lift its retaliatory duties on American products as the US keeps its tariffs on some $360 billion in imports from China as Trump seeks to maintain leverage for the second phase of negotiations.

    Allen also made clear the overall purchase schedule left many U.S. companies uncomfortable even as they saw benefits in other parts of the deal. "The vast majority of our members are looking for no more than a level playing field in China," Allen said. "We are not looking for quotas or special treatment."

    As a result, for many manufacturers what is actually changing -- and what China has committed to instead of given a "best efforts" promise to achieve -- remains unclear.

    Major exporters such as Boeing Co., whose CEO Dave Calhoun attended Wednesday's signing ceremony, have stayed mum about what exactly the deal will mean for their business with China. In an attempt to "clarify", Trump tweeted that the deal includes a Chinese commitment to buy $16 billion to $20 billion in Boeing planes. It was unclear if he meant 737 MAX planes which nobody in the world will ever voluntarily fly inside again.

    Finally, prompting the latest round of cronyism allegations, Trump's new China pact also includes plans for exports of American iron and steel , "a potential gain for an industry close to the president that has benefited from his tariffs and complained about Chinese production and overcapacity for years." As Bloomberg adds, the text of the agreement lists iron and steel products ranging from pig iron to stainless steel wire and railway tracks, but steel industry sources said they had been caught by surprise and not been given any additional details on China's purchase commitments.

    It is unclear why Beijing would need US product s: after all, in its scramble to erect ghost cities and hit a goalseeked GDP print, China produces more than 50% of the world's steel, drawning criticism from around the world – if not Greta Thunberg – for the massive coal-derived pollution that comes from flooding global markets with cheap steel.

    [Jan 19, 2020] Has US overplayed its tech advantage

    Jan 19, 2020 | www.asiatimes.com

    This partly explains why the US is taking its battle on 5G technology with the Chinese so seriously. As a faltering global leader, the Americans do not take it kindly when China tries to snatch a lunch right from under their nose. As such, the US-China trade war goes beyond economics and ideology. It is about global domination across every conceivable technology that consumers and governments worldwide are addicted to these days.

    Metaphorically, technology is the new opium that rakes in money, power and control. Take a look at the way consumers across the world are utilizing technologies. From smartphones to mobile apps, from cloud-computing to cybersecurity, trillions of dollars are being spent by consumers and their governments. The Americans were laughing their way to the bank until the Chinese came along and upset their game.

    As greed has no boundary or limit, every challenger or opposition to the consumption of this "new opium" means a loss in revenue, power and control for the US and its preferred allies. Sharing the spoils with others is looking like an inconceivable option for them at this stage.

    To call the tension between the US and China a trade war undermines this greater reality. From unilateral sanctions to outright destruction of economies, it is starting to look as if the US is using technology to regain global domination at all costs.

    [Jan 19, 2020] The US-China "Trade Deal" by Paul Craig Roberts

    Notable quotes:
    "... Trump is covering his retraction by calling it a trade deal. China's part of the deal is to agree to purchase the US goods that it already intended to purchase. ..."
    Jan 18, 2020 | www.informationclearinghouse.info

    The first thing to understand is that it is not a trade deal. It is Trump backing off his tariffs when he discovered that the tarrifs fall on US goods and American consumers, not on China. Trump is covering his retraction by calling it a trade deal. China's part of the deal is to agree to purchase the US goods that it already intended to purchase.

    The purpose of tariffs is to protect domestic producers from foreign competition by raising the price of imported goods. What Trump, his administration, and the financial press did not understand is that at least half of the US trade deficit with China is the offshored goods produced in China by such corporations as Apple, Nike, and Levi. The offshored production of US global corporations counts as imports when they are brought into the US to be sold to Americans. Thus, the cost of the tariffs were falling on US corporations and US consumers.

    Tariffs are not an effective way to bring offshored US manufacturing home. If Trump or any US government wants to bring US manufacturing back to the US from its offshored locations, the way to achieve this result is to change the way the US taxes corporations. The rule would be: If a US corporation produces in the US with US labor for US markets, the firm's profits are taxed at a low rate. If the corporation produces products for the US market abroad with foreign labor, the tax rate will be high enough to more than wipe out the labor cost savings.

    As I have emphasized for years, the offshoring of US manufacturing has inflicted massive external costs on the United States. Middle class jobs have been lost, careers ended, living standards of former US manufacturing workers and families have dropped. The tax base of cities and states has shrunk, causing cutbacks in public services and undermining municipal and state pension funds. You can add to this list. These costs are the true cost of the increased profits from the lower foreign labor and compliance costs. A relatively few executives and shareholders benefitted at the expense of a vast number of Americans.

    This is the problem that needs to be addressed and corrected.

    Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. Roberts' latest books are The Failure of Laissez Faire Capitalism and Economic Dissolution of the West , How America Was Lost , and The Neoconservative Threat to World Order . Donate and support Dr, Roberts Work.

    [Jan 18, 2020] The US China Phase 1 Deal Interpeted: Break Thing, Claim to Fix Thing, Repeat

    Highly recommended!
    Jan 18, 2020 | econbrowser.com

    ...if nothing had happened in the US-China trade war. Well, me might have gotten to where we are supposed to be with the deal

    ..a honest question. In terms of the environment and global climate, is it a good thing that farmers will be producing more monoculture grains, dairy, beef and pork for export?

    [Jan 18, 2020] The US-China Nothing Burger Trade Deal by Barkley Rosser

    Jan 18, 2020 | angrybearblog.com

    There has been much hype about the signing of Phase One (and probably only) US-China trade deal. However based on a front page story in today's Washington Post, there is not much there. The US did not raise tariffs as planned, but tarifsf still remain on two thirds of the sectors that had them, although some were halved. But numerous US sectors see no change at all and are now viewing the situation as not likely to improve, with them suffering losses of business likely to return. Among those are chemicals, apparel retailers, and auto parts. In these and other sectors there is not much reduction of uncertainty regarding US-China trade, so not likely much increase in investment.

    The main items in it besides no worsening of tariffs, China has made promises not to pressure US firms to turn over technology and also to increase imports from the US by $200 billion over the next two years, especially in energy and agriculture. So maybe US soybean farmers will no longer need the bailouts of billions of $ Trump has been providing to them. However, such promises have been made in the past.

    As it is, I am watching commentators on Bloomberg, and about the most any of them are willing to say is that this "puts a floor" on the "deterioration" of US-China trade relations. That is far from some dramatic breakthrough, and most of the tariffs put on as part of the US-China trade war remain in place.

    Barkley Rosser


    spencer , January 16, 2020 3:49 pm

    This looks like it may be a way to make it a status quo or back burner issue until after the election.

    Of course Trump will always be able to blow it up if he decides that would be to his advantage.

    Bert Schlitz , January 16, 2020 4:53 pm

    I don't see how they "buy" 200 billion worth of goods. The Chinese economy is slowing and that is why purchases were flattening by 2014.

    Its noise and circuses.

    pgl , January 16, 2020 5:48 pm

    Bert – I agree. Menzie Chinn over at Econbrowser has a lot of details on this noise and circus. Check it out!

    [Jan 18, 2020] Numerous US sectors see no change at all and are now viewing the situation as not likely to improve, with them suffering losses of business likely to return. Among those are chemicals, apparel retailers, and auto parts by Barkley Rosser

    Jan 18, 2020 | angrybearblog.com

    There has been much hype about the signing of Phase One (and probably only) US-China trade deal. However based on a front page story in today's Washington Post, there is not much there. The US did not raise tariffs as planned, but tarifsf still remain on two thirds of the sectors that had them, although some were halved. But numerous US sectors see no change at all and are now viewing the situation as not likely to improve, with them suffering losses of business likely to return. Among those are chemicals, apparel retailers, and auto parts. In these and other sectors there is not much reduction of uncertainty regarding US-China trade, so not likely much increase in investment.

    The main items in it besides no worsening of tariffs, China has made promises not to pressure US firms to turn over technology and also to increase imports from the US by $200 billion over the next two years, especially in energy and agriculture. So maybe US soybean farmers will no longer need the bailouts of billions of $ Trump has been providing to them. However, such promises have been made in the past.

    As it is, I am watching commentators on Bloomberg, and about the most any of them are willing to say is that this "puts a floor" on the "deterioration" of US-China trade relations. That is far from some dramatic breakthrough, and most of the tariffs put on as part of the US-China trade war remain in place.


    spencer , January 16, 2020 3:49 pm

    This looks like it may be a way to make it a status quo or back burner issue until after the election.

    Of course Trump will always be able to blow it up if he decides that would be to his advantage.

    Bert Schlitz , January 16, 2020 4:53 pm

    I don't see how they "buy" 200 billion worth of goods. The Chinese economy is slowing and that is why purchases were flattening by 2014.

    Its noise and circuses.

    pgl , January 16, 2020 5:48 pm

    Bert – I agree. Menzie Chinn over at Econbrowser has a lot of details on this noise and circus. Check it out!

    [Jan 16, 2020] Battle of the Ages to stop Eurasian integration by Pepe Escobar

    Jan 16, 2020 | www.asiatimes.com

    Battle of the Ages to stop Eurasian integration

    Coming decade could see the US take on Russia, China and Iran over the New Silk Road connection

    The Raging Twenties started with a bang with the targeted assassination of Iran's General Qasem Soleimani.

    Yet a bigger bang awaits us throughout the decade: the myriad declinations of the New Great Game in Eurasia, which pits the US against Russia, China and Iran, the three major nodes of Eurasia integration.

    Every game-changing act in geopolitics and geoeconomics in the coming decade will have to be analyzed in connection to this epic clash.

    The Deep State and crucial sectors of the US ruling class are absolutely terrified that China is already outpacing the "indispensable nation" economically and that Russia has outpaced it militarily . The Pentagon officially designates the three Eurasian nodes as "threats."

    Hybrid War techniques – carrying inbuilt 24/7 demonization – will proliferate with the aim of containing China's "threat," Russian "aggression" and Iran's "sponsorship of terrorism." The myth of the "free market" will continue to drown under the imposition of a barrage of illegal sanctions, euphemistically defined as new trade "rules."

    Yet that will be hardly enough to derail the Russia-China strategic partnership. To unlock the deeper meaning of this partnership, we need to understand that Beijing defines it as rolling towards a "new era." That implies strategic long-term planning – with the key date being 2049, the centennial of New China.

    The horizon for the multiple projects of the Belt and Road Initiative – as in the China-driven New Silk Roads – is indeed the 2040s, when Beijing expects to have fully woven a new, multipolar paradigm of sovereign nations/partners across Eurasia and beyond, all connected by an interlocking maze of belts and roads.

    The Russian project – Greater Eurasia – somewhat mirrors Belt & Road and will be integrated with it. Belt & Road, the Eurasia Economic Union, the Shanghai Cooperation Organization and the Asia Infrastructure Investment Bank are all converging towards the same vision.

    Realpolitik

    So this "new era", as defined by the Chinese, relies heavily on close Russia-China coordination, in every sector. Made in China 2025 is encompassing a series of techno/scientific breakthroughs. At the same time, Russia has established itself as an unparalleled technological resource for weapons and systems that the Chinese still cannot match.

    At the latest BRICS summit in Brasilia, President Xi Jinping told Vladimir Putin that "the current international situation with rising instability and uncertainty urge China and Russia to establish closer strategic coordination." Putin's response: "Under the current situation, the two sides should continue to maintain close strategic communication."

    Russia is showing China how the West respects realpolitik power in any form, and Beijing is finally starting to use theirs. The result is that after five centuries of Western domination – which, incidentally, led to the decline of the Ancient Silk Roads – the Heartland is back, with a bang, asserting its preeminence.

    On a personal note, my travels these past two years, from West Asia to Central Asia, and my conversations these past two months with analysts in Nur-Sultan, Moscow and Italy, have allowed me to get deeper into the intricacies of what sharp minds define as the Double Helix. We are all aware of the immense challenges ahead – while barely managing to track the stunning re-emergence of the Heartland in real-time.

    In soft power terms, the sterling role of Russian diplomacy will become even more paramount – backed up by a Ministry of Defense led by Sergei Shoigu, a Tuvan from Siberia, and an intel arm that is capable of constructive dialogue with everybody: India/Pakistan, North/South Korea, Iran/Saudi Arabia, Afghanistan.

    This apparatus does smooth (complex) geopolitical issues over in a manner that still eludes Beijing.

    In parallel, virtually the whole Asia-Pacific – from the Eastern Mediterranean to the Indian Ocean – now takes into full consideration Russia-China as a counter-force to US naval and financial overreach.

    Stakes in Southwest Asia

    The targeted assassination of Soleimani, for all its long-term fallout, is just one move in the Southwest Asia chessboard. What's ultimately at stake is a macro geoeconomic prize: a land bridge from the Persian Gulf to the Eastern Mediterranean.

    Last summer, an Iran-Iraq-Syria trilateral established that "the goal of negotiations is to activate the Iranian-Iraqi-Syria load and transport corridor as part of a wider plan for reviving the Silk Road."

    There could not be a more strategic connectivity corridor, capable of simultaneously interlinking with the International North-South Transportation Corridor; the Iran-Central Asia-China connection all the way to the Pacific; and projecting Latakia towards the Mediterranean and the Atlantic.

    What's on the horizon is, in fact, a sub-sect of Belt & Road in Southwest Asia. Iran is a key node of Belt & Road; China will be heavily involved in the rebuilding of Syria; and Beijing-Baghdad signed multiple deals and set up an Iraqi-Chinese Reconstruction Fund (income from 300,000 barrels of oil a day in exchange for Chinese credit for Chinese companies rebuilding Iraqi infrastructure).

    A quick look at the map reveals the "secret" of the US refusing to pack up and leave Iraq, as demanded by the Iraqi Parliament and Prime Minister: to prevent the emergence of this corridor by any means necessary. Especially when we see that all the roads that China is building across Central Asia – I navigated many of them in November and December – ultimately link China with Iran.

    The final objective: to unite Shanghai to the Eastern Mediterranean – overland, across the Heartland.

    As much as Gwadar port in the Arabian Sea is an essential node of the China-Pakistan Economic Corridor, and part of China's multi-pronged "escape from Malacca" strategy, India also courted Iran to match Gwadar via the port of Chabahar in the Gulf of Oman.

    So as much as Beijing wants to connect the Arabian Sea with Xinjiang, via the economic corridor, India wants to connect with Afghanistan and Central Asia via Iran.

    Yet India's investments in Chabahar may come to nothing, with New Delhi still mulling whether to become an active part of the US "Indo-Pacific" strategy, which would imply dropping Tehran.

    The Russia-China-Iran joint naval exercise in late December, starting exactly from Chabahar, was a timely wake-up for New Delhi. India simply cannot afford to ignore Iran and end up losing its key connectivity node, Chabahar.

    The immutable fact: everyone needs and wants Iran connectivity. For obvious reasons, since the Persian empire, this is the privileged hub for all Central Asian trade routes.

    On top of it, Iran for China is a matter of national security. China is heavily invested in Iran's energy industry. All bilateral trade will be settled in yuan or in a basket of currencies bypassing the US dollar.

    US neocons, meanwhile, still dream of what the Cheney regime was aiming at in the past decade: regime change in Iran leading to the US dominating the Caspian Sea as a springboard to Central Asia, only one step away from Xinjiang and weaponization of anti-China sentiment. It could be seen as a New Silk Road in reverse to disrupt the Chinese vision.

    Battle of the Ages

    A new book, The Impact of China's Belt and Road Initiativ e , by Jeremy Garlick of the University of Economics in Prague, carries the merit of admitting that, "making sense" of Belt & Road "is extremely difficult."

    This is an extremely serious attempt to theorize Belt & Road's immense complexity – especially considering China's flexible, syncretic approach to policymaking, quite bewildering for Westerners. To reach his goal, Garlick gets into Tang Shiping's social evolution paradigm, delves into neo-Gramscian hegemony, and dissects the concept of "offensive mercantilism" – all that as part of an effort in "complex eclecticism."

    The contrast with the pedestrian Belt & Road demonization narrative emanating from US "analysts" is glaring. The book tackles in detail the multifaceted nature of Belt & Road's trans-regionalism as an evolving, organic process.

    Imperial policymakers won't bother to understand how and why Belt & Road is setting a new global paradigm. The NATO summit in London last month offered a few pointers. NATO uncritically adopted three US priorities: even more aggressive policy towards Russia; containment of China (including military surveillance); and militarization of space – a spin-off from the 2002 Full Spectrum Dominance doctrine.

    So NATO will be drawn into the "Indo-Pacific" strategy – which means containment of China. And as NATO is the EU's weaponized arm, that implies the US interfering on how Europe does business with China – at every level.

    Retired US Army Colonel Lawrence Wilkerson, Colin Powell's chief of staff from 2001 to 2005, cuts to the chase: "America exists today to make war. How else do we interpret 19 straight years of war and no end in sight? It's part of who we are. It's part of what the American Empire is. We are going to lie, cheat and steal, as Pompeo is doing right now, as Trump is doing right now, as Esper is doing right now and a host of other members of my political party, the Republicans, are doing right now. We are going to lie, cheat and steal to do whatever it is we have to do to continue this war complex. That's the truth of it. And that's the agony of it."

    Moscow, Beijing and Tehran are fully aware of the stakes. Diplomats and analysts are working on the trend, for the trio, to evolve a concerted effort to protect one another from all forms of hybrid war – sanctions included – launched against each of them.

    For the US, this is indeed an existential battle – against the whole Eurasia integration process, the New Silk Roads, the Russia-China strategic partnership, those Russian hypersonic weapons mixed with supple diplomacy, the profound disgust and revolt against US policies all across the Global South, the nearly inevitable collapse of the US dollar. What's certain is that the Empire won't go quietly into the night. We should all be ready for the battle of the ages.

    [Jan 16, 2020] A Trade Deal Meant to Heal Rifts Could Actually Make Them Worse

    Jan 16, 2020 | www.moonofalabama.org

    vk , Jan 16 2020 18:16 utc | 9

    An extremely rare candid and somewhat precise piece of journalism by the NYT (albeit telling the story from the point of view of the Americans/capitalists):

    A Trade Deal Meant to Heal Rifts Could Actually Make Them Worse

    Here's an interesting paragraph:

    What it does not do is tackle the root causes of the trade war. The deal leaves untouched Beijing's subsidies for homegrown industries and its firm control over crucial levers of its hard-charging economy . The deal also keeps in place most of Mr. Trump's tariffs on $360 billion worth of Chinese goods, a much heavier tax than Americans pay for products from practically anywhere else.

    Solving those issues could take years.

    Interesting to see what the Americans consider to be China's "root causes of the trade war". And we still have people who believe the war against China is not a war between capitalism and socialism, but between "freedom and tyranny". Pure middle class liberal dellusion of grandeur.

    --//--

    In the last open thread, in my first comment, I highlighted how fast the Western MSM gave up the idea the Labour Party should have its first female leader in order to prop up their guy, Keir Starmer (literally the only male still in the dispute right now). The reason, of course, is that his main rival - Rebecca Long-Bailey - is Corbyn's successor and, as such, has Momentum's (and, probably, of the unions) support.

    Well, this didn't stop the typical Western hypocrisy from working. Yesterday, a wave of accusations of Bernie Sanders happened (again).

    I have been stating here for some time now that the function of the middle class is to serve as the battering ram of the capitalists. They are the class tasked with fabricating the narratives and "theories" which all the society should believe and never question. They are what that 007 villain (Spectre) called "visionaires", or what the far-rightists in America call "the experts".

    If that's true, then postmodernism is their ideological weapon of choice nowadays.

    karlof1 , Jan 16 2020 18:37 utc | 10

    doesn't matter in which order they're read, but Escobar's latest intersects with Alastair Crooke's to provide Big Picture perspective.

    Towards his conclusion, Escobar cites retired US Army Colonel Lawrence Wilkerson, Colin Powell's chief of staff from 2001 to 2005:

    "We are going to lie, cheat and steal to do whatever it is we have to do to continue this war complex. That's the truth of it. And that's the agony of it."

    But nowhere in the citation does Wilkerson say that any of this effort's being done to defend the USA, whereas its beyond clear that Iran, China and Russia are all working to protect their nations and people. Rather, it appears as if "the profound disgust and revolt against US policies all across the Global South" is finally being adopted by a majority of the USA's polity as it becomes clear that all the lying, cheating and stealing is being done at the expense of the 99% for the 1%'s benefit.

    As Crooke alludes, wagging the dog a la Clinton might save Trump from being convicted and removed by the Senate, but such a move will likely cost him the election, although much depends on how those controlling the D-Party behave in the face of Sanders winning the nomination via the primaries prior to the Convention.

    [Jan 16, 2020] US-China Phase One Deal Signed What Is Inside and What to Expect Next

    Trust was destroyed, but it looks like China folded...
    Jan 16, 2020 | sputniknews.com

    Under the text of the Phase One deal - which was released later in the day by the Office of the US Trade Representative - both sides agree that they can formally complain to each other if either feels the other side is not holding up its end of the bargain.

    China Accepts Deal to Buy $200Bln in US Goods

    First and foremost, the document obliges Beijing to purchase at least $200 billion worth of US goods over the next two years.

    "During the two-year period from January 1, 2020, through December 31, 2021, China shall ensure that purchases and imports into China from the United States of the manufactured goods, agricultural goods, energy products, and services identified in Annex 6.1 exceed the corresponding 2017 baseline amount by no less than $200 billion", the text of the agreement reads.

    The agreement said China will ensure that it buys $32.9 billion worth of US manufactured goods this year and $44.8 billion in 2021; $12.5 billion in US agricultural goods this year and $19.5 billion in 2021; $18.5 billion in US energy products this year and $33.9 billion in 2021; and $12.8 billion in US services this year and $25.1 billion in 2021.

    US, China Agree to Protect Patents, Fight Abuse of Trade Secrets

    The United States and China agreed to protect patents, particularly in pharmaceuticals, and ban counterfeit products and the misappropriation of trade secrets.

    "China shall permit pharmaceutical patent applicants to rely on supplemental data to satisfy relevant requirements for patentability, including sufficiency of disclosure and inventive step, during patent examination proceedings, patent review proceedings, and judicial proceedings", the text of the deal said. "The United States affirms that existing US measures afford treatment equivalent to that provided for in this Article".

    Beijing and Washington also resolved to strengthen cooperation and coordination in combating piracy, including counterfeiting on e-commerce platforms, in the agreement.

    On the protection of trade secrets, the United States said China will treat as "urgent" the use, or attempted use, of claimed trade secret information and provide its judicial authorities the authority to order a preliminary injunction based on case facts and circumstances. Washington pledged to do the same for China.

    China to Boost US Energy Imports by $52 Bln

    China also agreed to increase purchases of US energy products by $52 billion in the next two years.

    The US energy products will be part of the total $200 billion worth of US goods that China will import through 2021, according to the agreement.

    "For the category of energy products no less than $18.5 billion above the corresponding 2017 baseline amount is purchased and imported into China from the United States in calendar year 2020, and no less than $33.9 billion above the corresponding 2017 baseline amount is purchased and imported into China from the United States in calendar year 2021", the text of the deal said.

    The agreement listed the US energy products that China will be buying as: crude oil, liquefied natural gas, refined petroleum and coal.

    China is the world's largest buyer of oil and the United States is the largest producer of the commodity.

    Oil prices, which hit five-week lows earlier on Wednesday, pared their losses after the energy deal was announced by the US and Chinese governments.

    Avoiding Currency Manipulations

    Under the Phase One deal China agrees to not engage in currency manipulation for the purpose of achieving trade advantages over the United States.

    "The Parties shall refrain from competitive devaluations and not target exchange rates for competitive purposes, including through large-scale, persistent, one-sided intervention in exchange markets," the agreement states.

    The United States and China will communicate regularly and consult on foreign exchange markets, activities and policies as well as consult with each other regarding the International Monetary Fund's assessment of the exchange rate of each country, the agreement states.

    The agreement states that the United States and China should achieve and maintain a market-determined exchange rate regime.

    The agreement comes after two years of wrangling and numerous halts in discussions, during which both sides piled hundreds of billions of dollars of tit-for-tat tariffs on each other.

    Despite the signing of the accord, the Trump administration will maintain tariffs on $360 billion of Chinese goods in an attempt to hold Beijing accountable to the deal, US officials said. The Chinese government has also said it will decide later on the tariffs it has imposed on US imports, which last stood at $185 billion in value.

    The US-China trade war sparked in January 2019, when the Trump administration announced duties on Chinese-made solar panels and washing machines. The Trump administration has since placed tariffs on $550 billion worth of Chinese products.

    'Phase Two' Will End US-China Trade War?

    US Treasury Secretary Steve Mnuchin commented earlier on Wednesday on the agreement and said that certain technology and cybersecurity issues would be resolved in the next chapter of the deal to end the trade dispute.

    "I think a very significant amount of the technology issues are in Phase One. There are other certain areas of services away from financial services that will be in Phase Two. There are certain additional cybersecurity issues that will be in Phase Two [...] There still more issues to deal with and we'll address those", Mnuchin said, cited by CNBC.

    Although the timing and details of Phase Two remain vague, Mnuchin ruled out Huawei being included, claiming that the Chinese tech giant is part of "the national security dialogue".

    Trump claimed during a news conference on Wednesday that he does not foresee a Phase Three trade agreement with China, expecting to conclude the trade negotiations with Phase Two.

    Buick Verano is assembled at General Motors' Orion Assembly plant in Orion Township © AP Photo / Carlos Osorio Fed Study Finds Trump's Trade Wars Backfired, Leading to Lost Jobs and Price Hikes Trump pointed out that his administration will begin Phase Two trade negotiations with China "shortly", without elaborating a timeline. US Vice President Mike Pence told Fox Business later in the day that the talks on the second phase were already underway.

    "We've already begun discussions on a Phase 2 deal", Pence said, cited by Fox Business.

    Trump said earlier that inking of the second phase of the deal may have to wait until after the 2020 presidential election to allow time to negotiate a better agreement.

    Phase One and Phase Two could reportedly ease trade tensions between the two major economic powers but it would unlikely settle the dispute, The Washington Post reported.

    According to the media outlet, the Trump administration is developing new export control regulations aimed at limiting flows of sophisticated technology to China, while US officials embarked on closely scrutinizing potential Chinese investments in the United States. Media reports of alleged new economic and technology levies against Beijing sparked speculation among analysts that Phase Three should not be excluded.

    [Dec 25, 2019] US Must Pursue Targeted Decoupling From China's Economy, Says Former US Ambassador

    Dec 25, 2019 | www.zerohedge.com

    Despite the latest Sino-American phase one deal to ease tensions over trade, one former top US official is now calling for a decoupling between both economies, reported the South China Morning Post (SCMP).

    Former US ambassador to India Ashley Tellis explains in a new book titled Strategic Asia 2020: US-China Competition for Global Influence -- that the world's two largest economies have entered a new period of sustained competition.

    Tellis said Washington had developed a view that "China is today and will be for the foreseeable future the principal challenger to the US."

    "The US quest for a partnership with China was fated to fail once China's growth in economic capabilities was gradually matched by its rising military power," he said.

    Tellis said Washington must resume its ability to support the liberal international order established by the US more than a half-century ago, and "provide the global public goods that bestow legitimacy upon its primacy and strengthen its power-projection capabilities to protect its allies and friends."

    He said this approach would require more strategic cooperation with allies such as Australia, Japan, and South Korea.

    "The US should use coordinated action with allies to confront China's trade malpractices should pursue targeted decoupling of the US and Chinese economies, mainly in order to protect its defense capabilities rather than seeking a comprehensive rupture."

    The latest phase one deal between both countries is a temporary trade truce -- likely to be broken as a strategic rivalry encompasses trade, technology, investment, currency, and geopolitical concerns will continue to strain relations in the early 2020s.

    A much greater decoupling could be dead ahead and likely to intensify over time, as it's already occurring in the technology sector.

    Tellis said President Trump labeling China as a strategic competitor was one of "the most important changes in US-China relations."

    The decoupling has already started as Washington races to safeguard the country's cutting-edge technologies, including 5G, automation, artificial intelligence, autonomous vehicle, hypersonics, and robotics, from getting into the hands of Chinese firms.

    A perfect example of this is blacklisting Huawei and other Chinese technology firms from buying US semiconductor components.

    Liu Weidong, a US affairs specialist from the Chinese Academy of Social Sciences, told SCMP that increased protectionism among Washington lawmakers suggests the decoupling trend between both countries is far from over.

    The broader shift at play is that decoupling will result in de-globalization , economic and financial fragmentation, and disruption of complex supply chains.

    [Dec 21, 2019] Xi says phase-one China-U.S. trade deal benefits both sides, world - Xinhua English.news.cn

    Dec 21, 2019 | www.xinhuanet.com

    javascript:void(0)

    BEIJING, Dec. 21 (Xinhua) -- The phase-one economic and trade deal between China and the United States benefits both sides and the whole world, Chinese President Xi Jinping said Friday.

    In a phone conversation with his U.S. counterpart, Donald Trump, Xi noted that the two countries have reached the phase-one agreement on the basis of the principle of equality and mutual respect.

    Against the backdrop of an extremely complicated international environment, the agreement benefits China, the United States, as well as peace and prosperity of the whole world, Xi said.

    For his part, Trump said that the phase-one economic and trade agreement reached between China and the United States is good for the two countries and the whole world.

    Noting that both countries' markets and the world have responded very positively to the agreement, Trump said that the United States is willing to maintain close communication with China and strive for the signing and implementation of the agreement at an early date.

    Xi stressed that the economic and trade cooperation between China and the United States has made significant contributions to the stability and development of China-U.S. relations and the advancement of the world economy.

    Modern economy and modern technologies have integrated the world as a whole, thus making the interests of China and the United States more intertwined with each other, Xi said, adding that the two sides will experience some differences in cooperation.

    As long as both sides keep holding the mainstream of China-U.S. economic and trade cooperation featuring mutual benefits and win-win outcomes, and always respect each other's national dignity, sovereignty and core interests, they will overcome difficulties on the way of progress, and push forward their economic and trade relations under the new historical conditions, so as to benefit the two countries and peoples, Xi said.

    China expresses serious concerns over the U.S. side's recent negative words and actions on issues related to China's Taiwan, Hong Kong, Xinjiang and Tibet, Xi said.

    He noted that the U.S. behaviors have interfered in China's internal affairs and harmed China's interests, which is detrimental to the mutual trust and bilateral cooperation.

    China hopes that the United States will seriously implement the important consensuses reached by the two leaders over various meetings and phone conversations, pay high attention and attach great importance to China's concerns, and prevent bilateral relations and important agendas from being disturbed, Xi said.

    Trump said he is looking forward to maintaining regular communication with Xi by various means, adding he is confident that both countries can properly handle differences, and U.S.-China relations can maintain smooth development.

    Xi said he is willing to maintain contacts with Trump by various means, exchange views over bilateral relations and international affairs, and jointly promote China-U.S. relations on the basis of coordination, cooperation and stability.

    The two heads of state also exchanged views on the situation of the Korean Peninsula. Xi stressed that it is imperative to stick to the general direction of a political settlement, saying all parties should meet each other halfway, and maintain dialogue and momentum for the mitigation of the situation, which is in the common interests of all.

    [Dec 17, 2019] A Great Deal Of Nonsense by Michael Every

    If true this china capitulation. Or some shrewd tactical maneuver, as the next year it is China who hold trump cards -- it can derail Trump re-election with ease.
    I have my doubts about Trump being the Grand Dealmaker he calls himself. Looking at seven bankruptcies as a proof of that ... mythical skill I don't find much. I recall Trump suing the Deutsche Bank after the bank wanted a credit back. His lawyers in court referred to the bank crisis, called the Deutsche Bank as a bank responsible for that and said that thus they don't deserve repayment. that was Chutzpah in the First Degree, For very obvious reasons Trump lost that case and did pay back.
    When Trunmp recently went on searching lawyers to work and sue for him he didn't find any. A big corp lawyer anonymously briefly explained why: "Doesn't pay. Doesn't listen.'
    Dec 17, 2019 | www.zerohedge.com

    Submitted by Michael Every of Rabobank

    A US-China trade deal was announced to chaotic fanfare late Friday Asian time – and we are sceptical. First, we still don't have details other than that December tariffs were postponed by both sides, the 15% US tariffs imposed on 1 September are to be reduced to 7.5% as a sign of goodwill, and the 25% tariffs on USD250bn stay in place . Second, we aren't going to get a signing ceremony between the US and Chinese leaders, which does not send an encouraging signal. And third, what we see is close to the terms we previously criticized for being unrealistic in reports such as 'A Great Deal of Nonsense" and "LOL-A-PLAZA".

    The US Trade Representative (USTR) says the final text of the phase one agreement is still being finalised, and he will sign it early next year for a likely incept date of end-January 2020. The areas covered include: Intellectual Property (IP); Technology Transfer; Agriculture; Financial Services; Currency; Expanding Trade; and Dispute Resolution. Each of these promises much and yet potentially delivers little.

    China has pledged to address issues of geographical indications, trademarks, and enforcement against pirated and counterfeit goods. That's just after a Chinese court ruled that Japanese retailer Muji doesn't own its own name in China and a local rival started years afterwards does. Enforcement matters, not promises: more on that in a moment.

    China has agreed to end forcing or pressuring foreign companies to transfer their tech as a condition for obtaining market access or administrative approvals. Again, enforcement is all that matters here. China also " commits to refrain from directing or supporting outbound investments aimed at acquiring foreign technology pursuant to industrial plans that create distortion. " That is China's reason for outbound investment! For example, Sweden's Defence Research Agency just released a detailed survey of Chinese corporate acquisitions in their country showing at least half are correlated with the "Made in China 20205" plan.

    China will " support a dramatic expansion of US food, agriculture and seafood product exports " , with the USTR stating the target is to jump to USD40bn in 2020, a USD16bn increase over the pre-trade war level of USD24bn, and to aim for USD50bn. Part of that reflects China's decimated pork herd, so is hardly a concession. Yet it is hard to conceive of how the total figure can be achieved without China using the US to displace agri imports from other nations, e.g., Argentinean and Brazilian soy, and perhaps Aussie and Kiwi farm goods. That also increases China's economic exposure to the US at a time of rising geopolitical tensions between the two (see news of the US' secret expulsion of two Chinese diplomats), and US' farmers exposure to China in kind. For its part, the Chinese press are not mentioning these US hard targets, and are talking about WTO trading terms, which bodes poorly.

    The financial services chapter pledges China to an opening up already underway as it searches for new sources of USD inflows, so again is not a concession. Interestingly, it also says US ratings agencies will get access – which will be fun given the evident credit stresses emerging in China just as US banks will be trying to sell China as an investment destination. .

    On currency the US is requiring "high-standard commitments" to refrain from competitive devaluations and targeting of exchange rates. Everyone knows the CNY is not freely-traded – but also that China is doing its best to prop it up, not to try to push it lower. The key message is CNY is not going to be allowed to do what it ought to be doing, i.e., weakening, as China is pledging new fiscal stimulus in 2020 that will decrease its external surplus. That runs counter to market forces, and smacks of a kind of Plaza Accord. Of course, as long as this US-China agreement holds that might be sustainable due to the promised higher capital inflows...

    Eexcept the expanding trade chapter implies the opposite. The USTR says China is pledging to boost its 2020 imports of US goods and services by USD100bn over the level in 2017, and by USD100bn again in 2021, for a total increase of USD200bn . Given 2017 was pre-trade war and US exports to China dropped off a cliff in 2019, this means around a 110% y/y increase in purchases in 2020 – and agri is only a portion of that. The problems should be obvious. How can a slowing Chinese economy (imports are down y/y from most sources), see this kind of increase without substituting US for world exports or local goods? How can a China with a USD liquidity shortage serious enough to be driving said lowered import bill, and '1USD-in/1USD-out' de facto capital controls, cope with the net reduction on the trade side? As of November, the 12-month rolling Chinese global trade surplus with the US it was USD330bn and globally was USD440bn. We are talking about reducing that US figure by 2/3 and the global total by 1/2!

    Which brings us to the last chapter: Dispute Resolution. Getting China to comply is far harder than getting it to sign. The USTR notes the agreement " establishes strong procedures for addressing disputes related to the agreement and allows each party to take proportionate responsive actions that it deems appropriate ." In other words, each side can unilaterally do what they want when they want! So much for the unilateral US control of the process.

    So how to see this in summary? The reduction in tariffs from 15% to 7.5% is a positive, albeit far less than the Wall Street Journal had promised. (NB, the USTR took the extraordinary step of publicly chastising the WSJ journalists who wrote that story – regular readers may recall I have also called them out more than once in the past.) Indeed, if China really has agreed to all that is stated here then further incremental tariff rollbacks can be seen – though the USTR has said the 25% tariffs will stay as collateral for a phase two deal that nobody really expects to happen. Yet the terms of this phase one still seem to be A Great Deal of Nonsense. How can China stop buying foreign tech? How can it buy as much US stuff as pledged? How can it do so and not undermine the WTO? How can it do so and not weaken CNY? And how can it do so with a strong CNY without increasing its USD debts, its strategic reliance on the USD, and to US goods? In short, if China does as the USTR claims, the US is a huge winner here (and there are lots of losers); if China does not comply with what look an impossible import targets, then the US can frame China as the bad guy and the tariffs can go back up again. Arguably, the question is not if that will happen, but when.

    [Dec 14, 2019] A Partial Trade Deal With China Mitigates One More Trump-Economy Risk

    Dec 14, 2019 | nymag.com

    The most important thing about the "phase one" trade agreement announced Friday by U.S. and Chinese officials is what won't happen: The two countries won't impose additional tariffs on Sunday that would have further escalated the trade war.

    There will also be a bit of de-escalation. In September, Trump imposed 15 percent tariffs on $110 billion worth of Chinese consumer goods, such as clothing; those tariffs will be cut in half, to 7.5 percent. But the largest piece of Trump's China tariffs -- a 25 percent tariff on $250 billion in goods mostly sold to businesses rather than consumers -- will stay unchanged, for now.

    [Dec 14, 2019] Looks like some limited trade deal was achived, but both sides are wary of each other now

    Dec 14, 2019 | www.moonofalabama.org

    karlof1 , Dec 13 2019 18:50 utc | 85

    Awaited confirmation by China about the Trade Deal before writing about it. This article is what I waited to be published: "Phase one trade deal a step forward, a new beginning," yes, an optimistic tone, although tempered in the text:

    "Rome was not built in a day. Trade protectionism has expanded in some places of the world, affecting some people's thinking. It is not easy for China and the US to agree on the text of the deal. But how to define this deal and whether it can keep its positive effects on the global market and even accumulate more positive energy will depend on further efforts from China and the US , as the global market has been disturbed by the trade war.

    " We must see that the first phase of the trade agreement is a win-win outcome which will deliver tangible benefits to the world . The response from investors around the world is most real because they would not use their own money just to make a grand gesture. However, some people in both China and the US may hype that their own country suffers loss from this deal. This is a natural counter-stream of public opinion, but does not represent the mainstream attitude on either side." [My Emphasis]

    Gee, "benefits for the whole world," not just China and Outlaw US Empire? What forced the Empire to compromise:

    "The US-China trade war happens at a time when the US' strategic thinking on China has changed. This requires Washington to find a strategic impetus to end the trade war. So what would be such a strategic impetus?

    "We believe as long as the US side is realistic, it is possible that such a strategic impetus can be formed and gradually expanded. The trade war is not an effective way to resolve the strategic competition between China and the US. It can neither scare China nor effectively weaken China, but will cause a gradual rise in the cost of the US economy" . [My Emphasis]

    IMO, China's assessment's correct. The financialized economy of the Evil Outlaw US Empire has drained it of the resilience it once enjoyed and that China's economy has obtained. Plus, as I wrote several months ago, China's employing geoeconomic levers which the Empire can no longer deploy and is thus stuck with using the only remaining tool it has--its waning geopolitical levers.

    [Dec 14, 2019] China's employing geoeconomic levers which the Empire can no longer deploy and is thus stuck with using the only remaining tool it has--its waning geopolitical levers.

    Dec 14, 2019 | www.moonofalabama.org

    karlof1 , Dec 13 2019 18:50 utc | 85

    Awaited confirmation by China about the Trade Deal before writing about it. This article is what I waited to be published: "Phase one trade deal a step forward, a new beginning," yes, an optimistic tone, although tempered in the text:

    "Rome was not built in a day. Trade protectionism has expanded in some places of the world, affecting some people's thinking. It is not easy for China and the US to agree on the text of the deal. But how to define this deal and whether it can keep its positive effects on the global market and even accumulate more positive energy will depend on further efforts from China and the US , as the global market has been disturbed by the trade war.

    " We must see that the first phase of the trade agreement is a win-win outcome which will deliver tangible benefits to the world . The response from investors around the world is most real because they would not use their own money just to make a grand gesture. However, some people in both China and the US may hype that their own country suffers loss from this deal. This is a natural counter-stream of public opinion, but does not represent the mainstream attitude on either side." [My Emphasis]

    Gee, "benefits for the whole world," not just China and Outlaw US Empire? What forced the Empire to compromise:

    "The US-China trade war happens at a time when the US' strategic thinking on China has changed. This requires Washington to find a strategic impetus to end the trade war. So what would be such a strategic impetus?

    "We believe as long as the US side is realistic, it is possible that such a strategic impetus can be formed and gradually expanded. The trade war is not an effective way to resolve the strategic competition between China and the US. It can neither scare China nor effectively weaken China, but will cause a gradual rise in the cost of the US economy" . [My Emphasis]

    IMO, China's assessment's correct. The financialized economy of the Evil Outlaw US Empire has drained it of the resilience it once enjoyed and that China's economy has obtained. Plus, as I wrote several months ago, China's employing geoeconomic levers which the Empire can no longer deploy and is thus stuck with using the only remaining tool it has--its waning geopolitical levers.

    [Dec 09, 2019] Beijing has ordered all government offices and public institutions to remove foreign computer equipment and software within three years

    Dec 09, 2019 | www.moonofalabama.org

    psychohistorian , Dec 9 2019 6:11 utc | 70

    Below is a link from ZH about the tech front in the civilization war between the empire West/US and China

    China Retaliates For Huawei: Beijing Orders All Government Offices And Public Companies To Replace Foreign PCs And Software

    The take away quotes
    "
    ...... the FT reports that Beijing has ordered all government offices and public institutions to remove foreign computer equipment and software within three years.
    ..........
    The take home message here is that US PC and software giants are about to lose billions in sale to Chinese customers, a move that will infuriate Trump who will, correctly, see such attempts to isolate the Chinese PC market from US vendors.
    "

    This is going to be difficult for China but they have a domestic OS, the Kylin OS, that is Unix/Linux based, so much Open Source software is available to replace the Microsoft/Apple software they currently use until they develop their own.

    This speaks to Trump saying he can wait for a trade deal until after the (s)election but it seems obvious that his negotiating position is going to get weaker by the day.

    -------------------------------

    Another aspect of the tech war that is financial also is that I am reading the China is on the cusp of releasing a digital fiat RMD currency. This will have serious disintermediation effects on the BIS, City of London Corp and others doing currency exchange if any can do such on their phones. I am reading about digital currencies needing a blockchain underpinning but if the US dollar can exist without one currently then what are the show stoppers except the private finance dead weight in the middle?

    [Dec 04, 2019] One year pause in the US-China trade war is probably in the cards due to Trump re-election concerns. But only one year...

    Notable quotes:
    "... When you factor in reelection worries, Trump needs to find a mutually agreeable solution to at least pause the trade war. Such a move will surely revive economic growth hurt by sanctions and ensure the smoothest possible path toward a second term. People vote with their wallets, and Trump gets that. ..."
    "... Nothing could be worse for Xi than the markets concluding that China is in a recession with one of its prime economic centers now in open revolt. Just as quickly as China was dubbed the next rising superpower, her economic and political obituary could be written. ..."
    "... Here is where a so-called Phase One trade deal could help patch up the relationship and give both sides the short-term domestic boost their leaderships are looking for. ..."
    "... But there are reasons to worry. A recent report in Axios claims that China is quite angry over Trump's decision to sign the Hong Kong bill, and as a result talks between the two nations have "stalled." Still, both sides have ample reasons to get a trade deal done. However, if Trump does indeed get reelected and China feels stable domestically once again, the pull of history -- specifically, which nation will dominate geopolitics in the 21st century -- may be too strong to resist. ..."
    Dec 04, 2019 | www.theamericanconservative.com

    Consider America's position. President Trump surely has incentives to push for what I would call a strategic pause in his quest to contain a rising China through tough trade moves. At the moment, staring down a possible vote on articles of impeachment and a Senate trial, rising trade tensions, which could reignite fears of a recession, are the last thing the president needs. When you factor in reelection worries, Trump needs to find a mutually agreeable solution to at least pause the trade war. Such a move will surely revive economic growth hurt by sanctions and ensure the smoothest possible path toward a second term. People vote with their wallets, and Trump gets that.

    Chinese president Xi Jinping, meanwhile, has similar concerns. China's 6 percent economic growth, something Washington can only dream of, is likely a number that exists only on paper, for Beijing is known to cook their books. With growth more than likely just barely in positive territory, thanks in large part to U.S. trade tariffs, and the challenges in Hong Kong not looking as if they will subside anytime soon, Xi needs to deliver what he can claim is a victory that also revives economic growth, at least for the time being. This will help stabilize China domestically, plus give Xi time to allow Hong Kong's protests to burn out while not having to worry about economic troubles at the same time.

    Nothing could be worse for Xi than the markets concluding that China is in a recession with one of its prime economic centers now in open revolt. Just as quickly as China was dubbed the next rising superpower, her economic and political obituary could be written.

    Here is where a so-called Phase One trade deal could help patch up the relationship and give both sides the short-term domestic boost their leaderships are looking for. A potential deal could involve China rolling back tariffs on all U.S. goods, agreeing to a large purchase of American agricultural goods, and providing basic protections on all U.S. intellectual property involving high-technology goods (think 5G, computers, and robotics). In turn, America would roll back all tariffs -- something China wants very badly -- including, and most importantly, agreeing not to launch the scheduled new round of massive tariffs on December 15, which are viewed as potentially the most damaging to date. While such an interim deal is far from perfect -- China hawks will surely go ballistic, calling the deal nothing more than appeasement or select your other favorite neocon smear -- Xi and Trump are pragmatic enough to see that a deal is in both sides' interests.

    But there are reasons to worry. A recent report in Axios claims that China is quite angry over Trump's decision to sign the Hong Kong bill, and as a result talks between the two nations have "stalled." Still, both sides have ample reasons to get a trade deal done. However, if Trump does indeed get reelected and China feels stable domestically once again, the pull of history -- specifically, which nation will dominate geopolitics in the 21st century -- may be too strong to resist.

    Harry J. Kazianis is a senior director at the Center for the National Interest and the executive editor of The National Interest magazine.

    [Dec 04, 2019] GUILFOYLE: Hong Kong Is Critical To US Effort To Secure A Trade Deal With China

    Dec 04, 2019 | dailycaller.com

    By offering Hong Kong official tools of support, President Trump has broadened the trade dispute...

    Throughout negotiations, the Chinese have been reluctant to get a deal over the line, walking away from agreed upon terms several times. By supporting Hong Kong, President Trump is showing the Chinese Communist Party that he will not sit idly by while they jerk trade negotiations around.

    [Dec 03, 2019] China was once very dependent on US chips for its phones by Mike Shedlock

    Dec 03, 2019 | www.zerohedge.com

    Authored by Mike Shedlock via MishTalk,

    China was once very dependent on US chips for its phones. The latest Chinese phones have no US parts.

    The Wall Street Journal reports Huawei Manages to Make Smartphones Without American Chips .

    American tech companies are getting the go-ahead to resume business with Chinese smartphone giant Huawei Technologies Co., but it may be too late: It is now building smartphones without U.S. chips.

    Huawei's latest phone, which it unveiled in September -- the Mate 30 with a curved display and wide-angle cameras that competes with Apple Inc.'s iPhone 11 -- contained no U.S. parts, according to an analysis by UBS and Fomalhaut Techno Solutions, a Japanese technology lab that took the device apart to inspect its insides.

    In May, the Trump administration banned U.S. shipments to Huawei as trade tensions with Beijing escalated. That move stopped companies like Qualcomm Inc. and Intel Corp. from exporting chips to the company, though some shipments of parts resumed over the summer after companies determined they weren't affected by the ban.

    Meanwhile, Huawei has made significant strides in shedding its dependence on parts from U.S. companies. (At issue are chips from U.S.-based companies, not those necessarily made in America; many U.S. chip companies make their semiconductors abroad.)

    Huawei long relied on suppliers like Qorvo Inc., the North Carolina maker of chips that are used to connect smartphones with cell towers, and Skyworks Solutions Inc., a Woburn, Mass.-based company that makes similar chips. It also used parts from Broadcom Inc., the San Jose-based maker of Bluetooth and Wi-Fi chips, and Cirrus Logic Inc., an Austin, Texas-based company that makes chips for producing sound.

    Yet Another Trump Trade Win

    "When Huawei came out with this high-end phone -- and this is its flagship -- with no U.S. content, that made a pretty big statement," said Christopher Rolland, a semiconductor analyst at Susquehanna International Group.

    Huawei executives told Rolland that the company was moving away from American parts, but it was still surprising how quickly it happened.

    This was likely going to happen anyway, but Trump escalated the speed at which it happened.

    Trade Deal?

    me title=

    Standard Assumption for 17 Months

    Assuming there is a deal, the standard assumption for 17 months, Trump will announce two key elements.

    Greatest Deal in History
    1. China will resume buying the same amount of soybeans as before.
    2. China will resume buying the same amount of chips as before.

    ​The longer this takes the more wins there will be.

    With that in mind, please recall Another Trump Tariff Success Story: Vietnam .

    And despite the fact that Trump's China Tariffs Made Matters Made the Global Manufacturing Recession Worse and has killed US farmers, It's important to remember, Trump is collecting "huge tariffs".

    So please brush aside this recession warning: Freight Volumes Negative YoY for 11th Straight Month .


    myne , 1 minute ago link

    The trade war is the first act in the much larger game of hegemony.

    Both sides are disentangling.

    Apple finished their Indian plant.

    Huawei went ex-US (but almost certainly not US IP)

    Europe is already muttering about human rights in Hong Kong and Xiangjang.

    We're nearly ready for act 2. That's when Europe joins in on squeezing trade, and the rest of the democratic world and a few others is bullied and bribed to follow.

    greatdisconformity , 1 minute ago link

    That was the game from day one.

    Soon there will be no US parts in anything made in China.

    Because there are no industries left here who can make them.

    They have all died, or been bought and relocated.

    Take away software and vapid entertainment programming, and the US has *** for consumer technology.

    ***.

    Noob678 , 14 minutes ago link

    Do you know why Russia still sells rocket engines to US after being hit US sanctions? Don't tell me they need US dollar.

    Do you know that China is facing US embargo under the pretext of national security from 1949 until now and things allowed to export to China mostly agriculture produce, gas and oil? This is the reason they develop their own technologies which the media told me stolen from the US even that the US doesn't have like 5G, quantum satellite, hypersonic weapons just to name a few.

    Do you know where soybeans in US came from?

    Omega_Man , 12 minutes ago link

    russia needs to stop selling those engines to merica and cut them out of space... what a dumb move... russia always trying to be friends with evil merica

    schroedingersrat , 11 minutes ago link

    Its because not everyone is as psychopathic as the US

    victorher , 16 minutes ago link

    Plainly, China will never buy the same amount of soybeans or chips than before as Russia will never accumulate US dollars in its Reserve. They have discovered than US is not a reliable partner.

    davelis , 1 hour ago link

    Those that think that China is only about ripping off US technology are going to be surprised. Sure that was once China's main method as it was for the early USA to rip off British textile secrets. Trump trying to take down China's biggest technology company has been a real wake up call for them. Now, they will own all of the content and will dominate in Asian markets, the middle east, etc. They already did it in solar panels and much else. They have a plan. They build infrastructure, we let it ours decay. They invest in education, we leave out students in debt up to their eyeballs and then give them Starbucks jobs. They have high speed trains everywhere, we have Amtrak. They are looking outward, we are looking inward. America first, rah rah. This will end badly - for the USA.

    L00K0UTB3L0W , 55 minutes ago link

    only bc ppl in the usa are pushing it that way

    no average american benefits from international trade unless the product is unattainable state side. if we can grow it, we should. if we can make it, we should. excess can be sold outside the nation but since everything has been weaponized, we are the ones caught in the middle who suffer.

    tariffs are good and we should use them to protect our industries. the problem is that our industry was destroyed before implementing tarrifs.. that part doesn't make sense and all of our major corporations have sold out anyways, further screwing john q public because lets be real, companies are out for profit and shareholder return, not protecting employees and consumers. so they could care less where its being made / sold as long as they see their bottom line increase, no worries.

    The Palmetto Cynic , 52 minutes ago link

    And if the US doing all of that internally was a good idea, someone would be building the manufacturing capacity as I type this....but they ain't.

    L00K0UTB3L0W , 34 minutes ago link

    problem is big business doesn't want to pay it. it has always been that way. when the money system was put in place, business owners didn't like the idea of increased competition (less slaves and more company owners) and therefore they were given the ability to claim you for tax purposes, hence why anytime you take a job they want your SS#. investment in the past happened because of things that were to come in the future. the future in america from her current vantage is trans/post humanism with the idea of automation, human/machine integration and that leaves little room or interest in building $100m slave factories for working class people to grind away in

    L00K0UTB3L0W , 41 minutes ago link

    chips have been made consistently in Malaysia, Taiwan and Korea for the better part of almost 25 years, not real sure how any of what you said is relative to current events. just syncrhonicity and morons like you saying dumb ****.

    I am Groot , 1 hour ago link

    Wow, the article is really insulting to the Chinese. Like building a smart phone for them was like landing on the moon or something. They steal everything from everyone anyways, so who cares what they build.......

    beemasters , 1 hour ago link

    Now the only NSA backdoor to Huawei is completely shut.

    fezline , 1 hour ago link

    This is why they are trying to ban Chinese hardware... not because they fear they are spying on us but because their govt mandated backdoors aren't installed on Chinese hardware. The US govt wants to ban their use because they can't spy on them... That is the real reason.

    porco rosso , 1 hour ago link

    US is losing the technology race against China. In the first phase China copied the tech, now it is on par, and in five to ten years the murican chip manufacturers are out of business.

    The point is this: the muricans are lazy bastards, most of the brain power is imported. They lived too long off the dollar reserve currency status, soon enough nobody will interested in that toilet paper anymore.

    Asoka_The_Great , 1 hour ago link

    Two years ago, Donald *** Trumptard on behalf of his handler, the US War State/Dark State/Deep State , launched a world wide war against the Chinky company, Huawei, in order, to kill it.

    But that failed spectacularly. Not only is Huawei not dead, but its revenue actually grown 24% in 2019.

    Now, its smart phones, and 5G cell tower equipments are totally free of US components.

    WHY IS THE US DARK STATE SO TERRIFIED OF HUAWEI'S 5G WIRELESS TECHNOLOGY?

    The US Dark State/War State/Deep State, that is the NSA/CIA/Pentagon/MIC/MSM . . . etc has forced every western tech companies to install backdoors and malwares on their equipments, except Huawei. They have tried to force Huawei to install those NSA backdoors and malwares, in 2014, but the company categorically refused.

    "The real issue is that nothing has changed since a 2014 report from The Register that Huawei categorically refuses to install NSA backdoors into their hardware to allow unfettered intelligence access to the data that crosses their networks.

    All our emails, text messages, phone calls, internet searches, web browsing, library records, . . . etc, are recorded and stored by NSA/CIA's vast servers farms.

    Now, Huawei is not only the leading 5G wireless provider, but it is the only one, so far. The other companies like Nokia and Ericsson are far behind.

    5G is going to completely replace 4G and 3G. It is about 200 times faster than 4GLTE, in download speed.

    What this means is that if the world adopts the Huawei equipments and standards, it will threaten to UNDO the US Dark State's vast global surveillance network.

    This is what terrifies the US Dark State. Their vast Global Surveillance Network is the basis of its power, and tools to enslave mankind.

    There is a very good reason, why the American Founding Fathers , enacted every measures, to protect our rights and privacy, so that we will not be controlled and enslaved by the tyranny of totalitarian government, which is already upon us, in the form of US Dark State/War State .

    The US Dark State/Deep State/War State does not represent America. It is Un-American. It is not the American Republic founded by our Founding Fathers, and enshrined in the US Constitution.

    Anonymous IX , 1 hour ago link

    Maybe so, Asoka. I think the Rothschild Clan plays both sides. They are in China. Some purport the family carrying that lineage is named Li.

    The U.S. is slowly but surely being isolated for The Great Fall...when we lose world currency status. The Banking Cartel will evidently make huge money and gain enormous power once the U.S. collapses. China already has the massive surveillance state, lack of privacy, institutionalized social scoring, and workers' living cubes located on factory premises...so the Rothshilds are in love. Sigh. So much control!! So much degradation!!! They're in love!!!

    Asoka_The_Great , 50 minutes ago link

    "I think the Rothschild Clan plays both sides. They are in China. Some purport the family carrying that lineage is named Li."

    They are trying hard to infiltrate China. But the Chinese banks and financial service firms are State Owned . They are hard penetrate. That is why they are using Donald *** Trump to launch the Mother of All Great Trade War , to force the Chinese to open up their financial sector for infiltration and plundering.

    Plus, Chinese and westerner looks distinctively different. And so, they are trying the inter-marriage trick with the rich and powerful Chinese families.

    [Dec 02, 2019] Cheap, ubiquitous cameras, microphones, and location trackers are the real issue. If the state can track everyone's movements and conversations, then it can build a better Stasi even with crude, simple AI

    Notable quotes:
    "... Seeing Like a State ..."
    "... More generally, I think AI gets far too much of the billing in authoritarian apocalypse forecasts. Cheap, ubiquitous cameras, microphones, and location trackers are the real issue. If the state can track everyone's movements and conversations, then it can build a better Stasi even with crude, simple ai. ..."
    Dec 02, 2019 | crookedtimber.org

    The theory behind this is one of strength reinforcing strength – the strengths of ubiquitous data gathering and analysis reinforcing the strengths of authoritarian repression to create an unstoppable juggernaut of nearly perfectly efficient oppression. Yet there is another story to be told – of weakness reinforcing weakness. Authoritarian states were always particularly prone to the deficiencies identified in James Scott's Seeing Like a State – the desire to make citizens and their doings legible to the state, by standardizing and categorizing them, and reorganizing collective life in simplified ways, for example by remaking cities so that they were not organic structures that emerged from the doings of their citizens, but instead grand chessboards with ordered squares and boulevards, reducing all complexities to a square of planed wood . The grand state bureaucracies that were built to carry out these operations were responsible for multitudes of horrors, but also for the crumbling of the Stalinist state into a Brezhnevian desuetude, where everyone pretended to be carrying on as normal because everyone else was carrying on too. The deficiencies of state action, and its need to reduce the world into something simpler that it could comprehend and act upon created a kind of feedback loop, in which imperfections of vision and action repeatedly reinforced each other.

    So what might a similar analysis say about the marriage of authoritarianism and machine learning? Something like the following, I think. There are two notable problems with machine learning. One – that while it can do many extraordinary things, it is not nearly as universally effective as the mythology suggests. The other is that it can serve as a magnifier for already existing biases in the data. The patterns that it identifies may be the product of the problematic data that goes in, which is (to the extent that it is accurate) often the product of biased social processes. When this data is then used to make decisions that may plausibly reinforce those processes (by singling e.g. particular groups that are regarded as problematic out for particular police attention, leading them to be more liable to be arrested and so on), the bias may feed upon itself.

    This is a substantial problem in democratic societies, but it is a problem where there are at least some counteracting tendencies. The great advantage of democracy is its openness to contrary opinions and divergent perspectives . This opens up democracy to a specific set of destabilizing attacks but it also means that there are countervailing tendencies to self-reinforcing biases. When there are groups that are victimized by such biases, they may mobilize against it (although they will find it harder to mobilize against algorithms than overt discrimination). When there are obvious inefficiencies or social, political or economic problems that result from biases, then there will be ways for people to point out these inefficiencies or problems.

    These correction tendencies will be weaker in authoritarian societies; in extreme versions of authoritarianism, they may barely even exist. Groups that are discriminated against will have no obvious recourse. Major mistakes may go uncorrected: they may be nearly invisible to a state whose data is polluted both by the means employed to observe and classify it, and the policies implemented on the basis of this data. A plausible feedback loop would see bias leading to error leading to further bias, and no ready ways to correct it. This of course, will be likely to be reinforced by the ordinary politics of authoritarianism, and the typical reluctance to correct leaders, even when their policies are leading to disaster. The flawed ideology of the leader (We must all study Comrade Xi thought to discover the truth!) and of the algorithm (machine learning is magic!) may reinforce each other in highly unfortunate ways.

    In short, there is a very plausible set of mechanisms under which machine learning and related techniques may turn out to be a disaster for authoritarianism, reinforcing its weaknesses rather than its strengths, by increasing its tendency to bad decision making, and reducing further the possibility of negative feedback that could help correct against errors. This disaster would unfold in two ways. The first will involve enormous human costs: self-reinforcing bias will likely increase discrimination against out-groups, of the sort that we are seeing against the Uighur today. The second will involve more ordinary self-ramifying errors, that may lead to widespread planning disasters, which will differ from those described in Scott's account of High Modernism in that they are not as immediately visible, but that may also be more pernicious, and more damaging to the political health and viability of the regime for just that reason.

    So in short, this conjecture would suggest that the conjunction of AI and authoritarianism (has someone coined the term 'aithoritarianism' yet? I'd really prefer not to take the blame), will have more or less the opposite effects of what people expect. It will not be Singapore writ large, and perhaps more brutal. Instead, it will be both more radically monstrous and more radically unstable.

    Like all monotheoretic accounts, you should treat this post with some skepticism – political reality is always more complex and muddier than any abstraction. There are surely other effects (another, particularly interesting one for big countries such as China, is to relax the assumption that the state is a monolith, and to think about the intersection between machine learning and warring bureaucratic factions within the center, and between the center and periphery).Yet I think that it is plausible that it at least maps one significant set of causal relationships, that may push (in combination with, or against, other structural forces) towards very different outcomes than the conventional wisdom imagines. Comments, elaborations, qualifications and disagreements welcome.


    Ben 11.25.19 at 6:32 pm (no link)

    This seems to equivocate between two meanings of bias. Bias might mean a flaw that leads to empirically incorrect judgements and so to bad decisions, and it's true that that type of bias could destabilize an authoritarian state. But what we usually worry about with machine learning is that the system will find very real, but deeply unjust, patterns in the data, and reinforce those pattern. If there's a particular ethnic group that really does produce a disproportionate number of dissidents, and an algorithm leads to even-more-excessive repression of that group -- I'm not sure why an authoritarian state would see a stability threat in that tendency.

    More generally, I think AI gets far too much of the billing in authoritarian apocalypse forecasts. Cheap, ubiquitous cameras, microphones, and location trackers are the real issue. If the state can track everyone's movements and conversations, then it can build a better Stasi even with crude, simple ai.

    faustusnotes 11.26.19 at 1:00 am (no link)
    I'd just like to point out (re: the tweet in the original post) that the "Uighur face-matching AI" idea is bullshit invented by scaremongers, with no basis in fact and traceable to a shoddy reddit thread. The Chinese government is not using facial recognition to identify Uighur, and the facial recognition fears about the Chinese government are vastly overstated.

    Australia's border control facial recognition software is far more advanced than China's, as is the UK's, and facial recognition is actually pretty common in democracies. See e.g. the iPhone.

    The main areas in which China uses facial recognition are in verifying ID for some high cost functions (like buying high speed rail tickets), and it's quite easy to avoid these functions by joining a queue and paying a human. The real intrusiveness of the Chinese security state is in its constant bag searches and very human-centric abuses of power in everyday life in connection with "security". Whether you get stopped and searched depends a lot on very arbitrary and error prone judgments by bored security staff at railway stations, in public squares, and on buses, not some evil intrusive state technology.

    Conversely, the UK is a world leader in installing and using CCTV cameras, and has been for a long time. Furthermore, these CCTV cameras are a huge boon to law-abiding citizens, since they act as both excellent forms of crime prevention (I have had this experience myself) and for finding serious criminals. The people responsible for the death of those 39 Vietnamese labourers in the ice truck were caught because of CCTV; so was the guy who murdered that woman on the street in Melbourne a few years ago.

    Finally to address another point that's already been raised (sadly): China no longer harvests organs, and the 2019 report that says it does is a sham. The social credit system is also largely a myth, and nobody from China even seems to know wtf it is.

    If you're going to talk about how state's work, and the relative merits of autocratic vs. democratic states and their interaction with technology, it's a really good idea to get the basic facts right first.

    Nathanael 11.26.19 at 6:10 am (no link)
    I'll add that John Quiggin's point that Xi has already lost control of the provinces is correct -- but it DOES threaten his position as dictator. Once the provincial governors know they can act with impunity, it is absolutely standard for the next step to be getting rid of that annoying guy who is pretending to be dictator. It may take a few years but Xi now has dozens of powerful insiders who know that he's a weakling. They'll bide their time but when he crosses too many of them they'll take him out. And if China doesn't shut down coal, he's going to look like a weakling internationally too, in a couple of years. This will create a new group of ambitious insiders with a different reason to take him out.

    Xi broke the "technocratic consensus" which was present after Deng, of central committee members who strove for competence and fact-based decision-making. That was a surprisingly effective type of junta government which led to lots of thinkpieces about whether authoritarian China would beat the democratic west. But it succumbed to the succession problem, like all authoritarian systems; Xi made himself Premier-for-life and the country is now exhibiting all the usual failures of authoritarian countries.

    Hidari 11.26.19 at 9:08 am (no link)
    @11 Yes it's strange that allegations of Chinese use of facial recognition software is gaining so much traction at a time when the Trump regime is deliberately ratcheting up tensions with China to pursue nakedly imperial goals, when the objective facts of Israeli use of similar software, which the Israelis boast about ( https://www.nbcnews.com/news/all/why-did-microsoft-fund-israeli-firm-surveils-west-bank-palestinians-n1072116 ) doesn't cause so much interest, at a time when the Trump regime has simple decreed that the Israeli invasion/colonisation of Palestine is 'legal under international law'.

    One of life's little mysteries I guess.

    If we must talk about China could we at least bring it back to areas where we are responsible and where, therefore, we can do something about it?

    https://www.theguardian.com/world/2019/feb/01/blackwater-founder-erik-prince-to-build-training-camp-in-chinas-xinjiang

    [Nov 28, 2019] Futures Tumble After Trump Signs Bill Backing Hong Kong Protesters, Defying China

    So in due course the trade war was replaced by the full scale cold war.
    Notable quotes:
    "... Needless to say, no differences will be "settled amicably" and now China will have no choice but to retaliate, aggressively straining relations with the US, and further complicating Trump's effort to wind down his nearly two-year old trade war with Beijing. ..."
    "... The legislation, S. 1838, which was passed virtually unanimously in both chambers, requires annual reviews of Hong Kong's special trade status under American law and will allow Washington to suspend said status in case the city does not retain a sufficient degree of autonomy under the "one country, two systems" framework. The bill also sanctions any officials deemed responsible for human rights abuses or undermining the city's autonomy. ..."
    "... The House cleared the bill 417-1 on Nov. 20 after the Senate passed it without opposition, veto-proof majorities that left Trump with little choice but to acquiesce, or else suffer bruising fallout from his own party. the GOP. ..."
    "... In accordance with the law, the Commerce Department will have 180 days to produce a report examining whether the Chinese government has tried use Hong Kong's special trading status to import advanced "dual use" technologies in violation of US export control laws. Dual use technologies are those that can have commercial and military applications. ..."
    "... The new law directs the US secretary of state to "clearly inform the government of the People's Republic of China that the use of media outlets to spread disinformation or to intimidate and threaten its perceived enemies in Hong Kong or in other countries is unacceptable." ..."
    "... The state department should take any such activity "into consideration when granting visas for travel and work in the United States to journalists from the People's Republic of China who are affiliated with any such media organizations", the law says. ..."
    "... Yes I think getting the western financial institutions out of HK is the plan. I'm sure they appreciate the US doing this for them, but of course they could never admit that. ..."
    Nov 27, 2019 | www.zerohedge.com

    Less than an hour after Trump once again paraded with yet another all-time high in the S&P...

    ... and on day 510 of the trade war, it appears the president was confident enough that a collapse in trade talks won't drag stocks too far lower, and moments after futures reopened at 6pm, the White House said that Trump had signed the Hong Kong bill backing pro-democracy protesters, defying China and making sure that every trader's Thanksgiving holiday was just ruined.

    In a late Wednesday statement from the White House, Trump said that:

    I signed these bills out of respect for President Xi, China, and the people of Hong Kong. They are being enacted in the hope that Leaders and Representatives of China and Hong Kong will be able to amicably settle their differences leading to long term peace and prosperity for all.

    Needless to say, no differences will be "settled amicably" and now China will have no choice but to retaliate, aggressively straining relations with the US, and further complicating Trump's effort to wind down his nearly two-year old trade war with Beijing.

    Trump's signing of the bill comes during a period of unprecedented unrest in Hong Kong, where anti-government protests sparked by a now-shelved extradition bill proposal have ballooned into broader calls for democratic reform and police accountability.

    "The Hong Kong Human Rights and Democracy Act reaffirms and amends the United States-Hong Kong Policy Act of 1992, specifies United States policy towards Hong Kong and directs assessment of the political developments in Hong Kong," the White House said in a statement. "Certain provisions of the act would interfere with the exercise of the president's constitutional authority to state the foreign policy of the United States."

    The legislation, S. 1838, which was passed virtually unanimously in both chambers, requires annual reviews of Hong Kong's special trade status under American law and will allow Washington to suspend said status in case the city does not retain a sufficient degree of autonomy under the "one country, two systems" framework. The bill also sanctions any officials deemed responsible for human rights abuses or undermining the city's autonomy.

    The House cleared the bill 417-1 on Nov. 20 after the Senate passed it without opposition, veto-proof majorities that left Trump with little choice but to acquiesce, or else suffer bruising fallout from his own party. the GOP.

    Trump also signed into law the PROTECT Hong Kong act, which will prohibit the sale of US-made munitions such as tear gas and rubber bullets to the city's authorities.

    While many members of Congress in both parties have voiced strong support for protesters demanding more autonomy for the city, Trump had stayed largely silent, even as the demonstrations have been met by rising police violence.

    Until now.

    The bill's author, Senator Marco Rubio of Florida, said that with the legislation's enactment, the US now had "new and meaningful tools to deter further influence and interference from Beijing into Hong Kong's internal affairs."

    In accordance with the law, the Commerce Department will have 180 days to produce a report examining whether the Chinese government has tried use Hong Kong's special trading status to import advanced "dual use" technologies in violation of US export control laws. Dual use technologies are those that can have commercial and military applications.

    One other less discussed but notable provision of the Hong Kong Human Rights Act targets media outlets affiliated with China's government. The new law directs the US secretary of state to "clearly inform the government of the People's Republic of China that the use of media outlets to spread disinformation or to intimidate and threaten its perceived enemies in Hong Kong or in other countries is unacceptable."

    The state department should take any such activity "into consideration when granting visas for travel and work in the United States to journalists from the People's Republic of China who are affiliated with any such media organizations", the law says.

    * * *

    In the days leading up to Trump's signature, China's foreign ministry had urged Trump to prevent the legislation from becoming law, warning the Americans not to underestimate China's determination to defend its "sovereignty, security and development interests."

    "If the U.S. insists on going down this wrong path, China will take strong countermeasures, " said China's foreign ministry spokesman Geng Shuang at a briefing Thursday in Beijing. On Monday, China's Vice Foreign Minister Zheng Zeguang summoned the U.S. ambassador, Terry Branstad to express "strong opposition" to what the country's government considers American interference in the protests, including the legislation, according to statement. The new U.S. law comes just as Washington and Beijing showed signs of working toward "phase-one" of deal to ease the trade war. Trump would like the agreement finished in order to ease economic uncertainty for his re-election campaign in 2020, and has floated the possibility of signing the deal in a farm state as an acknowledgment of the constituency that's borne the brunt of retaliatory Chinese tariffs.

    Last week China's Vice Premier and chief trade negotiator Liu He said before a speech at the Bloomberg New Economy Forum in Beijing, that he was "cautiously optimistic" about reaching the phase one accord. He will now have no choice but to amend his statement.

    In anticipation of a stern Chinese rebuke, US equity futures tumbled, wiping out most of the previous day's gains... Still, the generally modest pullback - the S&P was around 2,940 when Trump announced the Phase 1 deal on Oct 11 - suggests that despite Trump's signature, markets expect a Chinese deal to still come through. That may be an aggressive and overly "hopeful" assumption, especially now that China now longer has a carte blanche to do whatever it wants in Hong Kong, especially in the aftermath of this weekend's landslide victory for the pro-Democracy camp which won in 17 of the city's 18 districts.

    "Following last weekend's historic elections in Hong Kong that included record turnout, this new law could not be more timely in showing strong US support for Hongkongers' long-cherished freedoms," said Rubio


    The Palmetto Cynic , 1 hour ago link

    Trade wars are good and easy to win. LOL.

    Gonzogal , 32 minutes ago link

    This is another attempt by the US to stop BRICS. They care NOTHING about HK, only its usefulness in the US war on Chinas growing importance in world trade.

    Fascal Rascal upended , 27 minutes ago link

    **** trading with communists.

    lift foot, aim, pull trigger.

    but no no no... trading with communists brings jobs to sell cheap crap. oh what was I thinking.... cheap crap, jobs, and the richest of the rich get richer... my bad.
    it ain’t like the commies are going to use the money to build up their military..

    silly me.

    sentido kumon , 41 minutes ago link

    Of course the obvious solution is to just let people choose whatever or whomever they want to associate with and be respected and left alone for their choice.

    But no. We all have to live and abide by the wishes of other people bcuz of "unity" and ****.

    This non sense is really getting tiresome.

    Gonzogal , 51 minutes ago link

    This criticism from a country that just this week renewed the "Patriot Act" that has taken away Americans rights and increased spying on US citizens.

    The US should get its OWN house in order BEFORE moves against countries that do the SAME THING THE US DOES!

    The world is sick of this hypocracy!

    Helg Saracen , 1 hour ago link

    Eh guys, you still do not understand that all this (not only China and Hong Kong) is a very big "elite" performance for ordinary people to keep you (the rest of the boobies) in subjection. It's like in boxing - contractual fights. Do you think world "elites" benefit from peace and order? You are mistaken - these guys have the world as death (the death of their Power and their Control). An example from the history of Europe - in the 18-19 and early 20th century, Europe only did what it fought. But the funny thing is that the monarchs (the real owners of Europe) were relatives among themselves. The First World War was popularly called “The War of Three Cousins” (English monarch, German Kaiser and Russian emperor). But the Europeans paid for the dismantling of relatives. Now the "monarchs" are bankers and your position has not changed, you changed only the owners after 1918.

    He–Mene Mox Mox , 1 hour ago link

    Problem with Hong Kong is, it is dependent on China to survive. That is not only true for the most basic neccessities, but also as a port for international trade. However, in the last 25 years, Shenzhen and Guangzhou have built up their own trade hubs, which has pulled trade away from being concentrated in Hong Kong, and consequently more dependent on China. Our ideas of Hong Kong remaining an independent island nation isn't going to work for three reasons:

    1. Without being a doorway to China, there is no other reason for its existence.

    2. Hong Kong is indeed Chinese sovereign territory, that was taken away from it to be made into a trade colony by the British in 1841, under the Treaty of Nanking. The British gave up Hong Kong in 1997, under the 1984 signed Sino-British Joint Declaration, in which Britain agreed to return not only the New Territories but also Kowloon and Hong Kong itself. China promised to implement a "One Country, Two Systems" regime, under which for fifty years Hong Kong citizens could continue to practice capitalism and political freedoms forbidden on the mainland. So, when the year 2047 comes around, Hong Kong will be fully absorbed and integrated in a One Country, One system Chinese regime. In otherwords, Hong Kong's fate was already sealed in 1984, and there is nothing America can legally do about it.

    3. Hong Kong still needs the basic neccessities from China to survive. Don't count on either the British or the Americans to provide it.

    Dzerzhhinsky , 1 hour ago link

    Yes I think getting the western financial institutions out of HK is the plan. I'm sure they appreciate the US doing this for them, but of course they could never admit that.

    [Nov 25, 2019] China doesn't aim to be an empire for the simple reason it learned from America's mistakes

    Nov 25, 2019 | www.moonofalabama.org

    psychohistorian , Nov 23 2019 6:37 utc | 58

    Xi Jinping tells that bullshit little story about China's 5,000 year History, but the truth is really much more pragmatic: China doesn't aim to be an empire for the simple reason it learned from America's mistakes.

    The CCP already knows that being the sole superpower is unsustainable and, in the medium term, goes even against its main objective, which is to establish a "moderately prosperous society" in China until 2030 (they consider the 2000s Belgium as the standard for "moderately prosperous").

    Socialist China has shown, so far, an incredible capacity of learning from other nations' mistakes:

    1) It correctly read the historical conjuncture of the late 1960s, by concluding that the historical cycle of socialist revolutions was over, and moved on to try to break the Cold War embargo in order to initiate a cycle of wealth production. They achieved that in 1972. This was when Mao Zedong was still alive and commanding China with absolute authority, so it's a myth China "freed itself" only when and because Mao died (1976);

    2) It learned from the failed experiment of the Brazilian liberal dictatorship, by doing exactly the opposite of the Zona Franca de Manaus . The result was the creation of the Special Economic Zones, which allowed capitalist investment from abroad to come to China but in quarentene, and with technological transfer.

    3) It learned from the trap the USSR fell, and used a peaceful geopolitical strategy. It avoided an arms race and was able to expand its allied nations portfolio and slowly tightened its grip over the American economy.

    4) It learned from the the failure of Soviet socialism in producing very good quality consumer goods. It solved this problem by "opening up" for capitalist exploitation the sectors which produced and distributed consumer goods, without affecting the strategic sectors (defense, finance, natural resources, etc.).

    5) It learned from the failure of the American empire of maintaining its status as the world's "lonely superpower" by not adopting a war culture in China and by being more tolerant with its neighbors. But that didn't mean they didn't consolidated position: military spending continues to go up and the Armed Forces continues to be modernized and under firm CCP control. The South China Sea is a "corridor of life" for the Chinese, so the CCP quickly, but in a peaceful manner, took control of it, very aware that it would probably cost the Vietnamese friendship. But that was the exception that proves the rule, an exceptional situation where the benefits were greater than the costs.

    vk , Nov 23 2019 13:58 utc | 79

    @

    [Nov 25, 2019] China's trade has gradually steadied as the nation moves to explore third markets

    Nov 25, 2019 | www.moonofalabama.org

    karlof1 , Nov 22 2019 21:16 utc | 20

    This isn't the only article I've read over the past several days suggesting China won't agree to a trade deal anytime soon. The following are amongst the reasons why:

    "China's trade has gradually steadied as the nation moves to explore third markets. 'A substantial decline in trade and a drastic fall in economic growth which some international observers were worried about didn't occur, pointing to the potential and resilience of the Chinese economy,' he went on to say.

    "The US, for its part, has seen its current account deficit as a percentage of GDP shoot up from 2.9 percent to 3.2 percent. This suggests the trade war is failing to address the issue of the US' current account deficit, stressed Zhu, who is currently the Chairman of the National Institute of Financial Research at Tsinghua University. He added that, more worryingly, tariffs mean additional costs are put on US companies and consumers."

    Evil Outlaw US Empire planners in their hubristic zeal to decouple from China's economy erred massively in thinking China would be the one harmed and come begging for a trade deal. Instead, China's geoeconomic strategy is clearly working and is more potent than what the Empire can bring to the table--Oops! China can now play Trump.

    uncle tungsten , Nov 23 2019 8:09 utc | 68
    Peter AU1 #64

    psychohistorian 63
    I see Trump's envoy Kissinger is standing next to Xi. Seems like Trump is trying to cook something up with Kissinger regularly on the scene when it comes to Russia and China.

    Interesting that Kissinger is there . Steve Pieczenik takes the very strong view that Pompeo is a dead man walking. Worth every second of his five minute discourse . What I like about Steve and his various takes on people of note is that he assassinates them immediately and intensely with a quick turn of phrase.

    Peter AU1 , Nov 23 2019 8:20 utc | 69
    uncle tungsten

    Kissinger was also Nixon's envoy. He engineered the split between China and the Soviet Union amongst other things. China and Russia's current leadership though may be above Kissinger's pay grade.

    [Nov 15, 2019] Asia Times Numbers show joke is on the US, not Huawei Article

    Nov 15, 2019 | www.asiatimes.com

    Numbers show joke is on the US, not Huawei US ban lit a fire under Huawei, seen taking lead in smartphones and awash in cash as bonds trade at a premium

    By Umesh Desai

    Unlisted Chinese telecommunications giant Huawei Technologies was made an international pariah by US regulators earlier this year after a ban on buying key parts and on access to crucial markets.

    You think that sounded the death knell for the company? Think again.

    This week, Huawei announced a US$286 million bonuses bonanza to its employees . Its bonds continue to trade above par, and its cash balances are massive. Hardly the signs of a company struggling under sanctions.

    The company has repeatedly denied US allegations that it is a front for the Chinese government – the justification Washington cited for banning US companies from using Huawei-manufactured gear.

    Huawei is the world's biggest telecom equipment maker and it's the second biggest smartphone maker.

    According to data from International Data Corporation, smartphone shipments in the July-September quarter rose 18.6% to 66.6 million, just behind global leader Samsung's 78.2 million.

    "Huawei has been gaining market share in China and overseas despite US trade war frictions and may become the leading smartphone maker in the next two quarters," said Nitin Soni, director of corporate ratings at Fitch Ratings.

    He said telcos across emerging markets, which are facing capital expenditure pressures and limited 5G business viability in the short term, may be willing to buy Huawei's 5G equipment given it is cheaper and has better technology than European counterparts.

    It's not just Soni. Industry leaders also acknowledge Huawei's quality standards .

    Indian telco Bharti Enterprises' chairman Sunil Mittal said recently, for example, "I can safely say their products in 3G and 4G that we have experienced are significantly superior to Ericsson and Nokia. I use all three of them. "

    Indeed, the bond-market performance of the unrated, unlisted company confirms Huawei's strength. Its dollar-denominated bonds traded in global markets are changing hands at above par, indicating bond investors are confident about the company's cash position and liquidity situation.

    Its bonds due 2025, which pay a coupon of 4.125%, are trading at a price of $104 while the holder would only get $100 at maturity. The premium would be compensated by the annual coupon, which would reduce the yield. The bonds are currently yielding 3.4% compared with the 4.25% yield at the time of the issuance. In price terms the bonds have rallied from $99 in 2015 to $104. Prices move inversely to yields.

    The financial highlights also betray no signs of weakness. The company has a cash hoard of $39 billion and generates $10 billion from operations each year.

    So, in fact, the US ban on Huawei may be helping the company.

    "A ban on US companies such as Google to supply software to Huawei may lead to faster innovation by Huawei to develop its own operating system and chips," said Soni.

    [Nov 09, 2019] Asia Times America's misguided war on Chinese technology Article

    Nov 09, 2019 | www.asiatimes.com

    America's misguided war on Chinese technology Jeffrey D Sachs By Jeffrey D Sachs November 8, 2019

    The worst foreign-policy decision by the United States of the last generation – and perhaps longer – was the "war of choice" that it launched in Iraq in 2003 for the stated purpose of eliminating weapons of mass destruction that did not, in fact, exist. Understanding the illogic behind that disastrous decision has never been more relevant, because it is being used to justify a similarly misguided US policy today.

    The decision to invade Iraq followed the illogic of then-US vice-president Richard Cheney, who declared that even if the risk of WMD falling into terrorist hands was tiny – say, 1% – we should act as if that scenario would certainly occur.

    Such reasoning is guaranteed to lead to wrong decisions more often than not. Yet the US and some of its allies are now using the Cheney Doctrine to attack Chinese technology. The US government argues that because we can't know with certainty that Chinese technologies are safe, we should act as if they are certainly dangerous and bar them.

    Proper decision-making applies probability estimates to alternative actions. A generation ago, US policymakers should have considered not only the (alleged) 1% risk of WMD falling into terrorist hands, but also the 99% risk of a war based on flawed premises. By focusing only on the 1% risk, Cheney (and many others) distracted the public's attention from the much greater likelihood that the Iraq war lacked justification and that it would gravely destabilize the Middle East and global politics.

    The problem with the Cheney Doctrine is not only that it dictates taking actions predicated on small risks without considering the potentially very high costs. Politicians are tempted to whip up fears for ulterior purposes.

    That is what US leaders are doing again: creating a panic over Chinese technology companies by raising, and exaggerating, tiny risks. The most pertinent case (but not the only one) is the US government attack on the wireless broadband company Huawei. The US is closing its markets to the company and trying hard to shut down its business around the world. As with Iraq, the US could end up creating a geopolitical disaster for no reason.

    I have followed Huawei's technological advances and work in developing countries, as I believe that fifth-generation (5G) and other digital technologies offer a huge boost to ending poverty and other Sustainable Development Goals. I have similarly interacted with other telecom companies and encouraged the industry to step up actions for the United Nations' SDGs. When I wrote a short foreword (without compensation) for a Huawei report on the topic, and was criticized by foes of China, I asked top industry and government officials for evidence of wayward activities by Huawei. I heard repeatedly that Huawei behaves no differently than trusted industry leaders.

    The US government nonetheless argues that Huawei's 5G equipment could undermine global security. A "back door" in Huawei's software or hardware, US officials claim, could enable the Chinese government to engage in surveillance around the world. After all, US officials note, China's laws require Chinese companies to cooperate with the government for purposes of national security.

    Given the technology's importance for their sustainable development, low-income economies around the world would be foolhardy to reject an early 5G rollout. Yet despite providing no evidence of back doors, the US is telling the world to stay away from Huawei

    Now, the facts are these. Huawei's 5G equipment is low-cost and high-quality, currently ahead of many competitors, and already rolling out. Its high performance results from years of substantial spending on research and development, scale economies, and learning by doing in the Chinese digital marketplace. Given the technology's importance for their sustainable development, low-income economies around the world would be foolhardy to reject an early 5G rollout.

    Yet despite providing no evidence of back doors, the US is telling the world to stay away from Huawei. The US claims are generic. As a US Federal Communications Commissioner put it , "The country that owns 5G will own innovations and set the standards for the rest of the world, and that country is currently not likely to be the United States." Other countries, most notably the United Kingdom, have found no back doors in Huawei's hardware and software. Even if back doors were discovered later, they could almost surely be closed at that point.

    The debate over Huawei rages in Germany, where the US government threatens to curtail intelligence cooperation unless the authorities exclude Huawei's 5G technology. Perhaps as a result of the US pressure, Germany's spy chief recently made a claim tantamount to the Cheney Doctrine: "Infrastructure is not a suitable area for a group that cannot be trusted fully." He offered no evidence of specific misdeeds. Chancellor Angela Merkel, by contrast, is fighting behind the scenes to leave the market open for Huawei.

    Ironically, though predictably, the US complaints partly reflect America's own surveillance activities at home and abroad. Chinese equipment might make secret surveillance by the US government more difficult. But unwarranted surveillance by any government should be ended. Independent UN monitoring to curtail such activities should become part of the global telecommunications system. In short, we should choose diplomacy and institutional safeguards, not a technology war.

    The threat of US demands to blockade Huawei concerns more than the early rollout of the 5G network. The risks to the rules-based trading system are profound. Now that the US is no longer the world's undisputed technology leader, President Donald Trump and his advisers don't want to compete according to a rules-based system. Their goal is to contain China's technological rise. Their simultaneous attempt to neutralize the World Trade Organization by disabling its dispute settlement system shows the same disdain for global rules.

    If the Trump administration "succeeds" in dividing the world into separate technology camps, the risks of future conflicts will multiply. The US championed open trade after World War II not only to boost global efficiency and expand markets for American technology, but also to reverse the collapse of international trade in the 1930s. That collapse stemmed in part from protectionist tariffs imposed by the US under the 1930 Smoot-Hawley Act , which amplified the Great Depression, in turn contributing to the rise of Adolf Hitler and, ultimately, the outbreak of World War II.

    In international affairs, no less than in other domains, stoking fears and acting on them, rather than on the evidence, is the path to ruin. Let's stick to rationality, evidence and rules as the safest course of action. And let us create independent monitors to curtail the threat of any country using global networks for surveillance of or cyberwarfare on others. That way, the world can get on with the urgent task of harnessing breakthrough digital technologies for the global good.

    Copyright: Project Syndicate, 2019.
    www.project-syndicate.org

    [Nov 03, 2019] Is China Playing Trump His Trade Team For Chumps

    Nov 03, 2019 | www.zerohedge.com

    The world's worst negotiating strategy is to give the other side everything they want in exchange for worthless empty promises, yet this is exactly what Trump and his trade team are doing. All the Chinese trade team has to do to get rid of tariffs and other U.S. bargaining chips is mutter some empty phrase about "agreeing in principle" and the U.S. surrenders all its bargaining chips.

    If the other side are such naive chumps that they give you everything you want without actually committing to anything remotely consequential, why bother with a formal agreement? Just play the other side for the chumps they are: if they threaten to reinstate tariffs, just issue another worthless press release about "progress has been made."

    The other guaranteed losing strategy in negotiation is advertise your own fatal weakness, which in Trump's case is his obsession with pushing the U.S. stock market to new highs. There is no greater gift he could hand the Chinese trade team than this monumental weakness, for all they have to do is talk tough and the U.S. stock market promptly tanks, sending the Trump Team into a panic of appeasement and empty claims of "progress."

    The Chinese team has gotten their way for a year by playing Trump's team as chumps and patsies, so why stop now? The Chinese know they can get way without giving anything away by continuing to play the American patsies and using the president's obsession with keeping U.S. stocks lofting higher to their advantage: declare the talks stalled, U.S. stocks crater, the American team panics and rushes to remove anything that might have enforcement teeth, reducing any "trade deal" to nothing but empty promises.

    Given their success at playing America's team, why do a deal at all? Just play the chumps for another year, and maybe Trump will be gone and a new set of even more naive patsies enter the White House.

    If we put ourselves in the shoes of the Chinese negotiators, we realize there's no need to sign a deal at all: the Trump team has gone out of its way to make it needless for China to agree to anything remotely enforceable. All the Chinese have to do is issue some stern talk that crushes U.S. stocks and the Trump Team scurries back, desperate to appease so another rumor of a "trade deal" can be issued to send U.S. stocks higher.

    It would be pathetic if it wasn't so foolish and consequential.

    [Nov 01, 2019] Pompeo reused anti-soviet rhetoric in trade war with China

    Notable quotes:
    "... Pompeo said the United States had long cherished its friendship with the Chinese people, adding the Communist government was not the same thing as the people of China. ..."
    "... We are in a civilization war about the global social contract and whether sovereign public finance gets a chance to be compared against the Western centuries old private finance controlled world. ..."
    "... The USA has been successful at bribing foreign leaders, taking them under their wing, and getting them to accept their place in the world order. They think they can do this with anybody. ..."
    "... The US never really counts on foreign leaders taking their peoples interests at heart and standing up to the hegemon. As far as Pompeo goes this is classic projection. It is a sign they are losing and are worried about it. ..."
    Nov 01, 2019 | www.moonofalabama.org

    psychohistorian , Oct 31 2019 15:18 utc | 4

    Below is a Reuters posting about Mike Pompeo presenting the public/private finance "dog whistle" at a Hudson Institute think tank gala dinner....the pot calling the kettle black.

    "
    WASHINGTON (Reuters) - U.S. Secretary of State Mike Pompeo on Wednesday stepped up recent U.S. rhetoric targeting China's ruling Communist Party, saying Beijing was focused on international domination and needed to be confronted.

    Pompeo made the remarks even as the Trump administration said it still expected to sign the first phase of deal to end a damaging trade war with China next month, despite Chile's withdrawal on Wednesday as the host of an APEC summit where U.S. officials had hoped this would happen.

    Pompeo said the United States had long cherished its friendship with the Chinese people, adding the Communist government was not the same thing as the people of China.

    "They are reaching for and using methods that have created challenges for the United States and for the world and we collectively, all of us, need to confront these challenges ... head on," Pompeo said in an address to a gala dinner in New York of the conservative Hudson Institute think tank.

    "It is no longer realistic to ignore the fundamental differences between our two systems, and the impact that the differences in those systems have on American national security."
    "

    I posted the above about 6 hours ago on the Weekly Open thread and now get up to read that the financial markets are down and Trump is tweeting that it is the Fed's fault for not lowering rates even further even though there are a couple of ZH postings that refer to China's response to Pompeo's remarks as offensive and maybe a trade deal won't get signed...

    We are in a civilization war about the global social contract and whether sovereign public finance gets a chance to be compared against the Western centuries old private finance controlled world.

    goldhoarder | Oct 31 2019 16:35 utc | 16

    4 @psychohistorian

    Haha. The fight is an old one. Who is to be master and who is to be slave. China was supposed to happily be the world's cheap manufacturer and not get too big for its britches. The USA has been successful at bribing foreign leaders, taking them under their wing, and getting them to accept their place in the world order. They think they can do this with anybody.

    They think every leader is a budding Lenin Moreno or that they can arrange a coup and force into office another Lenin Moreno. Russia, China, and India will not allow it.

    All have at one time or another (Russia quite recently) been under the heel of Western empire. All have old and proud civilizations.

    The US never really counts on foreign leaders taking their peoples interests at heart and standing up to the hegemon. As far as Pompeo goes this is classic projection. It is a sign they are losing and are worried about it.

    [Oct 30, 2019] Chinese Patriotism Huawei Smartphone Sales Jump 66% In China As Apple iPhone Sales Slump

    Oct 30, 2019 | www.zerohedge.com

    Chinese Patriotism: Huawei Smartphone Sales Jump 66% In China As Apple iPhone Sales Slump by Tyler Durden Wed, 10/30/2019 - 13:50 0 SHARES We're starting to get first-hand knowledge of what we're coining as the " blowback period " in the trade war. This is a point in time when Chinese consumers, downright furious of President Trump's protectionist policies that targeted Chinese companies over the summer, have collectively stood up to an aggressor (the US), and have secretly fired back, targeting US firms by abandoning their products for domestic ones, all in the name of patriotism.

    Honestly, over time, the trade war, if solved next month or next year, or who knows at this point when it'll be solved, will have devastating consequences for corporate America as their market share in China will erode as patriotism forces consumers to gravitate towards domestic brands.

    A new report from Canalys , an independent research firm focused on technology, has linked patriotism in China for the jump in Huawei smartphone sales in the third quarter.

    Huawei's 3Q19 smartphone sales soared by 66% YoY in China , compared with a 31% increase in 2Q19.

    Between 2Q-3Q, President Trump escalated the trade war to near full-blown, and also attacked individual companies with economic sanctions and banned certain ones from doing business in the US. Chinese consumers responded by ditching American products, like Apple iPhones , as this is some of the first evidence we've seen of the blowback period, likely to worsen in 4Q19 through 1Q20.

    As shown in the chart below, the July-September period of 2019 was a devastating quarter for Huawei's top rivals, including Vivo, Oppo, Xiaomi (other Chinese brands), along with depressing sales from Apple.

    Smartphone shipments overall were 97.8 million, down 3% from 100.6 million for the same period last year.

    Apple's YoY slump gained momentum from -14% in 2Q to -28% for 3Q .

    Chinese patriotism allowed Huawei's market share in the country to expand from 24.9% to 42.4% over the past year.

    Canalys analyst Mo Jia said, "The U.S.-China trade war is also creating new opportunities," adding that, " Huawei's retail partners are rolling out advertisements to link Huawei with being the patriotic choice, to appeal to a growing demographic of Chinese consumers willing to take political factors into account when making a purchase decision. "

    The blowback period has begun, and corporate America should be terrified that their market share in China is about to evaporate.

    [Oct 28, 2019] Sleepwalking Into the Abyss

    Oct 28, 2019 | jessescrossroadscafe.blogspot.com

    Sleepwalking Into the Abyss

    "As I have stated strongly before, and just to reiterate, if Turkey does anything that I, in my great and unmatched wisdom, consider to be off limits, I will totally destroy and obliterate the Economy of Turkey (I've done before!) "

    Donald J. Trump

    "China uses a host of monopolizing strategies to extend its geopolitical and commercial power, everything from below cost pricing to grab market share, patent trolling, espionage, mergers, and financial manipulation. In fact, the CCP is best understood as a giant monopoly that also controls a nation of 1.4 billion people and a large military apparatus...

    China's biggest asset in gaining power was how most people in the West just didn't realize that the CCP aimed to use it. Now China's cover is blown. The raw exercise of power to censor a random Houston Rockets basketball executive has made millions of people take notice. Everyone knows, the Chinese government isn't content to control its own nation, it must have all bow down to its power and authority.

    Matt Stoller, How Joe Biden Empowered China's Censorship of the NBA


    Matt overstates the headline I think. The empowerment of China may have gone into higher gear with Bill Clinton perhaps, but has been fully supported by every President, both parties, and especially the moneyed interests in the US, who place their short term greed first and foremost.

    Follow the money. China is certainly not alone among organizations, and even nations, in playing on the personal greed, divided loyalties, and lust for power of our political and financial class.

    This in itself is nothing new. But the extent of it, and the fashionable acceptance of it amongst our society's elites, the industrialization of political corruption and big money in politics, has been breathtaking.

    [Oct 26, 2019] Can The US Beat China In A Trade War by Andre Vltcheck

    That looks like vast and generally incorrect exaggeration. While China mode substantial progress in catching up with the West, the technology is still dominated by the West.
    But as technological revolution is slowing down and in some areas coming to the end (die size in semiconductors in one example; it is impossible to shrink it further; smartphones reached saturation level, and hardware wise their capabilities are far above what a regular user needs or wants) it is easier for other countries to catch up.
    In any case, the main reason for trade war with China is to try to slow down its ascendance.
    The problem for China is that China converted to neoliberalism, and as such (like Russia) is subject to all the ills the neoliberal society tend to bring into the country. Including a very high level of inequality.
    And while backlash against neoliberalism is growing and in the USA neoliberalism entered a prolong crisis with secular stagnation as the "new normal" , the question is what is that alternative ? And while backlash against neoliberalism is growing and in the USA neoliberalism entered a prolong crisis with secular stagnation as the "new normal" , the question is what is that alternative ?
    Notable quotes:
    "... Precisely! The war against the Soviet Union was hardly a war for economic survival of the United States. It was an ideological battle, which the United States, unfortunately won, because it utilized both propaganda and economic terror (the arms race and other means). ..."
    "... Now, China is next on the list, and the White House is not even trying to hide it. But China is savvy. It is beginning to understand the game. And it is ready, by all means, to defend the system which has pulled almost all its citizens out of misery, and which could, one day soon, do the same for the rest of the world. ..."
    "... China has more problems than the United States. Taiwan, Tibet, Hong Kong, persecuting Uyghurs in Xinjiang, Indonesia and Malaysia because of Islam, Inner Mongolia separatists, Kashmir and India, USA trade pressure, Japan and South Korea are competitors. ..."
    Oct 25, 2019 | www.zerohedge.com

    Authored by Andre Vltcheck via Off-Guardian.org,

    It is very popular these days to talk and write about the "trade war" between the United States and China. But is there really one raging? Or is it, what we are witnessing, simply a clash of political and ideological systems : one being extremely successful and optimistic, the other depressing, full of dark cynicism and nihilism?

    In the past, West used to produce almost everything. While colonizing the entire planet (one should just look at the map of the globe, between the two world wars), Europe and later the United States, Canada and Australia, kept plundering all the continents of natural resources, holding hundreds of millions of human beings in what could be easily described as 'forced labor', often bordering on slavery.

    Under such conditions, it was very easy to be 'number one', to reign without competition, and to toss around huge amounts of cash, for the sole purpose of indoctrinating local and overseas 'subjects' on topics such as the 'glory' of capitalism, colonialism (open and hidden), and Western-style 'democracy'.

    It is essential to point out that in the recent past, the global Western dictatorship (and that included the 'economic system) used to have absolutely no competition. Systems that were created to challenge it, were smashed with the most brutal, sadistic methods. One only needs recall invasions from the West to the young Soviet Union, with the consequent genocide and famines. Or other genocides in Indochina, which was fighting its wars for independence, first against France, later against the United States.

    *

    Times changed. But Western tactics haven't.

    There are now many new systems, in numerous corners of the world. These systems, some Communist, others socialist or even populist, are ready to defend their citizens, and to use the natural resources to feed the people, and to educate, house and cure them.

    No matter how popular these systems are at home, the West finds ways to demonize them, using its well-established propaganda machinery. First, to smear them and then, if they resist, to directly liquidate them.

    As before, during the colonial era, no competition has been permitted. Disobedience is punishable by death.

    Naturally, the Western system has not been built on excellence, hard work and creativity, only. It was constructed on fear, oppression and brutal force. For centuries, it has clearly been a monopoly.

    *

    Only the toughest countries, like Russia, China, Iran, North Korea or Cuba, have managed to survive, defending they own cultures, and advancing their philosophies.

    To the West, China has proved to be an extremely tough adversary.

    With its political, economic, and social system, it has managed to construct a forward-looking, optimistic and extraordinarily productive society. Its scientific research is now second to none. Its culture is thriving. Together with its closest ally, Russia, China excels in many essential fields.

    That is precisely what irks, even horrifies the West.

    For decades and centuries, Europe and the United States have not been ready to tolerate any major country, which would set up its own set of rules and goals.

    China refuses to accept the diktat from abroad. It now appears to be self-sufficient, ideologically, politically, economically and intellectually. Where it is not fully self-sufficient, it can rely on its friends and allies. Those allies are, increasingly, located outside the Western sphere.

    *

    Is China really competing with the West? Yes and no. And often not consciously.

    It is a giant; still the most populous nation on earth. It is building, determinedly, its socialist motherland (applying "socialism with the Chinese characteristics" model). It is trying to construct a global system which has roots in the thousands of years of its history (BRI – Belt and Road Initiative, often nicknamed the "New Silk Road").

    Its highly talented and hardworking, as well as increasingly educated population, is producing, at a higher pace and often at higher quality than the countries in Europe, or the United States. As it produces, it also, naturally, trades.

    This is where the 'problem' arises. The West, particularly the United States, is not used to a country that creates things for the sake and benefit of its people. For centuries, Asian, African and Latin American people were ordered what and how to produce, where and for how much to sell the produce. Or else!

    Of course, the West has never consulted anyone. It has been producing what it (and its corporations) desired. It was forcing countries all over the world, to buy its products. If they refused, they got invaded, or their fragile governments (often semi-colonies, anyway) overthrown.

    The most 'terrible' thing that China is doing is: it is producing what is good for China, and for its citizens.

    That is, in the eyes of the West, unforgiveable!

    *

    In the process, China 'competes'. But fairly: it produces a lot, cheaply, and increasingly well. The same can be said about Russia.

    These two countries are not competing maliciously. If they were to decide to, they could sink the US economy, or perhaps the economy of the entire West, within a week.

    But they don't even think about it.

    However, as said above, to just work hard, invent new and better products, advance scientific research, and use the gains to improve the lives of ordinary people (they will be no extreme poverty in China by the end of 2020) is seen as the arch-crime in London and Washington.

    Why? Because the Chinese and Russian systems appear to be much better, or at least, simply better, than those which are reigning in the West and its colonies. And because they are working for the people, not for corporations or for the colonial powers.

    And the demagogues in the West – in its mass media outlets and academia – are horrified that perhaps, soon, the world will wake up and see the reality. Which is actually already happening: slowly but surely.

    *

    To portray China as an evil country, is essential for the hegemony of the West. There is nothing so terrifying to London and Washington as the combination of these words: "Socialism/ Communism, Asian, success". The West invents new and newer 'opposition movements', it then supports them and finances them, just in order to then point fingers and bark: "China is fighting back, and it is violating human rights", when it defends itself and its citizens. This tactic is clear, right now, in both the northwest of the country, and in Honk Kong.

    Not everything that China builds is excellent. Europe is still producing better cars, shoes and fragrances, and the United States, better airplanes. But the progress that China has registered during the last two decades, is remarkable. Were it to be football, it is China 2: West 1.

    Most likely, unless there is real war, that in ten years, China will catch up in many fields; catch up, and surpass the West. Side by side with Russia.

    It could have been excellent news for the entire world. China is sharing its achievements, even with the poorest of the poor countries in Africa, or with Laos in Asia.

    The only problem is, that the West feels that it has to rule. It is unrepentant, observing the world from a clearly fundamentalist view. It cannot help it: it is absolutely, religiously convinced that it has to give orders to every man and woman, in every corner of the globe.

    It is a tick, fanatical. Lately, anyone who travels to Europe or the United States will testify: what is taking place there is not good, even for the ordinary citizens. Western governments and corporations are now robbing even their own citizens. The standard of living is nose-diving.

    China, with just a fraction of the wealth, is building a much more egalitarian society, although you would never guess so, if you exclusively relied on Western statistics.

    *

    So, "trade war" slogans are an attempt to convince the local and global public that "China is unfair", that it is "taking advantage" of the West. President Trump is "defending" the United States against the Chinese 'Commies'. But the more he "defends them", the poorer they get. Strange, isn't it?

    While the Chinese people, Russian people, even Laotian people, are, 'miraculously', getting richer and richer. They are getting more and more optimistic.

    For decades, the West used to preach 'free trade', and competition. That is, when it was in charge, or let's say, 'the only kid on the block'.

    In the name of competition and free trade, dozens of governments got overthrown, and millions of people killed.

    And now?

    What is China suppose to do? Frankly, what?

    Should it curb its production, or perhaps close scientific labs? Should it consult the US President or perhaps British Prime Minister, before it makes any essential economic decision? Should it control the exchange rate of RMB, in accordance with the wishes of the economic tsars in Washington? That would be thoroughly ridiculous, considering that (socialist/Communist) China will soon become the biggest economy in the world, or maybe it already is.

    There is all that abstract talk, but nothing concrete suggested. Or is it like that on purpose?

    Could it be that the West does not want to improve relations with Beijing?

    On September 7, 2019, AP reported:

    White House economic adviser Larry Kudlow compared trade talks with China on Friday to the U.S. standoff with Russia during the Cold War

    "The stakes are so high, we have to get it right, and if that takes a decade, so be it," he said.

    Kudlow emphasized that it took the United States decades to get the results it wanted with Russia. He noted that he worked in the Reagan administration: "I remember President Reagan waging a similar fight against the Soviet Union."

    Precisely! The war against the Soviet Union was hardly a war for economic survival of the United States. It was an ideological battle, which the United States, unfortunately won, because it utilized both propaganda and economic terror (the arms race and other means).

    Now, China is next on the list, and the White House is not even trying to hide it. But China is savvy. It is beginning to understand the game. And it is ready, by all means, to defend the system which has pulled almost all its citizens out of misery, and which could, one day soon, do the same for the rest of the world.


    JBL , 1 minute ago link

    hm....a crumbling neoliberal empire that sits idly by when its own children (your future) are chemically castrated as young as 5

    versus a nation that blocks jewish regulatory capture of the commanding heights of their economy

    lemme get more popcorn

    BT , 12 minutes ago link

    US is hemorrhaging around $1.7 trillion dollars(according to the bond king) a year with the “greatest economy ever” and near zero interest rate. Clearly, this is not sustainable and can’t last much longer. When the jig is up, whoever has the most guns(not gold) will prevail. .

    Spiritual Anunnaki , 50 minutes ago link

    China has more problems than the United States. Taiwan, Tibet, Hong Kong, persecuting Uyghurs in Xinjiang, Indonesia and Malaysia because of Islam, Inner Mongolia separatists, Kashmir and India, USA trade pressure, Japan and South Korea are competitors.

    China has some bright spots with Pakistan, North Korea and a very open hand negotiated with the African Union to colonize that continent etc. Russia is neutral but if it is to fall it will probably be towards Europe not the East.

    Vietnam is falling away leaving Myanmar and Cambodia. Thailand might already be a Western proxy.

    JLee2027 , 55 minutes ago link

    Let me break it down for you...when you have a buyer (USA) and a seller (China), the buyer is always in control when they can go somewhere else.

    ALWAYS.

    ChaoKrungThep , 26 minutes ago link

    You've broken down nothing. China can sell somewhere else, since it makes all the stuff. The US makes very little and will pay far more Chinese equivalent goods. Further, China's GDP is now 80% domestically generated; of the remaining 20% export income, the US accounts for only 30% of it, ie 6%. China can stand a loss of 6% easily. While the Americans, led the Ape-in-Chief have been thumping their chests, the nimble Chinese have taken markets everywhere, diversified their manufacturing bases and transportation systems. The US is shouting at the Moon. Enjoy the tan...

    Aussiekiwi , 1 hour ago link

    'The war against the Soviet Union was hardly a war for economic survival of the United States. It was an ideological battle, which the United States, unfortunately won,'

    Really !!! have a read of Gulag Archipelago before you come out with anything this stupid.

    ChaoKrungThep , 24 minutes ago link

    Read some American history. Their "gulags" are your "justice system", currently incarcerating the world's largest prison population.

    PGR88 , 1 hour ago link

    Crap article full of leftist slogans, and highly ideological Neo-marxist analysis of the West, while completely ignoring reality in China.

    He–Mene Mox Mox , 1 hour ago link

    The author apparently has never been to China to know what their perspective is. Instead, he is superimposing what western ideologs think it is. To Americans, it is political and ideological struggle. To the Chinese, it's basic economics and the welfare of its people. The Chinese know better than anyone else, what it was like being down in the gutter for almost 200 years, about the time the British showed up with their opium trade in the 1830's. The Chinese have made great strides in the last 45 years to get their people out of poverty, modernize, and build an industrialized economy that rivals any other economy in the world. The truth is, it's a feat that Americans are tacitly envious of, and will do whatever it takes to cut the Chinese down.

    The problem is, America is not the shining example of success and exceptionalism it thinks it is. It has fallen behind the power curve and isn't competitive any longer. Free trade is far and away better in China than what you will find in America. Don't believe it? Go there and see for yourself. Then ask yourself, why did the greater chunk of American manufacturing left and went to China in the first place, (besides chasing cheap labor), If it wasn't for free trade?

    Many other countries don't share the same ideology or values with Americans either, particularly when America can't provide for the welfare of its own people, so why would they want to copy that model of decay?

    Cheap Chinese Crap , 1 hour ago link

    Yet still they buy their safe haven bolt holes in Seattle rather than Shenzhen.

    The old American term for this is : Voting with their feet.

    Guess that model of decay is pretty attractive to a lot of rich, connected people in the mysterious orient.

    zeratul108 , 24 minutes ago link

    attractive properties in shenzhen or any tier 1 chinese cities are in the millions or tens of millions of dollars. not likely to jump higher anytime soon but whole lot of downside potential. Vancouver is full up. why not seattle, DC or somewhere with "cheap" prices?

    BT , 35 minutes ago link

    China and the rest of the world will continue to be held hostage until they have an alternative to SWIFT and Reinsurance.

    ChaoKrungThep , 8 minutes ago link

    They have two alternatives to SWIFT - CIPS & NSPK. Further, both Russia and China are using their own and local currencies in trade, bypassing not only SWIFT fees and delays, but the USD exchange rate rip-off.

    Frankly ZH readers are about 10 yrs behind the latest developments, hence the rednecks ranting about their already lost cause. Do some research.

    artistant , 1 hour ago link

    So far, Trump...

    1. Failed with Iran, Syria, Turkey, and the Middle East Peace Process

    2. Failed with Russia

    3. Failed with Venezuela

    4. Failed with trade war

    5. Failed with immigration

    6. Kidnapped a Huawei executive

    7. Set Hong Kong on fire

    8. Stole an Iranian tanker

    9. Stole a Venezuelan ship full of foods

    10. Stole Jerusalem and the Golan Heights for the FAKE HEBREWS

    11. Kept all wars in the Middle East going for APARTHEID Israhell

    12. Faked Epstein’s death who’s now living comfortably in Apartheid Israhell

    13. Faked it with N Korea

    14. Does nothing but plays golf, tweets, and insults

    15. Destroyed American farmers, coal miners, truckers, and manufacturers

    16. Failed to hire competent staff

    17. Failed to abolish the Fed

    18. Failed to drain the Swamp

    19. Failed to dismantle the Deep State

    20. Failed the US economy

    #TimeForTrumpToGo He's done enough damage.

    Especially as Preparation for WAR WITH IRAN is underway .

    Arising , 1 hour ago link

    I don't really know what to say- there may be truths in this article but that big fat commie elephant in the room keeps getting in the way.

    Theremustbeanotherway , 1 hour ago link

    "So far, China has exercised restraint." ...because they don't want the world to see what a truly monstrous regime runs that country...much like Israhell tries to silence and stifle criticism of its monstrous racist and supremacist regime.

    Meanwhile the West is on meds as it willingly takes the dagger someone is handing it to enable it to commit suicide..

    I wonder who is pulling strings in the background?

    This is quite interesting...

    https://www.chabad.org/centers/default_cdo/country/China/jewish/Chabad-Centers-and-Synagogue-Directory.htm

    contrast with

    https://www.theguardian.com/world/2019/jan/13/china-christians-religious-persecution-translation-bible

    https://www.persecution.org/2019/04/29/christianity-grows-china-despite-persecution/

    Could the two be linked in any way?

    Just asking....

    east of eden , 1 hour ago link

    Canada and australia most certainly did NOT plunder the world, at anytime. We have all the resources we will ever need,and we have never sought an empire. Don't try to drag us down into your pit for company. It is your pit, along with Britain. Let the British keep you company.

    MaxThrust , 2 hours ago link

    China "is ready to defend the system which has pulled almost all its citizens out of misery"

    China is very late to the game of "printing debt" It has taken the USA 100 years to bankrupt itself. China with it's 350% of GDP has managed it in 30 years.

    [Oct 26, 2019] Can The US Beat China In A Trade War

    That looks like vast and generally incorrect exaggeration. While China mode substantial progress in catching up with the West, the technology is still dominated by the West.
    But as technological revolution is slowing down and in some areas coming to the end (die size in semiconductors in one example; it is impossible to shrink it further; smartphones reached saturation level, and hardware wise their capabilities are far above what a regular user needs or wants) it is easier for other countries to catch up.
    In any case, the main reason for trade war with China is to try to slow down its ascendance.
    The problem for China is that China converted to neoliberalism, and as such (like Russia) is subject to all the ills the neoliberal society tend to bring into the country. Including a very high level of inequality.
    Notable quotes:
    "... Precisely! The war against the Soviet Union was hardly a war for economic survival of the United States. It was an ideological battle, which the United States, unfortunately won, because it utilized both propaganda and economic terror (the arms race and other means). ..."
    "... Now, China is next on the list, and the White House is not even trying to hide it. But China is savvy. It is beginning to understand the game. And it is ready, by all means, to defend the system which has pulled almost all its citizens out of misery, and which could, one day soon, do the same for the rest of the world. ..."
    Oct 25, 2019 | www.zerohedge.com

    Authored by Andre Vltcheck via Off-Guardian.org,

    It is very popular these days to talk and write about the "trade war" between the United States and China. But is there really one raging? Or is it, what we are witnessing, simply a clash of political and ideological systems : one being extremely successful and optimistic, the other depressing, full of dark cynicism and nihilism?

    In the past, West used to produce almost everything. While colonizing the entire planet (one should just look at the map of the globe, between the two world wars), Europe and later the United States, Canada and Australia, kept plundering all the continents of natural resources, holding hundreds of millions of human beings in what could be easily described as 'forced labor', often bordering on slavery.

    Under such conditions, it was very easy to be 'number one', to reign without competition, and to toss around huge amounts of cash, for the sole purpose of indoctrinating local and overseas 'subjects' on topics such as the 'glory' of capitalism, colonialism (open and hidden), and Western-style 'democracy'.

    It is essential to point out that in the recent past, the global Western dictatorship (and that included the 'economic system) used to have absolutely no competition. Systems that were created to challenge it, were smashed with the most brutal, sadistic methods. One only needs recall invasions from the West to the young Soviet Union, with the consequent genocide and famines. Or other genocides in Indochina, which was fighting its wars for independence, first against France, later against the United States.

    *

    Times changed. But Western tactics haven't.

    There are now many new systems, in numerous corners of the world. These systems, some Communist, others socialist or even populist, are ready to defend their citizens, and to use the natural resources to feed the people, and to educate, house and cure them.

    No matter how popular these systems are at home, the West finds ways to demonize them, using its well-established propaganda machinery. First, to smear them and then, if they resist, to directly liquidate them.

    As before, during the colonial era, no competition has been permitted. Disobedience is punishable by death.

    Naturally, the Western system has not been built on excellence, hard work and creativity, only. It was constructed on fear, oppression and brutal force. For centuries, it has clearly been a monopoly.

    *

    Only the toughest countries, like Russia, China, Iran, North Korea or Cuba, have managed to survive, defending they own cultures, and advancing their philosophies.

    To the West, China has proved to be an extremely tough adversary.

    With its political, economic, and social system, it has managed to construct a forward-looking, optimistic and extraordinarily productive society. Its scientific research is now second to none. Its culture is thriving. Together with its closest ally, Russia, China excels in many essential fields.

    That is precisely what irks, even horrifies the West.

    For decades and centuries, Europe and the United States have not been ready to tolerate any major country, which would set up its own set of rules and goals.

    China refuses to accept the diktat from abroad. It now appears to be self-sufficient, ideologically, politically, economically and intellectually. Where it is not fully self-sufficient, it can rely on its friends and allies. Those allies are, increasingly, located outside the Western sphere.

    *

    Is China really competing with the West? Yes and no. And often not consciously.

    It is a giant; still the most populous nation on earth. It is building, determinedly, its socialist motherland (applying "socialism with the Chinese characteristics" model). It is trying to construct a global system which has roots in the thousands of years of its history (BRI – Belt and Road Initiative, often nicknamed the "New Silk Road").

    Its highly talented and hardworking, as well as increasingly educated population, is producing, at a higher pace and often at higher quality than the countries in Europe, or the United States. As it produces, it also, naturally, trades.

    This is where the 'problem' arises. The West, particularly the United States, is not used to a country that creates things for the sake and benefit of its people. For centuries, Asian, African and Latin American people were ordered what and how to produce, where and for how much to sell the produce. Or else!

    Of course, the West has never consulted anyone. It has been producing what it (and its corporations) desired. It was forcing countries all over the world, to buy its products. If they refused, they got invaded, or their fragile governments (often semi-colonies, anyway) overthrown.

    The most 'terrible' thing that China is doing is: it is producing what is good for China, and for its citizens.

    That is, in the eyes of the West, unforgiveable!

    *

    In the process, China 'competes'. But fairly: it produces a lot, cheaply, and increasingly well. The same can be said about Russia.

    These two countries are not competing maliciously. If they were to decide to, they could sink the US economy, or perhaps the economy of the entire West, within a week.

    But they don't even think about it.

    However, as said above, to just work hard, invent new and better products, advance scientific research, and use the gains to improve the lives of ordinary people (they will be no extreme poverty in China by the end of 2020) is seen as the arch-crime in London and Washington.

    Why? Because the Chinese and Russian systems appear to be much better, or at least, simply better, than those which are reigning in the West and its colonies. And because they are working for the people, not for corporations or for the colonial powers.

    And the demagogues in the West – in its mass media outlets and academia – are horrified that perhaps, soon, the world will wake up and see the reality. Which is actually already happening: slowly but surely.

    *

    To portray China as an evil country, is essential for the hegemony of the West. There is nothing so terrifying to London and Washington as the combination of these words: "Socialism/ Communism, Asian, success". The West invents new and newer 'opposition movements', it then supports them and finances them, just in order to then point fingers and bark: "China is fighting back, and it is violating human rights", when it defends itself and its citizens. This tactic is clear, right now, in both the northwest of the country, and in Honk Kong.

    Not everything that China builds is excellent. Europe is still producing better cars, shoes and fragrances, and the United States, better airplanes. But the progress that China has registered during the last two decades, is remarkable. Were it to be football, it is China 2: West 1.

    Most likely, unless there is real war, that in ten years, China will catch up in many fields; catch up, and surpass the West. Side by side with Russia.

    It could have been excellent news for the entire world. China is sharing its achievements, even with the poorest of the poor countries in Africa, or with Laos in Asia.

    The only problem is, that the West feels that it has to rule. It is unrepentant, observing the world from a clearly fundamentalist view. It cannot help it: it is absolutely, religiously convinced that it has to give orders to every man and woman, in every corner of the globe.

    It is a tick, fanatical. Lately, anyone who travels to Europe or the United States will testify: what is taking place there is not good, even for the ordinary citizens. Western governments and corporations are now robbing even their own citizens. The standard of living is nose-diving.

    China, with just a fraction of the wealth, is building a much more egalitarian society, although you would never guess so, if you exclusively relied on Western statistics.

    *

    So, "trade war" slogans are an attempt to convince the local and global public that "China is unfair", that it is "taking advantage" of the West. President Trump is "defending" the United States against the Chinese 'Commies'. But the more he "defends them", the poorer they get. Strange, isn't it?

    While the Chinese people, Russian people, even Laotian people, are, 'miraculously', getting richer and richer. They are getting more and more optimistic.

    For decades, the West used to preach 'free trade', and competition. That is, when it was in charge, or let's say, 'the only kid on the block'.

    In the name of competition and free trade, dozens of governments got overthrown, and millions of people killed.

    And now?

    What is China suppose to do? Frankly, what?

    Should it curb its production, or perhaps close scientific labs? Should it consult the US President or perhaps British Prime Minister, before it makes any essential economic decision? Should it control the exchange rate of RMB, in accordance with the wishes of the economic tsars in Washington? That would be thoroughly ridiculous, considering that (socialist/Communist) China will soon become the biggest economy in the world, or maybe it already is.

    There is all that abstract talk, but nothing concrete suggested. Or is it like that on purpose?

    Could it be that the West does not want to improve relations with Beijing?

    On September 7, 2019, AP reported:

    White House economic adviser Larry Kudlow compared trade talks with China on Friday to the U.S. standoff with Russia during the Cold War

    "The stakes are so high, we have to get it right, and if that takes a decade, so be it," he said.

    Kudlow emphasized that it took the United States decades to get the results it wanted with Russia. He noted that he worked in the Reagan administration: "I remember President Reagan waging a similar fight against the Soviet Union."

    Precisely! The war against the Soviet Union was hardly a war for economic survival of the United States. It was an ideological battle, which the United States, unfortunately won, because it utilized both propaganda and economic terror (the arms race and other means).

    Now, China is next on the list, and the White House is not even trying to hide it. But China is savvy. It is beginning to understand the game. And it is ready, by all means, to defend the system which has pulled almost all its citizens out of misery, and which could, one day soon, do the same for the rest of the world.

    [Oct 19, 2019] China vice premier said China would expand investments in core technologies to ensure the economic restructuring of the economy was stable

    Oct 19, 2019 | www.zerohedge.com

    That said, as Bloomberg noted, Liu didn't address specifics about the trade talks in his speech. Instead, the vice premier said China would expand investments in core technologies to ensure the economic restructuring of the economy was stable, adding that economic activity in the year ahead is "very bright."

    "We're not worried about short-term economic volatility. We have every confidence in our ability to meet macroeconomic targets for the year," he said.

    As reported on Friday, ahead of the latest round of talks, President Trump's top economic advisors and industry experts warned him of an economic downturn if a further escalation in the trade war is seen by 2020. As such, it is likely that a lite trade deal could be on the table next month.

    But as our readers have recently learned, the trade war didn't start the synchronized global downturn, which has been almost entirely a function of China's clogged up credit impulse...

    ... so any deal - lite or otherwise - won't result in an immediate acceleration of global growth; indeed, as some speculate, failure to observe a substantial economic rebound following a "deal" could well mark the point when central banks and governments finally throw in the towel, as they finally usher in the final lap in the global race to debase destroy fiat currencies and hyperinflate away the debt: MMT and Helicopter Money.


    CashMcCall , 27 minutes ago link

    Trump's pathetic Trade war accomplished nothing. US exports down 18% globally. Farmer destroyed. US markets for all goods harmed. The world is offloading any and all dependence on US products. Impulsive stupid jerk. 45% of the world population on US Sanctions, rising black markets, US supply chain disruptions, US manufacturing in a recession.

    Tariffs are tax deductible so they do not accumulate any tax benefit to the US Treasury. They are virtually all rolled over into the national debt. So while the consumer may not notice a rising CPI, they are getting drown in Trump Debt, the largest spending deficits in US history, largest debt to GDP of over 110% and rising. Trump has the fastest acceleration of US debt of any white house occupancy nearly 4 trillion in 2.7 years. It is obvious Trump is clueless in virtually everything. Has no capacity to comprehend a thing.

    Look at this scatterbrained Turkey Kurds fiasco. Impulsive, thoughtless and accomplished nothing. US troops now guarding Syrian oil. Astonishing. Everything this guy touches turned into a burning crap filled dumpster fire.

    'I will be so good at the military, your head will spin'

    https://youtu.be/dkKY8plxxzQ

    "When those 'gunds' start shooting they tend to do things"

    Then there are no deals from the self-proclaimed "art of the Deal"... nothing. Look at Iran. He has made negative progress across the board. Thank to the orange stupid nations across the globe are circumventing US Dollar Reserve. Each day the US importance and more importantly reliability is diminished.

    Look at Trump in high tech... Merck has developed an Ebola vaccine in EUROPE not the USA. The USA hasn't even approved it yet. What is Trump doing... ATTACKING BIG PHARMA. Trumptards love seeing that. Yet it is the Trumptards that keep screaming to buy Murica products but if they have to pay more for them, then suddenly they demonize the US companies. Big Pharma will be the next sector to joint Semiconductor to leave the USA.

    Trump blacklist Big tech. Why? Tech products have a very short shelf life. If the US doesn't sell tech product what do they have that others want? COAL? Soy Beans? From smart to stupid. Look at Intel and Microsoft. Trump band Intel Chip sales to China and threatens Microsoft operating software. In one year China now has RISC V chips from Alibaba, all open source and the Chinese Military has switched to Linux and UNIX GNU. So who loses here? The US tech businesses. Look at Micron dying on the vine, tossed from China.

    Meanwhile China has 5G and has replaced all US components in its boards with the help of Hitachi and Panasonic who are doing the same with all their electronics to avoid Trump Blacklist compliance. Trump is low tech and dumb as dirt. The US Tech sector is being carpet bombed under Trump... and without tech, what products does the US have to sell that world markets want? Not a god damn thing.

    Let's remember that Trump didn't want a partial deal... Now he will take anything to get him out of his self-made wreckage. Meanwhile impeachment is coming... Mista no deals is going down in flames.

    CashMcCall , 13 minutes ago link

    Brazil and Argentina

    Last year 300,000 us farmers grew soy and had 110 mmt. This year there are 100,000 us Soy farmers left and they grew 34 mmt... not enough to export.

    ... Arbitrary and capricious meddling by US politicians in commodity contracts renders all contracts voidable under force majeure. I would have thought with your handle you would have known this. Those markets will never come back.

    They will forever be marginalized and smaller. Trump's damage to US trade is permanent.

    AllSoRight , 10 minutes ago link

    In other words, consolidation among large corp farmers, decimation of the smaller family farmers? I am truly asking, but seems to remind me of the trend since the 1980s.

    runningman18 , 48 minutes ago link

    Trump and China claimed "substantial progress" this past spring, and it all fell apart within a couple months. The same thing will happen on this "deal"....

    [Oct 15, 2019] Trump trade war with China is the start of a new Cold War, the Cold War III

    Oct 15, 2019 | economistsview.typepad.com

    Fred C. Dobbs , October 11, 2019 at 09:14 PM

    Former World Leaders: The Trade War Threatens
    the World's Economy https://nyti.ms/2MAFOTC
    NYT - Kevin Rudd, Helen Clark and Carl Bildt - October 11

    Despite an interim deal, global peace and prosperity
    remain at risk if the United States and China do not
    fully resolve their conflict.

    (The authors are former prime ministers
    of Australia, New Zealand and Sweden.)

    This piece has been updated to reflect news developments.

    The 18-month trade war between the United States and China represents the single greatest threat to global economic growth.

    President Trump announced on Friday a preliminary trade détente with China, saying that the two countries have a verbal agreement for an initial phase of a deal. The agreement reportedly includes concessions from China to protect American intellectual property, to accept guidelines on managing its currency and to buy tens of billions worth of American agricultural products. Washington, for its part, will not go through next month with placing more tariffs on Chinese products.

    This is an encouraging sign, but a verbal agreement is just a first step. A failure to bring the trade war to a final conclusion significantly increases the risk of recession next year in the United States, Europe, Japan and other developed and emerging economies. It would also seriously undermine China's near-term growth prospects.

    That's why, as representatives of a group of 10 former prime ministers and presidents from center-left and center-right governments that have enjoyed close relations with both the United States and China, we are writing to urge Presidents Donald Trump and Xi Jinping to reach a substantive trade agreement by year's end. It's time to bring this source of global economic uncertainty to a close.

    America's and China's prosperity have been built on global free trade. America has profited immensely from access to global markets since its birth. China, since opening up 40 years ago, has lifted millions of its people out of poverty largely through global trade. Indeed, much of the prosperity enjoyed by people across the world is anchored in our ability to sell goods and services freely across national boundaries.

    Now, however, we see global growth in trade lagging behind general economic growth for the first time in decades. In part, this is the product of the expanding trade war between America and China, the world's two largest economies. In part, it is because of a more general outbreak of protectionism around the world. Both these factors threaten continued global prosperity.

    We recognize, as former leaders of countries with longstanding economic relationships with China, the real difficulties regarding a number of Beijing's trade and economic practices. We understand, for example, the challenges that arise from Chinese policies on intellectual property and technology transfer, its restrictions on access to its markets, and its subsidization of private and public companies that are active in the global marketplace. We believe that these practices need to change in whichever countries may use them. But it is particularly important in China, because it is the world's second-largest economy.

    At the same time, as countries long committed to the principles of free trade, we do not see the ever-widening tariff war, started by the United States, as an effective way to resolve trade and economic disputes. Tariffs, by definition, are the enemy of free trade. Their cumulative impact, particularly combined with the current resurgence of protectionism worldwide, only depresses economic growth, employment and living standards. Tariffs raise the cost of living for working families as consumer prices are driven up.

    Stock markets rose on Friday with the news of the preliminary deal. The tariff war has been creating economic uncertainty, depressing international investor confidence, compounding downward pressure on growth and increasing the risk of recession. The disruption of global supply chains is already profound, and it may continue until a final deal is reached.

    We believe that the World Trade Organization, despite its limitations, is best positioned to address China's trade practices. We also believe that the W.T.O. is the most appropriate forum in which to resolve trade disputes. So we urge the United States and China to work with other member states to strengthen the W.T.O.'s institutional capacity.

    Our group of former prime ministers and presidents includes François Fillon of France, Joe Clark of Canada, Enrico Letta of Italy, Jan Peter Balkenende of the Netherlands, Felipe Calderón and Ernesto Zedillo of Mexico, and Han Seung-soo of South Korea. Given our collective experience, we are not naïve about the inherent complexities in negotiating trade agreements. Many of us have negotiated free-trade pacts with both the United States and China. We are deeply familiar with the concerns of each country, including the domestic political constituencies that argue for continued protection.

    Many of those domestic concerns have focused on the long-term enforcement of any agreement. On this point, we argue that it is in China's own long-term economic interest to ensure the effective implementation of any new trade deal -- whether involving intellectual property, technology transfer, state subsidies or market access. Such policies would also need to apply to all of China's trading partners, just as they would need to apply to its relationship with the United States.

    On the question of enforcement, China must be acutely aware that if it fails to comply with the terms of the agreement, an already damaging trade war is likely to resume. A new trade agreement should include strong enforcement provisions, along with strengthened W.T.O. dispute-resolution mechanisms, to give greater confidence to both parties.

    For these reasons, and given the gravity of the global economic outlook for 2020, we urge both countries to exercise every effort to reach a substantive agreement this year. We also urge the United States to withdraw the punitive tariffs it has imposed -- and that China do the same with the reciprocal tariffs it has enacted.

    Beyond trade, we are anxious about the wider strategic impact of any further decoupling of the Chinese and the American economies, particularly in technology and finance. Such a decoupling would present a long-term threat to global peace and security.

    It would also effectively constitute the first step in the declaration of a new Cold War. As with the last Cold War, many nations would be forced to choose between the two powers. And that is a choice none of us wants to make.

    [Oct 15, 2019] The Unwinnable Trade War

    Notable quotes:
    "... Meanwhile, Chinese consumers aren't paying higher prices for U.S. imports. A study by the Peterson Institute for International Economics shows that since the beginning of 2018, China has raised the average tariff rate on U.S. imports from 8.0 percent to 21.8 percent and has lowered the average tariff rate on all its other trading partners from 8.0 percent to 6.7 percent. China imposed tariffs only on U.S. commodities that can be replaced with imports from other countries at similar prices. It actually lowered duties for those U.S. products that can't be bought elsewhere more cheaply, such as semiconductors and pharmaceuticals. Consequently, China's import prices for the same products have dropped overall, in spite of higher tariffs on U.S. imports. ..."
    "... Beijing has proved much more capable than Washington of minimizing the pain to its consumers and economy. ..."
    "... The uncomfortable truth for Trump is that U.S. trade deficits don't spring from the practices of U.S. trading partners; they come from the United States' own spending habits. ..."
    "... The United States has run a persistent trade deficit since 1975, both overall and with most of its trading partners. Over the past 20 years, U.S. domestic expenditures have always exceeded GDP, resulting in negative net exports, or a trade deficit. ..."
    "... Even a total Chinese capitulation in the trade war wouldn't make a dent in the overall U.S. trade deficit. ..."
    "... The U.S. economy, on the other hand, has had the longest expansion in history, and the inevitable down cycle is already on the horizon: second-quarter GDP growth this year dropped to 2.0 percent from the first quarter's 3.1 percent. ..."
    "... If the trade war continues, it will compromise the international trading system, which relies on a global division of labor based on each country's comparative advantage. Once that system becomes less dependable -- when disrupted, for instance, by the boycotts and hostility of trade wars -- countries will start decoupling from one another. ..."
    Oct 15, 2019 | economistsview.typepad.com

    Fred C. Dobbs said in reply to Fred C. Dobbs... , October 12, 2019 at 02:41 AM

    The Unwinnable Trade War
    https://www.foreignaffairs.com/articles/asia/2019-10-08/unwinnable-trade-war
    Foreign Affairs - Weijian Shan - November/December 2019

    Everyone Loses in the US-Chinese Clash
    -- but Especially Americans

    ... Economists reckon the dead-weight loss arising from the existing tariffs on $200 billion in Chinese imports to be $620 per household, or about $80 billion, annually. This represents about 0.4 percent of U.S. GDP. If the United States continues to expand its tariff regime as scheduled, that loss will more than double.

    Meanwhile, Chinese consumers aren't paying higher prices for U.S. imports. A study by the Peterson Institute for International Economics shows that since the beginning of 2018, China has raised the average tariff rate on U.S. imports from 8.0 percent to 21.8 percent and has lowered the average tariff rate on all its other trading partners from 8.0 percent to 6.7 percent. China imposed tariffs only on U.S. commodities that can be replaced with imports from other countries at similar prices. It actually lowered duties for those U.S. products that can't be bought elsewhere more cheaply, such as semiconductors and pharmaceuticals. Consequently, China's import prices for the same products have dropped overall, in spite of higher tariffs on U.S. imports.

    Beijing's nimble calculations are well illustrated by the example of lobsters. China imposed a 25 percent tariff on U.S. lobsters in July 2018, precipitating a 70 percent drop in U.S. lobster exports. At the same time, Beijing cut tariffs on Canadian lobsters by three percent, and as a result, Canadian lobster exports to China doubled. Chinese consumers now pay less for lobsters imported from essentially the same waters.

    THE INESCAPABLE DEFICIT

    Beijing has proved much more capable than Washington of minimizing the pain to its consumers and economy. But the trade war would be more palatable for Washington if its confrontation with China were accomplishing Trump's goals. The president thinks that China is "ripping off" the United States. He wants to reduce the United States' overall trade deficit by changing China's trade practices. But levying tariffs on Chinese imports has had the paradoxical effect of inflating the United States' overall trade deficit, which, according to the U.S. Census Bureau, rose by $28 billion in the first seven months of this year compared with the same period last year.

    The uncomfortable truth for Trump is that U.S. trade deficits don't spring from the practices of U.S. trading partners; they come from the United States' own spending habits.

    The United States has run a persistent trade deficit since 1975, both overall and with most of its trading partners. Over the past 20 years, U.S. domestic expenditures have always exceeded GDP, resulting in negative net exports, or a trade deficit. The shortfall has shifted over time but has remained between three and six percent of GDP.

    Trump wants to boost U.S. exports to trim the deficit, but trade wars inevitably invite retaliation that leads to significant reductions in exports. Moreover, increasing the volume of exports does not necessarily reduce trade deficits unless it is accompanied by a reduction in the country's spending in terms of consumption and investment. The right way to reduce a trade deficit is to grow the economy faster than concurrent domestic expenditures, which can be accomplished only by encouraging innovation and increasing productivity. A trade war does the opposite, damaging the economy, impeding growth, and hindering innovation.

    Even a total Chinese capitulation in the trade war wouldn't make a dent in the overall U.S. trade deficit. If China buys more from the United States, it will purchase less from other countries, which will then sell the difference either to the United States or to its competitors.

    For example, look at aircraft sales by the U.S. firm Boeing and its European rival, Airbus. At the moment, both companies are operating at full capacity. If China buys 1,000 more aircraft from Boeing and 1,000 fewer from Airbus, the European plane-maker will still sell those 1,000 aircraft, just to the United States or to other countries that might have bought instead from Boeing.

    China understands this, which is one reason it hasn't put higher tariffs on U.S.-made aircraft. Whatever the outcome of the trade war, the deficit won't be greatly changed.

    A RESILIENT CHINA

    The trade war has not really damaged China so far, largely because Beijing has managed to keep import prices from rising and because its exports to the United States have been less affected than anticipated.

    This pattern will change as U.S. importers begin to switch from buying from China to buying from third countries to avoid paying the high tariffs. But assuming China's GDP continues to grow at around five to six percent every year, the effect of that change will be quite modest.

    Some pundits doubt the accuracy of Chinese figures for economic growth, but multilateral agencies and independent research institutions set Chinese GDP growth within a range of five to six percent.

    Skeptics also miss the bigger picture that China's economy is slowing down as it shifts to a consumption-driven model. Some manufacturing will leave China if the high tariffs become permanent, but the significance of such a development should not be overstated. Independent of the anxiety bred by Trump's tariffs, China is gradually weaning itself off its dependence on export-led growth. Exports to the United States as a proportion of China's GDP steadily declined from a peak of 11 percent in 2005 to less than four percent by 2018. In 2006, total exports made up 36 percent of China's GDP; by 2018, that figure had been cut by half, to 18 percent, which is much lower than the average of 29 percent for the industrialized countries of the Organization for Economic Cooperation and Development. Chinese leaders have long sought to steer their economy away from export-driven manufacturing to a consumer-driven model.

    To be sure, the trade war has exacted a severe psychological toll on the Chinese economy. In 2018, when the tariffs were first announced, they caused a near panic in China's market at a time when growth was slowing thanks to a round of credit tightening. The stock market took a beating, plummeting some 25 percent. The government initially felt pressured to find a way out of the trade war quickly. But as the smoke cleared to reveal little real damage, confidence in the market rebounded: stock indexes had risen by 23 percent and 34 percent on the Shanghai and Shenzhen exchanges, respectively, by September 12, 2019. The resilience of the Chinese economy in the face of the trade war helps explain why Beijing has stiffened its negotiating position in spite of Trump's escalation.

    China hasn't had a recession in the past 40 years and won't have one in the foreseeable future, because its economy is still at an early stage of development, with per capita GDP only one-sixth of that of the United States. Due to declining rates of saving and rising wages, the engine of China's economy is shifting from investments and exports to private consumption. As a result, the country's growth rate is expected to slow. The International Monetary Fund projects that China's real GDP growth will fall from 6.6 percent in 2018 to 5.5 percent in 2024; other estimates put the growth rate at an even lower number.

    Although the rate of Chinese growth may dip, there is little risk that the Chinese economy will contract in the foreseeable future. Private consumption, which has been increasing, representing 35 percent of GDP in 2010 and 39 percent last year, is expected to continue to rise and to drive economic growth, especially now that China has expanded its social safety net and welfare provisions, freeing up private savings for consumption.

    The U.S. economy, on the other hand, has had the longest expansion in history, and the inevitable down cycle is already on the horizon: second-quarter GDP growth this year dropped to 2.0 percent from the first quarter's 3.1 percent. The trade war, without taking into account the escalations from September, will shave off at least half a percentage point of U.S. GDP, and that much of a drag on the economy may tip it into the anticipated downturn. (According to a September Washington Post poll, 60 percent of Americans expect a recession in 2020.) The prospect of a recession could provide Trump with the impetus to call off the trade war. Here, then, is one plausible way the trade war will come to an end. Americans aren't uniformly feeling the pain of the tariffs yet. But a turning point is likely to come when the economy starts to lose steam.

    If the trade war continues, it will compromise the international trading system, which relies on a global division of labor based on each country's comparative advantage. Once that system becomes less dependable -- when disrupted, for instance, by the boycotts and hostility of trade wars -- countries will start decoupling from one another.

    China and the United States are joined at the hip economically, each being the other's biggest trading partner. Any attempt to decouple the two economies will bring catastrophic consequences for both, and for the world at large. Consumer prices will rise, world economic growth will slow, supply chains will be disrupted and laboriously duplicated on a global scale, and a digital divide -- in technology, the Internet, and telecommunications -- will vastly hamper innovation by limiting the horizons and ambitions of technology firms. ...

    [Oct 15, 2019] President Trump's placement of Huawei on the US entity list was a body blow. But Huawei is still standing

    Notable quotes:
    "... Yes, the U.S. government can hurt Huawei in the short term by limiting their access to technology (and to certain foreign markets). But, absent a viable competitor, this won't have much impact in the long term. Because Huawei is fundamentally not a technology company. Huawei is a human resources company. And is kind of obsessed with survival. ..."
    "... Huawei's fundamental purpose has always been about survival. ..."
    "... Huawei, like most engineering-based enterprises, has only one real resource, which is the cumulative brainpower of its people. This is the resource that creates the products and sells them to their customers. And as technology changes quickly, they must continually create and recreate the products – and therefore the value of the enterprise. Huawei's main strength is the system they have developed for the creation, assessment and distribution of value by over 190,000 people. It's about HR strategy. ..."
    Oct 15, 2019 | economistsview.typepad.com

    anne , October 10, 2019 at 12:30 PM

    https://news.cgtn.com/news/2019-10-10/Huawei-is-going-to-beat-Trump-with-human-resources-KFEpAxznJ6/index.html

    October 10, 2019

    Huawei is going to beat Trump with human resources
    By Jeff Towson

    President Trump's placement of Huawei on the U.S. entity list was a body blow. The magnitude of the hit should not be understated. Being cut off from U.S. technology so suddenly staggered the multinational. But, to their credit, Huawei didn't go down. They took the hit and stayed on their feet.

    I'm not really sure what the U.S. government thought it would achieve with the ban. To stop Huawei's growth in international markets? To shift 5G market share to Ericsson and Nokia? To cripple the company? Just an assertion of principle?

    I think they really just don't understand Huawei.

    Yes, the U.S. government can hurt Huawei in the short term by limiting their access to technology (and to certain foreign markets). But, absent a viable competitor, this won't have much impact in the long term. Because Huawei is fundamentally not a technology company. Huawei is a human resources company. And is kind of obsessed with survival.

    Huawei's core strategy has always been about survival.

    If you read Ren Zhengfei's talks and papers going back to the early 1990's, what jumps out at you is how different Huawei is. The goal of the company has never really been about money. Nor about becoming a tech giant. Nor about innovation. And it has definitely not been about going public and getting a big payday. Huawei's fundamental purpose has always been about survival.

    "Being big and strong temporarily is not what we want. What we want is the ability and resilience to survive sustainably," said Ren in 2001.

    Actually he has been talking for literally decades about how Huawei can survive long-term – and about the common causes of corporate decline. My simplistic take is that Ren came up with a fairly logical plan for long-term survival: Serve your customers no matter what. Then get big and slowly grind your competitors down with lower costs and greater R&D spending. And within this, the only resource you really have are your people and their cumulative brainpower.

    Huawei's main resource is its people.

    Huawei, like most engineering-based enterprises, has only one real resource, which is the cumulative brainpower of its people. This is the resource that creates the products and sells them to their customers. And as technology changes quickly, they must continually create and recreate the products – and therefore the value of the enterprise. Huawei's main strength is the system they have developed for the creation, assessment and distribution of value by over 190,000 people. It's about HR strategy.

    Unlike the companies in the U.S. and Europe, where the shareholders are the stakeholders with ultimate say or multiple stakeholders, such as employees, owners and the community, at Huawei, the only stakeholders you ever really hear about are the current employees. It's all about the top contributing, current employees. Shareholders, providers of capital, retired employees and even the founders are all a distant second in importance.

    Note how different this is to other large engineering-focused companies (say GM and Bosch), where much of the value goes into guaranteed salaries (regardless of contribution) and into post-retirement benefits (i.e., not current employees). Huawei is not only focused primarily on this one group, they are also operating much more as a meritocracy with regards to labor.

    Huawei to me looks a lot like what 3G capital has been doing in consumer-facing companies like Budweiser and Burger King. They have instituted "meritocracy and partnership" on a massive scale in a knowledge business. There is a lot of ownership. And you rise and fall based on your performance.

    Huawei is awesome at inspiring dedication in their top contributing, current employees. And that is pretty logical. If brainpower is Huawei's main resource, this is the group that creates that value. So recruiting and motivating this group is the biggest priority. And they don't just want them motivated. They want them "all in."

    In practice, this is actually pretty complicated. It's a big company. Employees are at different stages of their lives and careers. How do you get current staff, senior staff and incoming staff to go "all in" in creating value for customers – and therefore the enterprise?

    My outsider's take is that Huawei is mostly focused on motivating teams and team managers. High-performance teams with aggressive and dedicated managers are the engine of Huawei. And these are mostly in sales and marketing and R&D. They make the largest contributions to the customers and therefore the enterprise. You motivate at the team level and within the departments that matter most. And then you scale it up.

    But how do you assess contributed value?

    Staff are rated every 6-12 months across metrics such as sales performance (usually team-based), talent, dedication, and the potential for advancement. The phrases I keep coming across in my reading are "dedicated employees" and "high-performance teams." In fact, the book on their HR book is titled Dedication.

    Once assessed, how do you reward performance?

    High-performing contributors are given higher bonuses, of course. But they are also identified and given more opportunities (and responsibilities). They are given more training and the option to participate in the employee share ownership program (very important). Low performers, in contrast, are demoted or exited. Meritocracy works in both directions.

    And this brings us back to the main point of this article: How does the U.S. tech ban impact any of this? How does it impact an HR system for motivating the more than 190,000 employees that continually recreate the company and ensure its survival?

    In the long term, it doesn't.

    Yes, the company took a big hit in the short term in terms of its access to tech (especially in semiconductors and in the consumer business) and to a few markets. But the core of the company is still churning along like it has for 30 years. And I think it is very likely Huawei will overcome these supply chain problems. And, ironically, the current crisis is probably resulting in increased motivation and dedication across the company.


    Jeff Towson is a Peking University professor.

    [Sep 29, 2019] White House Weighs Blocking Chinese Companies From U.S. Exchanges

    Sep 29, 2019 | economistsview.typepad.com

    anne , September 28, 2019 at 09:13 AM

    https://www.nytimes.com/2019/09/27/us/politics/trump-china-stock-exchange.html

    September 27, 2019

    White House Weighs Blocking Chinese Companies From U.S. Exchanges
    By Alan Rappeport and Ana Swanson

    WASHINGTON -- The Trump administration is discussing whether to block Chinese companies from listing shares on American stock exchanges, the latest push to try to sever economic ties between the United States and China, according to people familiar with the deliberations.

    The internal discussions are in their early stages and no decision is imminent, these people cautioned.

    The talks come as senior officials from both countries are scheduled to resume trade negotiations in Washington early next month. President Trump, who has continued to give mixed signals about the prospect of a trade deal with China, said earlier this week that an agreement could come "sooner than you think." His decision to delay an increase in tariffs until mid-October and China's recent purchases of American agricultural products has fueled optimism that the talks could produce an agreement.

    But the prospect of further limiting American investment in China underscores the challenge that the two sides will continue to face even as they try to de-escalate a trade war that has shaken the global economy. The administration has already increased scrutiny of foreign investment with a particular eye toward China, including expanding the types of investments that can be subject to a national security review.

    Last week, the Treasury Department unveiled new regulations detailing how a 2018 law, the Foreign Investment Risk Review Modernization Act, will work to prevent foreign firms from using investments like minority stakes to capture sensitive American information. And the United States has already blacklisted some Chinese companies, including Huawei, effectively barring them from doing business with American companies.

    Stocks dropped on Friday after a report on the deliberations was published by Bloomberg News. The market continued to slide through most of the day. At close, the S&P 500 was down 0.5 percent and the Nasdaq composite index was down 1.1 percent.

    Losses were particularly steep in the technology sector, and among semiconductor stocks, two parts of the market that have been sensitive to the latest updates on the economic tensions between China and the United States.

    Details of how the United States would restrict Chinese companies from American stock markets were still being worked out and the idea remained in its early stages, the people familiar with the deliberations said.

    China hawks within the administration have discussed the possibility of tighter restrictions on listed Chinese companies for many months. Supporters say the efforts would close longstanding loopholes that have allowed Chinese companies with links to its government to take advantage of America's financial rules and solicit funds from American investors without proper disclosure.

    Skeptics caution that the move could be deeply disruptive to markets and the economy and risk turning American investors and pension funds into another casualty of the trade war.

    The effect of limiting Chinese firms from raising capital inside the United States could be significant. As of the beginning of this year, 156 Chinese companies were listed on American exchanges and had a total market capitalization of $1.2 trillion, according to the U.S.-China Economic and Security Review Commission.

    "The underlying concerns have merit, but how to deal with them without creating a lot of collateral damage is tricky," Patrick Chovanec, managing director at Silvercrest Asset Management, wrote in a post on Twitter. "Abruptly delisting Chinese firms en masse would clearly send shock waves through markets."

    The idea gained traction on Capitol Hill this summer when Republicans and Democrats in the Senate and the House introduced legislation that would delist firms that were out of compliance with American regulators for three years. The lawmakers argued that Chinese companies have been benefiting from American capital markets while playing by a different set of rules.

    American complaints center on a lack of transparency into the ownership and finances of Chinese firms. The business community has long criticized China for classifying some auditor reports on company finances as state secrets and outlawing cross-border transfers of auditors' documentation.

    In 2015, the Chinese affiliates of the Big Four accounting firms -- Deloitte Touch Tohmatsu, KPMG, PricewaterhouseCoopers and Ernst & Young -- paid $500,000 each to settle a dispute about their refusal to provide documentation on Chinese companies to the Securities and Exchange Commission, which an American judge had ruled was a violation of United States law.

    The White House has grown more interested in blocking Chinese firms in recent weeks, with some in the administration describing it as a top priority. Officials say the topic is not yet an issue in bilateral negotiations with the Chinese and inserting it into the talks could lead negotiations to fall apart again.

    "This would be another step in ratcheting up the pressure," said Michael Pillsbury, a China scholar at the Hudson Institute who said he raised the concept of investment restrictions with the White House after negotiations with China broke down in the spring.

    The White House declined to comment.

    The concept has divided Mr. Trump's advisers along their usual fault lines, with Peter Navarro, Mr. Trump's trade adviser, advocating action and Treasury Secretary Steven Mnuchin urging caution....

    [Sep 26, 2019] A house bill bans using Huawei and ZTE phones; also adds 1 billion in taxpayer paid for equipment to be donated to to USA companies so the USA companies can trash the China made equipment and exchange if for 1 billion in USA and Israel made equipment.

    Sep 26, 2019 | www.moonofalabama.org

    snake , Sep 25 2019 18:50 utc | 12

    A house bill bans using Huawei and ZTE phones; also adds 1 billion in taxpayer paid for equipment to be donated to to USA companies so the USA companies can trash the China made equipment and exchange if for 1 billion in USA and Israel made equipment.

    I wonder does this mean the USA and Israel cannot compete with the Chinese?


    huawei ban

    huawei ban

    huawei ban
    huawei ban

    [Sep 23, 2019] Huawei launched its Mate 30 series on Friday, the first new device produced by the Shenzhen telecommunications firm since it has been blacklisted by the United States government and excluded from American technology markets.

    Notable quotes:
    "... With the inaugural "Huawei AppGallery" emerging with the Mate 30, the company has now positioned itself on an investment trajectory to create a new "Huawei core" to compete with the world of Google-led Android systems outright. ..."
    "... Beyond Apple and the iPhone, the Android operating system dominates in the global smartphone market. Describing it as an "operating system" is barely fitting; it might otherwise be described as "an ecosystem" with a wide range of Google orientated services within it. ..."
    "... They include the popular browser Chrome, the YouTube video service, Google mail and, most critically, the "Google Playstore," which, owing to its popularity, attracts more developers and investors than any other unofficial App stores. This "ecosystem" creates a "web of comfort" which effectively entrenches the consumer in the Android orbit. ..."
    "... p until May 2019, Huawei was a part of this orbit. Its subsequent estrangement from Android owing to the American government's decision has forced some difficult choices. It has made markets keen to observe how the Mate 30 will perform given its lack of Google applications and the need for users to obtain some apps through third-party stores. ..."
    "... So, the question is: How are they now adapting and making that transition? Bengt Nordstrom of North Stream research in Sweden notes that "they have a strategy to become completely independent from U.S. technology. And in many areas, they have become independent." ..."
    "... Huawei's announced bid to invest over 1 billion U.S. dollars in developing its own application "core" or ecosystem. This, in essence, is an effort to get developers to establish applications for the new "Huawei App store" and thus establish a self-reliant, independent path from the world of Android. ..."
    "... To achieve this, the company has pledged a competitive revenue sharing scheme of 15 percent to developers, half of that what Apple and Google demand for participation in their own app-stores. ..."
    Sep 23, 2019 | economistsview.typepad.com

    anne , September 21, 2019 at 06:30 AM

    https://news.cgtn.com/news/2019-09-21/Huawei-s-pivotal-moment-KabssDHWdq/index.html

    September 21, 2019
    Huawei's pivotal moment
    By Tom Fowdy

    Huawei launched its Mate 30 series on Friday, the first new device produced by the Shenzhen telecommunications firm since it has been blacklisted by the United States government and excluded from American technology markets.

    The subsequent result of the listing had led Google to sever ties with the company and prohibit new devices from using its Play Store services and operating system, something which ultimately impacts the Mate 30 Series, which is using an open-source version of Android.

    The impact of it all has led Western commentators to ask questions about Huawei's future in Western smartphone markets, particularly what applications can it access.

    However, not all is bleak, and what may start off as a hindrance for the company is set to transform into an opportunity. The United States' assault on the company has forced Huawei to innovate.

    With the inaugural "Huawei AppGallery" emerging with the Mate 30, the company has now positioned itself on an investment trajectory to create a new "Huawei core" to compete with the world of Google-led Android systems outright.

    In this case, what seems like a detriment is part of a broader pivotal moment for Huawei. The company's portfolio is about to change forever.

    Beyond Apple and the iPhone, the Android operating system dominates in the global smartphone market. Describing it as an "operating system" is barely fitting; it might otherwise be described as "an ecosystem" with a wide range of Google orientated services within it.

    They include the popular browser Chrome, the YouTube video service, Google mail and, most critically, the "Google Playstore," which, owing to its popularity, attracts more developers and investors than any other unofficial App stores. This "ecosystem" creates a "web of comfort" which effectively entrenches the consumer in the Android orbit.

    U p until May 2019, Huawei was a part of this orbit. Its subsequent estrangement from Android owing to the American government's decision has forced some difficult choices. It has made markets keen to observe how the Mate 30 will perform given its lack of Google applications and the need for users to obtain some apps through third-party stores.

    So, the question is: How are they now adapting and making that transition? Bengt Nordstrom of North Stream research in Sweden notes that "they have a strategy to become completely independent from U.S. technology. And in many areas, they have become independent."

    First of all, we are well aware that Huawei is developing its own Harmony Operating System as a contingency measure, although it has not chosen to apply it to the Mate 30 as an olive branch to Google.

    Second, and most excitingly is Huawei's announced bid to invest over 1 billion U.S. dollars in developing its own application "core" or ecosystem. This, in essence, is an effort to get developers to establish applications for the new "Huawei App store" and thus establish a self-reliant, independent path from the world of Android.

    To achieve this, the company has pledged a competitive revenue sharing scheme of 15 percent to developers, half of that what Apple and Google demand for participation in their own app-stores.

    This effort is combined with a wider scope in research and development from the company, which is also designed to forfeit dependence upon American technology chains in terms of critical components and other parts.

    We have already seen massive investment pledges from Huawei to build new research and development centers in the United Kingdom, Belgium, Italy and Brazil. They are not empty promises, but a serious and strategic effort.

    In this case, what was intended to be a political effort to destroy and contain Huawei is likely to prove a pivotal turning point in the company's history with huge repercussions for global smartphone and technology markets.

    Instead of having once been reliant on and thus beneficial to American technology markets, the outcome is that Huawei will re-emerge independent of and competing against it.

    Armed with a pending new operating system, a new application development drive and a broader research effort, what seemed otherwise a detriment is likely to bring a massive opportunity. Thus, it is very important to examine the long-term prospects for the company's fortunes ahead of short-term challenges.

    [Sep 23, 2019] Smartest and fastest: Huawei reveals new smartphone chip Kirin 990 5G

    Notable quotes:
    "... "The Kirin 990 is not only an SoC and a 5G modem glued together. We put a lot of effort in integrating the two chips. So the new chip uses less power and generates less heat while getting the job done," said Huawei fellow Ai Wei before the launch event. ..."
    "... The whole Kirin 990 5G chip is so dense that it contains 10.3 billion semiconductors, the first and largest of its kind. ..."
    "... Another example is AI-based video quality improvements, which takes in a low quality video and render a better one. Objects in the rendered video have much sharper edges. Huawei technicians refused to explain how they made it, but the underlying tech seems to be object recognition, content-based pixel generation and noise reduction, since these are the tricks AI does well. ..."
    "... Huawei's P30 Pro smartphone, together with the Kirin 980 chip, has taken "smartphone zoom to the next level," according to third-party review site DxOMark. The phone was on top of all smartphones when it comes to photography in DxOMark's ranking. The Kirin 990 is packed with more graphic features to continue Huawei's dominance. ..."
    Sep 23, 2019 | economistsview.typepad.com

    anne -> anne... , September 20, 2019 at 04:51 PM

    https://news.cgtn.com/news/2019-09-06/Smartest-and-fastest-Huawei-reveals-new-smartphone-chip-Kirin-990-5G-JLGH1KVKeI/index.html

    September 6, 2019

    Smartest and fastest: Huawei reveals new smartphone chip Kirin 990 5G
    By Gong Zhe

    Chinese smartphone giant Huawei, which has been under heavy attack from the U.S. government during the last few months, just revealed its next-generation smartphone system-on-a-chip (SoC) product "Kirin 990 5G," signaling the company's business is not stalled by foreign strangling.

    The launch event was held simultaneously at IFA electronic show in Berlin, Germany, and in Beijing on Friday.

    In his keynote speech, Huawei's head of gadgets Richard Yu told the press that the chip is more advanced than other flagship smartphone SoCs, because it has a built-in 5G modem.

    Current rivals of the chip, like Qualcomm's Snapdragon 855, have no 5G modem and have to rely on an extra chip to support 5G.

    "The Kirin 990 is not only an SoC and a 5G modem glued together. We put a lot of effort in integrating the two chips. So the new chip uses less power and generates less heat while getting the job done," said Huawei fellow Ai Wei before the launch event.

    The whole Kirin 990 5G chip is so dense that it contains 10.3 billion semiconductors, the first and largest of its kind.

    Flexible AI power

    The chip also features three AI cores, two larger than the other smaller. This design, first in smartphones, saves battery power by only using the small core to process simple AI tasks, while resorting to the larger cores for more complex jobs.

    The company named the cores "Ascend Lite" and "Ascend Tiny" to relate the cores to Huawei's new, self-proclaimed "fastest AI training chip in the world," the Ascend 910.

    Huawei built a showcase at the Beijing launch event to demonstrate the chip's AI power. They showed a FaceID-like face recognition feature in a Kirin 990-powered developer board that can work when the person is four meters away from the phone, times further than Apple's current product.

    Another example is AI-based video quality improvements, which takes in a low quality video and render a better one. Objects in the rendered video have much sharper edges. Huawei technicians refused to explain how they made it, but the underlying tech seems to be object recognition, content-based pixel generation and noise reduction, since these are the tricks AI does well.

    Even better photos

    Huawei's P30 Pro smartphone, together with the Kirin 980 chip, has taken "smartphone zoom to the next level," according to third-party review site DxOMark. The phone was on top of all smartphones when it comes to photography in DxOMark's ranking. The Kirin 990 is packed with more graphic features to continue Huawei's dominance.

    A Kirin 990-powered smartphone can shoot 4K videos (3840 x 2160 pixels) at 60 frames per second, on par with market flagship phones.

    The chip can also run DSLR-level noise-reduction algorithm – namely "Block Match 3D" – to bring professional tech to consumer devices.

    "Porting an algorithm from DSLR to smartphone may be easy. But getting the program to run fast enough can be hard for any phone maker," Ai told CGTN Digital.

    Non-U.S. tech

    The design of Kirin 990 is still based on technology Huawei bought from British tech company ARM, used by several mainstream brands.

    After the U.S. began imposing restrictions on Huawei, ARM cut ties with the Chinese phone maker. Despite this, Huawei has been able to use and modify AMRv8 technology thanks to its permanent ARM license. Hence why chips like Kirin 990 can still be legally built and sold.

    In addition to ARM, there are other major smartphone tech companies cutting ties with Huawei, forcing the Chinese company to create its own alternatives. After Google announced to bar Huawei phones from installing their apps, Huawei started porting its IoT system "Harmony" to smartphones.

    But Huawei still wishes to use technologies from all over the world. As Ai Wei explained at the launch event, "Huawei will not deliberately remove all U.S. tech from its smartphones. But when the supply from U.S. was cut, Huawei has to find a way to survive."

    "That's why Huawei chose to create its own technology," Ai added....

    anne -> anne... , September 20, 2019 at 05:01 PM
    The point in article after article is that China is emphasizing technical advance in building the economy from rural to urban applications and the emphasis will not be lessened. The rural applications I am reading about are especially exciting.
    point -> anne... , September 21, 2019 at 07:36 AM
    https://www.kcrw.com/culture/shows/scheer-intelligence/america-keeps-getting-china-all-wrong

    Terrific discussion on how the West perceives China et al and vice versa. Much new to me.

    anne -> point... , September 21, 2019 at 08:39 AM
    I appreciate the interview, but Clayton Dube as director of the University of Southern California's U.S.-China Institute knows remarkably little about China or American relations with China. Possibly Dube is being especially cautious, but still:

    "The air in Los Angeles," the academic explains by way of an example, "is influenced by the air coming out of northern China. But of course, that bad air in China is produced by factories often producing for the American market. And so we have not only outsourced production, we've outsourced pollution."

    This is absurdly wrong. China has been working on cleaning the environment for years now and the effects as monitored have been dramatic.

    point -> anne... , September 21, 2019 at 09:16 AM
    The idea that China thinks of 1849 to 1949 as a colonial period that took them 100 years to get free from, for instance, immediately helps me understand some of where they are coming from.
    anne -> point... , September 21, 2019 at 09:45 AM
    The idea that China thinks of 1849 to 1949 as a colonial period that took them 100 years to get free from, for instance, immediately helps me understand some of where they are coming from.

    [ Surely so, this very day is "International Day of Peace in Nanjing" in memory of the victims of the terrible Japanese occupation:

    http://www.xinhuanet.com/english/2019-09/21/c_138410902.htm ]

    anne -> point... , September 21, 2019 at 08:40 AM
    https://www.nytimes.com/2018/03/12/upshot/china-pollution-environment-longer-lives.html

    March 12, 2018

    Four Years After Declaring War on Pollution, China Is Winning
    Research gives estimates on the longer lives that are now possible in the country.
    By Michael Greenstone

    On March 4, 2014, the Chinese premier, Li Keqiang, told almost 3,000 delegates at the National People's Congress and many more watching live on state television, "We will resolutely declare war against pollution as we declared war against poverty."

    ...

    anne -> point... , September 21, 2019 at 08:46 AM
    China, for instance, has over 420,000 electric busses. The United States has 300:

    https://www.bloomberg.com/news/articles/2019-05-15/in-shift-to-electric-bus-it-s-china-ahead-of-u-s-421-000-to-300

    im1dc -> anne... , September 21, 2019 at 09:16 AM
    China has had the benefit of skipping over other advanced nation's Legacy infrastructure.

    Leapfrogging ahead in some areas of development is smart and saves money for China as well, but that doesn't make China superior to other advanced nations.

    anne -> anne... , September 21, 2019 at 09:26 AM
    China, for instance, has over 420,000 electric busses. The United States has 300:

    https://www.bloomberg.com/news/articles/2019-05-15/in-shift-to-electric-bus-it-s-china-ahead-of-u-s-421-000-to-300

    May 15, 2019

    The U.S. Has a Fleet of 300 Electric Buses. China Has 421,000
    The rest of the world will struggle for years to match China's rapid embrace of electric transit.
    By Brian Eckhouse - Bloomberg

    anne -> anne... , September 21, 2019 at 09:27 AM
    https://www.nytimes.com/2019/09/14/business/chinese-train-national-security.html

    September 14, 2019

    Fearing 'Spy Trains,' Congress May Ban a Chinese Maker of Subway Cars
    By Ana Swanson

    CHICAGO -- America's next fight with China is unfolding at a glistening new factory in Chicago, which stands empty except for the shells of two subway cars and space for future business that is unlikely to come.

    A Chinese state-owned company called CRRC Corporation, the world's largest train maker, completed the $100 million facility this year in the hopes of winning contracts to build subway cars and other passenger trains for American cities like Chicago and Washington.

    But growing fears about China's economic ambitions and its potential to track and spy on Americans are about to quash those plans. Congress is soon expected to approve legislation that would effectively bar the company from competing for new contracts in the United States, citing national security and economic concerns. The White House has expressed its support for the effort....

    anne -> anne... , September 21, 2019 at 09:38 AM
    https://news.cgtn.com/news/2019-09-18/Chinese-make-300-mln-daily-trips-through-green-transport-K5xRBUQiZO/index.html

    September 18, 2019

    Chinese make 300 mln daily trips through green transport

    [ China has 65% of the world total mileage of high-speed rail service, but what do the Chinese know about trains anyway? ]

    anne -> point... , September 21, 2019 at 09:20 AM
    Terrific discussion on how the West perceives China...

    [ Actually a discussion that shows a remarkable misperception of China even by an American China academic-specialist. As such the discussion is important though discouraging. ]

    [Sep 22, 2019] Trump May Get Much of the World's Manufacturing Out of China, but It Won't Be Coming Back to the US

    Notable quotes:
    "... I always thought globalization was about the opportunity for a handful of businesses and corporations to control major industries around the world. ..."
    "... There is an anti-China hawks faction based in the Republican party that has made its present felt. People like Robert Lighthizer, Peter Navarro and Steve Bannon. I have seen this sentiment spill over into Australian politics but they have not reached the stage where they are asking: "Are you now, or have you ever been, born Chinese?". ..."
    "... We have also seen hawk factions against Russia, Iran and not long ago Venezuela. The ones for Russia and Iran have been long going but the ones against China and Venezuela were sudden and new. It may be that tomorrow that Trump will do the same against Cuba and threaten any country that does trade with them. Who knows what other country may fall within his sights? ..."
    "... it seems business people in the government are being pushed aside by hawkish factions who do not care what effect it has on the economy or the country. Great! ..."
    "... Those are the same "hawks" that are busy destroying the rest of America as well. ..."
    "... As it is now, China literally has the US by the jewels, and if a serious conflict ever arose, could squeeze them hard. Just their dominance in manufacturing a large percentage of the pharmaceuticals consumed by US patients alone creates a serious vulnerability. ..."
    "... Situating the manufacturing in countries that are part of the Chinese sphere of influence won't help much in a conflict. China would probably be able to sweep through much of Southeast Asia quickly or interdict shipments if there was war. ..."
    "... the world wide presence/threat of the USA military and diplomatic corps allows globalization to be less risky for USA businesses, so, in effect, the patriotic "spreading of democracy" around the world via military actions is a factor in USA job loss. This is yet another cost of the bloated military to the general USA population. ..."
    "... Trump, as usual, got his strings pulled by the Deep State when he went for actual implementation of a campaign promise. The DS doesn't care about working Americans, they are simply against China. ..."
    "... as Julius Krein, editor of American Affairs, writes: "United States industry is losing ground to foreign competitors on price, quality and technology. In many areas, our manufacturing capacity cannot compete with what exists in Asia." ..."
    "... Back in the early 80s I saw a massive warehouse full of machine tools, Bridgeport mills, and such lined up, it seemed forever, the guy there said they were going to China. I asked my Dad about it, and he told me we were selling them to the Chinese for the price of scrap. The whole thing is mindless and pathetic, but the really maddening thing is the slippery way our 'leaders' can keep dodging the blame by simply pointing a finger in whatever direction, and everybody's eyes move in unison. ..."
    "... The argument/discussion is not about how and where to outsource our jobs, it's about how stupid it was to do it in the first place ..."
    "... Also the Chinese internal market continues to attract MNC's and this attraction will continue to grow far into the future. China's middle class is already larger than the total population of the US and it continues to grow rapidly. While down presently the Chinese internal consumption continues to grow at an annual rate of some 8.5%. ..."
    "... Trump's approach to trade is isolating the US, blocking its Co's from the Chinese market, and incentivizing the Chinese to offer better conditions to Co's of the rest of the world. How can that help the US ? ..."
    "... The relentless neoliberal race to the bottom, outsourcing, and austerity that marked the death blow to American Labor is over. In that light it makes little difference whether our corporations pull out of China, go to Vietnam, or come home. The exploitation of the poorest is coming to an end. And none too soon. ..."
    "... I hope some candidates discuss the imperative to have the US start making it's own medications again. ..."
    "... I could not believe the government has allowed the entire supply chain of building blocks of ALL our antibiotics to be sourced almost solely from China. To me THAT'S the national security issue we need to deal with immediately. As well as other vital drugs.. ..."
    "... Chinese manufacturers have the wealth and experience to teach production line workers and make things anywhere. Western companies manufacturing in China have belatedly looked for facilities in neighboring countries and found the Chinese are already there. ..."
    "... Trump doesn't give a damn about getting manufacturing jobs back into the United States! (Or at least his advisors don't). ..."
    "... Low housing costs, lead to lower wages so UK employers were able to compete in a free trade world. William White (BIS, OECD) talks about how economics really changed over one hundred years ago as classical economics was replaced by neoclassical economics. ..."
    "... He thinks we have been on the wrong path for one hundred years. Free trade requires a low cost of living and what was known in the 19th century had disappeared by the 20th. The West's high cost of living means high wages and an inability to compete in a free trade world. ..."
    Sep 21, 2019 | www.nakedcapitalism.com

    By Marshall Auerback, a market analyst and commentator. Produced by Economy for All, a project of the Independent Media Institute

    "Chimerica" is a term originally coined by the historian Niall Ferguson and economist Moritz Schularick to describe the growing economic relationship between the U.S. and China since the latter's entry into the World Trade Organization (WTO) in 2001. In the words of Ferguson : "The Chinese did the saving, the Americans the spending. The Chinese did the exporting, the Americans the importing. The Chinese did the lending, the Americans the borrowing." Much of the pre-crisis boom in global trade was driven by this economic symbiosis, which is why successive American presidents tolerated this marriage of convenience despite the increasing costs to the U.S. economy . The net benefits calculation, however, began to change after 2008, and the conflict has intensified further after the 2016 presidential election result. Today, the cumulative stress of Donald Trump's escalating trade war is leading to if not an irreparable breach between the two countries, then certainly a significant fraying. The imminent resumption of trade talks notwithstanding, the rising cost of the tariffs is already inducing some U.S. manufacturers to exit China. But in most instances, they are not returning to home shores.

    It may have taken Trump to point out the pitfalls of the Chimerica link, but coming up with a coherent strategy to replace it is clearly beyond the president's abilities. America is likely to remain a relative manufacturing wasteland, as barren as Trump's own ill-conceived ideas on trade. At the same time, it's not going to be an unmitigated victory for China either, as Beijing is increasingly suffering from a large confluence of internal and external pressures.

    Chimerica helped to launch China as a global trade power. To the extent that this marriage helped the U.S. economy, it skewed toward the largely blue state coastal regions. Wall Street banks located on the East Coast happily collected lucrative commissions and investment banking fees, as China's export proceeds were recycled into U.S. treasuries, stocks, and high-end real estate while the capital markets boomed; on the West Coast, "new economy" companies thrived, their growth and profitability unhindered by the onslaught of Chinese manufactured exports. By contrast, facilitated by technological advances that permitted large-scale outsourcing by U.S. manufacturers, Chimerica laid waste to much of what was left of America's Rust Belt, and the politics of many of the displaced workers mutated to the extent that Donald Trump became an appealing alternative to the establishment in 2016.

    The major legacy of Chimerica, then, is that too many American workers have been semi-permanently replaced by low-cost offshored labor. Prior to great advances in technology, along with globalization, displacement of the current labor force could only have occurred through immigration of workers into the country. Historically, displacement by immigrants generally began at the menial level of the labor force, and became more restrictive as when it became correlated with significant unemployment. Given the rise of globalization and the corresponding liberalization of immigration in the past few decades, however, policy no longer arrests the displacement of American workers. The policy backlash has consequently manifested itself more via trade protectionism. Trump has sought to consolidate his Rust Belt base of supporters by launching a trade war, especially versus Beijing, the ultimate effects of which he hoped would be to re-domicile supply chains that had earlier migrated to China.

    Early on in his presidency, there was some hope that Trump's protectionism was at best a bluff or, at worst, an aberration, and that the return of a Democrat to the White House in 2020 would eventually reestablish the status quo ante. But the president still can't get a wall, and his protectionism has become more pronounced almost as if to compensate. The problem today is that even if Trump is voted out of office in 2020, corporate America is becoming less inclined to wait out the end of his presidency to return to the pre-Trump status quo of parking the bulk of their manufacturing in China. There is too much risk in putting all of one's eggs in the China basket, especially given growing national security concerns . Hence, U.S. companies are taking action. In spite of decades of investment in these China-domiciled supply chains, a number of American companies are pulling out: toy manufacturer Hasbro , Illinois-based phone accessories manufacturer Xentris Wireless, and lifestyle clothing company PacSun are a few of the operators who are exiting the country.

    But they are not coming back to the U.S., relocating instead to places like Vietnam, Bangladesh, Mexico, the Philippines and Taiwan. The chief financial officer of Xentris, Ben Buttolph, says that the company will never return to China: "We are trying to have multiple locations certified for all of our products, so that if all of a sudden there's an issue with one of the locations, we just flip the switch." Likewise, the CEO of Hasbro, Brian Goldner, recently spoke of "great opportunities in Vietnam, India and other territories like Mexico."

    All is not lost for the U.S., however, as Goldner did celebrate the success of Hasbro's facility in East Longmeadow, Massachusetts, which has resumed production of Play-Doh in the U.S. for the first time since 2004 . It is doubtful, however, that this represents the recapturing of the high value-added supply chains that Trump envisaged when he first launched his trade assault on Beijing.

    In general, as Julius Krein, editor of American Affairs , writes: "United States industry is losing ground to foreign competitors on price, quality and technology. In many areas, our manufacturing capacity cannot compete with what exists in Asia."

    These are not isolated examples. Defense One also notes the following development:

    It came without a breaking news alert or presidential tweet, but the technological competition with China entered a new phase last month. Several developments quietly heralded this shift: Cross-border investments between the United States and China plunged to their lowest levels since 2014, with the tech sector suffering the most precipitous drop. U.S. chip giants Intel and AMD abruptly ended or declined to extend important partnerships with Chinese entities. The Department of Commerce halved the number of licenses that let U.S. companies assign Chinese nationals to sensitive technology and engineering projects.

    This development consequently makes it hard to proclaim Beijing a winner in this dispute either. The country still needs access to U.S. high tech. The government announced yet another fiscal stimulus to the economy earlier this month in response to a cluster of weakening economic data, much of which is related to the trade shock. It is also the case that China is being buffeted politically, both externally and internally: externally, in addition to the escalating trade war, China's own efforts to counter the effects of rising protectionism by creating a " reverse Marshall Plan " via the Belt and Road Initiative is floundering . China's "iron brother," Pakistan, is increasingly being victimized by India's aggressive Hindu-centric nationalism . It is hard to imagine the Modi government opportunistically taking the step of annexing Kashmir and undermining Pakistan, had it not sensed Beijing's increasing vulnerability.

    Internally, Beijing is finding it increasingly challenging as it seeks to enforce its "One China" policy in Hong Kong and Taiwan. The withdrawal of the controversial extradition law that first precipitated widespread demonstrations in Hong Kong has not alleviated the political pressures in the territory, but simply allowed an even bigger protest culture to take root and strengthen an independent political mindset. Similarly, Taiwan has also openly supported the Hong Kong protesters, pledging help to those seeking asylum . Both regions now constitute both a huge humiliation and challenge to the primacy of China's ruling Communist Party. And now on top of that, foreign manufacturers are leaving the country, weakening a totally leveraged manufacturing complex.

    The implications of this divorce go well beyond the U.S. and China. They constitute another step toward regionalization, another step away from a quaint ideological "post-history" construct that saw Washington, D.C., as the head office and the rest of the world as a bunch of branch plants for "America, Inc." It's hardly comforting to contemplate that the last time we reached this historic juncture was the early 1900s, when a similarly globalized economy broke down, followed by the Great War. As Niall Ferguson points out , "a high level of economic integration does not necessarily prevent the growth of strategic rivalry and, ultimately, conflict." There's no doubt that both Washington and Beijing will likely making soothing noises to the markets in order to create favorable conditions for the trade talks in October, but their actions suggest that they are both digging in for a longer struggle . Today's trade wars, therefore, are likely to morph into something more destructive, which is a lose-lose in an era where human advancement depends on greater integration between economic powers.

    somecallmetim , September 21, 2019 at 2:43 am

    So ultimately trade peace or symbiosis is chimerical?

    John , September 21, 2019 at 4:09 am

    I always thought globalization was about the opportunity for a handful of businesses and corporations to control major industries around the world.

    Who knew that there were people in any country that benefit?

    The first country that would address affordable housing, healthcare and education so that people don't need more jobs will win.

    The Rev Kev , September 21, 2019 at 4:30 am

    There may be another aspect to this development and that is of geopolitics. You can see that in Marshall's article when the CFO of Xentris said: "We are trying to have multiple locations certified for all of our products, so that if all of a sudden there's an issue with one of the locations, we just flip the switch." There is an anti-China hawks faction based in the Republican party that has made its present felt. People like Robert Lighthizer, Peter Navarro and Steve Bannon. I have seen this sentiment spill over into Australian politics but they have not reached the stage where they are asking: "Are you now, or have you ever been, born Chinese?".

    So we have seen a long string of sanctions and tariffs at play so that China will change its laws and institutions to suit American interests. Yeah, I can't see that happening anytime soon but hey, America First, Baby. We have also seen hawk factions against Russia, Iran and not long ago Venezuela. The ones for Russia and Iran have been long going but the ones against China and Venezuela were sudden and new. It may be that tomorrow that Trump will do the same against Cuba and threaten any country that does trade with them. Who knows what other country may fall within his sights?

    That being the case if you were running an international country, you can no longer just have your manufacturing base or service operations just in one country. If Xentris is an example, US companies may have to split manufacturing into several countries in case one fine day that Trump will sanction yet another country that your company depends on.

    I would imagine that it would not be so efficient but it seems business people in the government are being pushed aside by hawkish factions who do not care what effect it has on the economy or the country. Great!

    Leroy , September 21, 2019 at 11:51 am

    Those are the same "hawks" that are busy destroying the rest of America as well. Another four years of this will, effectively, dismantle what democracy is left. The world trade won't be the big issue. The departure of millions of Americans will.

    drumlin woodchuckles , September 22, 2019 at 4:42 pm

    If that happens, be sure to thank the Catfood Democrats for it. Because they are the people who will do their very best and hardest to throw the next election to Trump, one way or another.

    jeremyharrison , September 21, 2019 at 5:23 am

    It seems like diversification of supply chains can only be a good thing. As it is now, China literally has the US by the jewels, and if a serious conflict ever arose, could squeeze them hard. Just their dominance in manufacturing a large percentage of the pharmaceuticals consumed by US patients alone creates a serious vulnerability.

    I really don't think it matters if manufacturing jobs are repatriated to the US, or just set up and spread around elsewhere for now – since they'll be obsolete jobs in the near future anyway, as robotics and AI get increasingly efficient at doing the work that human workers currently do.

    rd , September 21, 2019 at 5:25 pm

    Situating the manufacturing in countries that are part of the Chinese sphere of influence won't help much in a conflict. China would probably be able to sweep through much of Southeast Asia quickly or interdict shipments if there was war.

    Dan , September 21, 2019 at 6:28 am

    So the status quo was preferable? The tone of the article seems to suggest that America should accept it place as a third-world manufacturer, as if these Asian nations have some magical sauce that can't be replicated. Gawd.

    The US does have a lot of magic. Like one third of FDI related to tax evasion. Pulling Mac Book manufacturing out of Austin for the lack of one 'screw', etc. So is the premise of going after China on trade and IP policies good. I would agree. Maybe not in strategy, but at least someone has opened the box.

    John Wright , September 21, 2019 at 3:26 pm

    I agree with your comment, the article suggests the status quo was preferable. Of note, Trump has shown his supporters that something CAN be done other than follow the "resistance is futile" path of the Bill Clinton/Bush Jr./Obama administrations.

    I also suggest that the world wide presence/threat of the USA military and diplomatic corps allows globalization to be less risky for USA businesses, so, in effect, the patriotic "spreading of democracy" around the world via military actions is a factor in USA job loss. This is yet another cost of the bloated military to the general USA population.

    I worked in the electronics industry for 30+ years and watched high margin manufacturing move to Asia. Now the lower level component manufacturers (PCBs, passives) are firmly established in Asia as the USA companies have helped train worthy competitors overseas. It took 25+ years to move much of USA manufacturing overseas, indicating to me that it will take a long time to bring it back significantly, well outside the Trump time frame.

    But I suspect Trump voters will appreciate Trump's headline efforts. If the Democrats push for more Free Trade as good for the USA, it will hurt them at the ballot box.

    GramSci , September 21, 2019 at 6:51 am

    The second time as farce. How tragicomic that Trump has succeeded in little more than repatriating the manufacture of Play-Doh. On the other hand, the shipping cost of unbaked brick seems a rational factor in Hasbro's decision. A GND that shortens supply lines would be more effective in repatriating heavy industry, but then printed circuit boards aren't all that heavy .

    a different chris , September 21, 2019 at 8:42 am

    The thing is Trump, as usual, got his strings pulled by the Deep State when he went for actual implementation of a campaign promise. The DS doesn't care about working Americans, they are simply against China.

    So he goes and puts tariffs on a country, not a product. And surprise, said product doesn't come back on-shore. Comical (and yeah, cosmically a bit just) that Vietnam is getting so much of that manufacturing. Wasn't what he was elected for.

    Glen , September 21, 2019 at 9:44 am

    In general, as Julius Krein, editor of American Affairs, writes: "United States industry is losing ground to foreign competitors on price, quality and technology. In many areas, our manufacturing capacity cannot compete with what exists in Asia."

    As a engineer up to my elbows in manufacturing for forty years, this was awfully easy to predict way back then (I gave up complaining about it about 2000), and then watch happen – real time. And to once again state the obvious, China did not TAKE American jobs, American CEOs GAVE them our jobs. We will not fix this problem until we identify and fix the root cause.

    Now the only way to fix it is (once again obviously) massive government investment such as mandated by the GND. We need the GND, it is not only required to save the world, it will save our country.

    Leroy , September 21, 2019 at 11:57 am

    Fully agree Glen. How can we say China stole our "technology" when we placed it on their doorstep and asked them to make some of these for us please ?

    Watt4Bob , September 21, 2019 at 3:19 pm

    Agree, it was predictable, and it was predicted. What we've been talking about is the "Giant sucking sound" Ross Perot foretold would happen prior to the passing of NAFTA. It wasn't hard back then to see that he was right, but it took a few decades for the public to feel the impact, boiling frogs and all that.

    Back in the early 80s I saw a massive warehouse full of machine tools, Bridgeport mills, and such lined up, it seemed forever, the guy there said they were going to China. I asked my Dad about it, and he told me we were selling them to the Chinese for the price of scrap. The whole thing is mindless and pathetic, but the really maddening thing is the slippery way our 'leaders' can keep dodging the blame by simply pointing a finger in whatever direction, and everybody's eyes move in unison.

    rd , September 21, 2019 at 5:39 pm

    NAFTA and China are two completely separate things. I have actually supported NAFTA in principle because we should encourage trade to be focused on our immediate neighbors. A wealthier and safer Mexico and Central America would create markets for us and virtually eliminate illegal immigrants as the southern border.

    China is on the other side of the world and is not part of NAFTA. While we should have cordial relations with it, if we are looking for inexpensive labor, south of the border is the better place to focus on that. So Trump's tariffs on China are not the wrong thing to do per se. The problem is that they are being done in a vacuum of general trade policy where he is looking at everything as transaction bilateral relations with every country on the planet, which requires an immense amount of detailed thought and negotiation, neither of which appear to be a focus of this administration.

    The countries that the companies are talking about moving their operations to are generally part of the new TPP which the US is not part of. So, we have removed ourselves from having trade relations with countries US CEOs are setting up operations in, but those countries are now starting to work together to counter both China (original TPP purpose) and the US (now that the US has bailed on it). Sounds like a recipe for a replay of China's giant sucking sound.

    Watt4Bob , September 21, 2019 at 6:48 pm

    The argument/discussion is not about how and where to outsource our jobs, it's about how stupid it was to do it in the first place. Anyone smart enough to breath knows that Mexico is next door, and China is on the other side of the world, but they are both part of the same giant sucking sound. The fact that you support both NAFTA ,think it was unwise to back out of the TPP, and think the issue is the present administration's lack of " detailed thought and negotiation " indicate a truly unbelievable level of denial.

    drumlin woodchuckles , September 22, 2019 at 4:47 pm

    NAFTA and MFN for China were two different actions towards the same goal . . . the use of Free Trade to dismantle thingmaking in America and re-mantle thingmaking in foreign export-aggression platforms to use against America.

    Free Trade is the new Slavery. Militant Belligerent Protectionism is the new Abolition.

    John Wright , September 21, 2019 at 5:41 pm

    I remember when a Midwest Democrat (Stabenow?) tried to get a law passed that would prohibit a US corporation from deducting, from their federal taxes, the cost of moving factories overseas. A very minor disincentive, but a disincentive nonetheless. The Repubs beat it down as "anti-business". Concern about American workers is something to express in political speeches around election time but not in legislation.

    eg , September 21, 2019 at 7:31 pm

    This. As so ably described in Judith Stein's "Pivotal Decade" https://yalebooks.yale.edu/book/9780300171501/pivotal-decade

    And the consequences of which forewarned in James Goldsmith's "The Trap" https://www.goodreads.com/en/book/show/2091182.The_Trap

    https://m.youtube.com/watch?v=wwmOkaKh3-s

    Ignacio , September 21, 2019 at 10:41 am

    Hidden within this narrative is the fact that some countries, and not only China, have for long been playing beggar-thy-neighbor policies by restraining internal consumption and redirecting savings to the rest of the world that in turn finance their exporting machines. IMO, the biggest mistake made by China has been not to force fast enough a transition from a saving economy to a consumer economy with more balanced external relationships.

    These kind of policies are confrontational. As confrontational as tariffs or even as economic sanctions in my view. Yet, the prevailing economic narrative is that saving and exporting is the right economic thing to do. In this sense I think it matters a lot to which countries are being re directed investments of american companies leaving China. My intuition is that, for instance, Vietnam migth be willing to play this game while Mexico not. Investing in countries that save too much migth be counterproductive.

    I very much regret this aggressive narrative that has become common place in which countries are identified simply as competitors, if not enemies, in a global chess game. Political moves are confrontational and or humiliating. These Game of Thrones dynamics are played precisely when some international consensus in more important things like figthing climate change would be more than desirable. We are headed to truly bad times.

    laodan , September 21, 2019 at 11:33 am

    Here is an article by Steve Dickinson from the layers office Harris Bricken McVay Sliwoski that is based on his Co's China practice. Steve's conclusion goes as follows:

    The Chinese system put in place from 1992 to 2005 was a unique system and not likely to be replaced in S.E./South Asia or in any other region of the world. So for manufacturers, moving to a new region means doing the analysis from the ground up. Simply taking what they do in China and moving it to a new location is not likely to be a workable solution.

    Also the Chinese internal market continues to attract MNC's and this attraction will continue to grow far into the future. China's middle class is already larger than the total population of the US and it continues to grow rapidly. While down presently the Chinese internal consumption continues to grow at an annual rate of some 8.5%.

    Personal savings deposited in bank accounts reach the equivalent of some $US 30 Trillion ! Compare that to consumer debt at some $US 6.5 Trillion. In other words China is growing into the largest consumer market on earth and the biggest advantage that its internal market procures is its 'economies of scale' that make Chinese productions hyper-competitive. In other words China is gaining the kind of advantage that the US had along the 20th century. The advantage of a super large market size that dwarfs other national markets.

    Trump's approach to trade is isolating the US, blocking its Co's from the Chinese market, and incentivizing the Chinese to offer better conditions to Co's of the rest of the world. How can that help the US ?

    The biggest problem of the West and particularly the US is its ideological approach to economics. The Chinese adopted a pragmatic approach and it has served them well. Time to relearn the meaning of political economics (économie politique).

    JTMcPhee , September 21, 2019 at 3:42 pm

    I read Dickinson's PR piece linked by laodan. I used to work for a big law firm that had an international practice group focusing on moving US businesses to China ( I was not involved in that practice area, did environmental law and litigation.) The firm's PR department tasked lawyers with certain expertise to generate these kinds of come-ons as part of the compensation weighting scheme -- publish, and bring in business, or lose out in the annual "whining for dollars" partnership division of spoils. Eat what you kill.

    Dickinson is talking his book, of course. I have no idea if his read of the history and the current state of affairs in China and the "Asian Tigers" (does anyone use that term any more?) is accurate and complete, but what he describes is his firm's readiness to help supranational (emphasize SUPRAnational) and post-national corporate entities get a leg up in the race to the bottom. He'll help you find the places where the ruling class will give away the biggest share of the "national birthright" so the corporate entity can maximize profit by streamlining production and consumption, and of course growth. All the stuff that is killing the planet. But his time frame, his personal time frame, presumably, as well as the framing of the corporate shark entities which he is a remora to, cares nothing for the bigger economic and ecological effects of more stuff, more shipping, more energy use, and of course more combustion and consumption.

    And I'd note that he carefully omits all the baksheesh and greasing of palms that i read is such an important part of "doing business" at any kind of scale, to varying degrees everywhere in the world. I wonder if his custom analyses of the relative merits of, say, Vietnam vs. China vs. Cambodia vs. Taiwan includes sketching out the bribes that have to be paid to close on the sale of national birthrights on the way to the bottom that the globalist business model drives everything toward?

    I'm sure he would be happy to have the ear and hourly billings of all the great decision makers of all the various kinds of businesses, high to low tech, wanting to take full advantage of the "opportunities" that may be on offer, on how to ride the asymptotically downward curve of the race to the bottom, for fun and profit

    Looks like China has had a pretty effective industrial policy, unlike the US where corporate vampire capital dominion and corruption have bled the mopery white (not a racial reference, of course ) Do economists and policy wonks in the US even dare to use the phrase "industrial policy" any more? Or is it just presumed that "shareholder value" trumps all else? Especially as the author puts it, again quoting Ferguson, where we are "in an era where human advancement depends on greater integration between economic powers."

    Right.

    Susan the other` , September 21, 2019 at 3:06 pm

    The relentless neoliberal race to the bottom, outsourcing, and austerity that marked the death blow to American Labor is over. In that light it makes little difference whether our corporations pull out of China, go to Vietnam, or come home. The exploitation of the poorest is coming to an end. And none too soon.

    mtnwoman , September 21, 2019 at 7:22 pm

    For national security reasons at minimum, I hope some candidates discuss the imperative to have the US start making it's own medications again. Makes more sense to subsidize our production of medication than to give billions in subsidies to very profitable oil companies.

    https://www.tribdem.com/news/editorials/rosemary-gibson-u-s-dependence-on-china-for-medicine-a/article_db7c66e6-a407-11e9-a63e-5b2bf9c80820.html

    Merf56 , September 22, 2019 at 9:04 am

    I agree. I could not believe the government has allowed the entire supply chain of building blocks of ALL our antibiotics to be sourced almost solely from China. To me THAT'S the national security issue we need to deal with immediately. As well as other vital drugs..

    Anecdotally, I have started making this my number one political conversation issue – replete with references ( because of course not a soul believes it at first).. I have yet to find a single person Repub or Demo who isn't horrified and against it . Any nation with this much power over our drug supply they could kill millions of us in short order

    RBHoughton , September 21, 2019 at 10:06 pm

    Even getting manufacturing out of China will not bankrupt that country as intended. If USA is intent on pursuing a nationalistic basis to sanctions, I think its bound to fail. Trade always finds a way as we can well remember from our own commercial / industrial development.

    Chinese manufacturers have the wealth and experience to teach production line workers and make things anywhere. Western companies manufacturing in China have belatedly looked for facilities in neighboring countries and found the Chinese are already there. What's still available is land far from roads and rivers with little power supply.

    Another thing is preserving wealth. US Industrialists will keep their money offshore and remit only as much as they need in the homeland. A major problem imo is a mental restraint in USA thinking. Life is all about competition and winning. The actual activity, whatever it is, provides no joy unless you win. That fearful tag "No-one remembers who came second" is banded about. Thats not a philosophy for happiness. It forces the population into displacement activities few of which are wholesome. Here endeth the lesson.

    TG , September 21, 2019 at 10:48 pm

    It's not a bug, it's a feature! Trump doesn't give a damn about getting manufacturing jobs back into the United States! (Or at least his advisors don't).

    The trick is to move them out of nationalistic China, which is setting itself up as a competitor for power, and move the jobs into nice docile low-wage colonies, like Mexico and Indonesia and Bangladesh.

    The only catch: China has all the integrated supply lines and is stable. Moving your manufacturing into a dozen different uncoordinated unstable third-world banana republics has its own down side.

    Sound of the Suburbs , September 22, 2019 at 3:10 am

    The UK repealed the Corn Laws to embark on free trade. This reduced the price of bread, and lowered the cost of living, so UK employers could pay internationally competitive wages. Disposable income = wages – (taxes + the cost of living)

    Employees get their money from wages and the employer pays through wages, so the employer is paying for that bread through wages. Expensive bread leads to higher wages making UK employers unable to compete in a free trade world. "The interest of the landlords is always opposed to the interest of every other class in the community" Ricardo 1815 / Classical Economist

    Disposable income = wages – (taxes + the cost of living) Employees get their money from wages and the employer pays via wages. Employees get less disposable income after the landlords rent has gone. Employers have to cover the landlord's rents in wages reducing profit. Ricardo is just talking about housing costs, employees all rented in those days. The appalling conditions UK workers lived in during the 19th century were well documented.

    Low housing costs, lead to lower wages so UK employers were able to compete in a free trade world. William White (BIS, OECD) talks about how economics really changed over one hundred years ago as classical economics was replaced by neoclassical economics.

    https://www.youtube.com/watch?v=g6iXBQ33pBo&t=2485s

    He thinks we have been on the wrong path for one hundred years. Free trade requires a low cost of living and what was known in the 19th century had disappeared by the 20th. The West's high cost of living means high wages and an inability to compete in a free trade world.

    Never mind our companies can off-shore to where employers can pay lower wages for higher profits. Look at the US cost of living Donald; this is why those jobs ain't coming back. It's hard to make a good profit in the US, when employers have to cover the US cost of living in wages, reducing profit. The cost of living = housing costs + healthcare costs + student loan costs + other debt repayments + food + other costs of living

    Sound of the Suburbs , September 22, 2019 at 3:15 am

    A multi-polar world became a uni-polar world with the fall of the Berlin Wall and Francis Fukuyama said it was the end of history.
    It was all going so well, until the neoliberals got to work.

    The US created an open, globalised world with the Washington Consensus.

    China went from almost nothing to become a global super power.
    That wasn't supposed to happen, let's get the rocket scientists onto it.

    Maximising profit is all about reducing costs.
    China had coal fired power stations to provide cheap energy.
    China had lax regulations reducing environmental and health and safety costs.
    China had a low cost of living so employers could pay low wages.
    China had low taxes and a minimal welfare state.
    China had all the advantages in an open globalised world.

    It did have, but now China has become too expensive and developed Eastern economies are off-shoring to places like Vietnam, Bangladesh and the Philippines.

    An open, globalised world is a race to the bottom on costs.

    "The Washington Consensus was always going to work better for China than the US" the rocket scientists.

    The West never really stood a chance.

    drumlin woodchuckles , September 22, 2019 at 5:00 pm

    Several years ago Naked Capitalism ran an article about how a young George Ball was one of the New Immoralists for International Corporate Globalonial Plantationism. And that was before neoliberalism.

    Phillip Allen , September 22, 2019 at 8:06 am

    "[A]n era where human advancement depends on greater integration between economic powers."

    Oh, by all the gods, no. And what, pray, defines 'human advancement'? What the hell is Mr Auerback talking about?

    Further integration only propels the speed at which resources are extracted and the planet dies incrementally more. The future will not be one fully integrated planet guided by whatever-the-hell oligarchs and their 'meritocratic' servitors deign the best options. The future will of necessity be vastly more local, vastly more hand-made, vastly less energy- and resource-intensive, and there will be vastly less intercontinental and intra-continental trade. World-spanning – even continent-spanning political-economic arrangements have no long term viability whatsoever. Trying to maintain such is a foolish waste of effort and resources that could be more usefully be directed at de-growth and de-industrialization.

    And with that, The Lord Curmudgeon shook his cane one last time at the kids on his lawn and returned to the troll's cave from which he came.

    Merf56 , September 22, 2019 at 9:11 am

    I hope you have read James Howard Kunstler's World Made By Hand novelettes. They outline such a future. Interesting and quick reads if you haven't

    Sound of the Suburbs , September 22, 2019 at 5:02 pm

    The last engine of global growth, China, has now reached the end of the line as they have seen their Minsky Moment coming. China was the latest victim of neoclassical economics. The biggest danger to capitalism is neoclassical economics; it brought capitalism to its knees in the 1930s and is having another go now.

    https://cdn.opendemocracy.net/neweconomics/wp-content/uploads/sites/5/2017/04/Screen-Shot-2017-04-21-at-13.52.41.png

    1929 and 2008 look so similar because they are; it's the same economics and thinking. Richard Vague has analysed the data for 1929 and 2008 and they were even more similar than they initially appear. Real estate lending was actually the biggest problem in 1929. Margin lending was another factor in 2008.

    This has happened globally. At 25.30 mins you can see the super imposed private debt-to-GDP ratios.
    https://www.youtube.com/watch?v=vAStZJCKmbU&list=PLmtuEaMvhDZZQLxg24CAiFgZYldtoCR-R&index=6

    The 1920s US mistake is now global. Japan, the UK, the US, Euro-zone and now China. The last engine of global growth, China, has now reached the end of the line as they have seen their Minsky Moment coming. The debt fuelled growth model not only runs out of steam, all the debt in the economy then acts like a drag anchor holding the economy back. Japan has been like this for thirty years.

    Richard Koo explains the processes at work in the Japanese economy since the 1990s, which are at now at work throughout the global economy.

    https://www.youtube.com/watch?v=8YTyJzmiHGk

    The repayment of debt to banks destroys money and this is the problem.

    [Sep 17, 2019] Stop the Trade War in the Name of Prosperity

    Notable quotes:
    "... Furthermore, because of the horrific legacy of the one-child policy, China faces a rapidly aging population that will strain resources and reduce the number of working-age people . By 2050, it is estimated that the average Chinese will be 56 years of age. In contrast, the average American will be 44. No amount of spending or legal reform will prevent Beijing's coming demographic crisis. ..."
    Sep 16, 2019 | www.theamericanconservative.com

    Part of the Trump administration's latest round of 15 percent tariffs on Chinese imports went into effect Sunday, with the rest to follow on December 15. These increases will impact the prices of many consumer goods that Americans rely on, including clothing, appliances, televisions, smartwatches, textbooks, diapers, coffee, and even whiskey. And given their timing, they'll likely have an effect on holiday shopping. This makes all the more welcome President Trump's recent statement during the G7 summit that China is looking to end the trade war and that he too is open to making a deal.

    Trump is right to negotiate with Chinese President Xi Jinping, as finding an off-ramp from the trade war should be Washington's priority. America's interest is in out-competing Beijing, not hurting our own economy in an attempt to damage theirs. The United States has a better hand here, but we must play it to our advantage.

    America's great strength is in our freedom, our market economy, and our democratic system. The United States has attained a level of prosperity unseen in human history, and that economic engine is what fuels our military power. Without a strong economy, we cannot have a strong military. Thus an endless trade war endangers American security in the long term: as both sides pile on retaliatory tariffs, the risk of recession increases. American consumers will feel each new trade barrier as it hits their pocketbooks.

    Washington must not pursue policies that hurt those it governs. And the suffering inflicted by a trade war wouldn't just be limited to the pricing of consumer goods. It would also make us weaker for no good reason. And it would lower tax revenues, requiring America to go further into debt to maintain our present level of security.

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    Moreover, long-term trade attacks on China are unnecessary, because China already has more problems than America. Beijing suffers from high national debt, a lack of clear economic reform, and a rapidly aging population. It has few, if any, good or timely solutions to these pressing issues.

    According to the Institute of International Finance, China's total national, corporate, and household debt is now over 300 percent of its GDP. What makes this especially bad for Beijing is that the debt was taken on very quickly after the 2008 global recession, without the power of a global reserve currency to make borrowing easier, as the United States has. Moreover, this debt is largely corporate and China's state-capitalist system makes it harder for Chinese companies survive market pressures. Beijing has used cheap credit to fuel its exports and its economic rise through fully and partially state-controlled national companies.

    The Chinese economic system has undergone some reforms in recent years but still remains too top-down and too focused on exports over consumption as compared to more developed economies. In other words, China needs to transition to a full market economy like Taiwan and South Korea did on their paths to prosperity, but it hasn't done so yet.

    Furthermore, because of the horrific legacy of the one-child policy, China faces a rapidly aging population that will strain resources and reduce the number of working-age people . By 2050, it is estimated that the average Chinese will be 56 years of age. In contrast, the average American will be 44. No amount of spending or legal reform will prevent Beijing's coming demographic crisis.

    China Has Already Lost the Trade War Tariffs Are Economic Patriotism, Putting Americans First

    This comparative weakness is why it makes sense to find a trade war off-ramp sooner rather than later. China needs one badly and will eventually want a deal -- if it doesn't already. As for the United States, recession may be inevitable, but it would be better if it were not self-inflicted.

    Already the trade war has cost American billions in higher prices for imported products. American farmers have been hit hard by China's retaliatory tariffs and, according to a report by IHS Markit, U.S. manufacturing has shrunk for the first since 2009. Economists polled by Reuters believe the trade war has increased the risk of a recession, with a median of those surveyed giving a 45 percent chance of a downturn over the next two years. Additionally, major banks have expressed concerns , as the stock market takes hits with every new tariff increase and angry statement between Washington and Beijing.


    AllenQ 9 hours ago

    I couldnt disagree more. I want more tariffs against China and Europe. I want closed borders and zero migration. China has infiltrated our government, our defense agencies, our nuclear agencies, our major research centers, our college campuses, our media and bribed our politicians. China is an imminent threat to Hong Kong, Taiwan and its militarization of the islands in the South China Sea are a threat to all of South Asia. China has been stealing US, Canadian and European technology for decades to leapfrog the US into technological dominance globally. China's plan is to force the US our of the Asia Pacific. China has infiltrated Canada and Australia to a similar degree (if not more) than the US. If you pander to these free trade globalists then you will be paving the way for a military conflict between Chinese and American Hegemony in Asia and elsewhere around the world. I dont know about you but I will take a tariff and trade war over a military war any day. Ramp up those tariffs and shift those supply chains out of China toward more benevolent allies and the world be be all the safer for it.
    Mr. B 9 hours ago
    China has been waging a one sided trade war against us for over 30 years, it's about time we resisted. Becoming more economically intertwined with our dangerous and genocidal rival doesn't sound like the right answer to me, especially when China will continue protectionist policies and currency manipulation regardless of what we do. America has allowed its industrial base to hemorrhage since the 70s, and bending over for our enemy to keep cheap trash flowing and American factories closed is not the right answer.
    tz1 8 hours ago
    Is this a white box article the Chamber of Commerce is using to astroturf?

    China is a Monstrous regime that is killing and enslaving its citizens. It will simply kill everyone over 65, then 60 if it becomes convenient like they did with their one child policy. Problem solved.

    You wish to keep trading with criminals, polluters, and pirates so you can get cheap junk at WalMart?

    You have a job. I wish you would lose yours and that dozens of blue collar had working but laid off Americans can find one. It isn't how much something costs in dollars (or how much of your soul it costs), it is how much it costs in your virtuous labor. I'd rather pay double for stuff but get triple wages rather than pay half but be all but permanently unemployed.

    ThaomasH 8 hours ago
    Well said. Calling off the trade would be good for US consumers and the economy in general. But while we are on the subject,calling off the war on immigration would also be good for US consumers and the economy in general.
    Adriana Pena 8 hours ago
    Shoulda have voted for Hillary....
    Kent 8 hours ago
    Wow. This article is off-base on any number of levels.

    "These increases will impact the prices of many consumer goods that Americans rely on,"

    No, no they won't. Tariffs are paid for by the importer, not the consumer. If the importer could randomly increase prices, they would do so without tariffs. The market sets prices.

    "America's interest is in out-competing Beijing, not hurting our own economy in an attempt to damage theirs."

    If America could out-compete Beijing, American manufacturing would not have moved to China. It turns out, the American people simply don't want to live according to 3rd world standards. We want decent homes and stuff. We don't want to live in a cesspool of pollution. I'm sure the Chinese people have the same preferences, they just don't get a choice.

    "Moreover, long-term trade attacks on China are unnecessary, because China already has more problems than America."

    I agree with the author here, but not for the same reasons. Attacking China doesn't resolve anything. American companies will just move to a different 3rd world country with whom we can't complete. Why should I care if my clothes come from China or Vietnam?

    AllenQ 5 hours ago
    I am 100% supportive of the trade war and building the wall and tariffs. I say zero immigration and make all Chinese Tariffs permanent. Negotiate a trade deal with the tariffs intact. Id rather have a trade war with China and permanent tariffs than a war with China.

    China has been stealing technology and has infiltrated media, government, defense, education, government officials (usually through bribes) from the US, Canada, Australia and Europe. China is proving itself to be a threat to Hong Kong, Taiwan, Vietnam, Philippines, Indonesia, India and South Asia.

    Much of this "so called Russia Collusion" is actually a deflection of democratic politicians China is bribing to take down Trump in order to continue their military and technological theft, their existing preferential trade and their existing network. China is a serious danger to the US and the rest of the world. It is preferential to sacrifice a small amount of prosperity today for long term peace with China.

    Mark B. 5 hours ago
    Bring a thousand trade wars to blossom to save the climate, planet, middle classes. dignity and to fight rising extreme inequality.
    kalendjay 3 hours ago
    Propaganda. The aging of Chinese population? Not to worry, China has no real Social Security system, and so relies on massive surpluses of savings. The 300% consumer debt ratio? That would cripple any country with no help from trade. Should we let Wells Fargo and Goldman refinance them?

    Farmers hit hard? As I recall we have had the worst corn harvest in decades, and shame on us for not growing more wheat, oats, and sugar cane. Our beef and poultry prices will be affected, not to mention our fast food industry, which has been whipsawed by political correctness. But China will effectively ration its pork, as it faces an even worse African Swine Flu crisis, and an additional one on grains from the Black Army Worm.

    US decline in manufacturing? Look first at our glut of automobiles, and the self vetting of plant capacity by GM. Don't forget the crisis in car leases, which have made older cars worth less than their outstanding loans. And note, that the fall in lithium prices indicates that China's car electrification initiative is falling flat.

    One thing left out of the equation is oil. And why should China live high on Iranian oil (mostly wastefully burned in power plants, mind you, and not cars) while we suffer attacks on Saudi oil from Iranian proxies (all on ChiRussia's dime)? Puts our trade negotiations in clear perspective, doesn't it?

    Michael 3 hours ago
    Stopping the war will not bring back China as our major trading partner. China is not going to be in this vulnerable position with America again. She is going to develop other markets

    [Sep 14, 2019] How to lose 100 millions trying to enter the USA subway cars mar anne ,

    Sep 14, 2019 | economistsview.typepad.com

    https://www.nytimes.com/2019/09/14/business/chinese-train-national-security.html

    September 14, 2019

    Fearing 'Spy Trains,' Congress May Ban a Chinese Maker of Subway Cars
    By Ana Swanson

    CHICAGO -- America's next fight with China is unfolding at a glistening new factory in Chicago, which stands empty except for the shells of two subway cars and space for future business that is unlikely to come.

    A Chinese state-owned company called CRRC Corporation, the world's largest train maker, completed the $100 million facility this year in the hopes of winning contracts to build subway cars and other passenger trains for American cities like Chicago and Washington.

    But growing fears about China's economic ambitions and its potential to track and spy on Americans are about to quash those plans. Congress is soon expected to approve legislation that would effectively bar the company from competing for new contracts in the United States, citing national security and economic concerns. The White House has expressed its support for the effort.

    Washington's attempt to block a Chinese company from selling train cars inside America is the latest escalation in a trade war that has quickly expanded from a spat over tariffs and intellectual property to a broader fight over economic and national security.

    President Trump and lawmakers from both parties are increasingly anxious about the economic and technological ambitions of China, which has built cutting-edge global industries, including those that produce advanced surveillance technology. Those fears have prompted Washington to take an expansive view of potential risks, moving beyond simply trying to curtail Chinese imports.

    In addition to slapping tariffs on $360 billion worth of Chinese products, the administration has banned Chinese companies like Huawei, the telecom giant, from buying sensitive American technology. It is moving to curb the ability of firms to export technology like artificial intelligence and quantum computing from the United States to China. And Congress has given the administration expansive power to block Chinese investment on national security grounds.

    Now lawmakers have added a provision to a military spending bill that would prevent the use of federal grants to buy subway trains from state-owned or state-controlled companies, a measure that would effectively block CRRC's business.

    The bill has gained bipartisan support from lawmakers who say companies like CRRC pose a threat to the United States. Part of the concern is economic: Flush with cash from its rapid growth, China has pumped money into building globally competitive businesses, often creating overcapacity in markets like steel, solar panels and trains.

    That has lowered prices for consumers -- including American taxpayers who pay for subway cars. While a subway car has not been manufactured solely by an American company in decades, CRRC's low prices have raised concerns among American freight train companies that the company could ultimately move into -- and demolish -- their business.

    CRRC has consistently underbid its competitors, winning over urban transit agencies that are saddled with aging infrastructure and tight budgets. For the Chicago L, CRRC's Chicago subsidiary bid $1.55 million per car, compared with a bid of $1.82 million per car by Bombardier, the Canadian manufacturer. And CRRC also proposed to build the Chicago facility and create 170 new jobs.

    Legislators argue that Chinese state-owned companies are not pursuing profit, but the policy aims of the Chinese government to dominate key global industries like electric cars, robotics and rail.

    "When you can subsidize, when you can wholly own an enterprise like China does, you can create a wholly unlevel playing field," said Senator Tammy Baldwin, a Wisconsin Democrat who is a co-sponsor of the legislation. "We're used to that unlevel playing field existing between the U.S. and China, but now it's happening in our own backyard."

    Another more nefarious worry is also at play. Lawmakers -- along with CRRC's competitors -- say they are concerned that subway cars made by a Chinese company might make it easier for Beijing to spy on Americans and could pose a sabotage threat to American infrastructure, though CRRC says it surrenders control of all technology in the cars to its buyers. Nonetheless, critics speculate that the Chinese firm could incorporate technology into the cars that would allow CRRC -- and the Chinese government -- to track the faces, movement, conversations or phone calls of passengers through the train's cameras or Wi-Fi.

    Scott Paul, the president of the Alliance for American Manufacturing, which represents manufacturers and the United Steelworkers, said the risks of giving a Chinese company the ability to monitor or control American infrastructure could not be understated given recent laws requiring Chinese companies to turn over data to Beijing upon request.

    "I just think it would be irresponsible to assume the Chinese government to which this firm must answer would be a reliable security partner, given its well documented track record," Mr. Paul said.

    Whether those fears are justified remains uncertain. Proponents of the bill have not made clear how subway cars manufactured by a Chinese company would pose a greater espionage threat than everything else that China makes and sells in the United States, including laptops, phones and home appliances.

    Dave Smolensky, a spokesman for CRRC, said the company was being unfairly targeted by companies that wanted to legislate a competitor out of business under the guise of national security. He said the firm was a victim to "an aggressive multimillion-dollar media disinformation campaign," funded mostly by domestic freight train companies, intended to play on popular fears about China's rise.

    Employees at the Chicago factory also dismissed the concerns, saying they had not seen any evidence that they were working to construct "spy trains."

    "I haven't seen any secret wires yet," said Perry Nobles, an electrician for CRRC who was rigging wires in the interior of the trains. "With the world full of cellphones and computers, I'd think there's an easier way to get information."

    Rising fears of China's ambitions in Washington have prompted officials to adopt an unsparing view, with policymakers and national security officials warning domestic and foreign governments not to trust Chinese equipment.

    American officials have waged a global offensive against Huawei, telling other countries that allowing a Chinese company to build the world's next generation of wireless networks would be akin to handing national secrets to a foreign agent.

    Like CRRC, the fear surrounding Huawei is largely based on concerns about technological dominance by China's authoritarian government. No one has yet disclosed finding a backdoor in Huawei's products that would allow it to snoop -- but officials say by the time one is discovered, it may be too late.

    "The Chinese are working to put their systems in networks all across the world so they can steal your information and my information," Secretary of State Mike Pompeo said in an interview in May. "This administration is prepared to take this on."

    As Senator John Cornyn, Republican of Texas, introduced the provision in March, he said, "China poses a clear and present danger to our national security and has already infiltrated our rail and bus manufacturing industries."

    Representative Kevin McCarthy, a Republican whose California district is home to a Chinese bus maker, BYD, had opposed a version of the provision that would apply to buses as well as trains. House lawmakers dropped the bus provision, but the Senate bill would apply to both. Congress will take the issue up again in the coming weeks as part of the annual defense bill.

    The legislation would not affect the thousands of American subway cars that CRRC previously won contracts to build, including an 846-car order for the Chicago L. But it would block the company from future contracts, such as those under consideration by the Chicago Metra and the Washington Metro.

    The Chicago facility is the company's second in the United States. A factory in Massachusetts that employs more than 150 people is already building trains for Boston, Los Angeles and Philadelphia, prompting concerns that the company plans to expand rapidly in the United States as it has in other foreign markets.

    Like many Chinese state enterprises, CRRC is guided by Beijing's Made in China 2025 plan, which lays out an agenda to dominate key industries.

    In its 2018 annual report, Liu Hualong, the company's chairman and party secretary, pledged to pursue the dual goals of "Party construction as well as developing into a world-leading company with global competitiveness."

    "We conscientiously followed the important instructions of General Secretary Xi Jinping," the report said, referring to the Chinese president and Communist Party leader.

    The last American firm to make passenger rail cars, the Pullman Company, produced its final car in 1981. Since then, major American cities have bought subway cars from Bombardier and Japanese manufacturers like Kawasaki, Hyundai and Hitachi.

    But American manufacturers of freight rail cars, including the Greenbrier Companies and TrinityRail, which is based in Mr. Cornyn's home state of Texas, say CRRC could use its footing in the United States to steal its business. Together with unions and others, they have mounted a lobbying campaign against CRRC under an umbrella group known as the Rail Security Alliance.

    The group says American taxpayer dollars should not be spent in China, where the empty rail cars are made before being shipped to the United States for further work at the company's facilities in Illinois or Massachusetts.

    "We think those dollars should stay here," said Erik Olson, the vice president of the Rail Security Alliance.

    CRRC sends over experts from its giant headquarters in Qingdao, China, to plants in other countries. In Chicago, the American employees call these Chinese citizens "shifu," a polite term for a skilled worker meaning "master" or "teacher."

    On a sunny day in July, the company break room was split between shifus, wearing white jumpsuits and eating stuffed buns, and American workers, many of whom had joined the company in the last few months. The gleaming concrete factory floor was bare, save for a few dozen people installing wiring, air ducts and other components into the empty shells of two rail cars.

    "We are a little concerned because it's our livelihood," said Mr. Nobles, who was hired in March from a previous factory job making frames for the Ford Explorer.

    This summer, CRRC replaced the Chinese flag outside the factory with a Chicago flag. It has also retained two Washington lobbying firms, Squire Patton Boggs and Crossroads Strategies, to plead its case in Congress.

    It may be too late. Senator Sherrod Brown, Democrat of Ohio, said he helped sponsor the bill to prevent the American transit system from being "controlled by a foreign country that is not particularly friendly to us."

    "They spell out in black and white they're going to use foreign investment as a weapon, and we're taking action to defend ourselves," Mr. Brown said.

    [Sep 10, 2019] Trade Wars Are a Fool's Game -- Strategic Culture

    Sep 10, 2019 | www.strategic-culture.org

    Eric MARGOLIS

    According to the great military thinker, Maj. Gen. J.F.C. Fuller, 'the object of war is not victory. It is to achieve political goals.'

    Too bad President Donald Trump does not read books. He has started economic wars against China, Russia, Iran, Cuba and Venezuela without any clear strategic objective beyond inflating his ego as the world's premier warlord and punishing them for disobedience.

    Trump's wars are economic. They deploy the huge economic and financial might of the United States to steamroll other nations that fail to comply with orders from Washington. Washington's motto is 'obey me or else!' Economic wars are not bloodless. Imperial Germany and the Central Powers were starved into surrender in 1918 by a crushing British naval blockade.

    Trade sanctions are not making America great, as Trump claims. They are making America detested around the globe as a crude bully. Trump's efforts to undermine the European Union and intimidate Canada add to this ugly, brutal image.

    Worse, Trump's tariff war against China has damaged the economy of both nations, the world's leading economic powers, and raised tensions in Asia. The world is facing recession in large part due to Trump's ill-advised wars. All to prove Trump's power and glory.

    Trump and his advisors are right about China's often questionable trade practices. I did 15 years of business in China and saw a kaleidoscope of chicanery, double-dealing, and corruption. A favorite Chinese trick was to leave imports baking in the sun on the docks, or long delaying them by 'losing' paperwork.

    I saw every kind of craziness in the Wild East Chinese market. But remember that it's a 'new' market in which western-style capitalism is only one generation old. Besides, China learned many of its fishy trade practices from France, that mother of mercantilism.

    China indeed steals technical and military information on a mass scale. But so does the US, whose spy agencies suck up information across the world. America's claims to be a victim are pretty rich.

    What Trump & Co don't understand is that China was allowed into America's Greater Asia Co-Prosperity Sphere by the clever President Nixon to bring it under US influence – just as Japan and South Korea were in the 1950's. China's trade surplus with the US is its dividend for playing by Washington's rules. If China's trade bonus is stripped away, so will China's half-hearted acceptance of US policies. Military tensions will rise sharply.

    In China's view, the US is repeating what Great Britain did in the 19th century by declaring war to force opium grown in British-ruled Burma onto China's increasingly addicted people. Today the trade crop is soya beans and wretched pigs.

    Trump's ultimate objective, as China clearly knows, is to whip up a world crisis over trade, then dramatically end it – of course, before next year's elections. Trump has become a master dictator of US financial markets, rising or lowering them by surprise tweets. No president should ever have such power, but Trump has seized it.

    There is no telling how much money his minions have made in short or long selling on the stock market thanks to insider information. America's trillion dollar markets have come to depend on how Trump feels when he wakes up in the morning and watches Fox news, the Mother of Misinformation.

    It staggers the imagination to believe that Trump and his minions actually believe that they can intimidate China into bending the knee. China withstood mass devastation and at least 14 million deaths in World War II in order to fight off Japanese domination. Does the White House really think Beijing will cave in over soya beans and semi-conductors in a daft war directed by a former beauty contest and casino operator? China's new emperor, Xi Jinping, is highly unlikely to lose face in a trade war with the US. Dictators cannot afford to retreat. Xi can wait it out until more balanced minds again occupy the White House.

    Trade wars rarely produce any benefits for either side. They are the equivalent of sending tens of thousands of soldiers to be mowed down by machine guns on the blood-soaked Somme battlefield in WWI. Glory for the stupid generals; death and misery for the common soldiers

    This fool's war of big egos will inevitably end in a face-saving compromise between Washington and Beijing. Get on with it.

    ericmargolis.com

    [Sep 10, 2019] 'The New Normal' Trump's 'China Bind' Can Be Iran's Opportunity by Alastair Crooke

    Notable quotes:
    "... The old adage that the 'sea is always the sea' holds true for US foreign policy. And Iran repeating the same old routines, whilst expecting different outcomes is, of course, one definition of madness. A new US Administration will inherit the same genes as the last. ..."
    "... And in any case, the US is institutionally incapable of making a substantive deal with Iran. A US President – any President – cannot lift Congressional sanctions on Iran. The American multitudinous sanctions on Iran have become a decades' long knot of interpenetrating legislation: a vast rhizome of tangled, root-legislation that not even Alexander the Great might disentangle: that is why the JCPOA was constructed around a core of US Presidential 'waivers' needing to be renewed each six months. Whatever might be agreed in the future, the sanctions – 'waived' or not – are, as it were, 'forever'. ..."
    "... "[So] decoupling is already in motion. Like the shift of tectonic plates, the move towards a new tech alignment with China increases the potential for sudden, destabilizing convulsions in the global economy and supply chains. To defend America's technology leadership, policymakers must upgrade their toolkit to ensure that US technology leadership can withstand the aftershocks. ..."
    "... "The key driver of this shift has not been the President's tariffs, but a changing consensus among rank-and-file policymakers about what constitutes national security. This expansive new conception of national security is sensitive to a broad array of potential threats, including to the economic livelihood of the United States, the integrity of its citizens personal data, and the country's technological advantage". ..."
    "... A Quinnipiac University survey last week found for the first time in Trump's presidency, more voters now say the economy is getting worse rather than better, by a 37-31 percent margin – and by 41-37 percent, voters say the president's policies are hurting the economy. ..."
    "... This is hugely significant. If Trump is experiencing a crisis of public confidence in respect to his assertive policies towards China, the last thing that he needs in the run-up to an election is an oil crisis, on top of a tariff/tech war crisis with China. A wrong move with Iran, and global oil supplies easily can go awry. Markets would not be happy. (So Trump's China 'bind' can also be Iran's opportunity ). ..."
    Sep 09, 2019 | www.strategic-culture.org

    There is consensus amongst the Washington foreign policy élite that all factions in Iran understand that – ultimately – a deal with Washington on the nuclear issue must ensue. It somehow is inevitable. They view Iran simply as 'playing out the clock', until the advent of a new Administration makes a 'deal' possible again. And then Iran surely will be back at the table, they affirm.

    Maybe. But maybe that is entirely wrong. Maybe the Iranian leadership no longer believes in 'deals' with Washington. Maybe they simply have had enough of western regime change antics (from the 1953 coup to the Iraq war waged on Iran at the western behest, to the present attempt at Iran's economic strangulation). They are quitting that failed paradigm for something new, something different.

    The pages to that chapter have been shut. This does not imply some rabid anti-Americanism, but simply the experience that that path is pointless. If there is a 'clock being played out', it is that of the tic-toc of western political and economic hegemony in the Middle East is running down, and not the 'clock' of US domestic politics. The old adage that the 'sea is always the sea' holds true for US foreign policy. And Iran repeating the same old routines, whilst expecting different outcomes is, of course, one definition of madness. A new US Administration will inherit the same genes as the last.

    And in any case, the US is institutionally incapable of making a substantive deal with Iran. A US President – any President – cannot lift Congressional sanctions on Iran. The American multitudinous sanctions on Iran have become a decades' long knot of interpenetrating legislation: a vast rhizome of tangled, root-legislation that not even Alexander the Great might disentangle: that is why the JCPOA was constructed around a core of US Presidential 'waivers' needing to be renewed each six months. Whatever might be agreed in the future, the sanctions – 'waived' or not – are, as it were, 'forever'.

    If recent history has taught the Iranians anything, it is that such flimsy 'process' in the hands of a mercurial US President can simply be blown away like old dead leaves. Yes, the US has a systemic problem: US sanctions are a one-way valve: so easy to flow out, but once poured forth, there is no return inlet (beyond uncertain waivers issued at the pleasure of an incumbent President).

    But more than just a long chapter reaching its inevitable end, Iran is seeing another path opening out. Trump is in a 'China bind': a trade deal with China now looks "tough to improbable", according to White House officials, in the context of the fast deteriorating environment of security tensions between Washington and Beijing. Defense One spells it out:

    "It came without a breaking news alert or presidential tweet, but the technological competition with China entered a new phase last month. Several developments quietly heralded this shift: Cross-border investments between the United States and China plunged to their lowest levels since 2014, with the tech sector suffering the most precipitous drop. US chip giants Intel and AMD abruptly ended or declined to extend important partnerships with Chinese entities. The Department of Commerce halved the number of licenses that let US companies assign Chinese nationals to sensitive technology and engineering projects.

    "[So] decoupling is already in motion. Like the shift of tectonic plates, the move towards a new tech alignment with China increases the potential for sudden, destabilizing convulsions in the global economy and supply chains. To defend America's technology leadership, policymakers must upgrade their toolkit to ensure that US technology leadership can withstand the aftershocks.

    "The key driver of this shift has not been the President's tariffs, but a changing consensus among rank-and-file policymakers about what constitutes national security. This expansive new conception of national security is sensitive to a broad array of potential threats, including to the economic livelihood of the United States, the integrity of its citizens personal data, and the country's technological advantage".

    Trump's China 'bind' is this: A trade deal with China has long been viewed by the White House as a major tool for 'goosing' the US stock market upwards, during the crucial pre-election period. But as that is now said to be "tough to improbable" – and as US national security consensus metamorphoses, the consequent de-coupling, combined with tariffs, is beginning to bite. The effects are eating away at President Trump's prime political asset: the public confidence in his handling of the economy: A Quinnipiac University survey last week found for the first time in Trump's presidency, more voters now say the economy is getting worse rather than better, by a 37-31 percent margin – and by 41-37 percent, voters say the president's policies are hurting the economy.

    This is hugely significant. If Trump is experiencing a crisis of public confidence in respect to his assertive policies towards China, the last thing that he needs in the run-up to an election is an oil crisis, on top of a tariff/tech war crisis with China. A wrong move with Iran, and global oil supplies easily can go awry. Markets would not be happy. (So Trump's China 'bind' can also be Iran's opportunity ).

    No wonder Pompeo acted with such alacrity to put a tourniquet on the brewing 'war' in the Middle East, sparked by Israel's simultaneous air attacks last month in Iraq, inside Beirut, and in Syria (killing two Hizbullah soldiers). It is pretty clear that Washington did not want this 'war', at least not now. America, as Defense One noted , is becoming acutely sensitive to any risks to the global financial system from "sudden, destabilizing convulsions in the global economy".

    The recent Israeli military operations coincided with Iranian FM Zarif's sudden summons to Biarritz (during the G7), exacerbating fears within the Israeli Security Cabinet that Trump might meet with President Rouhani in NY at the UN General Assembly – thus threatening Netanyahu's anti-Iran, political 'identity' . The fear was that Trump could begin a 'bromance' with the Iranian President (on the Kim Jong Un lines). And hence the Israeli provocations intended to stir some Iranian (over)-reaction (which never came). Subsequently it became clear to Israel that Iran's leadership had absolutely no intention to meet with Trump – and the whole episode subsided.

    Trump's Iran 'bind' therefore is somehow similar to his China 'bind': With China, he initially wanted an easy trade achievement, but it has proved to be 'anything but'. With Iran, Trump wanted a razzmatazz meeting with Rohani – even if that did not lead to a new 'deal' (much as the Trump – Kim Jung Un TV spectaculars that caught the American imagination so vividly, he may have hoped for a similar response to a Rohani handshake, or he may have even aspired to an Oval Office spectacular).

    Trump simply cannot understand why the Iranians won't do this, and he is peeved by the snub. Iran is unfathomable to Team Trump.

    Well, maybe the Iranians just don't want to do it. Firstly, they don't need to: the Iranian Rial has been recovering steadily over the last four months and manufacturing output has steadied. China's General Administration of Customs (GAC) detailing the country's oil imports data shows that China has not cut its Iranian supply after the US waiver program ended on 2 May, but rather, it has steadily increased Iranian crude imports since the official end of the waiver extension, up from May and June levels. The new GAC data shows China imported over 900,000 barrels per day (bpd) of crude oil from Iran in July, which is up 4.7% from the month before.

    And a new path is opening in front of Iran. After Biarritz, Zarif flew directly to Beijing where he discussed a huge, multi-hundred billion (according to one report ), twenty-five-year oil and gas investment, (and a separate) 'Road and Belt' transport plan. Though the details are not disclosed, it is plain that China – unlike America – sees Iran as a key future strategic partner, and China seems perfectly able to fathom out the Iranians, too.

    But here is the really substantive US shift taking place. It is that which is termed "a new normal" now taking a hold in Washington:

    "To defend America's technology leadership, policymakers [are] upgrading their toolkit to ensure that US technology leadership can withstand the aftershocks Unlike the President's trade war, support for this new, expansive definition of national security and technology is largely bipartisan, and likely here to stay.

    with many of the president's top advisers viewing China first and foremost as a national security threat, rather than as an economic partner – it's poised to affect huge parts of American life, from the cost of many consumer goods to the nature of this country's relationship with the government of Taiwan.

    "Trump himself still views China primarily through an economic prism. But the angrier he gets with Beijing, the more receptive he is to his advisers' hawkish stances toward China that go well beyond trade."

    "The angrier he gets with Beijing" Well, here is the key point: Washington seems to have lost the ability to summon the resources to try to fathom either China, or the Iranian 'closed book', let alone a 'Byzantine' Russia. It is a colossal attenuation of consciousness in Washington; a loss of conscious 'vitality' to the grip of some 'irrefutable logic' that allows no empathy, no outreach, to 'otherness'. Washington (and some European élites) have retreated into their 'niche' consciousness, their mental enclave, gated and protected, from having to understand – or engage – with wider human experience.

    To compensate for these lacunae, Washington looks rather, to an engineering and technological solution: If we cannot summon empathy, or understand Xi or the Iranian Supreme Leader, we can muster artificial intelligence to substitute – a 'toolkit' in which the US intends to be global leader.

    This type of solution – from the US perspective – maybe works for China, but not so much for Iran; and Trump is not keen on a full war with Iran in the lead up to elections. Is this why Trump seems to be losing interest in the Middle East? He doesn't understand it; he hasn't the interest or the means to fathom it; and he doesn't want to bomb it. And the China 'bind' is going to be all absorbing for him, for the meantime.

    [Sep 08, 2019] https://twitter.com/DeanBaker13/status/1170197985168199680

    Sep 08, 2019 | twitter.com

    Dean Baker‏ @DeanBaker13

    Hey #SchoolyardDonnie, China is not paying for the tariffs, the price of our imports from China are down just 1.6 percent over the last year

    https://www.bls.gov/news.release/ximpim.t07.htm

    Your tariffs are 10-25 percent, that means the great workers in the U.S. are paying the bill.

    Donald J. Trump @realDonaldTrump

    "China is eating the Tariffs." Billions pouring into USA. Targeted Patriot Farmers getting massive Dollars from the incoming Tariffs! Good Jobs Numbers, No Inflation (Fed). China having worst year in decades. Talks happening, good for all!

    9:51 PM - 6 Sep 2019 Reply Saturday, September 07, 2019 at 10:06 AM

    Plp said in reply to anne... Btw family farmers prefer high demand for their output

    Not high subsidies

    They know the difference between earned and unearned dollars Reply Saturday, September 07, 2019 at 10:22 AM

    Fred C. Dobbs said... Fun fact:

    Trump has a favorite number
    when he makes big claims: 10,000
    https://www.bostonglobe.com/news/politics/2019/09/06/trump-has-favorite-number-when-makes-big-claims/WpS2YPcnjeJQzQchHJLXhP/story.html?event=event25 via @BostonGlobe

    Jordan Fabian - Bloomberg - September 6

    When President Donald Trump wants to convey that something is a big deal, he often reaches for the same big number: 10,000.

    He says it's the number of points the Dow Jones Industrial Average would be up had the Federal Reserve not raised interest rates. It's the number of people attending his rallies -- or the number forced to wait outside because they couldn't get in.

    It's also the number of jobs a company plans to create, the headcount of captured Islamic State fighters, the number of migrants in a caravan headed to the U.S., and the Allied casualty count on D-Day.

    Sometimes the number is accurate. Other times, it's a wild guess -- or wildly wrong.

    Trump on Wednesday predicted the Dow would be up -- another 10,000 points -- if he hadn't embarked on a trade war with China.

    "If I wanted to do nothing with China, my stock market -- our stock market -- would be 10,000 points higher than it is right now," Trump told reporters in the Oval Office.

    That would be a dramatic rise. With the Dow closing at 26,728 on Thursday, another 10,000 points would represent a 37% increase.

    Memorable Number

    From a marketing standpoint, there's a great reason to use 10,000: It's memorable.

    "He uses this round number in particular because it seems big," said Jonah Berger, marketing professor at the Wharton School of the University of Pennsylvania, which Trump often boasts of attending.

    "He wants to convey something is a big problem, or something would be quite different, so he uses a big round number to try and sway his audience," said Berger, author of "Contagious: Why Things Catch On."

    Trump has used the number since his 2016 campaign -- in speeches, remarks to reporters and one-on-one interviews -- but it could take on new significance as he seeks to burnish his record with the approach of the 2020 election.

    The president has repeatedly sought to use 10,000 to his political advantage, even when it doesn't neatly match reality.

    'Horrible People'

    For instance, he said in January that Immigration and Customs Enforcement officers last year removed 10,000 known or suspected gang members whom he described as "horrible people." (The agency actually reported arresting that number but removing 5,872 known or suspected gang members in fiscal year 2018.)

    The White House declined to comment on Trump's use of 10,000.

    The president has other verbal habits. He has often cited self-imposed two week deadlines for major announcements.

    While Trump is often faulted by fact-checkers for making false statements, his spokeswoman has said journalists take the president's words too literally.

    "I think the president communicates in a way that some people, especially the media, aren't necessarily comfortable with," White House press secretary Stephanie Grisham told the Washington Post in a recent interview. "A lot of times they take him so literally. I know people will roll their eyes if I say he was just kidding or was speaking in hypotheticals, but sometimes he is."

    'Truthful Hyperbole'

    Trump defended his use of what he called "truthful hyperbole" in his 1987 book "The Art of the Deal," calling it an "innocent form of exaggeration."

    "People may not always think big themselves, but they can still get very excited by those who do," Trump wrote. "People want to believe that something is the biggest and the greatest and the most spectacular."

    Wittingly or not, Trump has taken to a number that comes up often in history, religion and culture.

    The army of the Ten Thousand marched against Artaxerxes II of Persia. During the conquest of Mecca, Muhammad was said to have 10,000 soldiers. The King James Bible has dozens of references to 10,000. Minnesota's nickname is the Land of 10,000 Lakes. A television game show called "The $10,000 Pyramid" debuted in the U.S. in the early 1970s.

    But Trump's references typically are rooted in current affairs.

    The president used the number in July to talk about attendance at a North Carolina rally where his supporters chanted "Send her back!" after he invoked the name of Representative Ilhan Omar, a Minnesota Democrat.

    "We had thousands and thousands of people that wanted to come, and we said, 'Please don't come,'" Trump said. "It held 10,000 people. It was packed. We could've sold that arena 10 times."

    Authorities said 8,000 people got into the arena in Greenville, filling it to capacity, according to WITN-TV in North Carolina. About 2,000 were denied entry and between 750 and 1,000 were in an overflow area, the station said, citing police estimates.

    Booing Ryan

    In July, Trump used the number to attack former House Speaker Paul Ryan after the Wisconsin Republican was quoted in a book saying the president doesn't know how government works.

    "I remember a day in Wisconsin -- a state that I won -- where I stood up and made a speech, and then I introduced him and they booed him off the stage -- 10,000 people," Trump told reporters at the White House.

    The president appeared to be referring to a December 2016 post-election rally in West Allis, Wisconsin, where he publicly thanked Ryan, who was in the crowd. Audible, but not deafening, boos were heard as Trump tried to quiet his supporters by telling them that Ryan had improved "like a fine wine."

    Then there's job creation -- a Cameron LNG liquefied natural gas export facility in Louisiana or an Intel Corp. semiconductor plant in Arizona.

    In separate statements, Trump said they'd each create 10,000 jobs.

    Bringing Credibility

    Whether Trump's use of the number is accurate or not, the specificity can bring credibility to the president's claims, said Manoj Thomas, a behavioral scientist and marketing professor at Cornell University's SC Johnson College of Business.

    "Using a number to quantify a claim -- even implausible numbers -- makes it more credible because numbers are concrete," Thomas said. "Claims without any numbers, for example, 'The Dow would be much higher if not for the trade war,' are more difficult for the human mind to instinctively process because the information is abstract and lacks specificity."

    Trump could add even more credibility to his claim by making the number even more specific, Thomas said.

    For instance, Thomas suggested: "The Dow would be 4,600 points higher if not for the trade war."


    Reply Saturday, September 07, 2019 at 09:44 AM

    [Sep 07, 2019] People familiar with Chinese economic policymaking have said in recent weeks that Chinese leaders remain interested in reaching a trade deal with the United States, but that they are wary of what appear to be ever-increasing demands from the United States and what they describe as frequent shifts in the American negotiating position.

    Sep 07, 2019 | economistsview.typepad.com

    Fred C. Dobbs , September 05, 2019 at 03:49 PM

    Markets Soar on News of China Talks, but Hopes
    for Progress Are Low https://nyti.ms/2LrdVwH
    NYT - Ana Swanson and Matt Phillips - September 5

    WASHINGTON -- President Trump's decision to renew talks with China in the coming weeks sent financial markets soaring on Thursday, as investors seized on the development as a sign that both sides could still find a way out of an economically damaging trade war.

    The rally sent the S&P 500 up more than 1 percent, underscoring just how much financial markets are subsisting on hopes and fears about the trade war. Shares fell through most of August, as Mr. Trump escalated his fight with China and imposed more tariffs, only to snap back on Thursday after news of the talks.

    But expectations for progress remain low, and many in the United States and China see the best outcome as a continued stalemate that would prevent a collapse in relations before the 2020 election. Both Mr. Trump and President Xi Jinping of China are under pressure from domestic audiences to stand tough, and the talks will happen after Mr. Trump's next round of punishing tariffs take effect on Oct. 1.

    "Continuing to talk soothes markets a little bit," said Eswar Prasad, the former head of the China division at the International Monetary Fund. "But the political cost to making major concessions is, I think, too high for either side."

    The skepticism stems in part from what is emerging as a familiar pattern for Mr. Trump, for whom China is both a source of leverage and a potential vulnerability heading into an election year. The president has so far imposed tariffs on more than $350 billion worth of Chinese goods and routinely shifts from blasting China and threatening additional punishment to trying to calm the waters in the face of jittery markets and negative economic news.

    Over two weeks, Mr. Trump has called Mr. Xi an enemy of America, ordered companies to stop doing business in China and suggested the United States was in no rush to reach a trade deal. On Sunday, he moved ahead with his threat to eventually tax every golf club, shoe and computer China sends into the United States, placing tariffs on another $112 billion of Chinese goods.

    Stock investors have zeroed in on the threat the trade war poses to the economy, buying and selling in tandem with Mr. Trump's trade whims. Thursday's rally was the fifth positive performance for the market in the past six sessions. It brought the S&P 500 to within striking distance -- less than 2 percent -- of its high of 3025.86, reached on July 26.

    The coming weeks could result in more of the same, analysts say: tough words when the president wants to rally his base and a temporary cooling off when it seems to be hurting an economy that is one of his main arguments for re-election.

    Mr. Trump and his advisers are wary of a potential challenge from Democrats who will try to paint the president as weak on China. Officials are cognizant that striking a deal based on the kind of limited concessions China is currently offering would most likely be a political liability in the president's bid for re-election. Democrats, along with some Republicans, have previously accused Mr. Trump of buckling on China after he reached a deal that allowed ZTE, the Chinese telecom company, to avoid tough American punishment.

    Yet as collateral damage from the trade war increases, Mr. Trump is facing pressure to relent. The bond market has been flashing warning signs of a potential recession, and both consumer confidence and the manufacturing sector have slowed.

    The trade war is also clearly weighing on the Chinese economy, which is growing at its slowest pace in more than two decades. But China has responded defiantly, imposing retaliatory tariffs on $75 billion worth of American goods. The country is preparing to celebrate the 70th anniversary of its founding on Oct. 1, and analysts say Beijing would be unlikely to make concessions at such a politically delicate moment.

    People familiar with Chinese economic policymaking have said in recent weeks that Chinese leaders remain interested in reaching a trade deal with the United States, but that they are wary of what appear to be ever-increasing demands from the United States and what they describe as frequent shifts in the American negotiating position.

    The Chinese government continues to insist that it will not accept any agreement that is unequal, or that prevents it from pursuing economic policies that it needs for continued growth.

    While both countries have motivation to come to an agreement, each is still insisting the other will be the first to bend.

    "China and the US announced new round of trade talks and will work to make substantial progress," Hu Xijin, the editor of the state-run Global Times, wrote on Twitter. "Personally I think the US, worn out by the trade war, may no longer hope for crushing China's will. There's more possibility of a breakthrough between the two sides." ...

    [Sep 03, 2019] Wallerstein on China

    Notable quotes:
    "... Can China then depend on widening internal demand to maintain its global edge? There are two reasons why not. The present authorities worry that a widening middle stratum could jeopardize their political control and seek to limit it.[a] ..."
    "... The second reason, more important, is that much of the internal demand is the result of reckless borrowing by regional banks, which are facing an inability to sustain their investments. If they collapse, even partially, this could end the entire economic edge[b] of China. ..."
    Sep 03, 2019 | www.nakedcapitalism.com

    From Wallerstein's site, " What About China? " (2017):

    A structural crisis is chaotic. This means that instead of the normal standard set of combinations or alliances that were previously used to maintain the stability of the system, they constantly shift these alliances in search of short-term gains. This only makes the situation worse. We notice here a paradox – the certainty of the end of the existing system and the intrinsic uncertainty of what will eventually replace it and create thereby a new system (or new systems) to stabilize realities .

    Now, let us look at China's role in what is going on. In terms of the present system, China seems to be gaining much advantage. To argue that this means the continuing functioning of capitalism as a system is basically to (re)assert the invalid point that systems are eternal and that China is replacing the United States in the same way as the United States replaced Great Britain as the hegemonic power. Were this true, in another 20-30 years China (or perhaps northeast Asia) would be able to set its rules for the capitalist world-system.

    But is this really happening? First of all, China's economic edge, while still greater than that of the North, has been declining significantly. And this decline may well amplify soon, as political resistance to China's attempts to control neighboring countries and entice (that is, buy) the support of faraway countries grows, which seems to be occurring.

    Can China then depend on widening internal demand to maintain its global edge? There are two reasons why not. The present authorities worry that a widening middle stratum could jeopardize their political control and seek to limit it.[a]

    The second reason, more important, is that much of the internal demand is the result of reckless borrowing by regional banks, which are facing an inability to sustain their investments. If they collapse, even partially, this could end the entire economic edge[b] of China.

    In addition, there have been, and will continue to be, wild swings in geopolitical alliances. In a sense, the key zones are not in the North, but in areas such as Russia, India, Iran, Turkey, and southeastern Europe, all of them pursuing their own roles by a game of swiftly and repeatedly changing sides. The bottom line is that, though China plays a very big role in the short run, it is not as big a role as China would wish and that some in the rest of the world-system fear. It is not possible for China to stop the disintegration of the capitalist system. It can only try to secure its place in a future world-system.

    As far as Wallerstein's bottom line: The proof is in the pudding. That said, there seems to be a tendency to regard Xi as all-powerful. IMNSHO, that's by no means the case, not only because of China's middle class, but because of whatever China's equivalent of deplorables is. The "wild swings in geopolitical alliances" might play a role, too; oil, Africa's minerals.

    NOTES [a] I haven't seen this point made elsewhere. [b] Crisis, certainly. "Ending the entire economic edge"? I'm not so sure.

    [Aug 27, 2019] Trump s China Trade War Gaslighting Will There Eveh Be a Deal

    Notable quotes:
    "... That assumption looks to be incorrect. New Deal Democrat sent us the latest post from China Law Blog, written by lawyers who specialize in Chinese law with an eye to helping businesses get set up and operate in China. The post by Dan Harris is every bit as firm as its headline: Repeat After Me: There Will be No US-China Trade Deal . It also contains a good summary of key developments and detail on the various goods targeted. Key sections: ..."
    "... But what should you make of President Trump's ordering US companies to immediately start looking for an alternative to China? He can't really do that, can he? No, but in many respects this is exactly what Trump has been doing since the U.S.-China trade war began. Trump cannot literally require American companies to pull out of China, but he can and has made it so difficult that they all but have to leave China. And this is what most of the international lawyers and international trade lawyers at my firm have come to believe has been Trump's plan all along. ..."
    "... Every step of the way, Trump has made it all but impossible for China to make a trade deal with the United States, which is why this blog has been consistently clear that there will be no trade deal between the United States and China . If the US-China trade war/cold war were really about trade imbalances, it would have ended long ago with China buying more soybeans and Boeing airplanes from the United States. But from the very beginning, the U.S. has demanded China stop stealing IP and open its markets for foreign companies, and there is just no way China will agree to either of these things. Lead negotiator Robert Lighthizer is without a doubt smart enough to have known this all along. All this leads us to believe that the U.S. plan has always been to force a slow decoupling of the U.S. and China and then work to convince the rest of the democratic world (the EU, Australia, Canada, Latin America, Japan, etc.) to decouple from China, as well. In June, in Does China WANT a Second Decoupling? The Chinese Texts Say That it Does we wrote of how China wants this decoupling, as well. ..."
    "... The fact that Trump issues this "order" amidst rising recession fears only highlights how ending U.S.-China trade is at the top of his to-do list. ..."
    "... The critical part of the China Law Blog's reading is that the Trump Administration is deadly serious about its two big asks, intellectual property and market access. It's credible to attribute that to Trump's US Trade Representative, Lighthizer. As Lambert put it, Lighthizer is the closest thing this Administration has to a Jim Baker. Lighthizer started at Covington & Burling, then served in the Regan Administration as Deputy USTR before going to Skadden. Lighthizer is as fierce a China hawk as they come and has a long history of saying that the entry of China into the WTO was at the expense of US jobs (see here , for instance) and even making a full-throated defense of protectionism . ..."
    "... In April, China made a concession to the US by designating all fetanyl products as controlled substances, in the hope that that would reduce shipments to the US. The DEA has stated that China is the main source of US fentanyl . Fentanyl accounted 18,000 overdose deaths in 2018, one fourth of the total. If you count all synthetic opioids, the toll rises to 28,000. China nevertheless claimed even then that fentanyl shipments to the US were "extremely limited" . ..."
    "... Fentanyl featured in the escalation on Friday, and it could conceivably serve as the basis for a national emergency threat (even though, per the discussion earlier, it would have good odds of being overturned). One of Trump's four tweets urged US carriers to do more to halt shipments arriving from China or other destinations (Mexico is believed to be a route for the entry of Chinese fentanyl to the US). ..."
    "... In May I had a conversation with a long-time friend. My friend works for a global manufacturer with a household name. He has helped oversee construction of plants around the world. He helps source components from around the world. He told me that "everybody's moving out" (of China). ..."
    "... A few short years ago they had the Trans-Pacific Partnership being negotiated. This was nicknamed the "everybody but China" pact as that was its mission – to cut China out of the Pacific. Add to that the "Pivot to Asia" introduced by Obama which was to militarily threaten China and the writing was on the wall for China. They were to be boxed in and shut down. Trump may be the front man now for this effort but all the China-hawks have come out of the woodwork to be let loose in the government. ..."
    "... I suppose that the plan is to force US companies to bail out of China and relocate to places like Vietnam, India, Bangladesh, etc. But the question is whether these countries have the infrastructure to support these new factories? ..."
    "... I have mentioned before the idea of a multipolar world and I believe that we re seeing it now in action. The US and its vassals will be one pole and another one is forming around China, Iran and Russia. I doubt that the EU will be another as they are following what Trump orders even if reluctantly. There may be another factor. For centuries we have had an economy predicated on growth but I suspect that by the end of this century will will have one based on contraction due to climate change and depletion of resources. Better strap in. It could be a bumpy ride. ..."
    Aug 26, 2019 | www.nakedcapitalism.com

    Trump has been up to what he seems to like to do best: whipsawing those who might be affected by his plans. On Friday, he put Mr. Market and huge swathes of Corporate America in a tizzy by retaliating against China's tariff increases. China announced that it would impose new tariffs on $75 billion of US goods and the restart of tariffs on autos and auto parts. Trump tweeted that he would increase tariffs on Chinese goods already subject to tariffs: the $250 billion at 25% would go to 30% on October 1and the $300 billion at 10% would go to 15% in phases, on September 1 and December 1. Trump also "hereby ordered" US companies to pull out of China, suggesting that he'd rely on the International Emergency Economic Powers Act of 1977.

    Then, as most of you have likely heard, Trump made remarks at the G-7 summit that we widely interpreted as an indicator that he'd back off again, by admitting to regrets about how the trade spat was going. When the press took up that line, Trump doubled down, with the White House releasing a statement that Trump's sole regret was not raising tariffs higher.

    Needless to say, the all-too-typical Trump to-ing and fro-ing made for an easy target. From the Washington Post :

    Former treasury secretary Lawrence Summers, a veteran of the Clinton and Obama administrations, said the White House's conflicting statements were just the latest in a string of mixed messages that had made it impossible for people to understand its agenda.

    "Deeply misguided policy and strategy has been joined for some time by dubious negotiating tactics, with promises not kept and threats not carried out on a regular basis," Summers said in an interview. "We are at a new stage now with very erratic presidential behavior and frequent denials of obvious reality. I know of no U.S. historical precedent."

    And despite rousing himself to make a show of his resolve, the Administration did back down on one part of Trump's Friday missives, that of "ordering" US companies to get out of Dodge, um, China. From the Wall Street Journal :

    Aides to President Trump said Sunday he has no plans to invoke emergency powers and force companies to relocate operations from China

    "What he is suggesting to American businesses," [economic adviser] Mr. [Larry] Kudlow said, is that "you ought to think about moving your operations and your supply chains away from China and secondly, we'd like you to come back home."

    Treasury Secretary Steven Mnuchin also weighed in, telling "Fox News Sunday" that the president didn't have plans to invoke emergency powers to force U.S. companies out of China.

    "I think what he was saying is he's ordering companies to start looking," Mr. Mnuchin said."

    The Journal also pointed out that Trump might have trouble forcing companies to exit:

    Both Messrs. Mnuchin and Kudlow said that the president could theoretically force U.S. companies to leave China by invoking a law known as the International Emergency Economic Powers Act of 1977, or IEEPA .

    According to the Congressional Research Service, IEEPA can be used to deal with "any unusual and extraordinary threat" outside the U.S. "to the national security, foreign policy or economy of the United States, if the president declares a national emergency with respect to such threat."

    The president is required "in every possible instance" to consult with Congress before exercising authorities granted by IEEPA, and to specify in a report to lawmakers why the circumstances constitute a threat and why the actions are necessary, CRS said in a briefing paper on the law issued earlier this year. The president must submit follow-up reports every six months .

    Rod Hunter, a partner at Baker McKenzie and expert on international trade, said Mr. Trump could declare a state of emergency and issue the order, but that doesn't mean it will stand.

    "Congress could effectively override such a decision, and private parties would certainly challenge the action as an unconstitutional takings, a violation of due process rights and beyond the statutory authority granted to the president by Congress," Mr. Hunter said in an email.

    Mind you, just like Brexit, there is a way to do what Trump wants to do that would not be so destructive and shambolic. Trump's China policy appears to be intended to make American more economically self-sufficient so as to improve the prosperity of US workers, as well as curb a competing imperialist.

    But as we've described at some length in earlier posts, restoring America's manufacturing capabilities isn't just a matter of weaning itself off cheap Chinese imports. The US has ceded a tremendous amount of know-how, from the factory floor on up. Getting that back is a generation-long undertaking, requiring commitment to a national strategy that would include significant government investment in fundamental research, renewed emphasis on education, including much cheaper higher education and vocational training for those that aren't suited or inclined to go to college, and a reorientation of government spending and subsidies to favor productive sectors over the connected. Not only would it be difficult to get any Administration to embrace open industrial policy, particularly one that would break a lot of rice bowls (such as in our hugely wasteful arms industry and our bloated financial sector), maintaining it beyond even a two-term Presidency would be an even taller order.

    But where is the Trump tariff cage match likely to wind up? Given how often Trump has backed off when Mr. Market has had a hissy, most commentator appear to have assumed before Friday's tit for tat that Trump would back down, if nothing else, in the form of allowing a lot of exceptions, and the US and China would find a way for Trump to get enough concessions from China that he could declare peace with honor.

    That assumption looks to be incorrect. New Deal Democrat sent us the latest post from China Law Blog, written by lawyers who specialize in Chinese law with an eye to helping businesses get set up and operate in China. The post by Dan Harris is every bit as firm as its headline: Repeat After Me: There Will be No US-China Trade Deal . It also contains a good summary of key developments and detail on the various goods targeted. Key sections:

    The US-China Trade War Is and Will be the New Normal

    I hate to say we told you so, but for nearly a year, WE TOLD YOU SO. Since October, 2018 we have been all but screaming at anyone and everyone who has product made in China and sold into the United States to get out of China fast, if at all possible. We say this and we set out the below timeline to prove this not so much to show that we have been right all along, but to try to convince you that we are right when we now say there will be no resolution to the US-China trade war for a very long time and you need to act accordingly.

    The below is our timeline/proof of our having predicted a straight-line decline in US-China trade relations

    But what should you make of President Trump's ordering US companies to immediately start looking for an alternative to China? He can't really do that, can he? No, but in many respects this is exactly what Trump has been doing since the U.S.-China trade war began. Trump cannot literally require American companies to pull out of China, but he can and has made it so difficult that they all but have to leave China. And this is what most of the international lawyers and international trade lawyers at my firm have come to believe has been Trump's plan all along.

    Every step of the way, Trump has made it all but impossible for China to make a trade deal with the United States, which is why this blog has been consistently clear that there will be no trade deal between the United States and China . If the US-China trade war/cold war were really about trade imbalances, it would have ended long ago with China buying more soybeans and Boeing airplanes from the United States. But from the very beginning, the U.S. has demanded China stop stealing IP and open its markets for foreign companies, and there is just no way China will agree to either of these things. Lead negotiator Robert Lighthizer is without a doubt smart enough to have known this all along. All this leads us to believe that the U.S. plan has always been to force a slow decoupling of the U.S. and China and then work to convince the rest of the democratic world (the EU, Australia, Canada, Latin America, Japan, etc.) to decouple from China, as well. In June, in Does China WANT a Second Decoupling? The Chinese Texts Say That it Does we wrote of how China wants this decoupling, as well.

    This latest Trump "order" does not have the force of law, so in that respect it is not an order at all. But in most other respects it is. This order indicates Trump's passionate desire to rid the United States of what he sees as the China scourge . More importantly, it is yet another clear signal that he will continue to escalate this war with China until such time as he considers the United States to be victorious. The fact that Trump issues this "order" amidst rising recession fears only highlights how ending U.S.-China trade is at the top of his to-do list.

    So in terms of what this means for your business, it means that you must stop believing there will be a solution to the trade war that will allow you to go back to doing business with China the way you used to do business with China. You need to instead recognize that this situation is the New Normal as between the United States and China and that, if anything, things are way more likely to get worse than they are to get better.

    I'm persuaded by this point of view because these writers have adopted the perspective that we've found to be very useful in other geopolitical negotiations, which is to look at the bargaining position of both sides and see if there is any overlap. If there isn't, there won't be an agreement unless one of both parties makes a significant concession.

    One reason that other observers have likely missed what the China Law Blog discern is that there's an Anglo-American tendency to assume that differences can be settled and a deal can be had. But as Sir Ivan Rogers pointed out with Brexit, and you have similar dynamics with the US and China, there aren't precedents for trade deals where the two sides want to get further apart rather than closer. Sir Ivan is of the point of view that the desire to disengage makes it much harder to come to terms.

    The critical part of the China Law Blog's reading is that the Trump Administration is deadly serious about its two big asks, intellectual property and market access. It's credible to attribute that to Trump's US Trade Representative, Lighthizer. As Lambert put it, Lighthizer is the closest thing this Administration has to a Jim Baker. Lighthizer started at Covington & Burling, then served in the Regan Administration as Deputy USTR before going to Skadden. Lighthizer is as fierce a China hawk as they come and has a long history of saying that the entry of China into the WTO was at the expense of US jobs (see here , for instance) and even making a full-throated defense of protectionism .

    A part of the trade spat that hasn't gotten the attention it warrants and seems to confirm the China Law Blog's thesis is the arm-wrestling over China's fetanyl exports to the US. It's not hard to see that this is an inherently important issue, since as I understand it, fentanyl is so potent that it is very easy to overdose on it, making it markedly more dangerous than other addictive drugs. In other words, the high death rate of fentanyl may make reducing supply a more effective strategy than it normally is in "the war on drugs". Substitution with just about any other controlled substance would be less dangerous. And if Trump were to make a dent in this problem, it would serve as a PR offset to some of the costs of his China strategy, like lost soyabean exports.

    In April, China made a concession to the US by designating all fetanyl products as controlled substances, in the hope that that would reduce shipments to the US. The DEA has stated that China is the main source of US fentanyl . Fentanyl accounted 18,000 overdose deaths in 2018, one fourth of the total. If you count all synthetic opioids, the toll rises to 28,000. China nevertheless claimed even then that fentanyl shipments to the US were "extremely limited" .

    On August 2, Trump said Xi had welshed on his promise to halt fentanyl shipments . China objected, saying it had made "unprecedented efforts" and the US was to blame for its opioid crisis. On August 21, the US sanctioned three Chinese individuals it depicted as drug kingpins, eliciting more unhappy noises from China.

    Fentanyl featured in the escalation on Friday, and it could conceivably serve as the basis for a national emergency threat (even though, per the discussion earlier, it would have good odds of being overturned). One of Trump's four tweets urged US carriers to do more to halt shipments arriving from China or other destinations (Mexico is believed to be a route for the entry of Chinese fentanyl to the US).

    In other words, it's not clear where this row ends, but there doesn't seem to be a path to depressurization, much the less resolution.

    Update 5:00 AM EDT: Just as this post went live, the Wall Street Journal reported Trump Says China Called U.S. to 'Get Back to the Table' After Latest Tariff Spat . Trump is still hostage to Mr. Market, so it's awfully useful for him to talk up negotiations. From the story:

    President Trump said China called U.S. officials on Sunday evening and said "let's get back to the table," a day after the White House said the president regretted not escalating tariffs further on Chinese goods.

    Speaking to reporters alongside Egyptian President Abdel Fattah Al Sisi, Mr. Trump called the discussions a "very positive development." .

    The Chinese government didn't immediately respond to Mr. Trump's remarks or to requests to corroborate the president's account of a phone call having taken place. Chinese government officials have repeatedly said that Beijing wants to negotiate differences on trade. On Monday, Beijing's lead trade negotiator, Vice Premier Liu He, told a conference that China still wants to continue trade talks with the U.S. following heightened tensions in the past few days.


    DSB , August 26, 2019 at 8:58 am

    In May I had a conversation with a long-time friend. My friend works for a global manufacturer with a household name. He has helped oversee construction of plants around the world. He helps source components from around the world. He told me that "everybody's moving out" (of China).

    The ones who can have not waited for Trump's message of Friday.

    The Rev Kev , August 26, 2019 at 9:09 am

    A few short years ago they had the Trans-Pacific Partnership being negotiated. This was nicknamed the "everybody but China" pact as that was its mission – to cut China out of the Pacific. Add to that the "Pivot to Asia" introduced by Obama which was to militarily threaten China and the writing was on the wall for China. They were to be boxed in and shut down. Trump may be the front man now for this effort but all the China-hawks have come out of the woodwork to be let loose in the government.

    I suppose that the plan is to force US companies to bail out of China and relocate to places like Vietnam, India, Bangladesh, etc. But the question is whether these countries have the infrastructure to support these new factories? Do they have a trained, educated workforce to man these factories? Is there a will to move to such places? As far as those countries are concerned, these new companies could be seen as a two-edged sword. Yes they will bring investment and opportunities in those countries. But how will they know if a Trump or someone like him later on will not order those factories out if there is a dispute or if the US demands that those countries change their laws and open themselves up to financial exploitation? Trump is demanding the same of China right now. And will Trump demand that all the other western countries move out of China?

    I have mentioned before the idea of a multipolar world and I believe that we re seeing it now in action. The US and its vassals will be one pole and another one is forming around China, Iran and Russia. I doubt that the EU will be another as they are following what Trump orders even if reluctantly. There may be another factor. For centuries we have had an economy predicated on growth but I suspect that by the end of this century will will have one based on contraction due to climate change and depletion of resources. Better strap in. It could be a bumpy ride.

    Susan the other` , August 26, 2019 at 11:45 am

    This is all pretty interesting. More theater than trade. And the reason is that there is no demand. Demographics has a lot to do with it as well. It might not make any difference now how much a company can cut costs by moving to SE Asia because nobody will be very eager to buy more crap anyway. And manufacturing cannot up and move cheaply if they have to reinvent and retool their processes to make them more environmentally acceptable. It's a sea change. And a tap-dance.

    Ian Perkins , August 26, 2019 at 9:18 am

    According to this article," The DEA has stated that China is the main source of US fentanyl. " I followed the link, and found "The DEA has said China is a main source of fentanyl and other synthetic opioids." Which I take as meaning that even if the US could totally shut down Chinese synthetic opioid production, someone will still be making and supplying it.

    grizziz , August 26, 2019 at 11:42 am

    So, if the facts as given above are reconfigured, all it would take is for the Chinese producers of synthetic opioids to pay the US patent holders their due. Problem solved! All kidding aside, the demands to get intellectual property paid for requires a very pliant judicial system to actually recognize that an idea should be rightfully owned by a person.

    Individual agency is a product of 'enlightenment' thinking which opened the pathway for an idea to be the creation of a person who willed the idea into existence. A few steps later, a corporation becomes a person and then a group of people can somehow own a single idea and be able to rent that idea out. To think that the Chinese would accept this cockamamie/historically embedded/English common law idea would be to deny their own culturally based motivated reasoning.

    I don't know how this situation will be resolved, but it is quite laughable that the diversion through tariffs of IP revenues which in US legal logic should be paid to Corporations is actually going to go to the US Treasury.

    Ptb , August 26, 2019 at 9:46 am

    "All this leads us to believe that the U.S. plan has always been to force a slow decoupling of the U.S. and China and then work to convince the rest of the democratic world (the EU, Australia, Canada, Latin America, Japan, etc.) to decouple from China, as well"

    That is about right, and I do not doubt that this is the desire of Trump's negotiating team. Nor do I doubt that they can easily steer talks to fail as described (by asking for concessions on market access favorable to the US side, AND by refusing to back down on Huawei etc).

    However, while effectively forcing a decoupling of China and US is straightforward, controlling its speed is not. Pull the plug too fast (which China can threaten to accelerate), and some big US companies eat it. While Lighthizer and friends may be willing to pay that price, it will make a lot of others very nervous.

    Then, perhaps more importantly, is forcing the rest of the world to follow suit (or else there is no point). JP, ROK, DE (the high tech suppliers besides US) all trade at least as much with China as US. The world market buying Chinese made goods is also bigger than the US. It would take some skillful diplomacy to make it happen. This is not only beyond the level of the Trump admin, but I would say all US administrations since the year 2000, with the Iran deal maybe the only exception I can think of.

    China will end up defending itself by getting the overly aggressive and self-discrediting Team Trump reelected. By openly provoking a small proxy conflict for example. Trump gets to do his Ronald Reagan act, which is what his audience wants. It will be a weird political symbiosis. (an oversized personality can't survive without a suitably inflated enemy, and Joe Biden is no Hillary Clinton. The media will play along – such drama is the only thing keeping them in business now.)

    Anyway, if there is a counterbalancing force to prevent this, I would think it is wall street.

    Frank Little , August 26, 2019 at 10:04 am

    Apparently the US federal workers pension plan has started investing in index funds which include some Chinese companies that have been in Trump & Co's target list. From the FT this morning:

    The letter -- a copy of which was seen by the Financial Times -- said an impending investment shift by the FRTIB would mean that about $50bn in US government pensions becomes exposed to the "severe and undisclosed" risks of being invested in selected Chinese companies.

    The letter, dated August 26, was copied to senior US officials including Mike Pompeo, US secretary of state, and Steven Mnuchin, Treasury secretary.

    "The Federal Retirement Thrift Investment Board made a short-sighted -- and foolish -- decision to effectively fund the Chinese government and Communist party's efforts to undermine US economic and national security with the retirement savings of members of the US Armed Services and other federal employees," Mr Rubio told the Financial Times.

    One thing I remember from early on in this dispute was the US wanting more opportunities to invest in the Chinese market beyond just exports/manufacturing. If pension funds are getting involved I would think that private investors would like to do the same thing, which would make long-term decoupling more difficult, especially if US businesses also want to sell things to people in China even if those things are made elsewhere.

    As always your post was very informative and helpful and I certainly believe that pulling the US out of China is the goal of this whole trade dispute. I just wonder if things like this will put a damper on their plans.

    [Aug 26, 2019] China Did Not Trick the US -- Trade Negotiators Served Corporate Interests

    Aug 19, 2019 | economistsview.typepad.com

    anne , August 23, 2019 at 12:37 PM

    http://cepr.net/publications/op-eds-columns/china-did-not-trick-the-us-trade-negotiators-served-corporate-interests

    August 19, 2019

    China Did Not Trick the US -- Trade Negotiators Served Corporate Interests
    By Dean Baker

    The New York Times ran an article * last week with a headline saying that the 2020 Democratic presidential contenders faced a serious problem: "how to be tougher on trade than Trump." Serious readers might have struggled with the idea of getting "tough on trade." After all, trade is a tool, like a screwdriver. Is it possible to get tough on a screwdriver?

    While the Times's headline may be especially egregious, it is characteristic of trade coverage which takes an almost entirely Trumpian view of the topic. The media portray the issue of some countries, most obviously China, benefiting at the expense of the United States. Nothing could be more completely at odds with reality.

    China has a huge trade surplus with the United States, about $420 billion (2.1 percent of GDP) as of 2018. However, this doesn't mean that China is winning at the expense of the United States and because of "stupid" trade negotiators, as Trump puts it.

    The U.S. trade deficit with China was not an accident. Both Republican and Democratic administrations signed trade deals that made it easy to manufacture goods in China and other countries, and then export them back to the United States.

    In many cases, this meant that large U.S. corporations, like General Electric and Boeing, outsourced parts of their operations to China to take advantage of low-cost labor there. In other cases, retailers like Walmart set up low-cost supply chains so that they could undercut their competitors in the U.S. market.

    General Electric, Boeing, Walmart and the rest did not lose from our trade deficit with China. In fact, the trade deficit was the result of their efforts to increase their profits. They have little reason to be unhappy with the trade deals negotiated over the last three decades.

    It is a very different story for workers in the United States. As a result of the exploding trade deficit, we lost 3.4 million manufacturing jobs between 2000 and 2007, 20 percent of the workers in the sector. This is before the collapse of the housing bubble led to the Great Recession. We lost 40 percent of all unionized jobs in manufacturing.

    This job loss not only reduced the pay of manufacturing workers, but as these displaced workers flooded into other sectors, it put downward pressure on the pay of less-educated workers generally. This is a pretty awful story, but it is not a story of China tricking our so-called stupid negotiators; it is a story of smart negotiators who served well the interest of corporations.

    For some reason, the media always accept the Trumpian narrative that the large trade deficits the U.S. runs with China (and most of the rest of the world) were the result of other countries outsmarting our negotiators, or at least an accidental result of past trade deals. The media never say that large trade deficits were a predictable outcome of a trade policy designed to serve the wealthy.

    The fact that trade is a story of winners and losers within countries, rather than between countries, is especially important now that our trade conflicts are entering a new phase, especially with China. While not generally endorsing Trump's reality TV show tactics, most reporting has taken the position that "we" in the U.S. have genuine grounds for complaint with China.

    The complaints don't center on the under-valuation of China's currency, which is a problem for manufacturing workers. Rather, the issue that takes center stage is the supposed theft by China of our intellectual property.

    While this sort of claim is routinely asserted, the overwhelming majority of people in the United States have never had any intellectual property stolen by China. It is companies like Boeing, GE, Pfizer and Merck that are upset about China not respecting their patent and copyright claims, and they want the rest of us to have a trade war to defend them.

    If the goals of trade policies were put to a vote, these companies would be hugely outnumbered. However, they can count on the strong support of the media in both the opinion pages, and more importantly, the news pages. The issue is entirely framed in their favor, and dissenting voices are as likely to be heard as in the People's Republic of China.

    There is a lot at stake in preserving the myth that ordinary workers were hurt as just an accidental byproduct of globalization. The story is that it just happens to be the case that hundreds of millions of people in the developing world are willing to do the same work as our manufacturing workers for a lot less money.

    Yes, the loss of millions of manufacturing jobs is a sad story, but is just part of the picture. There are also millions of smart ambitious people in the developing world who are willing to do the same work as our doctors, dentists, lawyers and other professions for a lot less money.

    But the people who design trade policy have made sure that these people don't have the opportunity to put the same downward pressure on our most highly paid workers, as did their counterparts working in families. And, for what it's worth, the trade model works the same when we're talking about doctors as manufacturing workers. Less pay for U.S. doctors means lower cost health care, just as lower pay for textile workers means cheaper clothes.

    The key point is that winners in the global economy, along with the big corporations, got their good fortune because they rigged the process, not because of anything inherent in the nature of globalization. (This is the point of my book Rigged: How the Rules of Globalization and the Modern Economy Were Structured to Make the Rich Richer. ** )

    On this basic point, the media have no more interest in truth than Donald Trump. Hence, we can expect further media parroting about being "tough" on trade.

    * https://www.nytimes.com/2019/08/10/us/politics/democrats-trade-trump.html

    ** https://deanbaker.net/images/stories/documents/Rigged.pdf

    [Aug 26, 2019] China's response so far has been fairly modest and measured, at least considering the situation

    Notable quotes:
    "... Still, even if Trump isn't making sense, will China give in to his demands? The short answer is, "What demands?" Trump mainly seems exercised by China's trade surplus with America, which has multiple causes and isn't really under the Chinese government's control. ..."
    "... Others in his administration seem concerned by China's push into high-technology industries, which could indeed threaten U.S. dominance. But China is both an economic superpower and relatively poor compared with the U.S.; it's grossly unrealistic to imagine that such a country can be bullied into scaling back its technological ambitions ..."
    "... Which brings us to the question of how much power the U.S. really has in this situation. ..."
    "... So while Trump's tariffs certainly hurt the Chinese, Beijing is fairly well placed to counter their effects. China can pump up domestic spending with monetary and fiscal stimulus; it can boost its exports, to the world at large as well as to America, by letting the yuan fall. ..."
    "... At the same time, China can inflict pain of its own. It can buy its soybeans elsewhere, hurting U.S. farmers. As we saw this week, even a mostly symbolic weakening of the yuan can send U.S. stocks plunging. ..."
    "... And America's ability to counter these moves is hindered by a combination of technical and political factors. The Fed can cut rates, but not very much given how low they are already. We could do a fiscal stimulus, but having rammed through a plutocrat-friendly tax cut in 2017, Trump would have to make real concessions to Democrats to get anything more -- something he probably won't do. ..."
    "... So Trump is in a much weaker position than he imagines, and my guess is that China's mini-devaluation of its currency was an attempt to educate him in that reality. But I very much doubt he has learned anything. His administration has been steadily hemorrhaging people who know anything about economics, and reports indicate that Trump isn't even listening to the band of ignoramuses he has left. ..."
    Aug 26, 2019 | economistsview.typepad.com

    anne , August 23, 2019 at 12:38 PM

    https://www.nytimes.com/2019/08/08/opinion/trump-china-trade.html

    August 8, 2019

    China Tries to Teach Trump Economics
    But he doesn't seem to be learning.
    By Paul Krugman

    If you want to understand the developing trade war with China, the first thing you need to realize is that nothing Donald Trump is doing makes sense. His views on trade are incoherent. His demands are incomprehensible. And he vastly overrates his ability to inflict damage on China while underrating the damage China can do in return.

    The second thing you need to realize is that China's response so far has been fairly modest and measured, at least considering the situation. The U.S. has implemented or announced tariffs on virtually everything China sells here, with average tariff rates not seen in generations. The Chinese, by contrast, have yet to deploy anything like the full range of tools at their disposal to offset Trump's actions and hurt his political base.

    Why haven't the Chinese gone all out? It looks to me as if they're still trying to teach Trump some economics. What they've been saying through their actions, in effect, is: "You think you can bully us. But you can't. We, on the other hand, can ruin your farmers and crash your stock market. Do you want to reconsider?"

    There is, however, no indication that this message is getting through. Instead, every time the Chinese pause and give Trump a chance to rethink, he takes it as vindication and pushes even harder. What this suggests, in turn, is that sooner or later the warning shots will turn into an all-out trade and currency war.

    About Trump's views: His incoherence is on view almost every day, but one of his recent tweets was a perfect illustration. Remember, Trump has been complaining nonstop about the strength of the dollar, which he claims puts America at a competitive disadvantage. On Monday he got the Treasury Department to declare China a currency manipulator, which was true seven or eight years ago but isn't true now. Yet the very next day he wrote triumphantly that "massive amounts of money from China and other parts of the world is pouring into the United States," which he declared "a beautiful thing to see."

    Um, what happens when "massive amounts of money" pour into your country? Your currency rises, which is exactly what Trump is complaining about. And if lots of money were flooding out of China, the yuan would be plunging, not experiencing the trivial (2 percent) decline that Treasury condemned.

    Oh well. I guess arithmetic is just a hoax perpetrated by the deep state.

    Still, even if Trump isn't making sense, will China give in to his demands? The short answer is, "What demands?" Trump mainly seems exercised by China's trade surplus with America, which has multiple causes and isn't really under the Chinese government's control.

    Others in his administration seem concerned by China's push into high-technology industries, which could indeed threaten U.S. dominance. But China is both an economic superpower and relatively poor compared with the U.S.; it's grossly unrealistic to imagine that such a country can be bullied into scaling back its technological ambitions .

    Which brings us to the question of how much power the U.S. really has in this situation.

    America is, of course, a major market for Chinese goods, and China buys relatively little in return, so the direct adverse effect of a tariff war is larger for the Chinese. But it's important to have a sense of scale. China isn't like Mexico, which sends 80 percent of its exports to the United States; the Chinese economy is less dependent on trade than smaller nations, and less than a fifth of its exports come to America.

    So while Trump's tariffs certainly hurt the Chinese, Beijing is fairly well placed to counter their effects. China can pump up domestic spending with monetary and fiscal stimulus; it can boost its exports, to the world at large as well as to America, by letting the yuan fall.

    At the same time, China can inflict pain of its own. It can buy its soybeans elsewhere, hurting U.S. farmers. As we saw this week, even a mostly symbolic weakening of the yuan can send U.S. stocks plunging.

    And America's ability to counter these moves is hindered by a combination of technical and political factors. The Fed can cut rates, but not very much given how low they are already. We could do a fiscal stimulus, but having rammed through a plutocrat-friendly tax cut in 2017, Trump would have to make real concessions to Democrats to get anything more -- something he probably won't do.

    What about a coordinated international response? That's unlikely, both because it's not clear what Trump wants from China and because his general belligerence (not to mention his racism) has left America with almost nobody willing to take its side in global disputes.

    So Trump is in a much weaker position than he imagines, and my guess is that China's mini-devaluation of its currency was an attempt to educate him in that reality. But I very much doubt he has learned anything. His administration has been steadily hemorrhaging people who know anything about economics, and reports indicate that Trump isn't even listening to the band of ignoramuses he has left.

    So this trade dispute will probably get much worse before it gets better.

    Plp -> anne... , August 24, 2019 at 12:20 PM
    As dean points out Liberals aren't learning from Chinese policy triumphs either

    Denialism isn't just a reactionary character flaw

    Plp -> Plp... , August 24, 2019 at 12:21 PM
    Imagine communists party hacks running the most successful economic development op in human history
    point -> Plp... , August 24, 2019 at 07:00 PM
    but, but, that conclusion cannot be reached within the space spanned by our assumptions, therefore it cannot happen.
    point -> point... , August 25, 2019 at 04:49 AM
    :)
    ilsm -> anne... , August 25, 2019 at 08:15 AM
    Conscience of a "liberal"?

    ""You think you [Trump] can bully us [Xi]. But you can't. We, on the other hand, can ruin your farmers and crash your stock market. Do you want to reconsider?""

    Krugman is putting his "liberal" thinking in to Xi's mind.

    US farmers are the darling of the "liberal"? I suspect not so much unless to oppose Trump.

    To see the mechanism that China could crash the stock market requires some thinking.

    How could China do such a thing? Tariffs on $100B (in a $19,000B economy) in US exports is emotional to the exchanges. Dumping US debt would raise interest rates and make T Bills attractive over stocks, which is not a bad thing. The "liberals" know a 'deplorable' 36000 Dow is a dream. Then what does China do with all those USD?

    The issue is a lot of "liberals" do not want Trump to succeed in efforts to reverse the MNC expulsion of labor from the US to developing countries.

    I look forward to Trump asking the DNC select why he or she "wants Xi to win over labor in the US?"

    The underlying loser in the Trump scheme are the MNC's so will the DNC go all in for MNC's at the expense of the worker?

    Don't surprise me, none!

    Paine -> ilsm... , August 26, 2019 at 05:06 AM
    Trump has no considered
    long range plan
    Just goals and tactics
    Both chosen largely
    for show
    And ameroca's great white hero story line
    Paine -> Paine... , August 26, 2019 at 05:09 AM
    The MNCs are not losing

    It's global developments
    they watch emerge
    Largely
    Create and eclectically react to

    anne , August 23, 2019 at 12:41 PM
    https://glineq.blogspot.com/2019/08/nostalgia-for-past-that-never-was-part.html

    August 8, 2019

    Nostalgia for a past that never was; Part 1 review of Paul Collier's "The future of capitalism"

    Paul Collier's new book "The future of capitalism" is a very hard book to review. It is short (215 pages) but it covers an enormous area, from social and economic interpretation of the past seventy years in the West, to pleas for "ethical" companies, "ethical" families and even an "ethical" world, to a set of proposals for reform in advanced economies.

    The most uncharitable assessment would be to say that, at times, the book comes close (I emphasize "close") to nationalism, "social eugenics", "family values" of the moral majority kind, and conservativism in the literal sense of the word because it posits an idealized past and exhorts us to return there. But one could also say that its diagnosis of the current ills is accurate and remarkably clear-sighted. Its recommendations are often compelling, sophisticated and yet common-sensical.

    I have therefore decided to divide my review in two parts. In this part I will explain the points, mostly methodological and historical, on which I disagree with Collier. In the second part, I will discuss the diagnoses and recommendations on which I mostly agree.

    Pragmatism. Collier positions himself as a "pragmatist" battling both (1) ideologues: Utilitarians, Rawlsian (who are accused, somewhat strangely, of having introduced identity politics) and Marxists; and (2) populists who have no ideology at all but simply play on people's emotions. All three kinds of ideologies are wrong because they follow their script which is inadequate for current problems while populists do not even care to make things better but only to rule and have a good time. It is only a pragmatic approach that, according to Collier, makes sense.

    Pragmatism however is an ideology like any other. It is wrong to believe oneself exempt from ideological traps if one claims to be a "pragmatist". Pragmatism collects whatever are the ruling ideologies today and rearranges them: it provides an interpretative framework like any other ideology. Pragmatists are, as Keynes said in a similar context "practical men, who believe themselves to be quite exempt from any intellectual influences, [but] are usually the slaves of some defunct economist [or ideologue; my addition]."

    Adam Smith. The second building block of Collier book is based on his interpretation of Adam Smith, which has become more popular recently and tries to "soften" the hard edge of the Adam Smith of the "Wealth of Nations" (self-interest, profit, and power) by a more congenial Smith from "The Theory of Moral Sentiments". This is an old debate that goes almost 200 years back ("Die Adam Smith Frage").

    There are, I think, if not two Smiths, then one Smith for two sets of circumstances: in TMS, it is the Smith for our behavior with family, friends and community; in the WoN, it is the Smith of economic life, our behavior as "economic agents". I discuss this in "Capitalism, Alone". David Wootton in "Power, Pleasure and Profit" very persuasively makes the same point. And even Collier says exactly the same thing towards the end of his book, but in the early parts he argues that the Adam Smith of TMS applies to economics as well.

    Now, for an economist only the Smith from the WoN matters. Economists do not claim (or should not claim) to have particularly valuable insights regarding how people behave outside of economics. So it is fully consistent for economists to use a model of Smith's homo economicus who is pursuing monetary gains only, or more broadly, his own utility only. That of course does not exclude, as Collier and some other writers (e.g., Peter Turchin) seem to believe, cooperation with others. It is obvious that many of our monetary objectives are better achieved through cooperation: I am better off cooperating with people at my university than setting my own university. But whether I do one or the other, I am pursuing my own selfish interest. I am not doing things for altruistic reasons -- which perhaps I might do in my interactions with family or friends.

    My point in "Capitalism, Alone" is that under hyper-commercialized globalization Smith's economic sphere is rapidly expanding and "eating up" the sphere where the Smith of TMS applies. Commodification "invades" family relations and our leisure time. Both Collier and I agree on that. But while I think that this is an inherent feature of hyper-commercialized globalization, Collier believes that the clock can be turned back to an "ethical world" which existed in the past while somehow keeping globalization as it is now. This is an illusion and leads me to Collier's nostalgia.

    Social-democracy. In Collier's view of the Golden Age (1945-75), social-democracy that brought it about did this for ethical reasons. In several places he repeats more of less this breathtaking sentence "[Roosevelt] was elected because people recognized the New Deal was ethical". He argues that the origin of social-democracy lies in a (nice) co-operative movement, not that the reforms in capitalism after WW1 and WW2 were the product of a century of often violent struggle of social democratic parties to improve workers' conditions. It is not because ethical leaders decided suddenly to make capitalism "nicer" but because the two world wars, the Bolshevik revolution, the growth of social-democratic and communist parties, and their links with powerful trade unions, exacted the change of course from bourgeoisie under the looming threat of social disorder and expropriation. So it is not through the benevolence of the right that capitalism was transformed, but because the upper classes, chastised by past experience, decided to follow their own enlightened self-interest: give up some in order to preserve more. (For similar interpretations, see Samuel Moyn, Avner Offer,)

    This difference in the interpretations of history is important because Collier's view applied to today basically calls for ethical rulers -- to somehow appear. This is why at the end of the book he discusses how political leaders should be elected (not by party members or primaries, but by the elected representatives of their parties). My interpretation implies that unless there are strong social forces that would push back financial sector excesses, tax evasion, and high inequality nothing will be changed. What matters is not ethics or ethical leaders but group/class interest and relative power.

    The facts. And finally the Arcadia of the trente glorieuses * when Collier holds that moral giants strode the Earth, companies cared about workers, families were "full" and "ethical", never really existed, at least not in the way it is described in the book. Yes, like many others I have pointed out that the trente glorieuses were very good years for the West both in terms of growth and surely in terms of narrowing of wealth and income inequalities. But they were no Arcadia and in many respects they were much worse than the present.

    The period of Collier's "ethical family" in which "the husband was the head" when every member cared for each other, and several generations lived together, was a hierarchical patriarchy that even legally forbid any other types of family-formation. (I remember that in my high school in Belgium, only fathers were allowed to sign off on pupils' grades or school absences. Not mothers.)

    In the USA, the Golden Age was the age of social mimicry and conservatism, widespread racial discrimination, and gender inequality. When it comes to politics, it is often forgotten that during the Golden Age, France was basically twice on the edge of a civil war: during the Algerian war and in 1968. Spain, Portugal, and Greece were ruled by quasi-fascist regimes. Terrorism of RAF and Brigate Rosse came in the 1970s. Finally, if these years were so good and "ethical" why did we have the universal 1968 rebellion, from Paris to Detroit?

    That imagined world never was, and we are utterly unlikely to return to it; not only because it never was but because the current word is entirely different. Collier overlooks that the world of his youth to which he wants people to return was the world of enormous income differences between the rich world and the Third World. It is for that reason that the English working class could (as he writes) feel very proud and superior to the people in the rest of the world. They cannot feel so proud and superior now because other nations are catching up. Implicitly, regaining self-respect for the English working class requires a return to such worldwide stratification of incomes.

    The book is thus built on the quicksand of a world that did not exist, will not exist, and on a methodology that I find wanting. 2020s will not be the imagined 1945, however loudly we clamor for it. But this does not mean that the analyses of current problems and the recommendations are wrong. Many of them are very good. So I will turn to them next.

    * https://en.wikipedia.org/wiki/Trente_Glorieuses

    -- Branko Milanovic

    anne -> anne... , August 23, 2019 at 12:41 PM
    https://glineq.blogspot.com/2019/08/how-to-create-ethical-county-if-not.html

    August 10, 2019

    How to create an ethical county, if not the world: Part 2 review of Paul Collier's "The future of capitalism"

    This is the second part of my review of Paul Collier's "The future of capitalism". The first part is here. *

    In this review of Collier's policy recommendations, I will break the discussion into three parts, following Collier's own approach: how to make companies more ethical, families stronger, and the world better.

    Ethical firm. Collier argues that, in order for companies to be seen as ethical and to offer their workforce meaningful jobs, companies should include workers in management, give much more power to the middle-level management, and do profit-sharing. These are all well-taken recommendations, and I believe, like Collier, that they would increase companies' profitability in addition to providing "better" jobs. The question however is how many companies nowadays can afford to provide such meaningful and (relatively) stable jobs because of fast-evolving changes driven by globalization. Nevertheless the idea is correct.

    Collier then moves to what may be the most intriguing recommendation in the book and that goes beyond the usual "let's have higher and more progressive taxes". He looks at the big divide between the successful global cities (like New York and London) and their left-behind hinterlands. The success of metropolises comes from economies of scale, specialization, and complementarity (gains of agglomeration). People can specialize because the demand for specialized skills is high (the best tax accountants are located in New York not in small dilapidated cities). Companies can enjoy economies of scale because the demand is high and specialized workers benefit from complementarity in skills from other workers with whom they are in close geographical and intellectual contact.

    So who are the main winners from metropolises' success, asks Collier? People who own land and housing (as housing prices skyrocket) and highly skilled professionals who, after paying higher rents, still make more in global cities than elsewhere. Collier's suggestion then, based on his work with Tony Venables, is to tax heavily these two groups of people, i.e., to introduce supplemental taxes which would be geographical: tax housing and high income individuals living in London.

    How to help hinterland catch up? Use the money collected in London or New York to give subsidies to large cluster-like companies (like Amazon) if they set they businesses in the left-behind cities like Sheffield or Detroit. One can quibble with this idea but the logic of the argument is, I think, quite compelling, and the taxation suggested by Collier has the advantage of going beyond the indiscriminate increase in taxes for all. We are talking here of targeted taxation and targeted subsidies. This is the lieu fort of Collier's book.

    Ethical family. I am less enthusiastic about the suggestions in this area. Here Collier is at his most conservative although that social conservatism is masked under the cover of scientific studies that show that children living in "full" families with two heterosexual parents are doing much better than children living with one parent only.

    Collier almost implies that (say) mothers should stay in unloving or abusive relationships so that there would be both parents present in the family. Such families should, according to Collier, be given support and for all children public pre-K and K education should be free (very reasonable). Collier also very persuasively describes manifold advantages that the children of the rich receive, not only through inheritance but through intangible capital of parental knowledge and connections. This type of social capital inheritance is not a well-researched topic and I hope this changes since its importance in real life is substantial.

    Collier displays clear preference for "standard" families and even some "social eugenics" as when he criticizes UK policy that provides free housing and since 1999 extra benefits for single mothers to have encouraged "many women...to bear children who will not be raised well".

    The argument that parents should sacrifice themselves (regardless of the psychic cost) for children is also dangerous. It leads us to a family formation of the 19th century when women often lived in terrible marriages because of social pressure not to be seen as abandoning or not caring for their children. This is neither a desirable nor a likely solution for today. An ethical family should consider interests of all members equally, not subjugate the happiness of some (mostly mothers) to that of others.

    Ethical world. Collier has surprisingly little to say about the ethical world. His ethical world is a world largely closed to new migration which Collier rejects based on a not unreasonable view going back to Assar Lindbeck and George Borjas of cultural incompatibility between the migrants and the natives. Interestingly, Collier does not quote either of these two authors nor any others. (The book is directed at the general audience so the mentions of other authors are extremely rare except when it comes to Collier himself and a few of his co-authors).

    It is slightly disconcerting that Collier who has spent more than three decades working on Africa has almost nothing to say about how Africa and African migration fits into this "ethical world". There are only two ways in which he addresses migration.

    First, migrants or refugees should stay in countries that are geographically close to the source countries: Venezuelans in Colombia, Syrians in Lebanon and Turkey, Afghanis in Pakistan. Why the burden of migrants should be exclusively borne by the limitrophe countries ** that are often quite poor is never explained. Surely, an ethical world would require much more from the rich.

    Second, he argues that the West should help good companies invest in poor countries in order to increase incomes there and reduce migration. But how is this to be achieved is never explained. It is mentioned almost as an afterthought and is considered deserving of two sentences only (in two different parts of the book). This is in contrast with a detailed explanation, discussed above, of how governments should encourage and subsidize large companies to relocate to second-tier cities. Could a similar scheme be designed for investments in Africa? Nothing is said.

    Further, where does it leave African migrants crisscrossing the Mediterranean as I write? There are no geographically close countries where they could go (surely not to Libya) nor can they wait for years in Mali for the Western companies to bring them jobs. Again, nothing is said on that. It is not surprising that Collier is very supportive of Emmanuel Macron whose anti-immigration policy is quite obvious, and of Danish Social Democrats that are in the process of creating a kind of national social democracy with new laws that practically reduce immigration to a trickle. Collier favors Fortress Europe although he does not say so explicitly.

    In keeping with his anti-immigration stance, Collier argues that migration is not an integral part of globalization. Why –in principle– goods, services and one factor of production (capital) should be allowed to move freely while another factor of production (labor) is to remain stuck is not clear. Surely, the fact that trade is driven by comparative advantage and migration by absolute is not the reason to be against migration. On exactly the same grounds, one could be against movement of capital too.

    In conclusion, I think that the recommendations regarding the "ethical firm" and metropolis-hinterland divergence are spot on; the recommendations on "ethical family" are a combination of very perceptive and sensible points, and a view of the family that at times comes from a different age, and almost nothing is said about an "ethical world". This latter is a big omission in the era of globalization, but perhaps Collier was solely interested in how to improve nation-states.

    * https://glineq.blogspot.com/2019/08/nostalgia-for-past-that-never-was-part.html

    ** Territories situated on a border or frontier. In a broad sense, it means border countries -- any group of neighbors of a given nation which border each other thus forming a rim around that country.

    -- Branko Milanovic

    [Aug 26, 2019] Trump ordering companies around about where they can invest is a form of national socialism

    Notable quotes:
    "... This strategy is not popular with US corporations and will earn Trump some more opposition. Former Rep. Joe Walsh (R-Ill.) on Sunday announced he would mount a primary challenge to President Trump ..."
    Aug 26, 2019 | www.moonofalabama.org

    Don Bacon , Aug 25 2019 17:08 utc | 20

    Trump has put US companies on alert that he might force them to withdraw from China, where they have $256 billion invested. He says he is given this power by the 1977 law called the International Emergency Economic Powers Act, or IEEPA.

    The Republican Party has spent over a century warning against government involvement in the private sector, but now their leader is doing it big time. Trump ordering companies around about where they can invest is a form of fascism or rightwing national socialism. Left socialism is about public sector economic activity for the good of people. National socialism is the state usurping economic resources on behalf of a small corporate and high-official elite.

    Tara Golshan at Vox explained how Trump unilaterally raised China tariffs in the first place by 25% (he is threatening to go to 30%):

    "Trump's White House cited Section 232 of the Trade Expansion Act of 1962, a provision that gives the secretary of commerce the authority to investigate and determine the impacts of any import on the national security of the United States -- and the president the power to adjust tariffs accordingly."

    So one thing that is going on is that measures passed by Congress for limited and extreme situations are being misused by presidents for everyday policy-making. . . here

    This strategy is not popular with US corporations and will earn Trump some more opposition. Former Rep. Joe Walsh (R-Ill.) on Sunday announced he would mount a primary challenge to President Trump . . . here

    [Aug 25, 2019] Trump Says He Regrets Escalating Trade War With China, White House Immediately Retracts

    Notable quotes:
    "... During his meeting with Johnson on Sunday at the G7 in France, the US president raised eyebrows when he responded in the affirmative to questions from reporters on whether he had any second thoughts about the tariff move. ..."
    Aug 25, 2019 | www.zerohedge.com

    While one may accuse the US president of many things, having second thoughts is hardly one of them: once Trump has decided on a course of action, he tends to follow through. Which is why the global press gasped when a rare case of doubt emerged this morning during Trump's breakfast meeting with the UK's Boris Johnson at the Biarritz G-7, when the US president acknowledged having second thoughts about the escalating the trade war with China... only for his top spokeswoman to later retract and say Trump meant he regretted not raising tariffs even more.

    During his meeting with Johnson on Sunday at the G7 in France, the US president raised eyebrows when he responded in the affirmative to questions from reporters on whether he had any second thoughts about the tariff move.


    TheRapture , 14 minutes ago link

    Every president of the USA for the past 50 years has cultivated US exports to China. You want to just throw it away, only two or three years before the purchasing power of China exceeds that of the USA???

    China - 1.5 billion.
    USA - 326 million

    China growth rate 2018: 6.4%
    USA growth rate 2018: 2.8%
    source

    China now produces twice as many graduates a year as the US
    source

    As of 2015, China had already taken global lead in manufacturing output: source
    China - $2,010 billion
    USA - $1,867 billion

    World market size, based on population: source
    China - 18.7%
    USA - 4.3%

    LoveTruth , 1 hour ago link

    Greedy US corporations have been in bed with China robbing the US citizen with all those job exports to China.

    If things were produced in US, the corporations would have made less money, but the US citizen would have been better off. The trade deficit which has been running for decades wouldn't have been that much.

    Let it Go , 1 hour ago link

    Anyone with a lick of commonsense knew Trump's detractors would be gunning for him during his trip to Europe. Trump has not disappointed these people by continuing his effort to come across as too clever for his own good. Trump gave these people more ammunition when he said he has doubts about his actions.

    During breakfast with the UK's Boris Johnson at the G-7 meeting in Biarritz, France Trump acknowledged having second thoughts about the escalating the trade war with China. The article below explores how this may cause Trump a great deal of grief.

    https://Trump Continues His Effort To B Too Clever By Half.html

    cmurali , 1 hour ago link

    https://www.theguardian.com/us-news/video/2019/aug/25/sure-why-not-trump-admits-second-thoughts-on-china-trade-war-video

    [Aug 25, 2019] China Hits Back at Trump With Higher Tariffs on Soy, Autos

    Beijing just might be able to doom the president's chance of reelection. They can tune tariffs to hurt Trump base.
    Notable quotes:
    "... China's tariff threats take aim at the heart of Trump's political support -- factories and farms across the Midwest and South at a time when the U.S. economy is showing signs of slowing down. Soybean prices sank to a two-week low ..."
    "... The tariffs beginning in September include 10% on pork, beef, and chicken, and various other agricultural goods, while soybeans will have the extra 5% tariff on top of the existing 25%. Starting in December, wheat, sorghum, and cotton will also get a 10% tariff. ..."
    Aug 25, 2019 | www.bloomberg.com

    Some of the countermeasures will take effect starting Sept. 1, while the rest will come into effect from Dec. 15, according to the announcement Friday from the Finance Ministry. This mirrors the timetable the U.S. has laid out for 10% tariffs on nearly $300 billion of Chinese shipments

    An extra 5% tariff will be put on American soybeans and crude-oil imports starting next month. The resumption of a suspended extra 25% duty on U.S. cars will resume Dec. 15, with another 10% on top for some vehicles. With existing general duties on autos taken into account, the total tariff charged on U.S. made cars would be as high as 50%.

    China's tariff threats take aim at the heart of Trump's political support -- factories and farms across the Midwest and South at a time when the U.S. economy is showing signs of slowing down. Soybean prices sank to a two-week low

    .... ... ...

    The tariffs beginning in September include 10% on pork, beef, and chicken, and various other agricultural goods, while soybeans will have the extra 5% tariff on top of the existing 25%. Starting in December, wheat, sorghum, and cotton will also get a 10% tariff.

    [Aug 25, 2019] U.S. Decoupling From China Forces Others To Decouple From U.S.

    G7 is not less then 50% of world economics.
    Notable quotes:
    "... "The 2008 experience demonstrated that the U.S. dollar as the global reserve and main trade currency is dangerous for all who use it. Currently any hickup in the U.S. economy leads to large scale recessions elsewhere." ..."
    "... It has also become a primary tool for the US to assert extraterritorial jurisdiction over the world to enforce extreme uses of sanctions, as in blowing up the Iran deal. Already the EU has explored ways to get around that to work with Iran. ..."
    "... The over use of sanctions, and abuse of the US financial position in order to govern others, reinforces the desire to deal with fears that dependence on the dollar risks vulnerability to economic depression due to US irresponsibility. ..."
    "... The US is creating a perfect storm for the dollar, with is exactly what it would take to make others undertake the expense and difficulty of replacing it as the world reserve currency and presumed standard of exchange. ..."
    "... I just had a thought. The USSA has been doing it all wrong for all these decades. There are at least two responses the USSA could have applied to the obviously impending debacle of simply allowing the Chinese to thoroughly undermine its industrial system. The most obvious response would have been tariffs, which could be perceived as an aggressive policy, but certainly not as the outright aggression of sanctions. ..."
    "... Or probably even much better, a 'negative sales tax' on USSA manufactured products, which could in no way be perceived as aggressive at all. Note that there is (I presume) a vast difference between simply subsidizing companies (since subsidies coud then flow directly into the pockets of the companies' capitalists) and providing the companies' customers with a 'negative tax' on USSA produced products (basically an instant rebate). This could effectively provide price parity for the goods produced for the two countries, and could maintain the viability of the USSA manufacturing system. ..."
    "... The US ruling class cannot grow out of its desire to extend its rule to the rest of the planet. But humanity is not as malleable as the American people-with their dreams of sharing in the dividends when America (Great Again) (aka its ruling class) orders the rest of the world around and exploits everyone the way that it exploits the working people in the United States. ..."
    "... Are you not aware that the Bank of Japan basically owns 70% of the Japanese stock market in the from of ETFs? ..."
    "... While Europe and Japan are failing economically at least America is at war with the second biggest power on the planet, making drastic moves justified in the face of a national emergency. ..."
    "... I imagine now that John Maynard Keynes'ghost, if it were observing our current global political and economic affairs, would be having a laugh. It was Keynes who suggested the notion of International trade using a common trading currency created purely for International trade purposes, in a system in which nations would not be allowed to build up continuous balance-of-payments surpluses or deficits over several years, but would be required to spend their surpluses on countries forced to go into deficit because of other countries' desires for annual surpluses, leading to trade policies or currency manipulations to achieve such a dubious goal. ..."
    "... The real solution though is a different system with some global exchange medium that can not be manipulated by one country or a block of selfish countries. ..."
    Aug 25, 2019 | www.moonofalabama.org

    The U.S. is decoupling itself from China. The effects of that process hurt all global economies. To avoid damage other countries have no choice but to decouple themselves from the U.S.

    Today's Washington Post front page leads with a highly misleading headline:

    The headline above the article is also wrong:

    Trump retaliates in trade war by escalating tariffs on Chinese imports and demanding companies cut ties with China

    It was China, not Trump, which retaliated. Trump reacted to that with a tweet-storm and by intensifying the trade war he started . The piece under the misleading headline even says that :

    President Trump demanded U.S. companies stop doing business with China and announced he would raise the rate of tariffs on Beijing Friday, capping one of the most extraordinary days in the long-running U.S.-China trade war.
    ...
    The day began with Beijing's announcement that it would impose new tariffs on $75 billion in goods, including reinstated levies on auto products, starting this fall. It came to a close Friday afternoon with Trump tweeting that he would raise the rate of existing and planned tariffs on China by 5 percentage points.

    Beijing's tariff retaliation was delivered with strategic timing, hours before an important address by Powell, and as Trump prepared to depart for the G-7 meeting in Biarritz.

    After Trump's move the stock markets had a sad. Trade wars are, at least in the short term, bad for commerce. The U.S. and the global economy are still teetering along, but will soon be in recession.

    The Trump administration is fine with that. (As is Dilbert creator Scott Adams (vid).)

    U.S. grand strategy is to prevent other powers from becoming equals to itself or to even surpass it. China, with with a population four times larger than the U.S., is the country ready to do just that. It already built itself into an economic powerhouse and it is also steadily increasing its military might.

    China is thus a U.S. 'enemy' even though Trump avoided, until yesterday, to use that term.

    Over the last 20+ years the U.S. imported more and more goods from China and elsewhere and diminishes its own manufacturing capabilities. It is difficult to wage war against another country when one depends on that country's production capacities . The U.S. must first decouple itself from China before it can launch the real war. Trump's trade war with China is intended to achieve that. As Peter Lee wrote when the trade negotiations with China failed:

    The decoupling strategy of the US China hawks is proceeding as planned. And economic pain is a feature, not a bug.
    ...
    Failure of trade negotiations was pretty much baked in, thanks to [Trump's trade negotiator] Lightizer's maximalist demands.

    And that was fine with the China hawks.

    Because their ultimate goal was to decouple the US & PRC economies, weaken the PRC, and make it more vulnerable to domestic destabilization and global rollback.

    If decoupling shaved a few points off global GDP, hurt American businesses, or pushed the world into recession, well that's the price o' freedom.

    Or at least the cost of IndoPACOM being able to win the d*ck measuring contest in East Asia, which is what this is really all about.

    Trump does not want a new trade deal with China. He wants to decouple the U.S. economy from the future enemy. Trade wars tend to hurt all involved economies. While the decoupling process is ongoing the U.S. will likely suffer a recession.

    Trump is afraid that a downturn in the U.S. could lower his re-election chances. That is why he wants to use the Federal Reserve Bank to douse the economy with more money without regard for the long term consequences. That is the reason why the first part of his tweet storm yesterday was directed at Fed chief Jay Powell:

    In his order for U.S. companies to withdraw from China, some close to the administration saw the president embracing the calls for an economic decoupling made by the hawks inside his administration.

    The evidence of the shift may have been most apparent in a 14-word tweet in which Trump appeared to call Xi an "enemy."

    "My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?" he said in a Tweet posted after Powell gave a speech in Jackson Hole that contained implicit criticism of Trump's trade policies and their impact on the U.S. and global economies.

    Jay Powell does not want to lower the Fed interest rate. He does not want to increase bond buying, i.e. quantitative easing. Interest rates are already too low and to further decrease them has its own danger. The last time the Fed ran a too-low interest rate policy it caused the 2008 crash and a global depression.

    Expect Trump to fire Powell should he not be willing to follow his command. The U.S. will push up its markets no matter what.

    From Powell's perspective there is an additional danger in lowering U.S. interest rates. When the U.S. runs insane economic and monetary policies U.S. allies will also want decouple themselves - not from China but from the U.S. The 2008 experience demonstrated that the U.S. dollar as the global reserve and main trade currency is dangerous for all who use it. Currently any hickup in the U.S. economy leads to large scale recessions elsewhere.

    That is why even long term U.S. ally Britain warns of such danger and looks for a way out :

    Bank of England Governor Mark Carney took aim at the U.S. dollar's "destabilising" role in the world economy on Friday and said central banks might need to join together to create their own replacement reserve currency.

    The dollar's dominance of the global financial system increased the risks of a liquidity trap of ultra-low interest rates and weak growth, Carney told central bankers from around the world gathered in Jackson Hole, Wyoming, in the United States.
    ...
    Carney warned that very low equilibrium interest rates had in the past coincided with wars, financial crises and abrupt changes in the banking system.
    ...
    China's yuan represented the most likely candidate to become a reserve currency to match the dollar, but it still had a long way to go before it was ready.

    The best solution would be a diversified multi-polar financial system, something that could be provided by technology, Carney said.

    Carney speaks of a "new Synthetic Hegemonic Currency (SHC)" which, in a purely electronic form, could be created by a contract between the central banks of most or all countries. It would replace the dollar as the main trade currency and lower the risk for other economies to get infected by U.S. sicknesses (and manipulations).

    Carney did not elaborate further but is an interesting concept. The devil will be, as always, in the details. Will one be able to pay ones taxes in that currency? How will the value of each sovereign currency in relation to SHC be determined?

    That the U.S. dollar is used as a global reserve currency under the Bretton Woods system is, in the words of the former French Minister of Finance Valéry Giscard d'Estaing, an "exorbitant privilege". It if wants to keep that privilege it will have to go back to sane economic and monetary policies. Otherwise the global economy will have no choice but to decouple from it.

    Posted by b on August 24, 2019 at 19:22 UTC | Permalink


    Mark Thomason , Aug 24 2019 19:54 utc | 2

    "The 2008 experience demonstrated that the U.S. dollar as the global reserve and main trade currency is dangerous for all who use it. Currently any hickup in the U.S. economy leads to large scale recessions elsewhere."

    It has also become a primary tool for the US to assert extraterritorial jurisdiction over the world to enforce extreme uses of sanctions, as in blowing up the Iran deal. Already the EU has explored ways to get around that to work with Iran.

    The over use of sanctions, and abuse of the US financial position in order to govern others, reinforces the desire to deal with fears that dependence on the dollar risks vulnerability to economic depression due to US irresponsibility.

    The US is creating a perfect storm for the dollar, with is exactly what it would take to make others undertake the expense and difficulty of replacing it as the world reserve currency and presumed standard of exchange.

    No one currency is quite as good now, but one could be improved, or a basket approach could be used. In the ancient world, they used such a nominal currency as a standard by which to value real currencies. We could again.

    dltravers , Aug 24 2019 20:45 utc | 11

    Trump does not want a new trade deal with China. He wants to decouple the U.S. economy from the future enemy.

    That may well be what is going on here. Something between total insanity and managed insanity. The next president will unravel all of this in a year or so of effort. That is what is so damaging. No business can plan on what is next. No policy is long term.

    This is pure Trumpian logic unhinged. Hit them twice as hard as they hit you. I would not dare to guess who is winding him up and pointing him in this direction. Trump has had one of his busiest weeks yet.

    I see Elisabeth Warren's crowd sizes are getting very large. I will feel better when no one shows up to a Trump rally. China has time to wait this out and the ability to raise some chaos on their own to help undermine Trump.

    Jackrabbit , Aug 24 2019 20:46 utc | 12
    NemesisCalling @7, donkeytale @8

    Sorry guys, it was the realization that the Empire had driven Russia into China's arms that sparked the 'get tough' attitude on China.

    The Empire HAD TO isolate China but their horrendous treatment of Russia provided an opportunity for China to escape the coming 'smack down' by joining with Russia to challenge Western global domination.

    As usual, it is us 'little people that will suffer for the mistakes of our elites. And elite propaganda means that most will suffer in silence, not realizing what really happened.

    It should be clear by now that elite adventurism is a choice that is not subject to democratic controls. The sheeple will sleepwalk into WWIII.

    Silver lining? Maybe a multi-lateral world saves us from the the more terrible dystopia of a unilateral world.

    blues , Aug 24 2019 20:46 utc | 13
    I just had a thought. The USSA has been doing it all wrong for all these decades. There are at least two responses the USSA could have applied to the obviously impending debacle of simply allowing the Chinese to thoroughly undermine its industrial system. The most obvious response would have been tariffs, which could be perceived as an aggressive policy, but certainly not as the outright aggression of sanctions.

    Or probably even much better, a 'negative sales tax' on USSA manufactured products, which could in no way be perceived as aggressive at all. Note that there is (I presume) a vast difference between simply subsidizing companies (since subsidies coud then flow directly into the pockets of the companies' capitalists) and providing the companies' customers with a 'negative tax' on USSA produced products (basically an instant rebate). This could effectively provide price parity for the goods produced for the two countries, and could maintain the viability of the USSA manufacturing system.

    But... no, we didn't do anything like that. Our Harvard trained economics geniuses hatched the 'far superior' strategy of 'quantitative easing'. They simply eased all the money out of the system and into the absurdly deep pockets of the oligarchs, supposedly in order to 'save the system'. What a masterful strategy! So the options are all used up, and theres no sane way forward. Great job.

    So here's my plan. First, of course, we 'take care of' the lawyers. Well... no. First we we bulldoze Harvard. Then we institute the mother of all class action lawsuits, the 99% as plaintiffs and the 1% as defendants, and we clean them out (they will surely run off to China, but good riddance). We will be left with all their fake money, but at least we can try to start over.

    Sasha , Aug 24 2019 20:51 utc | 14
    @Posted by: Sasha | August 24, 2019 at 20:42

    From the article linked above...Just another model of political technology,....and of civilization....

    Titled 'Green is gold: the strategy and actions to China´s ecological civilization', the plan that was analyzed during the UNEA assembly explains, in its beginning, its starting point and destination: "Enjoying a beautiful house, a blue sky, a green land and clean water is the dream of any Chinese citizen and, therefore, the center of the Chinese dream (...) To achieve this vision, the government has decided to highlight the concept of eco-civilization and incorporate it into every aspect of the economy, politics, culture and social development of the country."

    Definitely, a different political technology from that of Bannon...

    Dianxi Xiaoge's YouTube channel is contemporary political technology at its finest. Recommended viewing for all future world leaders.

    https://twitter.com/therealsurkov/status/1164310392014811137

    bevin , Aug 24 2019 20:58 utc | 15
    Can one really get rid of one without just getting a new master?
    Contributor@4

    Why not? Progress is not inevitable but it is possible.

    The US ruling class cannot grow out of its desire to extend its rule to the rest of the planet. But humanity is not as malleable as the American people-with their dreams of sharing in the dividends when America (Great Again) (aka its ruling class) orders the rest of the world around and exploits everyone the way that it exploits the working people in the United States.

    Somehow the profits of Empire never quite trickle down to the people who do the work and man the armies.
    Elsewhere, however the dream of ruling the planet either never occurred or was grown out of. And people would be very happy to live good lives and make the earth a better place for future generations.

    RenoDino , Aug 24 2019 20:59 utc | 16
    Spot on in the first part of article about the inevitable new Cold War between China and America and the serious fallout from the breakup of close economic ties. But not so good on the second half wherein America central bankers are acting "insane" while the rest of the developed world looks on in horror. Are you forgetting most of the interest rates in Europe are now negative?

    Are you not aware that the Bank of Japan basically owns 70% of the Japanese stock market in the from of ETFs? America is way behind the curve when it comes to complete surrender to "market forces." Trump wants Powell to play catchup now that it's game on with China. While Europe and Japan are failing economically at least America is at war with the second biggest power on the planet, making drastic moves justified in the face of a national emergency.

    China is a bigger threat to America than Russia ever was because their economic model has been so successful compared to the U.S. This is made more so because we no longer have a government per se, only competing economic forces, while the Chinese have a government that runs everything. If they lose this war, they still have a system. If we lose this war, we lose everything.

    Jen , Aug 24 2019 21:04 utc | 17
    I imagine now that John Maynard Keynes'ghost, if it were observing our current global political and economic affairs, would be having a laugh. It was Keynes who suggested the notion of International trade using a common trading currency created purely for International trade purposes, in a system in which nations would not be allowed to build up continuous balance-of-payments surpluses or deficits over several years, but would be required to spend their surpluses on countries forced to go into deficit because of other countries' desires for annual surpluses, leading to trade policies or currency manipulations to achieve such a dubious goal.

    The EU would be looking very different as a result, without a southern zone of debtor nations with unstable economies and high unemployment, and a northern zone of smug nations with full employment whose social welfare programs depend on an army of unemployed southerner immigrants willing to work for peanuts.

    AntiUSA , Aug 24 2019 21:07 utc | 19
    When an American claims China has been behaving unfairly, what they really mean is that the Chinese played America's rigged game and ended up outsmarting the dealer.
    b , Aug 24 2019 21:10 utc | 20
    Why would others want to de-couple from US? What difference it would make to UK or other EU vassals to serve FED/petro-dollar or to serve CCP/petro-yuan? Can one really get rid of one without just getting a new master?

    Posted by: Contributor | Aug 24 2019 20:02 utc | 4

    The US$ is overvalued because there is, as it is the global reserve currency, a higher demand for it than otherwise justifiable. In consequence U.S. companies buy up companies in UK and Europe with an overvalued dollar. When the Fed lowers the price for US$ loans it increases that effect. The Fed also creates bubbles, see the mortgage crisis, and the currently overvalued stock markets, that have effects on foreign countries.

    Said differently: The U.S. abuses is 'exorbitant privilege'. The hope is that China would be less inclined to do so.

    The real solution though is a different system with some global exchange medium that can not be manipulated by one country or a block of selfish countries.

    NemesisCalling , Aug 24 2019 21:36 utc | 23
    ... ... ...

    Here is an interesting article entitled "The Dialectic of Globalization," that raises several important questions pertaining to the phenomenon of globalism from the end of colonialism to the height of "transnationalism" with the end of the cold war.

    I can just about agree with its conclusions and provide my own opinion as to the end of the "dialectic of globalism," that Trump seems to have, whether wittingly or not, ushered into its next phase.

    International neoliberalism needs vast amounts of regulating, but I do not believe that Supranational governing agencies will be able to do this fairly and in the light of day. The only other option then is to reassert state-controlled notions of legality which is what vast proportions of the west seems to be clamoring for as can be seen with the Trump-phenomenon.

    [Aug 23, 2019] Trump Hikes Tariffs On Chinese Goods In Retaliation To Trade War Escalation

    Aug 23, 2019 | www.zerohedge.com

    Starting on October 1st, the 250 BILLION DOLLARS of goods and products from China, currently being taxed at 25%, will be taxed at 30%. Additionally, the remaining 300 BILLION DOLLARS of goods and products from China, that was being taxed from September 1st at 10%, will now be taxed at 15%.

    dibiase , 38 seconds ago link

    ideally america would start rebuilding it's massive rust belt and get the hell out of the middle east..

    [Aug 23, 2019] An interesting observation in the NYT about the US China trade war

    Aug 23, 2019 | www.moonofalabama.org

    vk , Aug 23 2019 13:38 utc | 85

    Interesting observation in the NYT:

    From the same flaw the western MSM must suffer: did the NYT really expected China would just treat Trump like a child, wait for him to lose the 2020 election and suddenly make amends with the USA?

    Did it really think this trade war was just a bad taste joke? Did it really think China would just cave in in order to "defend globalisation"?

    Do they really think of America as some kind of transcendental, abstract idea, and not a concrete entity made of real human beings?

    Are they really that dense?


    donkeytale , Aug 23 2019 13:43 utc | 86

    China announces tit for tat tariffs as yuan sinks to new low against the dollar.

    Also sinking is Trump's popularity among US voters. AP has him at 36% approval versus 62% disapproval. Remarkably, Trump's highest mark of 46% approval is for his handling of the economy.

    A no deal Brexit which Trump supports is just the thing to set off a recession in the EU which spreads to Asia and the US.

    What will his approval rating be then?

    donkeytale , Aug 23 2019 13:43 utc | 86 vk , Aug 23 2019 13:47 utc | 87
    Wrong configuration from the last post (#85). I politely ask the administer to delete it.

    From the NYT:

    China to Raise Tariffs on $75 Billion in U.S. Goods

    The interesting part is the sub-headline:

    The plan to retaliate against President Trump's tariffs suggests that neither side in the trade war is prepared to back down.

    I doubted this theory for a very long time, but now I'm beginning to believe it: Americans really don't think they are responsible for the politicians they elect. They expect the rest of the world to interpret any wrongdoings of their country as individual flaws of random politicians. They expect the rest of the world to swallow the abuses by their POTUS under the idea that they will elect another one the next election cycle. They expect the rest of the world to be suportive, loyal and patient with their contry forever.

    From the same flaw the western MSM must suffer: did the NYT really expected China would just treat Trump like a child, wait for him to lose the 2020 election and suddenly make amends with the USA? Did it really think this trade war was just a bad taste joke? Did it really think China would just cave in in order to "defend globalisation"? Do they really think of America as some kind of transcendental, abstract idea, and not a concrete entity made of real human beings? Are they really that dense?

    [Aug 22, 2019] Anti-China Cult Gets U.S. Government Money - Runs Large Pro-Trump Ad Campaign

    Aug 22, 2019 | www.moonofalabama.org

    jb , Aug 21 2019 18:32 utc | 1

    "The Democrats could up their game by taking a deeper look into this issue." you mean the CIA democrats like Mark Warner? the US has nothing to offer the world except war, which is why the people of the US must destroy this country. there is 1000% bipartisan agreement on the war drive against both china & russia. both parties spend their days yelling at each other about who is the most commie, like Moscow Mitch or Comrade Nancy, b/c they are unified in their war drive. as they are on anything else that matters. this country exists to wage war, as the platform for projection of power, against competitors. nothing else. the illusion that any of the operators w/in the system, any of them at all, are doing anything but crafting a persona in relation to power for self-aggrandizement, not challenging power in the slightest, is not helpful.

    ab initio , Aug 21 2019 18:56 utc | 2

    b, what makes you think the Democrats are not in on the scam?

    Also, just like the US funds NGOs in other countries, China too spends hugely and has bought many influential lobbyists and think-tanks as well as media personalities and politicians in the US. Not very different than Israel lobbyists through AIPAC and the massive Israel First big money. China influence operations in the US is likely significantly larger than US influence operations in China since China is a closed CCP controlled system.

    psychohistorian , Aug 21 2019 18:57 utc | 3
    b wrote
    "
    The Democrats could up their game by taking a deeper look into this issue.
    "
    I agree with jb at comment #1

    Yes there are "good" Democrats which are very much in the minority. The rest D/R are acolytes for the God of Mammon finance/war based social order of the West.

    Yes, we are in a very strange WWIII with lots of spinning plates and propaganda action and shedding of blood mostly where the Western public does not "see" it

    vk , Aug 21 2019 19:15 utc | 5
    Well, unless the crisis catches the USA first:

    Deficit Will Reach $1 Trillion Next Year, Budget Office Predicts

    This time, the world may not be able to prop the Dollar up : the "rest of the world" is also maxed out.

    karlof1 , Aug 21 2019 20:37 utc | 15
    Excellent work b! Funding what on the surface appears to be a propaganda op aimed at another nation becomes a form of campaign finance for a president's reelection campaign! I wonder how many such funds went to similar work on previous occasions?

    It seems that at some point in time those within the Outlaw US Empire deemed it unimportant that other nations learn the funding for numerous NGOs seeking to subvert them are overtly financed by the USG and are thus not NGOs at all but CIA appendages; and that despite the overtness, the USG still claims those organizations to be legitimate NGOs.

    I find it worthy in an ironic manner that the USA will soon be eclipsed by the nation it might have become had it not sought to be a global empire. In fact, it's the very product of those Open Door policy advocates that will soon become the bane of their descendants who opted for a financialized Free Lunch economy for themselves instead of a massively robust, resilient industrial/commercial economy for all Americans.

    William Gruff , Aug 21 2019 20:40 utc | 16
    Falun Gong is kinda like Scientology crossed with Amway. Get rich quick while simultaneously healing your goiters. In its best days it was a terrible scam. Now it is just a blunt instrument that the US State Department uses to try and beat China with.
    FSD , Aug 21 2019 21:01 utc | 18
    The Epoch Times' Jeff Carlson has been in the thick of uncovering the broad Democratic Party coup (in league with transnational intelligence assets) against the Trump Presidency. Thus b's depiction here of the Dems potentially acting in the role of white knight subverts mountains of evidence. As for Falun Gong's potential affiliations with the CIA and NED that's another quite plausible storyline altogether.
    DrivelP , Aug 21 2019 21:32 utc | 19
    Funny thing, after watching a Vesti News video on youtube I saw a video ad for the Epoch Times. It had a young white millennial saying a bunch of propaganda drivel about the evil communist Chinese with regards to the Hong Kong protests.

    Money is flowing.

    [Aug 20, 2019] Trumponomics on the march: Israeli and EU farmers say thank you to Trump .

    Notable quotes:
    "... "The sentiment out in farm country is getting grimmer by the day," said John Heisdorffer, the chairman of the American Soybean Association. "Our patience is waning, our finances are suffering and the stress from months of living with the consequences of these tariffs is mounting. ..."
    "... The Republican senator Chuck Grassley, who represents Iowa, a state heavily reliant on agriculture, has called for a quick resolution to the dispute. "Americans understand the need to hold China accountable, but they also need to know that the administration understands the economic pain they would feel in a prolonged trade war," Grassley said in a statement. ..."
    May 14, 2019 | www.theguardian.com

    American farmers are likely to feel the pain first. Soybean exports to China collapsed last year when the trade war began, and agricultural exports will be hit harder when, or if, the new tariffs are imposed. Farmers are also suffering from extensive flooding that has delayed planting.

    "The sentiment out in farm country is getting grimmer by the day," said John Heisdorffer, the chairman of the American Soybean Association. "Our patience is waning, our finances are suffering and the stress from months of living with the consequences of these tariffs is mounting."

    The new round of tariffs will hit other parts of the US food industry, with beans, lentils, honey, flour, corn and oats all on the list of goods that will be taxed.

    ... ... ...

    The Republican senator Chuck Grassley, who represents Iowa, a state heavily reliant on agriculture, has called for a quick resolution to the dispute. "Americans understand the need to hold China accountable, but they also need to know that the administration understands the economic pain they would feel in a prolonged trade war," Grassley said in a statement.

    [Aug 20, 2019] China Warns Trump It Won't Make Trade Concession If US Plays Hong Kong Card

    Aug 20, 2019 | www.zerohedge.com

    China Warns Trump It Won't Make Trade Concession If US "Plays Hong Kong Card"

    by Tyler Durden Tue, 08/20/2019 - 09:15 0 SHARES

    Just days after Trump for the first time linked the ongoing Hong Kong protests with his assessment of the US-China trade war, Beijing has issued an ultimatum to the White House: the United States should not link trade negotiations with China to the Hong Kong protests, denouncing such a move as a miscalculation.

    In a short commentary published by Communist Party mouthpiece People's Daily late on Monday, the author said that events in Hong Kong were the internal affairs of China, and linking them with trade negotiations was a "dirty" aim.

    "Making a fuss about Hong Kong will not be helpful to economic and trade negotiations between China and the US," the commentary said. " They would be naive in thinking China would make concessions if they played the Hong Kong card " the oped cautioned.

    Chinese diplomatic observers also said Beijing considered the worsening situation in Hong Kong a sovereignty issue and would be highly unlikely to cave to Washington's pressure.

    The remarks followed a statement by US Vice-President Mike Pence on Monday which reiterated President Donald Trump's demand to tie the largely stalled trade talks with Hong Kong's deepening crisis, a day after hundreds of thousands of people marched peacefully in defiance of repeated intimidation from Beijing. In an address at the Detroit Economic Club on Monday, Pence said the Trump administration would continue to urge Beijing to resolve differences with the protesters peacefully and warned that it would be harder for Washington to make a trade deal with Beijing if there was violence in the former British territory. Separately, Mike Pompeo said that China should allow Hong Kong protesters the freedom to express themselves, in what China saw as clear interference in its own internal matters.

    The Chinese article countered by saying that the top priority for Hong Kong was to stop violence and restore order, adding that US politicians should not send the wrong message to people creating chaos in the city. "In the face of political intimidation, we not only dare to say no, but also take countermeasures," it warned.

    Global Times, a tabloid controlled by the flagship state-run newspaper People's Daily, also warned in an editorial on Monday that American political and public opinion elites should not harbour the illusion they could influence China's decisions on Hong Kong.

    "Because of the trade war, the US has lost the ability to impose additional pressure on China," it said.

    "The US should stop its meaningless threat of linking the China-US trade talks with the Hong Kong problem. Beijing did not expect to quickly reach a trade deal with Washington. More Chinese people are prepared that China and the US may not reach a deal for a long time."

    Chinese analysts noted Trump appeared to have hardened his stance on Hong Kong in the past week or so, under growing pressure from US lawmakers and extensive media coverage of the increasingly violent protests. Indeed, it was only a month ago when we reported that " Trump Abandoned Support For Hong Kong Protests To Revive Trade Talks With Beijing ." Now that trade war is once again front and center, with Trump using it as leverage for further Fed rate cuts, the US president is once again refocusing his attention on Hong Kong.

    As the SCMP writes , Trump initially focused on making a deal with China ahead of his 2020 re-election bid and adopted a hands-off approach by characterizing the protests as "riots" which were a matter for China to handle. Over the past few days, he suggested Chinese President Xi Jinping should resolve the situation by meeting with protest leaders and warned that any violence in the handling of the Hong Kong crisis would exacerbate difficulties for attempts to bring an early end to the trade war.

    "Trump's about-face on Hong Kong, from being neutral to piling pressure on Beijing, is largely due to domestic political pressure ahead of the presidential elections," said Shi Yinhong, an international relations expert at Renmin University and an adviser to the State Council which is China's cabinet.

    " But the Hong Kong issue concerns China's sovereignty and the government's ability to maintain stability, which in Beijing's view is of superior priority . China cannot afford to make much compromise and will do everything to fend off interventions from abroad, in spite of all the risks and ramifications," he said.

    Despite the soured mood between China and the US over their spiralling trade war – as well as escalating tensions over Huawei, Taiwan and other geopolitical rifts – both sides were planning further trade talks in the coming 10 days, according to White House chief economic adviser Larry Kudlow on Sunday.

    Any progress would be virtually impossible with analysts cautioning that the US attempt to "play the Hong Kong card" would further complicate the trade talks.

    Meanwhile, in the latest significant escalation in diplomatic tensions, China responded angrily to Washington's decision on a US$8 billion sale of F-16 fighter jets to Taiwan and Trump's warning against Huawei citing national security threats.

    "When a long list of old problems between the two countries remains unsolved, the US side is now ramping up the pressure on Hong Kong," said Shen Dingli, a professor of US studies at Fudan University. "China has so far refused to make concessions in the absence of adequate mutual respect and trust and I don't think we'll have much room to compromise on Hong Kong or other issues. We'll have to wait and see what the US would do next," he said.

    Shi also said none of the flashpoints in the bilateral ties – from Hong Kong, Taiwan, to the South China Sea and the denuclearisation of North Korea – had any easy solution in sight, with both sides showing little willingness to cooperate and accommodate the other's interests. He said the increasingly hardline, confrontational approach on China by Trump – who faced mounting pressure in his bid for re-election, especially amid signs of a looming global economic recession – would only make a trade deal increasingly unattainable.

    "Even if there were no Hong Kong crisis, could the US and China reach a trade deal? Even if Beijing caved into Washington's pressure on Hong Kong, would it make it easier for them to bridge their glaring differences in the trade talks and cut a deal?"

    Of course not, and since Trump is far more interested in keeping trade war simmering and on the verge of a substantial escalation if only to keep the Fed on its toes and ready for far more aggressive rate cuts, and even "some quantitative easing", that's precisely what the US president wants.

    [Aug 17, 2019] Charge us More by Michael Hudson

    Aug 15, 2019 | michael-hudson.com

    Trump's claim that China is paying for the tariffs is completely false and basically serves to redirect income from his poor supporters to his wealthy supporters.

    Not only that, the policy will have the consequence of further isolating the United States, says Michael Hudson.

    [Aug 13, 2019] Trump Is Delaying Tariffs on China for Holiday Shopping Season

    Aug 13, 2019 | economistsview.typepad.com

    im1dc , August 13, 2019 at 09:46 AM

    Ho Ho Ho

    https://www.thedailybeast.com/trump-is-delaying-tariffs-on-china-for-holiday-shopping-season?ref=home

    "Trump Is Delaying Tariffs on China for Holiday Shopping Season"

    by Shira Feder...08.13.19...11:04AM ET

    "The Trump administration announced Tuesday that tariffs set to be imposed Sept. 1 on Chinese consumer products like electronics, sneakers, and video game consoles will not go into effect until Dec. 15."...

    Fred C. Dobbs , August 13, 2019 at 09:50 AM
    (Ho, ho, ho!)

    US to Delay Some China Tariffs Until Stores Stock
    Up for Holiday Shoppers https://nyti.ms/2H50NMv
    NYT - Ana Swanson - August 13

    The Trump administration on Tuesday narrowed the list of Chinese products it plans to impose new tariffs on as of Sept. 1, delaying levies on cellphones, laptop computers, toys and other consumer goods until after stores stock up for the back-to-school and holiday shopping seasons. Stocks soared on the news.

    The move, which pushed a new 10 percent tariff on some goods until Dec. 15 and spared others entirely, came as President Trump faces mounting pressure from businesses and consumer groups over the harm they say the continuing trade war between the United States and China is doing.

    Mr. Trump's earlier tariffs on Chinese imports were carefully crafted to hit businesses in ways that everyday Americans would mostly not notice. But his announcement this month of the 10 percent tariff on $300 billion of Chinese goods meant consumers would soon feel the trade war's sting more directly.

    On Tuesday, Mr. Trump acknowledged as much.

    "We're doing this for the Christmas season," he told reporters around noon. "Just in case some of the tariffs would have an impact on U.S. customers." ...

    Fred C. Dobbs said in reply to Fred C. Dobbs... , August 13, 2019 at 09:54 AM
    ... Mr. Trump's comments about the tariffs' impact on consumers followed the United States trade representative's office announcement that while the new tariffs would take effect as Mr. Trump had threatened, some notable items would not immediately be subject to them.

    Consumer electronics, video game consoles, some toys, computer monitors and some footwear and clothing items were among the items the trade representative's office said would not be hit with tariffs until retailers had time to stockpile what they needed for their busiest time of year.

    The administration also said some products were being removed from the tariff list altogether "based on health, safety, national security and other factors." A spokesman for the trade representative's office said the products being excluded from the tariffs included car seats, shipping containers, cranes, certain fish and Bibles and other religious literature.

    The S&P 500 climbed nearly 2 percent after the announcement, lifted partly by stocks of retailers and computer chip producers that have been sensitive to indications that trade tensions were getting either better or worse.

    Best Buy, which gets a many of the products it sells from China, was among the best-performing stocks in the S&P 500, up more than 8 percent in morning trading. The Nasdaq composite index rose more than 2 percent. ...

    [Aug 11, 2019] How much of US China trade imbalance are due to each country's trade policy

    Aug 11, 2019 | economistsview.typepad.com

    anne , August 10, 2019 at 07:06 AM

    https://twitter.com/paulkrugman/status/1160183976771936257

    Paul Krugman @paulkrugman

    OK, I'm having a very nerdy moment. Trying to understand why US-China bilateral trade imbalance is so large. NOT because it's important, but just because it's kind of a puzzle; I guess it's my inner @Brad_Setser 1/

    6:39 AM - 10 Aug 2019

    So last year US goods imports from China were $539.5 billion, US goods exports $120.3 billion. That's 4.5 to 1. Why so much asymmetry? I think 4 reasons: Hong Kong, macroeconomics, value-added, and oil 2/

    Hong Kong: effectively part of the Chinese economy, and the US runs a large surplus - $37 b in exports, only $6 b in imports. Basically a lot of US goods appear to enter China via HK (something similar in Europe, where US exports to Germany go via Belgium/Netherlands) 3/

    Adding HK reduces the export imbalance to "only" 3.5 to 1. Now macro: the US runs overall trade deficit, with imports 1.5 times exports. China runs overall surplus, with imports only 0.8 exports. On some sort of gravity-ish story, this suggests ratio "should" be around 2 4/

    Now add China's role as "great assembler", with value-added in exports really coming from elsewhere; famous case of iPhone. Much less true than it used to be, but still means that Chinese surplus is partly optical illusion 5/

    Lastly, China imports a lot of oil, which means other things equal needs to run a surplus on everything else. Used to be true of US, but with fracking we're now almost self-sufficient in hydrocarbons (but not exporting to China) This adds a further reason for bilateral 6/

    Someone with more time and patience should try to do the full accounting, but I think the US-China bilateral can mainly be explained by "natural causes"; doesn't have much to do with either country's trade policy 7/

    RC (Ron) Weakley said in reply to anne... , August 10, 2019 at 07:17 AM
    I guess that Krugman is just a natural law kind of guy wherein IP protectionism and arbitrage seeking cross border capital flows in an exorbitantly privileged global reserve currency are just natural phenomenon like meteor showers and rain.
    anne -> RC (Ron) Weakley... , August 10, 2019 at 07:17 AM
    I tried, but have no idea what this criticism means; whereas I understand Paul Krugman.

    [Aug 08, 2019] China Retaliation Is '11' on Scale of 1 to 10, Wall Street Warns

    Notable quotes:
    "... "While there were measures that could have been chosen with larger direct effects on supply chains, the announcements from Beijing represent a direct shot at the White House and seem designed for maximum political impact," Krueger said. " We expect a quick (and possibly intemperate) response from the White House, and consequently expect a more rapid escalation of trade tensions." ..."
    "... In a mid-day note, Krueger added that "the next stop on the currency manipulation road is probably off the map." Krueger expects Trump's "drumbeat on currency" will get louder, with the potential for the president to use a "charge of currency manipulation to justify some combination of (more) tariffs, investment restrictions and export controls." ..."
    "... Instructing state-owned Chinese firms to halt U.S. crop purchases triggered "the obligatory flight-to-quality," which pushed 10-year yields to 1.74%, with two-year yields keeping pace. That was "an impressive move that suggests August will not experience the traditional summer doldrums. Who needs vacation anyway?" ..."
    "... Bank investors' eyes were "glued to the yield curve last week," with Trump's tariff tweet on Thursday, Graseck wrote in a note. They're now asking about Morgan Stanley's net interest margin (NIM), outlook. ..."
    Aug 08, 2019 | economistsview.typepad.com

    Fred C. Dobbs , August 05, 2019 at 01:39 PM

    China Retaliation Is '11' on Scale of 1 to 10, Wall Street Warns
    Bloomberg - Felice Maranz - August 5, 2019

    https://www.bloomberg.com/news/articles/2019-08-05/china-retaliation-is-11-on-scale-of-1-to-10-wall-street-warns

    Analysts continued to warn about the dangers of an escalating trade war on Monday, as China moved to strike back at the U.S., hitting U.S. stocks and boosting Treasuries.

    Semiconductors, with direct exposure to trade, and banks stocks, which are sensitive to interest rates, were among the decliners. The biggest U.S. banks slid, with the KBW Bank Index dropping as much as 4.1% to the lowest since June 4. Bank of America Corp. led index decliners, with a drop of 5.5%, the most since Dec. 4, while Citigroup Inc. shed more than 4% and JPMorgan Chase & Co. slipped 3.8%.

    Micron Technology Inc. fell 6.2% while Texas Instruments Inc. lost 4.4% and Intel Corp. was down 4%. Apple Inc. dropped 5.6%, the most since May 13. Shares in Chinese tech giants Alibaba Group Holding and JD.com Inc. fell near two month lows in U.S. Trading.

    Agriculture equipment makers Deere & Co. and AGCO Corp. tumbled as China suspended imports of U.S. agricultural products. The escalating trade tensions are also a major risk for the U.S. automotive industry, which has a significant exposure to the country. According to UBS's Global Wealth Management Chief Investment Officer Mark Haefele, the latest spat raises the possibility that "tariffs could also be placed on auto imports."

    President Donald Trump tweeted about China and the Fed on Monday morning, saying: "China dropped the price of their currency to an almost a historic low. It's called 'currency manipulation.' Are you listening Federal Reserve? This is a major violation which will greatly weaken China over time!"

    Here's a sample of some of the latest commentary:

    Cowen, Chris Krueger
    Krueger called China's retaliation "massive," adding that "on a scale of 1-10, it's an 11." He cited the Chinese government calling on state buyers to halt U.S. agricultural purchases, while there's "increased anecdotal evidence that the Chinese government is tightening its overview of foreign firms."

    "While there were measures that could have been chosen with larger direct effects on supply chains, the announcements from Beijing represent a direct shot at the White House and seem designed for maximum political impact," Krueger said. " We expect a quick (and possibly intemperate) response from the White House, and consequently expect a more rapid escalation of trade tensions."

    "There now will be increased expectations that the Fed will cut again in September to offset the drag caused by this escalation in the trade war," he added. "Such moves will only be a partial, lagged offset to the recessionary headwinds a cycle of retaliation would cause."

    In a mid-day note, Krueger added that "the next stop on the currency manipulation road is probably off the map." Krueger expects Trump's "drumbeat on currency" will get louder, with the potential for the president to use a "charge of currency manipulation to justify some combination of (more) tariffs, investment restrictions and export controls."

    BMO, Ian Lyngen
    "The wait is over for those wondering how Beijing would respond to Trump's recent tariff announcement," BMO said. "The result: the yuan was allowed to depreciate well beyond 7.0."

    Instructing state-owned Chinese firms to halt U.S. crop purchases triggered "the obligatory flight-to-quality," which pushed 10-year yields to 1.74%, with two-year yields keeping pace. That was "an impressive move that suggests August will not experience the traditional summer doldrums. Who needs vacation anyway?"

    "The most significant unknown at this moment," Lyngen added, "is how much further the yuan will be allowed to fall given that it's already the weakest since 2008."

    Morgan Stanley, Betsy Graseck (bank analyst)

    Bank investors' eyes were "glued to the yield curve last week," with Trump's tariff tweet on Thursday, Graseck wrote in a note. They're now asking about Morgan Stanley's net interest margin (NIM), outlook.

    Graseck didn't change her NIM assumptions -- yet. "We bake one additional cut of 25 basis points in 2019 in-line with our economist, and bake in the 10-year at 1.75% by mid 2020," she wrote. She'll update NIM and earnings per share estimates "if it looks like these trade tariffs are going through as September approaches."

    Morgan Stanley, Michael Zezas (policy strategist)

    "The dynamics of U.S.-China negotiation and macro conditions mean the next round of tariffs will likely be enacted, and investors are likely to behave as if further escalation will follow in 2019 until markets price in impacts," Zezas wrote. "This supports our core view of weaker growth and skews the Fed dovish."

    Zezas sees incentives for the U.S. to escalate quickly. If the administration "understands the Fed's trade policy reaction function, then it may also perceive that a more rapid escalation could deliver one or more of three beneficial points ahead of the 2020 election: 1) A quicker, potentially more aggressive Fed stimulus response that could help the economy heading into the election; 2) More time to re-frame the potential economic downside; and 3) A major concession by China (not our base case, but it is, of course, a possibility)."

    Veda, Henrietta Treyz

    "The U.S. and China are moving into one of their most aggressive phases yet in the year-plus long trade war and we fully expect things to escalate from here," Treyz wrote in a note.

    Treyz added that China's ability to quickly adjust their currency is an advantage they have over the U.S. that "goes to the heart of the issue for the Trump administration." The administration may view China's communist regime as a "systemic advantage" versus "free markets and democracy" in the U.S., as the Chinese can "subsidize domestic industry, quickly, enact lower tax rates and provide stimulus."

    Furthermore, her conversations with Republicans point to the belief that "China's economy is on the brink of collapse," she said, with turmoil in Hong Kong "considered evidence of an organic domestic uprising that many believe the Chinese government cannot contain."

    Republicans may also believe Trump will "galvanize" his base behind him, while attracting "anti-trade and union Democrats in the Rust Belt as he takes on the mantle of a war time president going into 2020 by engaging in this trade war." ...

    [Aug 08, 2019] There's a revealing puzzle in the China tariffs

    Aug 08, 2019 | economistsview.typepad.com

    anne , August 06, 2019 at 12:26 PM

    http://larrysummers.com/2019/05/15/theres-a-revealing-puzzle-in-the-china-tariffs/

    May 15, 2019

    There's a revealing puzzle in the China tariffs

    On Monday, China announced new tariffs on $60 billion of U.S. exports, and the United States threatened new tariffs on up to $300 billion of Chinese goods. These actions were cited as the principle reason for a decline of more than 600 points in the Dow Jones industrial average, or about 2.4 percent in broader measures of the stock market. With the total value of U.S. stocks around $30 trillion, this decline represents more than $700 billion in lost wealth.

    This was not an isolated event. Again and again in the past year, markets have gyrated in response to the state of trade negotiations between the United States and China.

    The market sensitivity to threats and counter-threats in the trade war is quite remarkable. Monday's announcement by the Chinese, for example, would be expected to raise China's tariffs by about $10 billion. Much of this will show up as higher prices for Chinese importers, and some of it will be avoided by diverting exports of goods such as liquid natural gas to other markets, so the impact on U.S. corporate profits will be far less than $10 billion. Meanwhile, U.S. tariffs are likely to raise corporate profits as higher import costs push some business to domestic producers.

    There is the further consideration that reasonable market participants should not have entirely discounted the possibility of tariff increases Monday and that there surely remains some chance a trade deal will be reached. So, in fact, the market should not even have moved in full proportion to the change in corporate profitability associated with new tariffs.

    There is a revealing puzzle here. Events whose direct impact on corporate profits is a few billion dollars seem to be driving market fluctuations that change the total value of corporations by hundreds of billions of dollars. To be sure, there would be many ways of refining my calculation of the profit impact to recognize various feedbacks, and certainly the imposition of tariffs increases uncertainty, which in general depresses markets. But with any plausible calculation of the direct impact of tariff changes on profitability or uncertainty about profitability, it is not possible to justify the kinds of changes in market value we observed Monday or on many other days when there was news about the status of the U.S.-China trade negotiations.

    Part of the answer to the puzzle, I suspect, lies in markets' tendency to sometimes overreact to news, especially in areas where they do not have long experience. This idea is supported by the tendency illustrated by the market's Tuesday rally, which took place without any particularly encouraging U.S.-China developments.

    A larger part of the answer probably lies in the idea that the current trade conflict is a possible prelude to a far larger conflict between the two nations with the largest economies and greatest power for as far as can be foreseen. When it appears less likely that a conflict over well-defined and ultimately not-that-difficult commercial issues can be resolved, rational observers conclude that it is also less likely the United States and China can manage issues ranging from 5G wireless technology to North Korea, from the future of Taiwan to global climate change, and from the management of globalization to the security architecture of the Pacific region.

    A world where relations between the United States and China are largely conflictual could involve a breakdown of global supply chains, a splinternet (as separate, noninteroperable internets compete around the world), greatly increased defense expenditures and conceivably even military conflict. All of this would be catastrophic for living standards and would also have huge adverse effects on the value of global companies.

    It is, I suspect, the greater risk of catastrophic medium-run outcomes, rather than the proximate impact of trade conflicts, that is driving the outsize market reactions to trade negotiation news.

    This carries with it an important lesson for both sides: It is risky to turn the pursuit of even vital national objectives into an existential crusade. Rather, even when nations have objectives that are in conflict, it is important to seek compromise, to avoid inflammatory rhetoric and to confine rather than enlarge the areas where demands are being made. Establishing credibility that promises will be kept and surprises will be avoided is as or more important with adversaries as with friends.

    As the Trump administration carries on the trade negotiations, and as the presidential campaign heats up, Americans will do well to remember that there is no greater threat to the success of our national enterprise over the next quarter-century than mismanagement of the relationship with China. It is not just possible but essential to be strong and resolute without being imprudent and provocative.

    -- Larry Summers

    anne -> anne... , August 06, 2019 at 12:29 PM
    Correcting date:

    May 15, 2019

    [Aug 08, 2019] White House To Unveil Rule Banning Agencies From Doing Business With Huawei

    Aug 08, 2019 | www.zerohedge.com

    As has long been expected, the White House is preparing to release a new rule on Wednesday barring government agencies from buying equipment or doing any kind of business with Chinese telecoms giant Huawei - ratcheting up tensions between the world's two largest economies at an already precarious time for the global economy.

    Here's more from CNBC :

    The Trump administration is expected to release a rule Wednesday afternoon that bans agencies from directly purchasing telecom, video surveillance equipment or services from Huawei. The prohibition was mandated by Congress as part of a broader defense bill signed into law last year.

    "The administration has a strong commitment to defending our nation from foreign adversaries, and will fully comply with Congress on the implementation of the prohibition of Chinese telecom and video surveillance equipment, including Huawei equipment," said Jacob Wood, a spokesman for the Office of Management and Budget.

    Per CNBC, the new rule is expected to take effect a week from Wednesday, and it applies not only to Huawei, but also to a list of other telecom companies that have drawn security concerns, such as ZTE and Hikvision.

    The official said contractors will be able to seek waivers from individual federal agencies if they believe their business with any of the targeted companies should be exempt from the rule.

    Moreover, the new rule will also set a deadline of August 2020 for a broader ban on federal contractors doing business with Huawei and other firms.

    The law passed by Congress is separate from the Trump Administration's own efforts to keep Huawei in check.

    The Commerce Department instigated the tensions between the US and China after it placed Huawei on a blacklist that effectively bans the company from buying goods or doing any kind of business with Huawei. A 90-day grace period that kept Huawei off the blacklist temporarily is now almost over. And President Trump has apparently walked back his promised, made at the G-20 Summit in Osaka, to ease the pressure on Huawei.

    However, US chipmakers and tech firms can request waivers, and the CEOs of Google, Qualcomm, Micron, Intel and others met with President Donald Trump at the White House last month and urged the administration to issue those decisions quickly.

    In an interview on CNBC, Huawei CSO Andy Purdy defended the company's track record, arguing that European leaders in the UK and Germany had told their counterparts in the US that they had found no evidence that Huawei was a security threat.

    "We have tested the products of all vendors to international standards so that there's trust through verification," Purdy said.

    But that likely won't change anybody's mind.


    TheRapture , 9 hours ago link

    Expect a new rule from China:

    All Chinese government agencies will be prohibited from buying CISCO and other American telecommunications products. Furthermore, contractors dealing with Chinese government agencies will also be so prohibited from buying American telecom products.

    America - population 329 million. Economic growth rate: 2.8%
    China - population 1.4 billion. Economic growth rate: 6.5%
    source: Wikipedia

    China is rapidly industrializing, and has the largest manufacturing base in the world. The USA is already a mature industrial economy, and since NAFTA has offshored most of its manufacturing base. The USA leads the world in the design, manufacture and export of weapons, but relies on coercive political relationships (such as NATO) rather than the "free market" to sell its overpriced and line of products to captive satellite countries. China is rapidly expanding in the weapons manufacturing sphere, as is Russia, and offer increasingly competitive products at lower prices, and with fewer political strings attached.

    Something to think about before breastbeating and cheering ourselves on.

    CashMcCall , 10 hours ago link

    Trump is getting the **** kicked out of him on CNBC and every Financial media on the internet. When China dug in, that was the end of the Trump bluff. For the first time, the absurd articles about China losing are gone and now the new reality is that China is going to squeeze the life out of Trump.

    Huawei is just another of Trump's wayward policies of getting Canadian poodles to kidnap Huawei's founder's daughter. Nice dirty **** Trump. Women already hate Trump this ices that cake.

    Last week Huawei overtook Apple as the second largest smart phone maker. Huawei announced it no longer had any dependence on US manufacturers for 5G, another body blow to the blowhard.

    Dozens of certifying agencies have no studied Huawei products and have found zero instances of spyware or any instance of this hardware being used for spying. In short, Trump and the NSA and CIA look like a bunch of assholes. This will only accelerate Huawei's 5G rollout.

    Trump is being **** canned in every direction. The great part of Trump von hitler's personality is that he knows his 10% Sept Tariffs were essentially the end of his presidency, but is too arrogant to reverse course. Instead, he is screaming at the Fed for more loose money to support his bad policies. And he wants more Farmer WELFARE. That dog don't hunt!

    China is not going to roll over over for Trump. The financial media is now tearing Trump a new ******* every hour. Markets are not responding to Trump plunge team efforts. They continue to sell off.

    Where's the endgame they ask? This is the same deal as Trump closing down the gov for nothing. Trumptards cheered as the orange idiot painted himself in the corner and accomplished nothing. Not one inch of wall has been constructed since Trump took office. Trump floats on a raft of ********. Meanwhile Trump has a 20 year history of hiring Illegals for Trump Organization. Total Fraud and self dealer.

    The GOP is now climbing the walls. Today Trump Screamed at the Fed to reduce rates emergently and then said it had nothing to do with China. Astonishing.

    When China put an end to US Ag purchases effective immediately they were basically saying they were tired of Trump's ********. The farmer associations are turning on Trump round the clock. Where is Trump? He's hiding out. But of course this has NOTHING to do with China.

    But here is Trump once again playing the phony national Security card with Huawei when a dozen independent organizations have published reports and cleared Huawei of the Trump Administration's phony security claims.

    vincenze , 11 hours ago link

    Huawei Honor smartphones and tablets are really good. The top models are even better than iPhones.

    There were some Chinese smartphones at Best Buy the last time I checked.

    But I just bought the 128Gb Lenovo Zuk for $280 from Banggoog a couple years ago when it was on sale. It's a little problematic to update Android, but it works perfectly anyway. There is a forum for Lenovo phones, though, with all answers.

    There is no need to buy from Best Buy or Amazon, buy cheaper directly from China.
    https://www.banggood.com/Wholesale-Smartphones-c-1567.html

    me or you , 11 hours ago link

    Back into reality.: Huawei to invest £1.2bn in new Shanghai R&D Centre, Build 'Self-Reliance' Amid US Trade War on

    Tachyon5321 , 11 hours ago link

    Poland's state security agency arrested Huawei sales director Wang Weijing and a Polish national over spying.

    Dongfan Chung The 74-year-old former Boeing Co. engineer was convicted in July of six counts of economic espionage and other federal charges for keeping 300,000 pages of sensitive papers in his home

    Chi Mak He copied and sent sensitive documents on U.S. Navy ships, submarines and weapons to China by courier.

    Don't waste my time. A 20 second google search shows you have no point, but the one on the top of your head.

    Thus, Given the Chinese government's record on espionage, "a good-faith assertion from Andy is not enough."

    Asoka_The_Great , 12 hours ago link

    Trumptard and the US Dark State's campaign to KILL Huawei has failed spectacularly.

    Huawei reported revenue growth of 23% in the first half of 2019.

    https://www.huawei.com/en/press-events/news/2019/7/huawei-announces-h1-2019-revenue

    "In Huawei's carrier business , H1 sales revenue reached CNY146.5 billion, with steady growth in production and shipment of equipment for wireless networks, optical transmission, data communications, IT, and related product domains. To date, Huawei has secured 50 commercial 5G contracts and has shipped more than 150,000 base stations to markets around the world.

    In Huawei's enterprise business , H1 sales revenue was CNY31.6 billion. Huawei continues to enhance its ICT portfolio across multiple domains, including cloud, artificial intelligence, campus networks, data centers, Internet of Things, and intelligent computing. It remains a trusted supplier for government and utility customers, as well as customers in commercial sectors like finance, transportation, energy, and automobile.

    In Huawei's consumer business , H1 sales revenue hit CNY220.8 billion. Huawei's smartphone shipments (including Honor phones) reached 118 million units, up 24% YoY . The company also saw rapid growth in its shipments of tablets, PCs, and wearables. Huawei is beginning to scale its device ecosystem to deliver a more seamless intelligent experience across all major user scenarios. To date, the Huawei Mobile Services ecosystem has more than 800,000 registered developers, and 500 million users worldwide.

    "Revenue grew fast up through May," said Liang. "Given the foundation we laid in the first half of the year, we continue to see growth even after we were added to the entity list. That's not to say we don't have difficulties ahead. We do, and they may affect the pace of our growth in the short term."

    He added, "But we will stay the course. We are fully confident in what the future holds, and we will continue investing as planned – including a total of CNY120 billion in R&D this year. We'll get through these challenges, and we're confident that Huawei will enter a new stage of growth after the worst of this is behind us."

    [1

    Tachyon5321 , 11 hours ago link

    Just more proof that Huawei is selling into the USA at below cost. A massive drop in American sales improved the razor thin profit of the company...

    Asoka_The_Great , 11 hours ago link

    "Just more proof that Huawei is selling into the USA at below cost. "

    WHAT A DUMB ****!

    HUAWEI HAS NO MARKETSHARE IN US.

    Huawei Networking Equipments was banned in US, years ago. None of three major US cellular networks use Huawei's equipment or sell its smartphones.

    Tachyon5321 , 4 hours ago link

    WHAT A DUMB ****!: Thanks!!! That makes me 3 times smarter than you because Huawei subcontractors do sell Huawei products in the USA. You are an ignorant Asian that should go back to his village and the one room dirt floor hut... LOL

    Edit: 8% margins....LOL

    Everybodys All American , 12 hours ago link

    I'd be the first to say that I don't know everything about this telecom but I will say this seems like a reasonable decision on it's face for the US government not to put in Chinese telecommunications equipment. Of course China is going to not like it because with Hillary she just gave them direct access to damn near anything through her email server.

    Archeofuturist , 12 hours ago link

    Exactly. Every penny .gov spends should mandated that it MUST be from America companies. Every nut, every bolt.

    [Aug 06, 2019] Pretty glum outlook on US China trade war

    Aug 06, 2019 | www.moonofalabama.org

    Passer by , Aug 5 2019 22:48 utc | 61

    b, the trade war is escalating, For The First Time In 25 Years, US Treasury Just Designated China A Currency Manipulator.

    Can you make an article on the situation?

    karlof1 , Aug 6 2019 0:26 utc | 65

    Passer by @61--

    First, Trump coerced the Fed into lowering interest rates which made US Dollars cheaper to buy then he increased domestic taxation 10% though increasing the tariff on selected Chinese goods. China then blocks the importation of all US foodstuffs and lowers the price of the Yuan an amount equal to the tariff increase--and the US treasury and Trump have the gall to call China the currency manipulator! NO, as usual with the Outlaw US Empire, it's accusations are psychological projection of what itself does. Hudson discusses it here . US financial markets have finally awakened to Trump's moves and have fallen 5% over the last three trading days, with more likely to follow. Hudson on Trump:

    "It's all a diversion so that people won't look at what's really happening, only at what Trump is saying. But as people find that they have to pay higher prices, I don't think they'll believe Trump. I think he's lost all credibility. That's why the stock market's collapsing. They're aghast. They think that even Trump can't get away with this big a lie when it's so obviously false."

    As I commented last Friday on the AP article my local paper ran about the tariff hike, it finally told the truth about who'll pay--US Consumers or China: US Consumers! AP, All Propaganda, tore a gapping hole into Trump's narrative--but will people believe a media outlet that's lied so often?

    Trump can't win his global trade war. China won't capitulate; it's economy and society are 100x healthier than the Outlaw US Empire's and are resilient where the USA can only claim to have been once upon a time. Why that is has been explained before. The transcript of this interview's poor, but the topic covers the answer by showing how Canada's economy became a victim of the same predators as the USA's.

    We know what happened, how and why. What we don't know how to do is reverse the situation politically. Hudson compares the dire situation to that of Rome:

    "So they obviously, the left-wingers such as Bernie Sanders, want to run for president as a kind of educational campaign to make their policy clear to the people, but they know that there's no way in which the ruling class will let them win.

    "It's been very clear, if they did win, they would be assassinated very quickly. I've been told that by presidential candidates. The threat is, you'll never be president, we have ways of keeping you out, and should you succeed, we will do to you what the Romans did to every advocate of democracy century after century, assassination."

    It seems the best those of us residing within the Outlaw US Empire can hope for is that Trump's policies will decimate US financial institutions worse than what occurred in 2008. Hudson's perspective:

    "I don't see any popular movement yet. You can very easily see why collapse is inevitable....

    "There's no way of knowing when there will be a break in the chain of payment. Usually it's a bankruptcy of a big company, very often by fraud, as the 2008 crisis was bank mortgage fraud. You don't know when people will fight back. Often, surprisingly, they only fight back when things are getting better. But things still have a way to go to get much worse in Canada, much worse in the United States, so I don't see any possibility of reform within the next 4 to 8 years."

    Pretty glum outlook.

    [Aug 05, 2019] Impulsive and aggreesive President: not a good combination

    Aug 05, 2019 | www.moonofalabama.org

    Passer by , Aug 4 2019 23:56 utc | 56

    Trump Overruled All Advisors Except Navarro "In Heated Exchange" Before Launching New China Tariffs

    https://www.zerohedge.com/news/2019-08-04/trump-overruled-all-advisors-except-navarro-launching-new-china-tariffs

    So much for Trump being a "moderate" and "not a hawk".

    In my assessment Trump is very aggressive President foreign policy wise. Way more aggressive than Obama.

    [Aug 04, 2019] Bank of America What Trump Did Is A Game Changer

    Price of clothing is already noticeably higher with some categories (shooes) affected more then others.
    Aug 04, 2019 | www.zerohedge.com

    However, all that is about to change, because as Bank of America team of economists writes, Trump's latest tariff announcement from last Thursday, when the president shockingly unveiled 10% tariffs on $300BN in Chinese imports starting September 1, "is a major escalation." The reason for this is that past measures had mostly avoided consumer goods. By contrast, the threatened tariffs would cover $120bn of consumer goods, out of $300bn in total, and since BofA expects the tariffs to be implemented, either on schedule or later this year, the period of dormant trade war inflation is about to end with a bang, not a whimper.

    ... ... ...

    Was Trump's announcement a negotiating tactic?

    For the past year, one of the points of biggest contention among economists and traders is that despite what is now a 1+ year trade war with China, inflation due to higher tariffs has been strangely missing, with some claiming that the goods targeted in previous tariff rounds were either not "consumer" enough, or simply had more affordable substitutes from other, non-Chinese supply chains, allowing US consumer to avoid having higher prices passed upon them.

    However, all that is about to change, because as Bank of America team of economists writes, Trump's latest tariff announcement from last Thursday, when the president shockingly unveiled 10% tariffs on $300BN in Chinese imports starting September 1, "is a major escalation." The reason for this is that past measures had mostly avoided consumer goods. By contrast, the threatened tariffs would cover $120bn of consumer goods, out of $300bn in total, and since BofA expects the tariffs to be implemented, either on schedule or later this year, the period of dormant trade war inflation is about to end with a bang, not a whimper.

    bitzager , 7 minutes ago link

    "Game Changer" - What's in your wallet? We'll soon find out in

    the Walmart near you.. :)))

    2banana , 13 minutes ago link

    Well, a silly "feedback loop" as for the first three years of Trump being elected - the Fed RAISED rates eight (8) times.

    In the face of all the tariffs during that time period and a trade war with China.

    Also - the Fed started the Great QE unwind in the same time period - "withdrawing" $700 billion from circulation.

    [Aug 04, 2019] Commentary China will never buckle under Washington's old trick of trade bullying

    Notable quotes:
    "... As the U.S. administration is ready to impose a 10 percent tariff on the remaining 300 billion U.S. dollars of Chinese imports, its sincerity in reaching a mutually beneficial trade deal with Beijing that can accommodate each other's major concerns has gone bust. It seems that in the eyes of Washington's China hawks, trade talks are no more than a formality with which to rip China off. ..."
    "... While the White House is boasting about taxing China until a trade deal is reached, it should keep in mind that China will only accept a win-win agreement on the basis of mutual respect and equal treatment. ..."
    "... Beijing's position has been consistent and clear: China does not want a trade war, but it is not afraid of one and will fight one if necessary. ..."
    "... It is therefore hoped that Washington should drop its fantasy to bring Beijing down to its knees with its same and old tricks of maximun pressure. If it truly wants a deal, then they will need to show some real sincerity first. ..."
    Aug 02, 2019 | www.xinhuanet.com

    Despite calling the just-concluded China-U.S. trade talks in Shanghai "constructive" and hoping for more "positive dialogue," the White House on Thursday announced plans to impose extra tariffs on Chinese imports from Sept. 1.

    Washington's unilateral escalation of trade disputes is a serious breach of trust after the two sides reached in June consensus to restart trade talks on the basis of equality and mutual respect.

    Apart from undermining the momentum of the newly resumed China-U.S. trade talks, the U.S. flip-flopping again exemplifies Washington's untrustworthiness in striking a deal and its disturbing propensity for bullying.

    The U.S. administration should bear in mind that its bullying and tariff threat, which has not worked in the past, will not work this time.

    For over a year, the U.S.-initiated trade disputes with China have bogged down not just economic growth of the two countries but that of the whole world. Meanwhile, an increasingly capricious Washington is harming the current world order with more uncertainties.

    As the U.S. administration is ready to impose a 10 percent tariff on the remaining 300 billion U.S. dollars of Chinese imports, its sincerity in reaching a mutually beneficial trade deal with Beijing that can accommodate each other's major concerns has gone bust. It seems that in the eyes of Washington's China hawks, trade talks are no more than a formality with which to rip China off.

    Also, the new twist in China-U.S. trade talks shows that some Washington politicians are trying to play tough against China on trade matters and gain cheap political points as the new cycle of U.S. presidential election is looming.

    Unlike previous rounds of taxing Chinese imports, the U.S. administration this time is targeting a wide swath of consumer goods, and therefore, is "using American families as a hostage" in its trade negotiations, according to Matt Priest, president of the Footwear Distributors and Retailers of America.

    While the White House is boasting about taxing China until a trade deal is reached, it should keep in mind that China will only accept a win-win agreement on the basis of mutual respect and equal treatment.

    Beijing's position has been consistent and clear: China does not want a trade war, but it is not afraid of one and will fight one if necessary.

    In response to Washington's tariff assaults since March 2018, China has had to take forceful counter measures. This instance will be no exception.

    Still, Beijing remains committed to handling its trade problems with Washington as long as the settlement is based on mutual respect and equality, and conform to China's core interests. China, which still sees a steady economic growth and boasts enormous potential for further development, will always find a way to withstand any pressure if there no deal is reached.

    It is therefore hoped that Washington should drop its fantasy to bring Beijing down to its knees with its same and old tricks of maximun pressure. If it truly wants a deal, then they will need to show some real sincerity first.

    [Aug 03, 2019] China's UN Envoy Says If US Wants To Fight, We Will Fight, Warns Beijing Will No Longer Allow Hong Kong Protests

    Aug 03, 2019 | www.zerohedge.com

    he war of words between the world's top superpowers is getting more heated by the hour.

    China's new ambassador to the United Nations, Zhang Jun, said on Friday that if the United States wanted to fight China on trade, "then we will fight" and warned that Beijing was prepared to take countermeasures over new U.S. tariffs, Reuters reports.

    "China's position is very clear that if U.S. wishes to talk, then we will talk, if they want to fight, then we will fight," he told reporters. Calling Trump latest tariff announcement an "irrational, irresponsible act", Jun said that China "definitely will take whatever necessary countermeasures to protect our fundamental right, and we also urge the United States to come back to the right track in finding the right solution through the right way." The ambassador also took a stab at the disintegration of good relations between the US and North Korea (with Beijing's blessing no doubt), saying that "you cannot simply ask DPRK to do as much as possible while you maintain the sanctions against DPRK, that definitely is not helpful" Yun said siding the the Kim regime. It was more than obvious who the "you" he referred to was.

    Pouring more salt on the sound, the Chinese diplomat said North Korea should be encourage, and "we think at an appropriate time there should be action taken to ease the sanctions", explicitly taking Pyongyang's side in the ongoing diplomatic saga between Kim and Trump.

    When asked if China's trade relations with the United States could harm cooperation between the countries on dealing with North Korea, Zhang said it would be difficult to predict. He added: "It will be hard to imagine that on the one hand you are seeking the cooperation from your partner, and on the other hand you are hurting the interests of your partner."

    As North Korea's ally and neighbor, China's role in agreeing to and enforcing international sanctions on the country over its nuclear and ballistic missile programs has been crucial.

    However, it is what he said last that was most notable, as it touched on what will likely be the next big geopolitical swan, namely Hong Kong. To wit, Jun said that while Beijing is willing to cooperate with UN member states, it will never allow interference in "internal affairs" such as the controversial regions of Xinjiang and Tibet, and - last but not least - Hong Kong.

    And in the latest warning to the defiant financial capital of the Pacific Rim, Jun virtually warned that a Chinese incursion is now just a matter of time, he said that Hong Kong protests are "really turning out to be chaotic and violent and we should no longer allow them to continue this reprehensible behavior."

    ... ... ...

    [Aug 03, 2019] Bloomberg Economics initial estimate of the additional costs of U.S. tariffs and Chinese retaliation sees both economies taking a 0.2% hit to GDP by 2021

    This might speed up "Trump recession"
    Aug 03, 2019 | www.bloomberg.com

    President Donald Trump's threat Thursday to put 10% tariffs on the remaining $300 billion of Chinese imports that aren't subject to his existing levies sent markets tumbling from Asia to Europe and in the U.S. on Friday. The new tax would hit American consumers, and businesses are going to face even more supply disruptions . China has already vowed to retaliate if Trump follows through.

    Bloomberg Economics ' initial estimate of the additional costs of U.S. tariffs and Chinese retaliation sees both economies taking a 0.2% hit to GDP by 2021.

    Meanwhile, a simmering trade fight between Japan and South Korea is boiling over , putting the health of two Asian export powers at stake. In Europe, concerns are mounting for a hard U.K. exit from the European Union.

    The week ended with fresh numbers out of Washington that show U.S. trade actually declined during the first six months of the year as exports flattened out.

    [Aug 02, 2019] Global Smartphone Shipments Plunge Again, Huawei Displaces Apple As No.2

    Aug 02, 2019 | www.zerohedge.com

    The global smartphone bust is currently underway (has been for some time) - but there's a new, surprising trend that could highlight one reason why the Trump administration has waged economic war against China.

    First, let's start with the global smartphone shipment data from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker.

    This new data details how worldwide smartphone shipments fell 2.3% in 2Q19 YoY. It also states that smartphone manufacturers shipped 333.2 million phones in 2Q19, which was up 6.5% QoQ.

    An escalating trade war between the US and China contributed to sharp declines in shipments in both countries over the last year. However, the declines weren't nearly as severe as expected in China over 1H19 versus 1H18, suggesting that three years of a smartphone bust in Asia could be nearing a recovery phase. Asia/Pacific (excluding Japan and China) maintained solid momentum in 2Q YoY, with shipments up 3% in the quarter fueled by Southeast Asia markets.

    The surprising trend IDC detected is that Huawei surpassed Apple in 2Q19, making it the first time in seven years that Samsung and Apple weren't the top smartphones manufactures in the world.

    Now it seems that a South Korea company [Samsung] and a Chinese company [Huawei] are the world leaders in smartphone shipments, something that has irritated the Trump administration.

    Samsung ranked No.1 with 75.5 million shipments in 2Q19, a 5.5% YoY increase. Huawei was No.2 with 58.7 million shipments in 2Q19, a 8.3% YoY jump. Apple was No.3 with 33.8 million shipments in 2Q19, a -18.2% YoY plunge.


    Cheap Chinese Crap , 1 minute ago link

    So let's see if I got this straight:

    1) Huawei announces a .6% decline in shipments worldwide over the Q1 numbers.

    2) Huawei announces an all-time high in domestic operations that now take up 62% of its sales.

    What do these two numbers hide?

    That Huawei's shipments to the international market must have suffered a considerable decline.

    That the rise in sales in low-value Chinese phones doesn't begin to offset the large drop in high-value developed world sales except on a purely nominal numerical basis of numbers of phones sold. The money isn't in the phones. It's in the plans. In fact, China pioneered the idea of giving the phones away for free and then making it all back on the gated connection plans.

    But there's no way that one Chinese plan equals one western plan in profitability back to the company, so buffing up the domestic numbers at the expense of the cash cow numbers overseas is ultimately not a good business strategy.

    Plus of course Huawei can report any number it wants inside China and nobody has any way of testing its veracity. They could have shipped 20,000,000 phones to distributors on consignment and then marked it up as sales.

    TheABaum , 6 minutes ago link

    Apple's been running on momentum since 2011. Cook isn't Jobs.

    Max.Power , 19 minutes ago link

    Apple is trapped in a once-brilliant marketing strategy which it struggles to escape now: hi-end expensive devices.

    It's not a hi-end product anymore, so it becomes more difficult to justify the price even for true fans.

    Omni Consumer Product , 4 minutes ago link

    It's still high-end, per se. But the price premium is no longer justified because other companies have commoditized the high-end features.

    Frankly, the company was doomed the moment Jobs died and the reins were turned over to Cook - an accountant by training, who clearly has no futurist vision or marketing skill whatsoever.

    Jobs might have been a puffed up peacock, but he was a master of creating the Reality Distortion Field.

    deFLorable hillbilly , 36 minutes ago link

    Smartphones are no longer fun or new or anything other than a commodity.

    Now they're also devices which even the dumbest know track your every thought, purchase, move, etc...

    It's like having a little East German Stasi agent in your pocket.

    I hope they all go broke.

    TheABaum , 4 minutes ago link

    The curse of always on, always with you, always spying and always misplaced.

    He–Mene Mox Mox , 39 minutes ago link

    There is one big problem that no one is talking about. The cell phone market is over saturated! Practically everyone has got a cell phone these days. It's like the auto industry. There has been an over production 10 billion automobiles in the world for 7.2 billion people, of which half really can't afford to buy, much less drive, or even have a place to park it. I have seen people with 3 and 4 cell phones, but you only have 2 ears. How are more cell phones going to help you? Even women don't multitask that well.

    The only thing that would make sales better on cell phones is if you could combine the computing power of a Cray computer into a roll-up tablet. Or, maybe a brain implant would be even better.

    deFLorable hillbilly , 33 minutes ago link

    No, they'll realize that it's far easier to design phones that fall apart after 18 month than to keep building quality products. Like American cars.

    Iconoclast422 , 40 minutes ago link

    who the hell is buying 11 million pieces of iCrap each month?

    navy62802 , 57 minutes ago link

    Apple has slowly but steadily declined overall since Steve Jobs' death. It's really sad to see the company steadily decline like it has.

    adr , 1 hour ago link

    Apple's iPhone shipments and sales have been falling for five years. Yet the company added $600billion in marketcap during that time.

    That is the insanity of Wall Street.

    Max.Power , 22 minutes ago link

    In modern days, even having a negative profit for years doesn't mean you can't increase market capitalization.

    thereasonableinvestor , 1 hour ago link

    Apple has moved on from the iPhone.

    Tim Cook: "When you step back and consider Wearables and Services together two areas where we have strategically invested in last several years, they now approach the size of a Fortune 50 company."

    [Aug 01, 2019] Trump will put additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China on Sept 1, 2019

    Aug 01, 2019 | www.zerohedge.com

    Just as investors thought it was safe to buy-the f**king-dip after Powell's plunge, President Trump steals the jam out of their donut by announcing new China tariffs...

    "... on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country "

    In a series of tweets, Trump laid out the state of the China trade deal... in a word - terrible...

    Our representatives have just returned from China where they had constructive talks having to do with a future Trade Deal. We thought we had a deal with China three months ago, but sadly, China decided to re-negotiate the deal prior to signing. More recently, China agreed to...

    ...buy agricultural product from the U.S. in large quantities, but did not do so. Additionally, my friend President Xi said that he would stop the sale of Fentanyl to the United States – this never happened, and many Americans continue to die! Trade talks are continuing, and...

    ...during the talks the U.S. will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country. This does not include the 250 Billion Dollars already Tariffed at 25%...

    ...We look forward to continuing our positive dialogue with China on a comprehensive Trade Deal, and feel that the future between our two countries will be a very bright one!

    [Aug 01, 2019] Fortunately, as Trump said, 'Trade Wars are easy to win!

    Notable quotes:
    "... Mr. Trump's anger was fueled, in part, by the fact that China has not begun buying large amounts of American farm products, which the president promised farmers would happen after a June meeting with Chinese President Xi Jinping. ..."
    "... Mr. Trump took credit for China's weakening economy, saying the tariffs he's placed on $250 billion worth of Chinese goods have put enormous pressure on the country, costing it jobs and prompting companies to leave. ..."
    "... American and Chinese negotiators finished talks on Wednesday with little progress toward ending a trade war that has shaken the world's economic confidence and rattled markets. ..."
    "... Instead, both sides appear to be settling in for a lengthy economic conflict. ..."
    "... Senior Chinese officials who gathered at an economic meeting on Tuesday run by China's top leader, Xi Jinping, stressed that the country had to rely on domestic demand to manage "new risks and challenges" and ward off what they described as "downward pressure on the economy," according to the Chinese state news media. China could turn "a crisis into an opportunity," the report added. ..."
    "... A lengthy trade war presents China's leaders with some difficult options. China is enduring an economic slowdown that has been made worse by the trade tensions. Beijing has responded by ratcheting up spending on infrastructure and other big-ticket projects, a reliable growth strategy that nevertheless could worsen the country's debt problems and do little to solve economic imbalances that could hinder its long-term prospects. ..."
    "... At a daily news briefing on Wednesday, Hua Chunying, a spokeswoman for the Chinese Foreign Ministry, said that "only if the U.S. shows sufficient integrity and sincerity, and conducts trade talks with the spirit of equality, mutual respect, mutual understanding and mutual accommodation, can the trade talks make progress." ... ..."
    "... the trade pressure by the United States on China has from the beginning been about undermining Chinese development. The US point has always been to stop Chinese scientific and technological advance but the Chinese have always understood and that is just not ever going to happen. ..."
    "... Accept United States restrictions on Chinese investments in sensitive technologies without retaliating. ..."
    "... Open up its services and agricultural sectors to full American competition. ..."
    Aug 01, 2019 | economistsview.typepad.com

    Fred C. Dobbs , July 30, 2019 at 10:52 AM

    President Trump took credit for weakening
    China's economy and downplayed the likelihood
    of a trade deal before the 2020 election.

    His comments came as his top negotiators were sitting
    down to dinner with their counterparts in Shanghai.

    Trump Goads China as Trade Talks
    Resume https://nyti.ms/32X4vBj
    NYT - Ana Swanson and Jeanna Smialek - July 30

    WASHINGTON -- President Trump lashed out at China on Tuesday morning as trade talks between the two nations resumed, taking credit for weakening China's economy and downplaying the likelihood of a deal before the 2020 election.

    The president's comments, in posts on Twitter and remarks to the press, came just as his top negotiators were sitting down to dinner with their counterparts at the Fairmont Peace Hotel in Shanghai. While both sides are trying to get trade talks back on track, Mr. Trump's angry words underscored the diminishing prospects for a transformative trade deal anytime soon and the extent to which the bilateral relationship has not unfolded in the way that Mr. Trump expected.

    "I think the biggest problem to a trade deal is China would love to wait and just hope," the president said. "They hope -- it's not going to happen, I hope, but they would just love if I got defeated so they could deal with somebody like Elizabeth Warren or Sleepy Joe Biden or any of these people, because then they'd be allowed and able to continue to rip off our country like they've been doing for the last 30 years."

    Mr. Trump's anger was fueled, in part, by the fact that China has not begun buying large amounts of American farm products, which the president promised farmers would happen after a June meeting with Chinese President Xi Jinping. Mr. Trump emerged from that meeting in Osaka, Japan, saying he had agreed to postpone tariffs on an additional $300 billion of Chinese products and allow American firms to resume sales of nonsensitive goods to the Chinese telecom firm Huawei. In return, Mr. Trump said China would immediately start buying American agricultural goods, touting it as a big win for farmers.

    But no such purchases have happened, and, in the weeks since, Chinese officials disputed that they had agreed to buy more farm products as a condition of the talks. On Sunday, Chinese state media reported that "millions of tons" of American soybeans had been shipped to China. But Mr. Trump on Tuesday said no such purchases had materialized.

    China "was supposed to start buying our agricultural product now -- no signs that they are doing so," Mr. Trump tweeted. "That is the problem with China, they just don't come through."

    His comments on Tuesday appeared to be an effort to give his negotiators more leverage and to pressure China into making concessions in talks this week. Mr. Trump took credit for China's weakening economy, saying the tariffs he's placed on $250 billion worth of Chinese goods have put enormous pressure on the country, costing it jobs and prompting companies to leave.

    But he seemed to veer between goading China to quickly accede to America's demands and suggesting the country could get a better deal if it waits and a Democrat wins the 2020 presidential election. ...

    Fred C. Dobbs , July 31, 2019 at 06:50 AM
    US-China Trade Talks End With No Deal
    in Sight https://nyti.ms/2GE3LHt
    NYT - Alexandra Stevenson - July 31

    American and Chinese negotiators finished talks on Wednesday with little progress toward ending a trade war that has shaken the world's economic confidence and rattled markets.

    Treasury Secretary Steven Mnuchin and Robert E. Lighthizer, the Trump administration's top trade negotiator, were seen leaving trade talks on Wednesday, the Chinese state news media said.

    Both sides "conducted frank, efficient and constructive in-depth exchanges on major issues of common interest in the economic and trade field," said a statement late in the day that was released by CCTV, China's state broadcaster.

    Another round of high-level talks will take place in the United States in September, CCTV reported.

    The Trump administration had not yet released its own statement.

    The meeting marked the first formal resumption of talks after negotiations fell apart almost three months ago, with each side pointing fingers at the other for derailing a deal. They agreed to try again after meeting last month on the sidelines of the Group of 20 summit meeting in Osaka, Japan.

    Instead, both sides appear to be settling in for a lengthy economic conflict.

    Senior Chinese officials who gathered at an economic meeting on Tuesday run by China's top leader, Xi Jinping, stressed that the country had to rely on domestic demand to manage "new risks and challenges" and ward off what they described as "downward pressure on the economy," according to the Chinese state news media. China could turn "a crisis into an opportunity," the report added.

    A lengthy trade war presents China's leaders with some difficult options. China is enduring an economic slowdown that has been made worse by the trade tensions. Beijing has responded by ratcheting up spending on infrastructure and other big-ticket projects, a reliable growth strategy that nevertheless could worsen the country's debt problems and do little to solve economic imbalances that could hinder its long-term prospects.

    Should China reach a quick deal, on the other hand, the country's leaders risk looking weak in the face of foreign powers, undermining the Communist Party's historical claim to rule.

    At a daily news briefing on Wednesday, Hua Chunying, a spokeswoman for the Chinese Foreign Ministry, said that "only if the U.S. shows sufficient integrity and sincerity, and conducts trade talks with the spirit of equality, mutual respect, mutual understanding and mutual accommodation, can the trade talks make progress." ...

    anne -> Fred C. Dobbs... , July 31, 2019 at 07:36 AM
    As I have repeatedly documented on Economist's View, the trade pressure by the United States on China has from the beginning been about undermining Chinese development. The US point has always been to stop Chinese scientific and technological advance but the Chinese have always understood and that is just not ever going to happen.
    anne -> Fred C. Dobbs... , July 31, 2019 at 07:37 AM
    https://www.washingtonpost.com/news/wonk/wp/2018/05/04/trump-is-asking-china-to-redo-just-about-everything-with-its-economy/

    May 4, 2018

    Trump is asking China to redo just about everything with its economy
    By Heather Long - Washington Post

    The Trump administration has finally presented the Chinese government with a clear list of trade demands. It's long and intense (there are eight sections), and President Trump isn't just asking Chinese President Xi Jinping for a few modifications. He's asking Xi to completely change his plans to turn the Chinese economy into a tech powerhouse.

    The demands include the following:

    • China will cut the $336 billion U.S.-China trade deficit by at least $200 billion by 2020, a 60 percent reduction.
    • China will stop subsidizing tech companies.
    • China will cease stealing U.S. intellectual property.
    • China will cut its tariffs on U.S. goods by 2020.
    • China will not retaliate against the United States (including against U.S. farmers).
    • The Chinese government will open China to more U.S. investment.

    anne -> Fred C. Dobbs... , July 31, 2019 at 07:38 AM
    https://www.nytimes.com/2018/05/04/business/china-us-trade-talks.html

    May 4, 2018

    U.S.-China Trade Talks End With Strong Demands, but Few Signs of a Deal
    By Keith Bradsher

    BEIJING -- The extensive list of United States trade demands was unexpectedly sweeping, and showed that the Trump administration has no intention of backing down despite Beijing's assertive stance in the last few days. "The list reads like the terms for a surrender rather than a basis for negotiation," said Eswar Prasad, an economics professor at Cornell University.

    Here are the highlights of the demands:

    China must

    ■ Cut its trade surplus by $100 billion in the 12 months starting in June, and by another $100 billion in the following 12 months.

    ■ Halt all subsidies to advanced manufacturing industries in its so-called Made In China 2025 program. The program covers 10 sectors, including aircraft manufacturing, electric cars, robotics, computer microchips and artificial intelligence.

    ■ Accept that the United States may restrict imports from the industries under Made in China 2025.

    ■ Take "immediate, verifiable steps" to halt cyberespionage into commercial networks in the United States.

    ■ Strengthen intellectual property protections.

    Accept United States restrictions on Chinese investments in sensitive technologies without retaliating.

    ■ Cut its tariffs, which currently average 10 percent, to the same level as in the United States, where they average 3.5 percent for all "noncritical sectors."

    Open up its services and agricultural sectors to full American competition.

    The United States also stipulated that the two sides should meet every quarter to review progress.

    Fred C. Dobbs said in reply to anne... , July 31, 2019 at 07:51 AM
    Fortunately, as Trump said,
    'Trade Wars are easy to win!'

    [Jul 21, 2019] On the alleged Arendt´s banality of evil, well, some more evil than others, if not because of their clearly over the top ambitions

    Notable quotes:
    "... If you believe the US media if they just removed Putin, Russia would go back to being a good little puppet state just like under Yeltins. Which is a shockingly naïve way to look at international relations. ..."
    "... It is not just Chinese but Asian in general. Watch several seasons of the Japanese cartoon "Gundam" and get back to me about who the good guys are and who the bad guys are in it. ..."
    "... People always suffer when they allow corrupt sociopaths to gain power. That is as true today as it was in Germany in 1930's and 40's. ..."
    "... According to news reports since the moron in charge announced that he had signed an executive order 'blacklisting' Huawei, those lovely humans at Google are denying Huawei phones access to gmail and playstore. The android operating system is open source and still available to Huawei. ..."
    "... Doubtless FB and M$ will follow suit. Getting rid of all the nasty stuff that spies on users 24/7/365 now means that Huawei phones have all the advantages with none of the disadvantages. ..."
    "... In Games of Thrones, the good characters are regularly disembowled, choked and drowned to death. Or turn evil. The evil characters grow in power and menace and rarely perish. The overwhelming message is that all people and all power are evil. There is no good in the world or what good there is will be quickly stomped out. Resistance is useless. ..."
    "... The main message is really that resistance is futile . If the powers that be can condition the contemporary (and naturally idealistic) Western youth to accept that hypothesis, any threat to their depredations and financial tyranny is rendered impotent. If resistance is futile, said youth will simply have to accept how things are and try to stay out of the way of tyrannical kings, rapacious queens, brutal captains of the guards and wanton dragons. I.e. sit down and shut up while HRC, John Bolton, John Brennan and James Clapper ruin the planet. ..."
    "... In the US 33% supported unilateral action, 70% of congress voted for the unilateral military action ..."
    "... Thomas Jefferson said: "I tremble for my countrymen because I know God is just..." ..."
    "... "The powerful do what they can and the weak suffer what they must." ..."
    "... The movies Hollywood produced are often telling psychological conflicts as the central story. Each character has a certain fixed attitude and the interacting of the characters create the story. It does not matter if the setting is in antic times or in the far future. In the end there are always the bad and the good guy slamming it out in a fistfight. ..."
    "... The historic Chinese drama which I currently favor are based on sociological storytelling. As they develop the stories form their characters. Their attitudes change over time because the developing exterior circumstances push them into certain directions. Good becomes bad and again good. The persons change because they must, not because the are genetically defined. I find these kind of movies more interesting. ..."
    "... The take away quote "Wang also reiterated the principled stand against the "long-arm jurisdiction" imposed by the United States." Empire is having its hand slapped back in Venezuela, Iran, Syria, ??? ..."
    "... I see empire as a war junkie and they are starting to twitch in withdrawals which is dangerous but a necessary stage. Trumps latest tweets show that level of energy. The spinning plates of empire are not wowing the crowds like before.....what is plan Z? ..."
    "... My own view is that, as with everything the US has done lately, it already lost the war before it even stepped into battle in the theater. ..."
    "... Strangest thing of all that the US itself would do the forcing out of itself from the world's trust. ..."
    "... As I've written previously, the political philosophers of the nascent USA thought they would have a Natural Aristocracy ( here and here ) somewhat based on a meritocratic system instead of the Old World's Inherited Aristocracy based on blood relations and closed to anyone not within a very small circle. Yet it was still an Aristocracy with all it inherent evils, and it is that vast assortment of evils the US citizenry has yet to overcome in its supposed--idealized--quest for self-government. ..."
    "... If you are interested in watching a film with a sociological approach to telling a story and you are close to a cinema, Mike Leigh's "Peterloo" just started screening last Thursday in Australia. The film is an exploration of British society during the Regency period (in the early 19th century), the class attitudes and opinions prevalent then, and the conditions and events that led to 60,000 - 100,000 labouring class people gathering at St Peter's Field in Manchester in August 1819, and how it was viciously broken up by cavalry and foot soldiers acting on orders of the aristocracy. ..."
    "... The culture I am immersed in (USA) is heavily weighted toward the dramatic and two dimensional. Simply put, mass perspective engineering is geared to over simplify and reinforce these views with media imprinting via hollywood, madison ave. etc. The lenses through which impressions from the "outside world" pass through engineered to give the desired results rather than expand consciousness or engender critical thinking. In short, we are breeding for weakness and gullibility. ..."
    "... If it is Hollywood, then you can be certain the intention is to manipulate the younger generation to supporting and idolising their permanent wars. On the face of it, that indeed appears to be the case. ..."
    May 21, 2019 | www.moonofalabama.org

    Oliver K , May 19, 2019 3:32:24 PM | 5

    " Why The Takedown Of Heinz-Christian Strache Will Strengthen The Right | Main May 19, 2019 The story in the American Conservative is very weak: that "the Americans" have already won the war is just due to the built-in superiority: the "land of the free" against "communist dictatorship" (so everybody knows who has to win). Or, a variation, "free market" against "state-owned".

    A typical statement of that article: "China views commercial relations with other countries as an extension of the political conflict between Western democracies and itself -- that is, an extension of war." -- a very defining element of the "American" character, to project the own aggression onto others.

    There was another opinion-piece somewhere, can't find it anymore, where the author argued that hopefully that "trade-war" will do really good for the Chinese economy -- forget about the US, and develop the home market.

    As I believe that the sanctions are a great gift to Russia, I also believe that this "trade-war" is a (potential) great gift to China.

    Kadath , May 19, 2019 4:21:27 PM | 0

    That was an interesting article on psychological vs sociological storytelling and it makes a good companion piece when thinking about how the US media personalizes US geo-political conflicts with the heads of rival state (Putin, Xi, Castro, Kim Jong-un, Khomeini, Gaddafi).

    If you believe the US media if they just removed Putin, Russia would go back to being a good little puppet state just like under Yeltins. Which is a shockingly naïve way to look at international relations. States have permanent interests and any competent head of State will always represent those interests to the best of their ability. True, you could overthrow the government and replace every senior government figure with a compliant puppet (which the US always tries to do), but the permanent interests that arise from the inhabitants of the State will always rise up and (re)assert themselves. When the State leadership is bribed or threatened into ignoring or acting against these needs it ultimately creates a failed State.

    Even the US media seems to subconsciously understand this, when they talk of "overly ambitious US goals of remaking societies", however, they never make the logical next step of investigating why these States do not wish to be remade as per the US imagined ideal, what the interests of these actually are and how diplomacy can resolve conflicts.

    According to the US media everything boils down to the US = good, anyone who disagrees with our policies = bad and diplomacy is just a measure of how vulgar our threats are during talks. I'm specifically thinking of the US Ambassador to Russia, John Huntsman's boast of a US aircraft carrier in the Mediterranean as being 100,000 tons of diplomacy to Russia - of all the ridiculous and stupid things to says to Russia when supposedly trying to "ease" tensions (I still can't believe Huntsmen, former Ambassador to China under Obama, is regarded a "serious" professional ambassador within the State departments when compared to all the celebrity ambassadorships the US President for fundraiser).

    KC , May 19, 2019 4:31:39 PM | 1
    @WJ #8 - That's probably a daily occurrence there anyway.
    KC , May 19, 2019 4:35:35 PM | 2
    Somewhat on-topic, China's state media is broadcasting Anti-American movies .
    William Gruff , May 19, 2019 4:43:17 PM | 4
    Cresty @9

    It is not just Chinese but Asian in general. Watch several seasons of the Japanese cartoon "Gundam" and get back to me about who the good guys are and who the bad guys are in it.

    The whole notion that the "good guys" and the "bad guys" are set in stone is antithetical to any worldview founded in Buddhism/Confucianism, or influenced by the same. Can you imagine western children's programming teaching ambiguity between good and evil? That which is which depends upon the observer's perspective? This is the sort of concept that few western people get exposed to until graduate level ethics and philosophy courses.

    Or maybe not. I have never seen a single episode of "Game of Thrones" and maybe that delves into ethical complexities that typical western mass media avoids. I wouldn't know. What I do know is that this moral and ethical complexity is something that most Asian children are introduced to before they hit their teens.

    Kadath , May 19, 2019 4:59:33 PM | 5
    Trump just tweeted "If Iran wants to fight, that will be the official end of Iran. Never threaten the United States again!". Needless to say, more ridiculousness, Trump is pretty close to plagiarizing himself with his prior comments regarding North Korean "North Korean Leader Kim Jong Un just stated that the "Nuclear Button is on his desk at all times." Will someone from his depleted and food starved regime please inform him that I too have a Nuclear Button, but it is a much bigger & more powerful one than his, and my Button works!". I think Trump is getting desperate now waiting by the phone for the Iranians to call him. Trump is certainly still smarting after the failed Venezuela coup and wants to avoid a second embarrassing defeat, however I doubt the Iranians will care that much about his latest threat by tweet.
    Nemesiscalling , May 19, 2019 5:18:09 PM | 6
    GOT was jarring this season. In the penultimate episode, a dragon wreaks havoc on a western capital city, brutally murdering most of its inhabitants.

    It is impossible not to make the correlation of the dragon as China and kings landing (The city) as Washington d.c.

    From this one can glean that they were attempting to show the ascendancy of China and the utter destruction of the U.S. With shades of gray thrown about as to if the people of the city deserved to be burned alive and as to whether the dragon and its rider, China, have become what they originally set out to vanquish. The old Nietzsche maxim...those who fight with monsters...

    It was indeed unsettling because there are no moral winners. It is well realised for this reason but poorly written and produced in other aspects as noted above by other posters.

    Sasha , May 19, 2019 5:26:49 PM | 7
    On the alleged Arendt´s banality of evil, well, some more evil than others, if not because of their clearly over the top ambitions:

    Interesting comment linking some sources and articles on US military strategy from decades ago , some of which I am not able to get to anymore, as the article at ICH numbered 3011:

    "First published From Parameters, Summer 1997, pp. 4-14: US Army War College: "There will be no peace. At any given moment for the rest of our lifetimes, there will be multiple conflicts in mutating forms around the globe. Violent conflict will dominate the headlines, but cultural and economic struggles will be steadier and ultimately more decisive. The de facto role of the US armed forces will be to keep the world safe for our economy and open to our cultural assault. To those ends, we will do a fair amount of killing."

    "Excerpts From Pentagon's Plan: 'Prevent the Re-Emergence of a New Rival':

    "Our first objective is to prevent the re-emergence of a new rival, either on the territory of the former Soviet Union or elsewhere, that poses a threat on the order of that posed formerly by the Soviet Union.

    This is a dominant consideration underlying the new regional defense strategy and requires that we endeavor to prevent any hostile power from dominating a region whose resources would, under consolidated control, be sufficient to generate global power. These regions include Western Europe, East Asia, the territory of the former Soviet Union, and Southwest Asia.

    There are three additional aspects to this objective: First, the U.S. must show the leadership necessary to establish and protect a new order that holds the promise of convincing potential competitors that they need not aspire to a greater role or pursue a more aggressive posture to protect their legitimate interests.
    Second, in the non-defense areas, we must account sufficiently for the interests of the advanced industrial nations to discourage them from challenging our leadership or seeking to overturn the established political and economic order. Finally, we must maintain the mechanisms for deterring potential competitors from even aspiring to a larger regional or global role. An effective reconstitution capability is important here, since it implies that a potential rival could not hope to quickly or easily gain a predominant military position in the world."

    ... access to vital raw materials, primarily Persian Gulf oil"

    Jackrabbit , May 19, 2019 6:01:23 PM | 9
    Nemesiscalling @16

    GOT is an allegory that explores the nature of power. If you see China's destruction of Washington it says more about you than the show. Firebombing of Dresden might be a more apt analogy.

    People always suffer when they allow corrupt sociopaths to gain power. That is as true today as it was in Germany in 1930's and 40's.

    The complaints about poor writing are just fan sadness at unexpected horrors that actually make sense for the show. Loose ends created by these horrors will likely be resolved in the last episode tonight.

    Maximus , May 19, 2019 6:09:55 PM | 1
    Link not working above here it is: https://twitter.com/realgollumtrump?lang=en
    Roy G , May 19, 2019 7:12:22 PM | 3
    WJ @13 thanks for the link, I am eternally hopeful that this particular thread gets pulled on until it unravels.

    One of my distinct memories of the immediate aftermath of 9/11 (I lived in NYC at the time), was the trumpeting of the Post and other tabloids about 'the Dancing Arabs,' which obviously fanned the flames of hatred towards the designated villains. Once it was revealed that they were actually Israelis, then crickets until the whole thing was shoved down the memory hole.

    Dolores P Candyarse , May 19, 2019 7:30:47 PM | 4
    I'm going out today to buy a couple of Huawei 'phones'.

    According to news reports since the moron in charge announced that he had signed an executive order 'blacklisting' Huawei, those lovely humans at Google are denying Huawei phones access to gmail and playstore. The android operating system is open source and still available to Huawei.

    Doubtless FB and M$ will follow suit. Getting rid of all the nasty stuff that spies on users 24/7/365 now means that Huawei phones have all the advantages with none of the disadvantages.

    They put their own chips in newer models and I have no doubt will find enough bright sparks to take over apps integration meaning that this divergence point will become a boon not a hurdle. Even better a Huawei costs 60% of a comparable korean model and half the price of the fbi backdoored american shit.
    I really like thinking expressed by an un-named english politician in a Henry Jackson Society report: ""Huawei has long been accused of espionage" – a claim repeatedly denied by the firm – and notes that "while there are no definitely proven cases", a precautionary principle should be adopted."

    All politicians are crooks and liars, everybody says so, lets lock em all up right now, no need for evidence or trial or any of that due process nonsense, the precautionary principle should apply.

    Uncoy , May 19, 2019 7:32:02 PM | 5
    William Gruff wrote:
    I have never seen a single episode of "Game of Thrones" and maybe that delves into ethical complexities that typical western mass media avoids. I wouldn't know.

    Having suffered through four seasons of Game of Thrones, after a degree in philology and literature, I'd be happy to share my impressions with you. In Games of Thrones, the good characters are regularly disembowled, choked and drowned to death. Or turn evil. The evil characters grow in power and menace and rarely perish. The overwhelming message is that all people and all power are evil. There is no good in the world or what good there is will be quickly stomped out. Resistance is useless.

    The main message is really that resistance is futile . If the powers that be can condition the contemporary (and naturally idealistic) Western youth to accept that hypothesis, any threat to their depredations and financial tyranny is rendered impotent. If resistance is futile, said youth will simply have to accept how things are and try to stay out of the way of tyrannical kings, rapacious queens, brutal captains of the guards and wanton dragons. I.e. sit down and shut up while HRC, John Bolton, John Brennan and James Clapper ruin the planet.

    Despite impressive production values, excellent acting (for the most part) and majestic locations, Game of Thrones is truly the most evil large scale creative work I've ever seen. On a philosophical level, Game of Thrones has no redeeming features. At best an impressionable mind might come away with a hedonist mindset, i.e. the traditional salve of weak spirits, carpe diem .

    PS. There's some very good comments at the tail end of the Takedown of Heinz-Christian Strache including one of my own covering in some depth the Austrian political background to this event. Worth revisiting if you only saw the early comments.

    Colin , May 19, 2019 7:39:27 PM | 6
    Analysis from a poll sometimes cited by Chomsky.

    See Gallup International poll pg 134
    https://www.circap.org/uploads/1/8/1/6/18163511/pollsoniraq-nonus15.pdf

    Using populations per country from '03 we get the following conclusions:

    of the 36 countries outside the US we get 33% of the world population where less than 8% supported unilateral military action by American and her allies and 57% supported under no circumstances

    this list excludes 42 additional countries with another 40% of world population who have had their governments overthrown or attempted to be overthrown by the US since WWII

    In the US 33% supported unilateral action, 70% of congress voted for the unilateral military action

    Being that the invasion was illegal and unpopular, the Bush admin invented a 'coalition of the willing to give the appearance of support.

    The Trump admin needed to create a similar type of facade for the Venezuelan coup. Such things are needed specifically because the move is so unpopular and illegal.

    KC , May 19, 2019 8:21:46 PM | 0
    At least the alternative media is taking notice of the warmongering tactics of John Bolton .
    NemesisCalling , May 19, 2019 9:03:28 PM | 4
    @ Jen 29

    I suppose that is a valid theory. But as the viewer we know the motivations of Dany and why in some small regard the people in King's Landing deserve a little roughing up.

    Thomas Jefferson said: "I tremble for my countrymen because I know God is just..."

    The difference here is that we judge Assad even though we don't see what he is truly doing.

    Here we see what Dany has done, mass slaughter, and think to ourselves...we kinda had it coming.

    NemesisCalling , May 19, 2019 9:21:34 PM | 5
    @25 uncoy

    Concerning your take on GoT: Isn't this really the thesis of Thucydides through and through reflected in GoT almost to a T?

    "The powerful do what they can and the weak suffer what they must." GoT is not disturbing to be nihilistic and shocking. It is holding up a mirror to history. But the quality of the show has declined since they have come to the end of the road in adapting the source material. The show has overtaken the books.

    psychohistorian , May 19, 2019 9:51:22 PM | 7
    Below is a link from Xinhuanet about the China financial sector opening up China to further open up financial sector: central bank

    The take away quote
    "
    As of the end of March, overseas investors bought a net of 1.77 trillion yuan (about 260.3 billion U.S. dollars) of bonds at the country's interbank bond market, up 31 percent from a year earlier, and held 5.4 trillion yuan of yuan-denominated financial assets, up 19 percent year on year, according to the central bank.
    "
    What us peasants don't know is the extent to which China will let foreign investment influence their socialistic ways. That said, China is the new empire, private or public is yet to be determined but guess where all the "smart" money in the world is going? The money movements are a giant sucking sound that will leave America under the global economic bus.

    Or not and China maintains its socialistic ways including projecting them around the world.

    vk , May 19, 2019 10:06:03 PM | 8
    The movies Hollywood produced are often telling psychological conflicts as the central story. Each character has a certain fixed attitude and the interacting of the characters create the story. It does not matter if the setting is in antic times or in the far future. In the end there are always the bad and the good guy slamming it out in a fistfight.

    The historic Chinese drama which I currently favor are based on sociological storytelling. As they develop the stories form their characters. Their attitudes change over time because the developing exterior circumstances push them into certain directions. Good becomes bad and again good. The persons change because they must, not because the are genetically defined. I find these kind of movies more interesting.

    That's the difference between materialism (marxism) and idealism (kantism, hegelianism and noekantism). Besides, an idealist tv series helps selling more merch and doing more sequels, hence the capitalist preference for idealism.

    S , May 19, 2019 10:50:33 PM | 3
    @KC #12:
    China's state media is broadcasting Anti-American movies.

    How are these movies "anti-American"? These movies are simply the truth.

    psychohistorian , May 19, 2019 10:55:01 PM | 6
    Below is my final Xinhuanet link about China/US relations

    Chinese FM urges U.S. to avoid further damage of ties in phone call with Pompeo

    The take away quote "Wang also reiterated the principled stand against the "long-arm jurisdiction" imposed by the United States." Empire is having its hand slapped back in Venezuela, Iran, Syria, ???

    Where are they going to get their war on?

    I see empire as a war junkie and they are starting to twitch in withdrawals which is dangerous but a necessary stage. Trumps latest tweets show that level of energy. The spinning plates of empire are not wowing the crowds like before.....what is plan Z?

    ben , May 19, 2019 10:58:49 PM | 7
    Hot tip, GOT is just a movie. Please, no more psychological insights. What fans really need, is some REAL WORLD justice, something that's noticeably missing in today's world.
    Grieved , May 19, 2019 11:21:32 PM | 8
    @5 Oliver K

    I agree that the American Conservative article was weak - as b obviously thought. It has the US trade war against China completely wrong. I side with b in his hunch that China will win. My own view is that, as with everything the US has done lately, it already lost the war before it even stepped into battle in the theater.

    And let's counter the author's point, in the weak article, that China needs the US trade surplus more than the US needs the imports from China. The author says that China has no way to substitute for exports to the US. There's abundant recent analysis on this, showing the relatively small part of China's economy that hinges on this trade, but here's a good Sputnik interview that illustrates how easily China can simply absorb goods into its own domestic market:

    Trade War: US to Pay Heavy Price for Underestimating China – Chinese Businessman

    I especially liked this part:

    "...we have our colossal domestic market, which has no competitors throughout the world. Our consumer and innovation markets provide us with a large number of advantages and room, giving China an opportunity to make a manoeuvre. Therefore, their blockage gives China a chance to become even stronger. We must express our appreciation to our mentor, Trump, for this, for this lesson and for forcing China to figure out how to withstand the threats on its own."

    The US used to be an important nation to do business with - commercial, diplomatic, military. But as it has become "agreement incapable", nations are forced to replace it. This takes a little time and readjustment, but then the change is permanent.

    Strangest thing of all that the US itself would do the forcing out of itself from the world's trust.

    ben , May 19, 2019 11:24:01 PM | 9
    For those with a penchant for movie dissection, I offer this from Truthdig;

    https://www.truthdig.com/articles/game-of-thrones-an-american-parable/

    Zack , May 19, 2019 11:50:54 PM | 0
    Trump, Saudi Arabia warn Iran against Middle East conflict
    Crown Prince Mohammed bin Salman discussed regional developments, including efforts to strengthen security and stability, in a phone call with U.S. Secretary of State Mike Pompeo, the Saudi Media Ministry tweeted on Sunday.

    "We want peace and stability in the region but we will not sit on our hands in light of the continuing Iranian attack," Jubeir said. "The ball is in Iran's court and it is up to Iran to determine what its fate will be."

    He said the crew of an Iranian oil tanker that had been towed to Saudi Arabia early this month after a request for help due to engine trouble were still in the kingdom receiving the "necessary care". The crew are 24 Iranians and two Bangladeshis .

    Is this a veiled threat on the lives of these crew members?

    Kadath , May 20, 2019 12:41:41 AM | 2
    Re@ 51 James, well Sputniknews is reporting that the Saudi's claim that the Houthis are planning to attack 300 critical infrastructure facilities in Saudi Arabia and the United Arab Emirates in the coming weeks so that might be the instigating event your concerned about
    karlof1 , May 20, 2019 12:45:56 AM | 3
    Grieved @44--

    Thanks for your kudos! As I've written previously, the political philosophers of the nascent USA thought they would have a Natural Aristocracy ( here and here ) somewhat based on a meritocratic system instead of the Old World's Inherited Aristocracy based on blood relations and closed to anyone not within a very small circle. Yet it was still an Aristocracy with all it inherent evils, and it is that vast assortment of evils the US citizenry has yet to overcome in its supposed--idealized--quest for self-government.

    Recall that George Washington was deemed safe to become the first president because he could be trusted not to proclaim himself king --something often forgotten by students of US History.

    I've often lamented on the nature of the 1787 Constitution because it allows any POTUS to become a king with almost zero hindrances on the power wielded. Sure, compared with other systems of government at the time, the USA's was revolutionary, but only down to the waist to borrow a phrase from Gilbert & Sullivan. Madison's theory, IMO, was--other than being Aristocratic--okay until his most important check/balance was removed--that of the "dueling oval office" where the losing POTUS candidate was awarded the Vice-Presidency--imagine Hillary Clinton as Veep with Trump in the driver seat! IMO, the 12th Amendment fatally wounded Madison's construction of a government that arrived at great decisions based on a consensus of genuine national interests instead of partisanship.

    Arguing that action is the great fault that must be corrected doesn't get much play nowadays. Indeed, it's very difficult to debate Constitutional Reform given the engineered political climate since the current situation suits the Ruling Oligarchy just fine.

    I hope everyone had an opportunity to click the link I provided to the series of paintings known as The Course of Empire . ICYMI, here it is again . Please note which Empire's being copied and compare that with the predominant architectural theme in the Outlaw US Empire's Imperium. Creditors ruled and eventually destroyed that Empire. That's one historical lesson that's totally omitted from the historiography of the USA.

    By and large, we know what and where the problems are. The fundamental question is, will we ever get the opportunity to fix them?

    somebody , May 20, 2019 1:26:48 AM | 5
    Posted by: Grieved | May 19, 2019 11:21:32 PM | 48

    Their disadvantage is that they have to import energy. So they need export if they do not wish to run a trade deficit. They do not necessarily need the US for this though if they can trade in Yuan.

    TJ , May 20, 2019 5:16:46 AM | 1
    Speaking of Chinese stories, here in the UK I grew up watching The Water Margin , from the opening titles 'The ancient sages said "do not despise the snake for having no horns, for who is to say it will not become a dragon?" So may one just man become an army.' and also Monkey , the opening titles gave us "The irrepressible spirit of Monkey" .
    Thirsty , May 20, 2019 7:55:53 AM | 5
    b, it is generally fund raising time during this time for some publishers (i.e. counterpunch etc) and I would like to send you something as well. Can you please post the payment information. Thanks.
    Jen , May 20, 2019 8:28:59 AM | 6
    Peter AU 1 @ 62:

    If you are interested in watching a film with a sociological approach to telling a story and you are close to a cinema, Mike Leigh's "Peterloo" just started screening last Thursday in Australia. The film is an exploration of British society during the Regency period (in the early 19th century), the class attitudes and opinions prevalent then, and the conditions and events that led to 60,000 - 100,000 labouring class people gathering at St Peter's Field in Manchester in August 1819, and how it was viciously broken up by cavalry and foot soldiers acting on orders of the aristocracy.

    The film is at least 150 minutes long and is a highly immersive experience. There is not much plot in the Hollywood sense of the term. I believe reviews have been mixed with most film critics complaining about the film being too long and boring. But if you are prepared to watch a film that uses a sociological approach to telling a narrative, then you'll agree with me that the film actually isn't long enough.

    Chevrus , May 20, 2019 9:19:33 AM | 0
    @Hmpf-59

    Very interesting studies and the ideas that they might spawn. The near parallels of the micro and macro as well as the flow patterns.

    The culture I am immersed in (USA) is heavily weighted toward the dramatic and two dimensional. Simply put, mass perspective engineering is geared to over simplify and reinforce these views with media imprinting via hollywood, madison ave. etc. The lenses through which impressions from the "outside world" pass through engineered to give the desired results rather than expand consciousness or engender critical thinking. In short, we are breeding for weakness and gullibility.

    In regard to large scale dynamics resembling the physics of things like the laws of thermodynamics, I am wondering if phenomena like those alluded to above might be engulfed and influenced by these kinds of natural patterns. So for example: Looking past the drama of sanctions, trade wars, and good guys vs. bad guys, wont the large scale movements caused by these things begin to move according to a kind of physics?

    I keep wondering what the result of this latest round of economic warfare will lead to. If the USA continues to sanction, embargo and blockade (at the behest of banking cartels?) will this not cause a mass exodus from dollar reserves, SWIFT, BIS and the like? I hear all sorts of opinions, bushels of dis-info and I'm mostly at a loss as to what to think. We are clearly nearing the end of the Bretton-Woods era so a reset is in order. The USA is a mere 6% of the world population and some would say at the end of it's due date as far an being an "international influencer".

    So if they and their EU poodles go ahead and sanction every nation who refuses to bend the knee what's stopping these nations from simply bypassing these decrees and going about their business? I get the sense that this is already happening quietly. Russia, China and various partner nations are creating alternatives in many forms, be they interweb servers, financial networks, OBOR, SCO and more I have never heard of.

    Perhaps the ratcheting up of tensions could also be swept up in the turbulence of thermodynamics? If sanctions become embargoes and then blockades, what happens to the "compressions ratios in the Straits of Hormuz?

    BM , May 20, 2019 9:26:11 AM | 1
    Re: Game of Thrones

    Well, I've come across a few advertisements, but I always thought it was some kind of children's video game. I cannot imagine why anyone other than a socially stunted and mis-developed American or Americanised adolescent could want to watch such infantile deranged garbage.

    If it is Hollywood, then you can be certain the intention is to manipulate the younger generation to supporting and idolising their permanent wars. On the face of it, that indeed appears to be the case.

    OK, I've got that off my chest now!

    [Jul 20, 2019] Escobar Western Intellectuals Freak Over Frankenstein China

    Jul 20, 2019 | www.zerohedge.com

    Decoupling

    Assuming the decoupling would take place, that could be easily perceived as "strategic blackmail" imposed by the Trump administration. Yet what the Trump administration wants is not exactly what the US establishment wants – as shown by an open letter to Trump signed by scores of academics, foreign policy experts and business leaders who are worried that "decoupling" China from the global economy – as if Washington could actually pull off such an impossibility – would generate massive blowback.

    What may actually happen in terms of a US-China "decoupling" is what Beijing is already, actively working on: extending trade partnerships with the EU and across the Global South.

    And that will lead, according to Li, to the Chinese leadership offering deeper and wider market access to its partners. This will soon be the case with the EU, as discussed in Brussels in the spring.

    Sun Jie, a researcher at the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, said that deepening partnerships with the Association of Southeast Asian Nations (Asean) will be essential in case a decoupling is in the cards.

    For his part Liu Qing, an economics professor at Renmin University, stressed the need for top international relations management, dealing with everyone from Europe to the Global South, to prevent their companies from replacing Chinese companies in selected global supply chains.

    And Wang Xiaosong, an economics professor at Renmin University, emphasized that a concerted Chinese strategic approach in dealing with Washington is absolutely paramount.

    All about Belt and Road

    A few optimists among Western intellectuals would rather characterize what is going on as a vibrant debate between proponents of "restraint" and "offshore balancing" and proponents of "liberal hegemony". In fact, it's actually a firefight.

    Among the Western intellectuals singled out by the puzzled Frankenstein guy, it is virtually impossible to find another voice of reason to match Martin Jacques , now a senior fellow at Cambridge University. When China Rules the World , his hefty tome published 10 years ago, still leaps out of an editorial wasteland of almost uniformly dull publications by so-called Western "experts" on China.

    Jacques has understood that now it's all about the New Silk Roads, or Belt and Road Initiative:

    "BRI has the potential to offer another kind of world, another set of values, another set of imperatives, another way of organizing, another set of institutions, another set of relationships."

    Belt and Road, adds Jacques, "offers an alternative to the existing international order. The present international order was designed by and still essentially privileges the rich world, which represents only 15% of the world's population. BRI, on the other hand, is addressing at least two-thirds of the world's population. This is extraordinarily important for this moment in history."

    [Jul 12, 2019] Nine Consequences of the Upcoming US-China Trade War by Renaud Anjoran

    Highly recommended!
    This author really knows what he is talking about
    Notable quotes:
    "... When tariffs went up from 0 to 10% on some product categories last year, many suppliers agreed to absorb half that amount (5%) in exchange for larger orders. The logic was as follows: higher orders lead to better deals with component suppliers and to higher production efficiencies, which means lower costs. ..."
    "... Do you ship American wood for processing in China and re-exporting to the US? You might have issues getting that material into China as smoothly as before. And then, the US Customs office might give you a hard time when you bring the goods in, too! ..."
    "... Who knows what non-monetary barriers the Chinese will erect. One can count on their creativity ..."
    "... Several US companies asked our company to look for assembly plants in Vietnam and, in those cases where we found some options, they were much more expensive than China. There is a reason why China's share of hard goods production in Asia has kept growing in recent years -- competition is often non-existent. ..."
    "... Now, with China's products suddenly much more expensive, what are these competing countries going to do? Won't they take advantage of it and push wages further up, at least for the export manufacturing sector? ..."
    "... Mexico should be the clear winner of this trade war. They are next to the US, their labor cost is comparable to that of China, and many American companies have long had extensive operations there. ..."
    May 09, 2019 | qualityinspection.org

    https://qualityinspection.org/9-consequences-us-china-trade-war/

    Based on all the articles I have read about the current geopolitical situation, I am not optimistic about the affect of the US-China trade war on American importers. Dan Harris, who wrote " the US-China Cold War start now, " announced that a "mega-storm" might be coming, and he may be right.

    Now, if things turn out as bad as predicted, and if tariffs apply on more goods imported from China to the US -- and at higher rates -- what does it mean for US importers?

    What will the damage from the US-China trade war look like?

    These are my thoughts about who or what is going to be hit hard by the ongoing 'trade war:'

    1. Small importers will be hit much harder than larger ones

    If you work with very large Chinese manufacturers, many of them have already started to set up operations outside of mainland China, for the simple reason that most of their customers have been pushing for that.

    They are in Vietnam, Malaysia, etc. And this is true in most industries -- from apparel to electronics.

    Do they still have to import most of their components from China? It depends on their footprints. As I wrote before :

    You set up a mammoth plant and you don't want your high-value component suppliers to be more than 1 hour away from you, for just-in-time inventory replenishment? They can be requested to set up a new manufacturing facility next to you.

    2. A higher total cost of goods purchased from China

    This one is obvious. If you have orders already in production, they will cost you more than expected.

    The RMB might slide quite a bit, and that might alleviate the total cost. I hope you have followed my advice and started paying your suppliers in RMB , to benefit from it automatically.

    Beijing might also give other forms of subsidies to their exporters. They might be quite visible (e.g. a higher VAT rebate) or totally 'under the table'.

    3. Difficult negotiations with Chinese suppliers

    Can you say the tariffs are Beijing's fault, and so your suppliers should absorb the tariffs? That's not going to work.

    When tariffs went up from 0 to 10% on some product categories last year, many suppliers agreed to absorb half that amount (5%) in exchange for larger orders. The logic was as follows: higher orders lead to better deals with component suppliers and to higher production efficiencies, which means lower costs.

    When tariffs go from 10% to 35%, what else can US buyers give their counter-parties? Payments in advance? Lower quality standards? I don't believe that.

    4. Difficulties at several levels in the supply chain

    Do you ship American wood for processing in China and re-exporting to the US? You might have issues getting that material into China as smoothly as before. And then, the US Customs office might give you a hard time when you bring the goods in, too!

    Who knows what non-monetary barriers the Chinese will erect. One can count on their creativity

    5. Short-term non-elasticity of alternative sources

    There are a finite number of Vietnamese export-ready manufacturers that can make your orders. And, chances are, their capacity is already full. If you haven't prepared this move for months (or years), other US companies have. The early bird gets the worm

    Same thing with Thailand, Indonesia, India, and so on, with the exception of apparel and (maybe) footwear.

    Several US companies asked our company to look for assembly plants in Vietnam and, in those cases where we found some options, they were much more expensive than China. There is a reason why China's share of hard goods production in Asia has kept growing in recent years -- competition is often non-existent.

    6. Faster cost increases in other low-cost Asian countries

    As I wrote before, since China announced their 5-year plan to increase wages, other Asian countries adopted similar plans . That's how we got to this upward trend across the board:

    Minimum wage comparison

    Now, with China's products suddenly much more expensive, what are these competing countries going to do? Won't they take advantage of it and push wages further up, at least for the export manufacturing sector?

    There could be some 'silver linings' due to the trade war

    It is not all bad news though. We may see these benefits caused by China and the USA slugging it out too:

    7. Many opportunities for Mexico

    Mexico should be the clear winner of this trade war. They are next to the US, their labor cost is comparable to that of China, and many American companies have long had extensive operations there.

    8. Rapid consolidation in the Chinese manufacturing sector

    The fittest will survive. Many uncompetitive manufacturers and traders will fold. Consolidation will accelerate. I often look at what happened in Japan and South Korea . Each of these countries developed very fast and, when the going got tough, the export manufacturing sector got devastated. Only the most competitive survived.

    9. Relaxed enforcement of anti-pollution regulations in China?

    I'd bet that, if the tariffs hit hard, far fewer operations will get closed for environmental reasons. Preserving employment and social peace will prevail.

    [Jul 01, 2019] The cover story is that foreign exchange controls and purchases of U.S. securities keep the renminbi's exchange rate low, artificially spurring its exports. The reality, of course, is that these controls protect China from U.S. banks creating free 'keyboard credit' to buy out Chinese companies to buy out Chinese companies or load down its economy with loans to be paid off in renminbi whose value will rise against the deficit-ridden dollar

    Jul 01, 2019 | www.moonofalabama.org

    karlof1 , Jun 30, 2019 8:50:06 PM | 83

    A while ago we discussed the obfuscation of classical economics in order to elevate the Junk Economics of Randian Neoliberalism. And with Trump's Trade War and the 2020 election cycle's start, I think it wise to revisit what's proven to be a timeless Michael Hudson essay from 2010, "America's China Bashing: A Compendium of Junk Economics" , which provided the ground work for the subsequent book he published on the topic.

    The following excerpt remains the underlying issue prompting Trump's Trade War with China:

    "The cover story is that foreign exchange controls and purchases of U.S. securities keep the renminbi's exchange rate low, artificially spurring its exports. The reality, of course, is that these controls protect China from U.S. banks creating free 'keyboard credit' to buy out Chinese companies to buy out Chinese companies or load down its economy with loans to be paid off in renminbi whose value will rise against the deficit-ridden dollar. It's the Wall Street arbitrage opportunity of the century that banks are pressing for, not the welfare of American workers ."

    As the years between have shown, the Chinese aren't fools and probably know more about economics than their politicized US counterparts, Trump especially included.

    psychohistorian , Jun 30, 2019 9:12:34 PM | 85

    @ William Gruff with the dh-mtl update about "control" during the early part of last century....I agree and thanks

    @ karlof1 with the Michael Hudson link.....I put a comment up last night with a quote from Xinhuanet
    "
    BEIJING, June 30 (Xinhua) -- China on Sunday rolled out revised negative lists for foreign investment market access, introducing greater opening-up and allowing foreign investors to run majority-share-controlling or wholly-owned businesses in more sectors.
    "
    It makes me worry about how much of "China" will be allowed to be bought/controlled by the private finance folk. I have been wondering about this since 2008 when the US started running the "printing presses" bigly enough to double the deficit in less than 10 years.....I didn't get any of those trillions, did you? At some point I expect there to be a meeting of global "big wigs" who say they own this or that and wonder how that meeting will turn out relative to Bretton Woods.

    I still see China throwing out a faux lifeline to the private finance folk that will be reeled in after the transition to a China led world.....want to make it look like the Koch brothers and Soros with their new peace tank are leading the parade.....

    [Jun 30, 2019] Trade War Has Damaged U.S. Chip Industry in Ways a Deal May Never Fix - The New York Times

    Notable quotes:
    "... Mr. Lidow is among the semiconductor executives in the United States who have become concerned that the trade war with China -- particularly the Trump administration's ban on selling chips to some prominent Chinese customers -- won't just squeeze current revenue. He fears that recent events have convinced Chinese companies that American component makers can no longer be seen as dependable partners and are permanently shifting away from them. ..."
    "... In May, President Trump ordered American companies on national-security grounds to stop selling components to companies like Huawei , China's big maker of mobile phones and networking equipment. And the administration placed five other Chinese entities on the same blacklist this month, including the computer maker Sugon and three subsidiaries. ..."
    "... China has responded by saying it would put together its own "unreliable entities list," including many American tech companies. ..."
    "... "The U.S. is in danger of becoming the vendor of last resort for China," said Walden Rhines, chief executive emeritus of Mentor, a unit of Siemens that sells software for designing chips ..."
    Jun 30, 2019 | www.nytimes.com

    SAN FRANCISCO -- Alex Lidow has sold semiconductors in China for decades, starting at a company, called International Rectifier, that his father and grandfather founded in the Los Angeles area in 1947.

    Now Mr. Lidow runs Efficient Power Conversion, which makes chips that manage electrical power in cars and other products. Efficient Power has a strong foothold in China, but has lately run into resistance from customers there that he traces to moves in Washington.

    Mr. Lidow is among the semiconductor executives in the United States who have become concerned that the trade war with China -- particularly the Trump administration's ban on selling chips to some prominent Chinese customers -- won't just squeeze current revenue. He fears that recent events have convinced Chinese companies that American component makers can no longer be seen as dependable partners and are permanently shifting away from them.

    "In my 40 years in this business, I've had friends in China that viewed me as a trusted supplier," Mr. Lidow said. "They can't now." His experience is part of the fallout affecting the American chip industry, one of the tech sectors hardest hit by the tit-for-tat between the United States and China over trade and national security.

    In May, President Trump ordered American companies on national-security grounds to stop selling components to companies like Huawei , China's big maker of mobile phones and networking equipment. And the administration placed five other Chinese entities on the same blacklist this month, including the computer maker Sugon and three subsidiaries.

    China has responded by saying it would put together its own "unreliable entities list," including many American tech companies.

    Even if a new trade deal eases tensions -- Mr. Trump is set to meet with President Xi Jinping of China in Osaka, Japan, on Saturday -- American chip executives and others said lasting damage had already been done. They said Chinese officials and companies would step up efforts to design and make more chips domestically. And Chinese customers seem likely to turn to vendors from countries like Japan, South Korea and Taiwan if no homegrown chips are available.

    "The U.S. is in danger of becoming the vendor of last resort for China," said Walden Rhines, chief executive emeritus of Mentor, a unit of Siemens that sells software for designing chips

    Already, big American chip makers have taken a financial hit from the China bans. Micron Technology, which sells two of the most widely used varieties of memory chips, disclosed Tuesday that the Huawei ban had lowered sales in its most recent quarter by nearly $200 million. Huawei is Micron’s largest customer, accounting for around 13 percent of its revenue.

    [Jun 30, 2019] The Art Of The Deal Vs. The Art Of War by Lance Roberts

    Notable quotes:
    "... "The problem, is that China knows time is short for the President and subsequently there is 'no rush' to conclude a 'trade deal' for several reasons: ..."
    "... The pressure is on the Trump Administration to conclude a "deal," not on China. Trump needs a deal done before the 2020 election cycle AND he needs the markets and economy to be strong. ..."
    "... corporate profits continued to come under pressure. As noted previously, corporate profits have declined over the last two quarters and are at the same level as in 2014 with the stock market higher by almost 60%. ..."
    "... But, if you think China is going to acquiesce any time soon to Trump's demands, you haven't been paying attention. China has launched a national call in their press to unify support behind China's refusal to give into Trump's demands. To wit: ..."
    "... "Lying behind the trade feud is America's intention to stifle China's development. The U.S. wants to be a permanent leader in the world, and there is no way for China to avoid the 'storm' through compromise. ..."
    Jun 30, 2019 | www.zerohedge.com

    Authored by Lance Roberts via RealInvestmentAdvice.com,

    ... ... ...

    By agreeing to continue talks without imposing more tariffs on China, China gains ample running room to continue to adjust for current tariffs to lessen their impact. More importantly, Trump gave up a major bargaining chip – Huawei.

    "One of the things I will allow, however, is -- a lot of people are surprised we send and we sell to Huawei a tremendous amount of product that goes into a lot of the various things that they make -- and I said that that's OK, that we will keep selling that product."

    No, a lot of people weren't surprised, just Trump as there has been pressure applied by U.S. technology firms to lift the ban on Huawei. While he may have appeased his corporate campaign donors for now, Trump gave up one of the more important "pain points" on China's economy.

    This gives China much needed room to run.

    Let's review what we said a couple of months ago as to why their will ultimately be no deal.

    "The problem, is that China knows time is short for the President and subsequently there is 'no rush' to conclude a 'trade deal' for several reasons:

    1. China is playing a very long game. Short-term economic pain can be met with ever-increasing levels of government stimulus. The U.S. has no such mechanism currently, but explains why both Trump and Vice-President Pence have been suggesting the Fed restarts QE and cuts rates by 1%. (Update: Trump says the U.S. should have Mario Draghi at the helm of U.S. monetary policy.)
    2. The pressure is on the Trump Administration to conclude a "deal," not on China. Trump needs a deal done before the 2020 election cycle AND he needs the markets and economy to be strong. If the markets and economy weaken because of tariffs, which are a tax on domestic consumers and corporate profits, as they did in 2018, the risk off electoral losses rise. China knows this and are willing to 'wait it out' to get a better deal.
    3. As I have stated before, China is not going to jeopardize its 50 to 100-year economic growth plan on a current President who will be out of office within the next 5-years at most. It is unlikely, the next President will take the same hard line approach on China that President Trump has, so agreeing to something that is unlikely to be supported in the future is unlikely. It is also why many parts of the trade deal already negotiated don't take effect until after Trump is out of office when those agreements are unlikely to be enforced.

    In the meantime, as noted in #3 above, corporate profits continued to come under pressure. As noted previously, corporate profits have declined over the last two quarters and are at the same level as in 2014 with the stock market higher by almost 60%.

    ... ... ...

    But, if you think China is going to acquiesce any time soon to Trump's demands, you haven't been paying attention. China has launched a national call in their press to unify support behind China's refusal to give into Trump's demands. To wit:

    "Lying behind the trade feud is America's intention to stifle China's development. The U.S. wants to be a permanent leader in the world, and there is no way for China to avoid the 'storm' through compromise.

    History proves that compromise only leads to further dilemmas. During previous trade tensions between the U.S. and Japan, Japan made concessions. As a result, its political stability and economic development were adversely affected, with structural reform being suspended and hi-tech companies being severely damaged.

    China, with a population of 1.4 billion, is the world's largest manufacturing base. Industrial upgrading and hi-tech innovation are crucial to China's economic development. China needs to leave more resources to its descendants by protecting the environment, and reaping the dividends of further opening-up. These are the core interests of China, and it will never give them up.

    The only way for a country to win a war is through development, not compromise. To achieve development, China will open its door wider to the world and fight to the end."

    These are Xi Jinping's mandates, dictated directly from his party, for the meeting with the United States president in Osaka.

    The only possible outcome for Trump was exactly what happened. Nothing. Just an agreement to talk more.

    While Trump may be following his "Art Of The Deal" tactics, Xi is clearly operating on the foundation of Sun Tzu's "The Art Of War."

    "If your enemy is secure at all points, be prepared for him. If he is in superior strength, evade him. I f your opponent is temperamental, seek to irritate him. Pretend to be weak, that he may grow arrogant. If he is taking his ease, give him no rest. If his forces are united, separate them. If sovereign and subject are in accord, put division between them. Attack him where he is unprepared, appear where you are not expected. "

    China has been attacking the "rust-belt" states, which are crucial to Trump's 2020 re-election, states with specifically targeted tariffs. As noted by MarketWatch:

    "China has lashed back with tariffs on $110 billion in American goods, focusing on agricultural products in a direct and painful shot at Trump supporters in the U.S. farm belt."

    While Trump is operating from a view that was a ghost-written, former best-seller, in the U.S. popular press, Xi is operating from a centuries-old blueprint for victory in battle.

    China clearly won this round, and the pressure is now squarely on Trump to get a deal done before the 2020 election.

    That isn't likely going to happen.

    [Jun 30, 2019] The Saker interviews A.B. Abrams about the geostrategic developments in Asia by The Saker

    Notable quotes:
    "... " China by contrast has historically conducted statecraft based on the concept of a civilization state – under which its strength is not measured by the weakness and subjugation of others but by its internal achievements. " ..."
    "... In my view the Usa had an excellent opportunity to enact in a positive way after WW2 but blew it. The main reason was the failure to live up to the above quoted characterisation of the Chinese. To encourage potential achievers in the best sense of the word. ..."
    "... Instead the Us oligarchy held back independent and creative thinking and brainwashed the population, in a way that weakened them. Jfk tried to encourage his countrymen but other forces prevailed. ..."
    Jun 30, 2019 | www.unz.com

    A.B. Abrams: In the introduction to this work I highlight that a fundamental shift in world order was facilitated by the modernization and industrialization of two Eastern nations – Japan under the Meiji Restoration and the USSR under the Stalinist industrialization program. Before these two events the West had retained an effective monopoly on the modern industrial economy and on modern military force. Russia's image is still affected by the legacy of the Soviet Union – in particular the way Soviet proliferation of both modern industries and modern weapons across much of the region was key to containing Western ambitions in the Cold War. Post-Soviet Russia has a somewhat unique position – with a cultural heritage influenced by Mongolia and Central Asia as well as by Europe. Politically Russia remains distinct from the Western Bloc, and perceptions of the country in East Asia have been heavily influenced by this. Perhaps today one the greatest distinctions is Russia's eschewing of the principle of sovereignty under international law and its adherence to a non-interventionist foreign policy. Where for example the U.S., Europe and Canada will attempt to intervene in the internal affairs of other parties – whether by cutting off parts for armaments , imposing economic sanctions or even launching military interventions under humanitarian pretexts – Russia lacks a history of such behavior which has made it a welcome presence even for traditionally Western aligned nations such as the Philippines, Indonesia and South Korea.

    While the Western Bloc attempted to isolate the USSR from East and Southeast Asia by supporting the spread of anticommunist thought, this pretext for shunning Russia collapsed in 1991. Today the West has had to resort to other means to attempt to contain and demonize the country – whether labelling it a human rights abuser or threatening its economic and defense partners with sanctions and other repercussions. The success of these measures in the Asia-Pacific has varied – but as regional economies have come to rely less on the West for trade and grown increasingly interdependent Western leverage over them and their foreign policies has diminished.

    Even when considered as a Western nation, the type of conservative Western civilization which Russia may be seen to represent today differs starkly from that of Western Europe and North America. Regarding a Russia Pivot to Asia, support for such a plan appears to have increased from 2014 when relations with the Western Bloc effectively broke down. Indeed, the Russia's future as a pacific power could be a very bright one – and as part of the up and coming northeast Asian region it borders many of the economies which appear set to dominate in the 21 st century – namely China, Japan and the Koreas. Peter the Great is known to have issued in a new era of Russian prosperity by recognizing the importance of Europe's rise and redefining Russia as a European power – moving the capital to St Petersburg. Today a similar though perhaps less extreme pivot Eastwards towards friendlier and more prosperous nations may be key to Russia's future.

    The Saker: We hear many observers speak of an informal but very profound and even game-changing partnership between Putin's Russia and Xi's China. The Chinese even speak of a " strategic comprehensive partnership of coordination for the new era ". How would you characterize the current relationship between these two countries and what prospects do you see for a future Russian-Chinese partnership?

    A.B. Abrams: A Sino-Russian alliance has long been seen in both the U.S. and in Europe as one of the greatest threats to the West's global primacy and to Western-led world order. As early as 1951 U.S. negotiators meeting with Chinese delegations to end the Korean War were instructed to focus on the differences in the positions of Moscow and Beijing in an attempt to form a rift between the two. Close Sino-Soviet cooperation seriously stifled Western designs for the Korean Peninsula and the wider region during that period, and it was repeatedly emphasized that the key to a Western victory was to bring about a Sino-Soviet split. Achieving this goal by the early 1960s and bringing the two powers very near to a total conflict significantly increased prospects for a Western victory in the Cold War, with the end of the previously united front seriously undermining nationalist and leftist movements opposing Western designs from Africa and the Middle East to Vietnam and Korea. Both states learned the true consequences of this in the late 1980s and early 1990s when there was a real risk of total collapse under Western pressure. Attempts to bring an end to China's national revolution through destabilization failed in 1989, although the USSR was less fortunate and the results for the Russian population in the following decade were grave indeed.

    Today the Sino-Russian partnership has become truly comprehensive, and while Western experts from Henry Kissinger to the late Zbigniew Brzezinski among others have emphasized the importance of bringing about a new split in this partnership this strategy remains unlikely to work a second time. Both Beijing and Moscow learned from the dark period of the post-Cold War years that the closer they are together the safer they will be, and that any rift between them will only provide their adversaries with the key to bringing about their downfall. It is difficult to comprehend the importance of the Sino-Russian partnership for the security of both states without understanding the enormity of the Western threat – with maximum pressure being exerted on multiple fronts from finance and information to military and cyberspace. Where in the early 1950s it was only the Soviet nuclear deterrent which kept both states safe from very real Western plans for massive nuclear attacks, so too today is the synergy in the respective strengths of China and Russia key to protecting the sovereignty and security of the two nations from a very real and imminent threat. A few examples of the nature of this threat include growing investments in social engineering through social media – the results of have been seen in Hong Kong, Taiwan and Ukraine, a lowering threshold for nuclear weapons use by the United States – which it currently trains Western allies outside the NPT to deploy, and even reports from Russian and Korean sources of investments in biological warfare – reportedly being tested in Georgia, Eastern Europe and South Korea .

    The partnership between Russia and China has become truly comprehensive, and is perhaps best exemplified by their military relations. From 2016 joint military exercises have involved the sharing of extremely sensitive information on missile and early warning systems – one of the most well kept defense secrets of any nuclear power which even NATO powers do not share with one another. Russia's defense sector has played a key role in the modernization of the Chinese People's Liberation Army, while Chinese investment has been essential to allowing Russia to continue research and development on next generation systems needed to retain parity with the United States. There is reportedly cooperation between the two in developing next generation weapons technologies for systems such as hypersonic cruise and anti aircraft missiles and new strategic bombers and fighter jets which both states plan to field by the mid-2020s. With the combined defense spending of both states a small fraction of that of the Western powers, which themselves cooperate closely in next generation defense projects, it is logical that the two should pool their resources and research and development efforts to most efficiently advance their own security.

    Cooperation in political affairs has also been considerable, and the two parties have effectively presented a united front against the designs of the Western Bloc. In 2017 both issued strong warnings to the United States and its allies that they would not tolerate an invasion of North Korea – which was followed by the deployment of advanced air defense systems by both states near the Korean border with coverage of much of the peninsula's airspace. Following Pyongyang's testing of its first nuclear delivery system capable of reaching the United States , and renewed American threats against the East Asian country, China and Russia staged near simultaneous exercises near the peninsula using naval and marine units in a clear warning to the U.S. against military intervention. China's Navy has on several occasions deployed to the Mediterranean for joint drills with Russian forces – each time following a period of high tension with the Western Bloc over Syria.

    In April 2018, a period of particularly high tensions between Russia and the Western Bloc over Western threats both to take military action against the Syrian government and to retaliate for an alleged but unproven Russian chemical weapons attack on British soil, the Chinese Defense Minister Wei Fenghe traveled to Russia and more explicitly stated that the Sino-Russian partnership was aimed at countering Western designs. Referring to the Sino-Russian defense partnership as "as stable as Mount Tai" he stated : "the Chinese side has come to show Americans the close ties between the Armed Forces of China and Russia, especially in this situation. We have come to support you." A week later China announced large-scale live fire naval drills in the Taiwan Strait – which according to several analysts were scheduled to coincide with a buildup of Western forces near Syria. Presenting a potential second front was key to deterring the Western powers from taking further action against Russia or its ally Syria. These are but a few examples Sino-Russian cooperation, which is set to grow only closer with time.

    The Saker: The US remains the most formidable military power in Asia, but this military power is being eroded as a result of severe miscalculations of the US political leadership. How serious a crisis do you think the US is now facing in Asia and how do you assess the risks of a military confrontation between the US and the various Asian powers (China, the Philippines, the DPRK, etc,).

    A.B. Abrams: Firstly I would dispute that the United States is the most formidable military power in the region, as while it does retain a massive arsenal there are several indicators that it lost this position to China during the 2010s. Looking at combat readiness levels, the average age of weapons in their inventories, morale both publicly and in the armed forces, and most importantly the correlation of their forces, China appears to have an advantage should war break out in the Asia-Pacific. It is important to remember that the for the Untied States and its European allies in particular wars aren't fought on a chessboard. Only a small fraction of their military might can be deployed to the Asia-Pacific within a month of a conflict breaking out, while over 95% of Chinese forces are already on the region and are trained and armed almost exclusively for war in the conditions of the Asia-Pacific. In real terms the balance of military power regionally is in China's favor, and although the U.S. has tried to counter this with a military 'Pivot to Asia' initiative from 2011 this has ultimately failed due to both the drag from defense commitments elsewhere and the unexpected and pace at which China has expanded and modernized its armed forces.

    For the time being the risk of direct military confrontation remains low, and while there was a risk in 2017 of American and allied action against the DPRK Pyongyang has effectively taken this option off the table with the development of a viable and growing arsenal of thermonuclear weapons and associated delivery systems alongside the modernization of its conventional capabilities. While the U.S. may have attempted to call a Chinese and Russian bluff by launching a limited strike – which seriously risked spiraling into something much larger – it is for the benefit of all regional parties including South Korea that the DPRK now has the ability to deter the United States without relying on external support. This was a historically unprecedented event, and as military technology has evolved it has allowed a small power for the first time to deter a superpower without relying on allied intervention. Changes in military technology such as the proliferation of the nuclear tipped ICBM make a shooting war less likely, but also alters the nature of warfare to place greater emphasis on information war, economic war and other new fields which will increasingly decide the global balance of power. Where America's answer to the resistance of China and North Korea in the 1950s to douse them with napalm, today winning over their populations through soft power, promoting internal dissent, placing pressure on their living standards and ensuring continued Western dominance of key technologies has become the new means of fighting.

    That being said, there is a major threat of conflict in the Asia-Pacific of a different nature. Several organizations including the United Nations and the defense ministries of Russia, Singapore and Indonesia among others have warned of the dangers posed by Islamic terrorism to stability in the region. Radical Islamism, as most recently attested to by Saudi Arabia's crown prince , played a key role in allowing the Western Bloc to cement its dominance over the Middle East and North Africa – undermining Russian and Soviet aligned governments including Algeria, Libya, Egypt and Syria – in most cases with direct Western support. CIA Deputy Director Graham Fuller in this respect referred to the agency's "policy of guiding the evolution of Islam and of helping them against our adversaries." Several officials, from the higher brass of the Russian, Syrian and Iranian militaries to the former President of Afghanistan and the President of Turkey , have all alleged Western support for radical terror groups including the Islamic State for the sake of destabilizing their adversaries. As the Asia-Pacific has increasingly slipped out of the Western sphere of influence, it is likely that this asset will increasingly be put into play. The consequences of the spread of jihadism from the Middle East have been relatively limited until now, but growing signs of danger can be seen in Xinjiang, Myanmar, the Philippines and Indonesia. It is this less direct means of waging war which arguably poses the greatest threat.

    The Saker: Do you think that we will see the day when US forces will have to leave South Korean, Japan or Taiwan?

    A.B. Abrams: Other than a limited contingent of Marines recently deployed to guard the American Institute , U.S. forces are not currently stationed in Taiwan. The massive force deployed there in the 1950s was scaled down and American nuclear weapons removed in 1974 in response to China's acceptance of an alliance with the United States against the Soviet Union. Taiwan's military situation is highly precarious and the disparity in its strength relative to the Chinese mainland grows considerably by the year. Even a large American military presence is unlikely to change this – and just 130km from the Chinese mainland they would be extremely vulnerable and could be quickly isolated from external support in the event of a cross straits war. We could, however, see a small American contingent deployed as a 'trigger wire' – which will effectively send a signal to Beijing that the territory is under American protection and that an attempt to recapture Taiwan will involve the United States. Given trends in public opinion in Taiwan, and the very considerable pro-Western sentiments among the younger generations in particular, it is likely that Taipei will look to a greater rather than a lesser Western military presence on its soil in future.

    Japan and particularly South Korea see more nuanced public opinion towards the U.S., and negative perceptions of an American military presence may well grow in future – though for different reasons in each country. Elected officials alone, however, are insufficient to move the American presence – as best demonstrated by the short tenure of Prime Minister Hatoyama in Japan and the frustration of President Moon's efforts to restrict American deployments of THAAD missile systems in his first year. It would take a massive mobilization of public opinion – backed by business interests and perhaps the military – to force such a change. This remains possible however, particularly as both economies grow increasingly reliant on China for trade and as the U.S. is seen to have acted increasingly erratically in response to challenges from Beijing and Pyongyang which has undermined its credibility. As to a voluntary withdrawal by the United States, this remains extremely unlikely. President Donald Trump ran as one of the most non-interventionist candidates in recent history, but even under him and with considerable public support prospects for a significant reduction in the American presence, much less a complete withdrawal, have remained slim.

    The Saker: Some circles in Russia are trying very hard to frighten the Russian public opinion against China alleging things like "China want to loot (or even conquer!) Siberia", "China will built up its military and attack Russia" or "China with its huge economy will simply absorb small Russia". In your opinion are any of these fears founded and, if yes, which ones and why?

    A.B. Abrams: A growth in Sinophobic sentiment in Russia only serves to weaken the nation and empower its adversaries by potentially threatening its relations with its most critical strategic partner. The same is applicable vice-versa regarding Russophobia in China. Given the somewhat Europhilic nature of the Russian state in a number of periods, including in the 1990s, and the considerable European soft influences in modern Russia, there are grounds for building up of such sentiment. Indeed Radio Free Europe, a U.S. government funded nonprofit broadcasting corporation with the stated purpose of "advancing the goals of U.S. foreign policy," notably published sinophobic content aimed at depicting the Russian people as victims of Chinese business interests to coincide with the Putin-XI summit in June 2019. However, an understanding of the modern Chinese state and its interests indicates that it does not pose a threat to Russia – and to the contrary is vital to Russia's national security interests. While Russia historically has cultural ties to the Western nations, the West has shown Russian considerable hostility throughout its recent history – as perhaps is most evident in the 1990s when Russia briefly submitted itself and sought to become part of the Western led order with terrible consequences. China by contrast has historically conducted statecraft based on the concept of a civilization state – under which its strength is not measured by the weakness and subjugation of others but by its internal achievements. A powerful and independent Russia capable of protecting a genuine rules based world order and holding lawless actors in check is strongly in the Chinese interest. It is clear that in Russia such an understanding exists on a state level, although there is no doubt that there will be efforts by external parties to turn public opinion against China to the detriment of the interests of both states.

    The idea that China would seek to economically subjugate Russia, much less invade it, is ludicrous. It was from Europe were the major invasions of Russian territory came – vast European coalitions led by France and Germany respectively with a third American led attack planned and prepared for but stalled by the Soviet acquisition of a nuclear deterrent. More recently from the West came sanctions, the austerity program of the 1990s, the militarization of Eastern Europe, and the demonization of the Russian nation – all intended to subjugate and if possible shatter it. Even at the height of its power, China did not colonize the Koreans, Vietnamese or Japanese nor did it seek to conquer Central Asia. Assuming China will have the same goals and interests as a Western state would if they were in a similar position of strength is to ignore the lessons of history, and the nature of the Chinese national character and national interest.

    The Saker: The Russian military is currently vastly more capable (even if numerically much smaller) than the Chinese. Does anybody in China see a military threat from Russia?

    A.B. Abrams: There may be marginalized extreme nationalists in China who see a national security from almost everybody, but in mainstream discourse there are no such perceptions. To the contrary, Russia's immense contribution to Chinese security is widely recognized – not only in terms of technological transfers but also in terms of the value of the joint front the two powers have formed. Russia not only lacks a history of annexing East Asian countries or projecting force against them, but it is also heavily reliant on China in particular both to keep its defense sector active and to undermine Western attempts to isolate it. Russian aggression against China is unthinkable for Moscow – even if China did not possess its current military strength and nuclear deterrence capabilities. This is something widely understood in China and elsewhere.

    I would dispute that Russia's military is vastly more capable than China's own, as other than nuclear weapons there is a similar level of capabilities in most sectors in both countries. While Russia has a lead in many key technologies such as hypersonic missiles, air defenses and submarines to name a few prominent examples, China has been able to purchase and integrate many of these into its own armed forces alongside the products of its own defense sector. Russia's most prominent fighter jet for example, the Flanker (in all derivatives from Su-27 to J-11D), is in fact fielded in larger numbers by China than by Russia itself – and those in Chinese service have access to both indigenous as well as Russian munitions and subsystems. Furthermore, there are some less critical but still significant sectors where China does appear to retain a lead – for example it deployed combat jets equipped with a new generation of active electronically scanned array radars and air to air missiles from 2017 (J-20 and in 2018 J-10C ) – while Russia has only done so this in July 2019 with the induction of the MiG-35. Whether this is due to a Chinese technological advantage, or to a greater availability of funds to deploy its new technologies faster, remains uncertain. Russia's ability to provide China with its most vital technologies, and China's willingness to rely so heavily on Russian technology to comprise so much of its inventory, demonstrates the level of trust between the two countries

    The Saker: Do you think that China could become a military threat to other countries in the region (especially Taiwan, India, Vietnam, the Philippines, etc.)?

    A.B. Abrams: I would direct you to a quote by Malaysian Prime Minister Mahathir Bin Mohamed from March this year. He stated: "we always say, we have had China as a neighbor for 2,000 years, we were never conquered by them. But the Europeans came in 1509, in two years, they conquered Malaysia." This coming from a nationalist leader considered one of the most sinophobic in Southeast Asia, whose country has an ongoing territorial dispute with China in the South China Sea, bears testament to the nature of claims of a Chinese threat. It is critical not to make the mistake of imposing Western norms when trying to understand Chinese statecraft. Unlike the European states, China is not and has never been dependent on conquering others to enrich itself – but rather was a civilization state which measured its wealth by what it could its own people could produce. A harmonious relationship with India, Vietnam, the Philippines and others in which all states' sovereign and territorial integrity is respected is in the Chinese interest.

    A second aspect which must be considered, and which bears testament to China's intentions, is the orientation of the country's armed forces. While the militaries of the United States and European powers such as Britain, the Netherlands, Belgium and France among others are heavily skewed to prioritize power projection overseas, China's military has made disproportionately small investments in power projection and is overwhelmingly tailored to territorial defense. While the United States has over 300 tanker aircraft deigned to refuel its combat jets midair and attack faraway lands, China has just three purpose-built tankers – less than Malaysia, Chile or Pakistan. The ratio of logistical to combat units further indicates that China's armed forces, in stark contrast to the Western powers, are heavily oriented towards defense and fighting near their borders.

    This all being said, China does pose an imminent threat to the government in Taipei – although I would disagree with your categorization of Taiwan as a country. Officially the Republic of China (ROC- as opposed to the Beijing based People's Republic of China), Taipei has not declared itself a separate country but rather the rightful government of the entire Chinese nation. Taipei remains technically at war with the mainland, a conflict would have ended in 1950 if the U.S. had not placed the ROC under its protection. The fast growing strength of the mainland has shifted the balance of power dramatically should the conflict again break out into open hostilities. China has only to gain from playing the long game with Taiwan however – providing scholarships and jobs for its people to live on the mainland and thus undermining the demonization of the country and hostility towards a peaceful reunification. Taiwan's economic reliance on the mainland has also grown considerably, and these softer methods of bridging the gaps between the ROC and the mainland are key to facilitating unification. Meanwhile the military balance in the Taiwan Strait only grows more favorable for Beijing by the year – meaning there is no urgency to take military action. While China will insist on unification, it will seek to avoid doing so violently unless provoked.

    The Saker: In conclusion: where in Asia do you see the next major conflict take place and why?

    A.B. Abrams: The conflict in the Asia-Pacific is ongoing, but the nature of conflict has changed. We see an ongoing and so far highly successful de-radicalization effort in Xinjiang – which was taken in direct response to Western attempts to turn the province into 'China's Syria or China's Libya,' in the words of Chinese state media, using similar means. We see a harsh Western response to the Made in China 2025 initiative under which the country has sought to compete in key technological fields formerly monopolized by the Western Bloc and Japan – and the result of this will have a considerable impact on the balance of economic power in the coming years. We see direct economic warfare and technological competition between China and the United States – although the latter has so far refrained from escalating too far due to the potentially devastating impact reprisals could have. We further see an information war in full swing, with Sinophobic stories often citing 'anonymous sources' being propagated by Western media to target not only their own populations – but also to influence public opinion in Southeast Asia and elsewhere. Influence over third parties remains vital to isolating China and cementing the Western sphere of influence. Use of social media and social engineering, as the events of the past decade have demonstrated from the Middle East in 2011 to Hong Kong today, remains key and will only grow in its potency in the coming years. We also see a major arms race, with the Western Bloc investing heavily in an all new generation of weapons designed to leave existing Chinese and allied defenses obsolete – from laser air defenses to neutralize China's nuclear deterrent to sixth generation stealth fighters, new heavy bombers, new applications of artificial intelligence technologies and new hypersonic missiles.

    All these are fronts of the major conflict currently underway, and the Obama and Trump administrations have stepped up their offensives to bring about a new 'end of history' much like that of the 1990s – only this time it is likely to be permanent. To prevail, China and Russia will need to cooperate at least as closely if not more so as the Western powers do among themselves.

    The Saker: thank you very much for your time and answers!


    anonymous [290] Disclaimer , says: June 27, 2019 at 2:18 pm GMT

    That being said, there is a major threat of conflict in the Asia-Pacific of a different nature. Several organizations including the United Nations and the defense ministries of Russia, Singapore and Indonesia among others have warned of the dangers posed by Islamic terrorism to stability in the region. Radical Islamism, as most recently attested to by Saudi Arabia's crown prince, played a key role in allowing the Western Bloc to cement its dominance over the Middle East and North Africa – undermining Russian and Soviet aligned governments including Algeria, Libya, Egypt and Syria – in most cases with direct Western support. CIA Deputy Director Graham Fuller in this respect referred to the agency's "policy of guiding the evolution of Islam and of helping them against our adversaries." Several officials, from the higher brass of the Russian, Syrian and Iranian militaries to the former President of Afghanistan and the President of Turkey, have all alleged Western support for radical terror groups including the Islamic State for the sake of destabilizing their adversaries. As the Asia-Pacific has increasingly slipped out of the Western sphere of influence, it is likely that this asset will increasingly be put into play. The consequences of the spread of jihadism from the Middle East have been relatively limited until now, but growing signs of danger can be seen in Xinjiang, Myanmar, the Philippines and Indonesia. It is this less direct means of waging war which arguably poses the greatest threat.

    There is hardly such a thing called "Islamic Terrorism." In most egregious cases, such as IS, etc., it can be shown that those lowlifes have been the mercenaries of the evil West and their accursed implant in the ME (and nowadays the hindutvars too), collectively the avowed enemies of true monotheism, Islam. I am including the recent Colombo attacks here.

    How can any so-called "muslim" who is a tool-of-evil of the enemies of Islam, be a true muslim? How then can it be termed "Islamic Terror"? Perhaps "Islamic Apostate Terror" would be more suitable.

    Of course, there are many other non-IS muslims who are called "terrorists." The Palestinians, the Kashmiris, etc. For us muslims, they are simply freedom fighters.

    Finally, there are a few muslims who do kill in the name Islam the Charlie Hebdo killers, Bombay\Dhaka attackers, etc. Some of them are justified (due to intense provocations) and others not at all. I will leave it for others to judge which falls under which category. Perhaps the listed order will help decipher that.

    It must be conceded, when it comes to setting the narrative of pure deceit, the West (and its minions, the Jooscum and their lickspittle, the hindutvars), like in all things bad, can be satanically good. We muslims are being decimated in the propaganda war.

    We still got our True Monotheism though. The pagan/godless enemies of the Almighty One are doomed to fail against it. God willing.

    Sean , says: June 27, 2019 at 6:19 pm GMT
    The American system ran on immigration that kept discontent about massive inequality under control because a substantial proportion of the lowest SES were immigrants just glad to be in the US. The tAmerican ruling class decided they could make more money by offshoring everything that could be offshored and mass immigration to keep wags from going up in the non offshorable parts of the economy.

    China and America's venal globalising elite had converging agendas, but could not fool the common people of America and their tribune . Even the military had began to get alarmed about the economic growth and technological progress of China, which had been benefiting from officially sanctioned preferential treatment by the US since Carter.

    Free ride is over for China, we will see China's economic and military strength progressively tested. What America built it can break.

    Russia will be secretly pleased

    Cyrano , says: June 27, 2019 at 9:18 pm GMT
    China was made an economic superpower by the US elites. Not because they felt sorry for China and wanted to speed up conversion to democracy by switching them to capitalist way of doing business first.

    They made them an economic superpower, because the US elites have lost their marbles. They simply didn't see it coming. They wanted to turn China into one giant cheap sweatshop in order to exploit their population with a low paying manufacturing jobs, which were never supposed to make China reach.

    But they did, because no matter how much the lost generation of the western elites were foaming at their mouths about knowledge based economy, value added economy, high tech jobs and the other crap, it is obvious that manufacturing remains a basis for any strong economy. That doesn't look like it's going to change even when you add robots to the mixture.

    I think that Napoleon was right when he warned the world about waking up the sleeping dragon. First they made them an economic superpower, and now they want to contain them militarily. Good luck with that.

    There is a reason why China wants to build the silk road. Silk road implies land. The US military has never been any good at land warfare. Neither where their predecessors – the British. China, on the other hand, showed in Korea that even then, with a backward army, equipped with handouts from the Soviet Union, they can pretty much trash the US army.

    With the silk road initiative, China will seize the control of the entire Euro-Asian land mass – the most populous and economically productive region of the world and will be more than happy to let the US play pirates on the seas.

    Priss Factor , says: Website June 29, 2019 at 12:04 am GMT
    Abrams is giving the West too much credit for the Sino-Soviet rift of the late 5os and 60s.

    That was NOT the doing of the CIA or Western Europe. It was 90% the fault of Mao who tried to shove Khrushchev aside as the head of world communism. Because Stalin had treated Mao badly, Krushchev wanted to make amends and treated Mao with respect. But Mao turned out to be a total a-hole. There are two kinds of people: Those who appreciate friendly gestures and those who seek kindness as 'weakness'.

    It's like Hitler saw Chamberlain's offer as weakness and pushed ahead. Being kind is nice, but one should never be kind to psychopaths, and Khrushchev was nice to the wrong person.

    Mao only understood power. He sensed Khrushchev as 'weak' and acted as if he wanted to be the new Stalin. He also made international statements that made the US-USSR relations much worse. He berated Khrushchev for seeking co-existence with the West and pressed on for more World Revolution.

    He also ignored Soviet advice not to attempt radical economic policies (that were soon to bring China to economic ruin -- at least Stalin's collectivization led to rise of industry; in contrast, Mao managed to destroy both agriculture and heavy industry).

    When Stalin was alive, he didn't treat Mao with any respect, and Mao disliked Stalin but still respected him because Mao understood Power. With Stalin gone, Khrushchev showed Mao some respect, but Mao felt no respect for Khrushchev who was regarded as a weakling and sucker.

    It was all so stupid. China and Russia could have gotten along well if not for Mao's impetuosity. Of course, Khrushchev could be reckless, contradictory, and erratic, and his mixed signals to the West also heightened tensions. Also, he was caught between a rock and a hard place where the Eastern Bloc was concerned. He wanted to de-Stalinize, but this could lead to events like the Hungarian Uprising.

    Anyway, Putin and Xi, perhaps having grown up in less turbulent times, are more stable and mature in character and temperament than Mao and Khrushchev. They don't see the Russo-China relations as a zero sum game of ego but a way for which both sides can come to the table halfway, which is all one can hope for.

    Peter Grafström , says: June 29, 2019 at 10:21 am GMT
    @Priss Factor You are probably right about Hitler seeing (Neville) Chamberlain as weak. But Hitler was a dupe for Britains much smarter and devious elites, who successfully played him to do their bidding. Hitler, along with the major members of the nazis, had been significantly influenced by Neville's elder cousin who spurred the nazis towards 'the ultimate solution'.

    Instead of being weak in the manner Hitler may have thought, Neville saved Hitler from his own generals.

    In historical turns , when Britain has appeared weak, it mostly is a deliberate faint.

    Be it in Gallipoli, St Petersburg in 1919, Norway or Singapore in WW2.

    Peter Grafström , says: June 29, 2019 at 10:38 am GMT
    Commendable contribution by Mr Abrams to enlighten the confused western establishment.

    " China by contrast has historically conducted statecraft based on the concept of a civilization state – under which its strength is not measured by the weakness and subjugation of others but by its internal achievements. "

    In my view the Usa had an excellent opportunity to enact in a positive way after WW2 but blew it. The main reason was the failure to live up to the above quoted characterisation of the Chinese. To encourage potential achievers in the best sense of the word.

    Instead the Us oligarchy held back independent and creative thinking and brainwashed the population, in a way that weakened them.
    Jfk tried to encourage his countrymen but other forces prevailed.

    Carlton Meyer , says: Website June 30, 2019 at 4:16 am GMT
    Americans cannot understand our relations with China by looking at events just the past 75 years. During the century before, European imperial powers and the United States treated China as a open borders business opportunity backed by foreign military force. China was infested by mini-colonies to profit from China's riches. The "Opium Wars" shock decent Americans.

    https://www.youtube.com/embed/sKgrb0oggfE?feature=oembed

    [Jun 27, 2019] Crisis of neoliberalism hits the US military industrial complex by Matt Stoller and Lucas Kunce

    Notable quotes:
    "... This story of lost American leadership and production is not unique. In fact, the destruction of America's once vibrant military and commercial industrial capacity in many sectors has become the single biggest unacknowledged threat to our national security. Because of public policies focused on finance instead of production, the United States increasingly cannot produce or maintain vital systems upon which our economy, our military, and our allies rely. Huawei is just a particularly prominent example. ..."
    "... Higher budgets would seem to make sense. According to the 2018 National Defense Strategy, the United States is shifting away from armed conflicts in the Middle East to "great power" competition with China and Russia, which have technological parity in many areas with the United States. As part of his case for higher budgets, Mattis told Congress that "our military remains capable, but our competitive edge has eroded in every domain of warfare -- air, land, sea, space, and cyber." ..."
    "... And yet, the U.S. military budget, even at stalled levels, is still larger than the next nine countries' budgets combined. So there's a second natural follow-up question: is the defense budget the primary reason our military advantage is slipping away, or is it something deeper? ..."
    "... The loss of manufacturing capacity has been devastating for American research capacity. "Innovation doesn't just hover above the Great Plains," Mottl said. "It is built on steady incremental changes and knowledge learned out of basic manufacturing." Telecommunications equipment is dual use, meaning it can be used for both commercial and military purposes. The loss of an industrial base in telecom equipment meant that the American national security apparatus lost military capacity. ..."
    "... "The middle-class Americans who did the manufacturing work, all that capability, machine tools, knowledge, it just became worthless, driven by the stock price," he said. "The national ability to produce is a national treasure. If you can't produce you won't consume, and you can't defend yourself." ..."
    "... In the commercial sector, rebuilding the industrial base will require an aggressive national mobilization strategy. This means aggressive investment by government to rebuild manufacturing capacity, selective tariffs to protect against Chinese or foreign predation, regulation to stop financial predation by Wall Street, and anti-monopoly enforcement to block the exploitation of market power. ..."
    Jun 27, 2019 | www.theamericanconservative.com

    Wall Street's short-term incentives have decimated our defense industrial base and undermined our national security.

    Early this year, U.S. authorities filed criminal charges -- including bank fraud, obstruction of justice, and theft of technology -- against the largest maker of telecommunications equipment in the world, a Chinese giant named Huawei. Chinese dominance in telecom equipment has created a crisis among Western espionage agencies, who, fearful of Chinese spying, are attempting to prevent the spread of Huawei equipment worldwide, especially
    in the critical 5G next-generation mobile networking space.

    In response to the campaign to block the purchase of Huawei equipment, the company has engaged in a public relations offensive. The company's CEO, Ren Zhengfei, portrayed Western fears as an advertisement for its products, which are, he said, "so good that the U.S. government is scared." There's little question the Chinese government is interested in using equipment to spy. What is surprising is Zhengfei is right about the products. Huawei, a relatively new company in the telecom equipment space, has amassed top market share because its equipment -- espionage vulnerabilities aside -- is the best value on the market.

    In historical terms, this is a shocking turnaround. Americans invented the telephone business and until recently dominated production and research. But in the last 20 years, every single American producer of key telecommunication equipment sectors is gone. Today, only two European makers -- Ericsson and Nokia -- are left to compete with Huawei and another Chinese competitor, ZTE.

    This story of lost American leadership and production is not unique. In fact, the destruction of America's once vibrant military and commercial industrial capacity in many sectors has become the single biggest unacknowledged threat to our national security. Because of public policies focused on finance instead of production, the United States increasingly cannot produce or maintain vital systems upon which our economy, our military, and our allies rely. Huawei is just a particularly prominent example.

    When national security specialists consider preparedness, they usually think in terms of the amount of money spent on the Pentagon. One of President Donald Trump's key campaign promises was to aggressively raise the military budget, which he, along with Congress, started doing in 2017. The reaction was instant. "I'm heartened that Congress recognizes the sobering effect of budgetary uncertainty on America's military and on the men and women who provide for our nation's defense," then-defense secretary Jim Mattis said. Budgets have gone up every year since.

    Higher budgets would seem to make sense. According to the 2018 National Defense Strategy, the United States is shifting away from armed conflicts in the Middle East to "great power" competition with China and Russia, which have technological parity in many areas with the United States. As part of his case for higher budgets, Mattis told Congress that "our military remains capable, but our competitive edge has eroded in every domain of warfare -- air, land, sea, space, and cyber."

    In some cases, our competitive edge has not just been eroded, but is at risk of being -- or already is -- surpassed. The Chinese surge in 5G telecom equipment, which has dual civilian and military uses, is one example. China is making key investments in artificial intelligence, another area of competition. They even seem to be able to mount a rail gun on a naval ship , an important next generation weapons technology that the U.S. Navy has yet to incorporate.

    And yet, the U.S. military budget, even at stalled levels, is still larger than the next nine countries' budgets combined. So there's a second natural follow-up question: is the defense budget the primary reason our military advantage is slipping away, or is it something deeper?

    Why the Regulators Went Soft on Monopolies The Conservative Case for Antitrust

    The story of Huawei, and many others, suggests the latter.

    ♦♦♦

    For over a century, America led the world in producing telecommunications equipment. The American telecom industry, according to Zach Mottl of Atlas Tool Works, a subcontractor in the industry, used to be a "crown jewel of American manufacturing." Mottl's company had been a manufacturing supplier to AT&T and its Bell Labs from the early 1900s until the early 2000s. "The radar system was invented here. The transistor came out of Bell Labs. The laser. I mean all of these high-tech inventions that have both commercial and military applications were funded out of the research," Mottl told TAC . More than just the sexy inventions, there was a domestic industrial sector which could make the equipment. Now, in a strategic coup for our adversaries, that capability is gone.

    Yet it wasn't one of those adversaries that killed our telecommunications capacity, but one of our own institutions, Wall Street, and its pressure on executives to make decisions designed to impress financial markets, rather than for the long-term health of their companies. In 1996, AT&T spun off Bell Labs into a telecom equipment company, Lucent Technologies, to take advantage of investors' appetite for an independent player selling high-tech telecom gear after Congress deregulated the telecommuncations space. At the time, it was the biggest initial public offering in history, and became the foundation of a relationship with financial markets that led to its eventual collapse.

    The focus on stock price at Lucent was systematic. The stock price was posted daily to encourage everyone to focus on the company's relationship with short-term oriented financial markets. All employees got a small number of "Founder's Grant Share Options," with executives offered much larger slugs of stock to solidify the connection. When Richard McGinn became CEO in 1997, he focused on financial markets.

    Lucent began to buy up companies. According to two scholars , "The perceived need to compete for acquisitions became a 'strategic' justification for keeping stock prices high. This in turn demanded meeting or exceeding quarterly revenue and earnings targets, objectives with which Lucent top executives, led by the hard-driving McGinn, became obsessed."

    Lucent got even more aggressive. McGinn's subordinate, an executive named Carly Fiorina, juiced returns with a strategy based on lending money to risky startups who would then turn around and buy Lucent equipment. Fiorina collected $65 million in compensation as the stock soared. And then, when the dot-com boom turned to bust, the company, beset by accounting scandals designed to impress shareholders and the financial markets, embarked on massive layoffs. CEO McGinn was among those laid off, but with a $12.5 million severance package -- royal compensation for taking one of America's strategic industrial assets down the road toward total destruction.

    In the early 2000s, the telecom equipment market began to recover from the recession. Lucent's new strategy, as Mottl put it, was to seek "margin" by offshoring production to China, continuing layoffs of American workers and hiring abroad. At first, it was the simpler parts of the telecom equipment, the boxes and assembly, but soon contract manufacturers in China were making virtually all of it. American telecom capacity would never return.

    Lucent didn't recover its former position. Chinese entrants, subsidized heavily by the Chinese state and using Western technology, underpriced Western companies. American policymakers, unconcerned with industrial capacity, allowed Chinese companies to capture market share despite the predatory subsidies and stolen technology. In 2006, French telecom equipment maker Alcatel bought Lucent, signifying the end of American control of Bell Labs. Today, Huawei, with state backing, dominates the market.

    The erosion of much of the American industrial and defense industrial base proceeded like Lucent. First, in the 1980s and 1990s, Wall Street financiers focused on short-term profits, market power, and executive pay-outs over core competencies like research and production, often rolling an industry up into a monopoly producer. Then, in the 2000s, they offshored production to the lowest cost producer. This finance-centric approach opened the door to the Chinese government's ability to strategically pick off industrial capacity by subsidizing its producers. Hand over cash to Wall Street, and China could get the American crown jewels.

    The loss of manufacturing capacity has been devastating for American research capacity. "Innovation doesn't just hover above the Great Plains," Mottl said. "It is built on steady incremental changes and knowledge learned out of basic manufacturing." Telecommunications equipment is dual use, meaning it can be used for both commercial and military purposes. The loss of an industrial base in telecom equipment meant that the American national security apparatus lost military capacity.

    This loss goes well beyond telecom equipment. Talking to small manufacturers and distributors who operate in the guts of our industrial systems offers a perspective on the danger of this process of financial predation and offshoring. Bill Hickey, who headed his family's metal distributor, processor, and fabricator, has been watching the collapse for decades. Hickey sells to "everyone who uses steel," from truck, car, and agricultural equipment manufacturers to stadiums and the military.

    Hickey, like many manufacturers, has watched the rise of China with alarm for decades. "Everyone's upset about the China 2025 plan," he told TAC , referencing the current Chinese plan causing alarm among national security thinkers in Washington. "Well there was a China 2020 plan, 2016 plan, 2012 plan." The United States has, for instance, lost much of its fasteners and casting industries, which are key inputs to virtually every industrial product. It has lost much of its capacity in grain oriented flat-rolled electrical steel, a specialized metal required for highly efficient electrical motors. Aluminum that goes into American aircraft carriers now often comes from China.

    Hickey told a story of how the United States is even losing its submarine fleet. He had a conversation with an admiral in charge of the U.S. sub fleet at the commissioning of the USS Illinois , a Virginia-class attack submarine, who complained that the United States was retiring three worn-out boats a year, but could only build one and a half in that time. The Trump military budget has boosted funding to build two a year, but the United States no longer has the capacity to do high quality castings to build any more than that. The supply chain that could support such surge production should be in the commercial world, but it has been offshored to China. "You can't run a really high-end casting business on making three submarines a year," Hickey said. "You just can't do it." This shift happened because Wall Street, or "the LBO (leveraged buy-out) guys" as Hickey put it, bought up manufacturing facilities in the 1990s and moved them to China.

    "The middle-class Americans who did the manufacturing work, all that capability, machine tools, knowledge, it just became worthless, driven by the stock price," he said. "The national ability to produce is a national treasure. If you can't produce you won't consume, and you can't defend yourself."

    The Loss of the Defense Industrial Base

    But it's not just the dual-use commercial manufacturing base that is collapsing. Our policy empowering Wall Street and offshoring has also damaged the more specialized defense base, which directly produces weaponry and equipment for the military.

    How pervasive is the loss of such capacity? In September 2018, the Department of Defense released findings of its analysis into its supply chain. The results highlighted how fragile our ability to supply our own military has become.

    The report listed dozens of militarily significant items and inputs with only one or two domestic producers, or even none at all. Many production facilities are owned by companies that are financially vulnerable and at high risk of being shut down. Some of the risk comes from limited production capability. Mortar tubes, for example, are made on just one production line, and some Marine aircraft parts are made by just one company -- one which recently filed for bankruptcy.

    At risk is everything from chaff to flares to high voltage cable, fittings for ships, valves, key inputs for satellites and missiles, and even material for tents. As Americans no longer work in key industrial fields, the engineering and production skills evaporate as the legacy workforce retires.

    Even more unsettling is the reliance on foreign, and often adversarial, manufacturing and supplies. The report found that "China is the single or sole supplier for a number of specialty chemicals used in munitions and missiles . A sudden and catastrophic loss of supply would disrupt DoD missile, satellite, space launch, and other defense manufacturing programs. In many cases, there are no substitutes readily available." Other examples of foreign reliance included circuit boards, night vision systems, batteries, and space sensors.

    The story here is similar. When Wall Street targeted the commercial industrial base in the 1990s, the same financial trends shifted the defense industry. Well before any of the more recent conflicts, financial pressure led to a change in focus for many in the defense industry -- from technological engineering to balance sheet engineering. The result is that some of the biggest names in the industry have never created any defense product. Instead of innovating new technology to support our national security, they innovate new ways of creating monopolies to take advantage of it.

    A good example is a company called TransDigm. While TransDigm presents itself as a designer and producer of aerospace products, it can more accurately be described as a designer of monopolies. TransDigm began as a private equity firm, a type of investment business, in 1993. Its mission, per its earnings call , is to give "private equity-like returns" to shareholders, returns that are much higher than the stock market or other standard investment vehicles.

    It achieves these returns for its shareholders by buying up companies that are sole or single-source suppliers of obscure airplane parts that the government needs, and then increasing prices by as much as eight times the original amount . If the government balks at paying, TransDigm has no qualms daring the military to risk its mission and its crew by not buying the parts. The military, held hostage, often pays the ransom. TransDigm's gross profit margins using this model to gouge the U.S. government are a robust 54.5 percent. To put that into perspective, Boeing and Lockheed's profit margins are listed at 13.6 percent and 10.91 percent. In many ways, TransDigm is like the pharmaceutical company run by Martin Shkreli, which bought rare treatments and then price gouged those who could not do without the product. Earlier this year, TransDigm recently bought the remaining supplier of chaff and one of two suppliers of flares, products identified in the Defense Department's supply chain fragility report.

    TransDigm was caught manipulating the parts market by the Department of Defense Inspector General in 2006 , again in 2008 , and finally again this year. It is currently facing yet another investigation by the Government Accountability Office .

    Yet, Trandigm's stock price thrives because Wall Street loves monopolies, regardless of who they are taking advantage of. Take this analysis from TheStreet from March 2019, published after the latest Inspector General report and directly citing many of the concerning facts from the report as pure positives for the investor:

    The company is now the sole supplier for 80% of the end markets it serves. And 90% of the items in the supply chain are proprietary to TransDigm. In other words, the company is operating a monopoly for parts needed to operate aircraft that will typically be in service for 30 years . Managers are uniquely motivated to increase shareholder value and they have an enviable record, with shares up 2,503% since 2009.

    Fleecing the Defense Department is big business. Its executive chairman W. Nicholas Howley, skewered by Democrats and Republicans alike in a May 2019 House Oversight hearing for making up to 4,000 percent excess profit on some parts and stealing from the American taxpayer, received total compensation of over $64 million in 2013 , the fifth most among all CEOs, and over $13 million in 2018 , making him one of the most highly compensated CEOs no one has ever heard of . Shortly after May's hearing, the company agreed to voluntarily return $16 million in overcharges to the Pentagon, but the share price is at near record highs.

    L3 Technologies, created in 1997, has taken a different, but also damaging, approach to monopolizing Defense Department contracts. Originally, it sought to become "the Home Depot of the defense industry" by going on an acquisition binge, according to its former CEO Frank Lanza. Today, L3 uses its size, its connections within the government, and its willingness to offer federal employees good-paying jobs at L3, to muscle out competitors and win contracts, even if the competitor has more innovative and better priced products . This practice attracted the ire of two Republican congressmen from North Carolina, Ted Budd and the late Walter Jones, who found in 2017 that L3 succeeds, in part, due to "blatant corruption and obvious disregard of American foreign interest in the name of personal economic profit."

    Like TransDigm, this isn't L3's first brush with trouble. It was temporarily suspended from U.S. government contracting for using "extremely sensitive and classified information" from a government system to help its international business interests. It was the subject of a scathing Senate Armed Services Committee investigation for failing to notify the Defense Department that it supplied faulty Chinese counterfeit parts for some of its aircraft displays. And it agreed to pay a $25.6 million settlement to the U.S. government for knowingly providing defective weapon sights for years to soldiers serving in Iraq and Afghanistan.

    Yet, also like TransDigm, L3 has thrived despite its troubles. When the company was granted an open-ended contract to update the Air Force's electronics jamming airplane in 2017, Lieutenant General Arnold Bunch outlined the Air Force's logic at a House Armed Services Subcommittee meeting. L3, he said, is the only company that can do the job. "They have all the tooling, they have all the existing knowledge, and they have the modeling and all the information to do that work," he said.

    In other words, because L3 has a monopoly, there was no one else to pick. The system -- a system designed by the financial industry that rewards monopoly and consolidation at the expense of innovation and national security -- essentially made the pick for him. It is no wonder our military capacities are ebbing, despite the large budget outlays -- the money isn't going to defense.

    ♦♦♦

    In fact, in some ways, our own defense budgets are being used against us when potential adversaries use Wall Street to take control of our own Pentagon-developed technologies.

    There's no better example than China's takeover of the rare earth metal industry, which is key to both defense and electronics. The issue has frequently made the front page during the recent trade war, but the seldom-discussed background to our dependence on China for rare earths is that, just like with telecom equipment, the United States used to be the world leader in the industry until the financial sector shipped the whole thing to China.

    In the 1970s and 1980s, the Defense Department invested in the development of a technology to use what are known as rare-earth magnets. The investment was so successful that General Motors engineers, using Pentagon grants, succeeded in creating a rare earth magnet that is now essential for nearly every high-tech piece of military equipment in the U.S. inventory, from smart bombs and fighter jets to lasers and communications devices. The benefit of DARPA's investment wasn't restricted to the military. The magnets make cell phones and modern commercial electronics possible.

    China recognized the value of these magnets early on. Chinese Premier Deng Xiaoping famously said in 1992 that "The Middle East has oil, China has rare earth," to underscore the importance of a rare earth strategy he adopted for China. Part of that strategy was to take control of the industry by manipulating the motivations of Wall Street.

    Two of Xiaoping's sons-in-law approached investment banker Archibald Cox, Jr. in the mid-1990s to use his hedge fund as a front for their companies to buy the U.S. rare-earth magnet enterprise. They were successful, purchasing and then moving the factory, the Indiana jobs, the patents, and the expertise to China. This was not the only big move, as Cox later moved into a $12 million luxury New York residence . The result is remarkably similar to Huawei: the United States has entirely divested of a technology and market it created and dominated just 30 years ago. China has a near-complete monopoly on rare earth elements, and the U.S. military, according to U.S. government studies, is now 100 percent reliant upon China for the resources to produce its advanced weapon systems.

    Wall Street's outsized control over defense contracting and industry means that every place a foreign adversary can insert itself into American financial institutions, it can insert itself into our defense industry.

    At an Armed Services Committee hearing in 2018, Representative Carol Shea-Porter talked about how constant the conflict between financial concentration and patriotism had been in her six years on the committee. She recounted a CEO once telling her, in response to her concern about the outsourcing of defense industry parts, that he "[has] to answer to stockholders."

    Who are these stockholders that CEOs are so compelled to answer to? Oftentimes, China. Jennifer M. Harris , an expert in global markets with experience at the U.S. State Department and the U.S. National Intelligence Council, researched a recent explosion of Chinese strategic investment in American technology companies. She found that China has systematically targeted U.S. greenfield investments, "technology goods (especially semiconductors), R&D networks, and advanced manufacturing."

    The trend accelerated, until the recent flare-up of tensions between the United States and China. "China's foreign direct investment (FDI) stock in the U.S. increased some 800% between 2009 and 2015," she wrote. Then, from 2015 to 2017, "Chinese FDI in the U.S. climbed nearly four-fold, reaching roughly $45.6 billion in 2016 , up from just $12.8 billion in 2014."

    This investment runs right through Wall Street, the key lobbying group trying to ratchet down Trump's tough negotiating posture with the Chinese. Rather than showing concern about the increasing influence of a foreign power in our commerce and industry, Wall Street banks have repeatedly followed Archie Cox down the path of easy returns.

    In 2016, J.P. Morgan Chase agreed to pay a $264 million bribery settlement to the U.S. government for creating a program, called "Sons and Daughters," to gain access to Chinese money by selectively hiring the unqualified offspring of high-ranking Communist Party officials and other Chinese elites. Several other banks are under investigation for similar practices, including Citigroup and Goldman Sachs, who, not coincidentally, hired the son of China's commerce minister. It appears to have worked out for them. In 2017, Goldman Sachs partnered with the Chinese government's sovereign wealth fund to invest $5 billion Chinese government dollars in American industry.

    In short, China is becoming a significant shareholder in U.S. industries, and is selectively targeting those with strategic implications. Congresswoman Shea-Porter's discovery that defense industry CEOs aren't able to worry about national security because they "[have] to answer to shareholders" was disturbing enough. But the fact that it potentially translates as CEOs not being able to worry about national security because they have to answer to the Chinese should elevate the issue to the top of our national security discussion. This nexus of China, Wall Street, and our defense industrial base may be the answer to why our military advantage is ebbing. Even when American ingenuity can thrive, too often the fruits go to the Chinese.

    In short, the financial industry, with its emphasis on short-term profit and monopoly , and its willingness to ignore national security for profit, has warped our very ability to defend ourselves.

    How Did We Get Here?

    Believe it or not, America has been here before. In the 1920s and 1930s, the American defense industrial base was being similarly manipulated by domestic financiers for their own purposes, retarding innovation and damaging the nation's ability to defend itself. And American military readiness was ebbing in the midst of an increasingly dangerous world full of rising autocracies.

    Today it might be artificial intelligence or drones, but in the 1930s the key military technology was the airplane. And as with much digital technology today, while Americans invented the airplane, many of the fruits went elsewhere. The reason was similar to the problem of Wall Street today. The American aerospace industry in the 1930s was undermined by fights among bankers over who got to profit from associated patent rights.

    In 1935, Brigadier General William Mitchell told Congress that the United States didn't have a single plane that could go against a "first-class power." "It is a disgraceful situation and is due," he said, "for one thing, to this pool of patents." The lack of aerospace capacity reflected a broader industrial problem. Monopolists refused to invest in factories to produce enough steel, aluminum, and magnesium for adequate military readiness, for fear of losing control over prices.

    New Dealers investigated, and by the time war broke out, the Roosevelt administration was in the midst of a sustained anti-monopoly campaign. The Nazi war machine, like China today, gave added impetus to the problem of monopoly in key technology-heavy industries. In 1941, an assistant attorney general for the antitrust division, Norman Littell, gave a speech to the Indiana State Bar Association about what he called "The German Invasion of American Business."

    The Nazis, he argued, used legal techniques, like patent laws, stock ownership, dummy corporations, and cartel arrangements, to extend their power into the United States. "The distinction between bombing a vital plant out of existence from an airplane and preventing that plant from coming into existence in the first place [through cartel arrangements]," he said, "is largely a difference in the amount of noise involved."

    Nazis used their American subsidiary corporations to spy on U.S. industrial capacity and steal technology, such as walkie-talkies, intertank and ground-air radio communication systems, and shortwave sets developed by the U.S. Army and Navy. They used patents or cartel arrangements to restrict the production of stainless steel, tungsten-carbide, and fuel injection equipment. According to the U.S. military after the war, I.G. Farben, the Nazi chemical monopoly, had influence over American production of "synthetic gas and oils, dyestuffs, explosives, synthetic rubber ('Buna'), menthol, cellophane, and other products," and sought to keep the United States "entirely dependent" on Germany for certain types of electrical equipment.

    The Nazis took advantage of an industrial system that was, like the current one, organized along short-term objectives. But seeing the danger, New Dealers attacked the power of financiers through direct financing of factories, excess profits taxes, and the breaking of the power of the Rockefeller, Dupont, and Mellon empires through bank regulation and antitrust suits. They separated the makers of airplanes from airlines, a sort of Glass Steagall for aerospace. During the war itself, antitrust chief Thurman Arnold, and those he influenced, sought to end international cartels and loosen patent rules in part because they allowed control over American industry by the Nazis.

    After the war, the link between global cartels and national security vulnerabilities was a key driver of American trade and military strategy. America pursued globalization, but with two differences from the form we have today. First, strategists sought to prevent the recurrence of global cartels and monopolies. Second, they sought to become industrially intertwined with allies, not rivals. While multinational corporations stretched across the West, they did not locate production or technology development in Moscow or among strategic rivals, as we do today in China.

    Domestically, anti-profiteering institutions and rules protected against corruption, especially important when the defense budget comprised a large chunk of overall American research and development. The Defense Department's procurement agency -- the Defense Logistics Agency -- was enormously powerful and oversaw procurement and supply challenges. The Pentagon had the power to force suppliers of sole source products -- contractors that had monopolies -- to reveal cost information to the government. The financial health of defense contractors mattered, but so did value to the taxpayer, a skilled defense industrial workforce, and the ability to deliver quality products to aid in national defense.

    A fragmented base of contractors and subcontractors ensured redundancy and competition, and a powerful federal apparatus with thousands of employees with expertise in pricing and negotiation kept prices reasonable. The Defense Department could even take ownership of specialized tooling rights to create competition in monopolistic markets with specialized spare part needs -- which is precisely where TransDigm specializes. This authority and expertise had been carefully cultivated over decades to provide the material necessary to equip American soldiers for World War II, the Korean and Vietnam wars, and the first Gulf war.

    In the 1980s, while Ronald Reagan allowed Wall Street free rein elsewhere in the economy, he mostly kept Wall Street from going after the defense base. But scholars began debating whether it made sense to have such a large and expensive negotiating apparatus to deal with contractors, or if a more "cooperative" approach should be taken. Business consultants argued that the Pentagon could save money if it would simply be "a better customer, by being less adversarial and more trusting" of defense contractors.

    With the end of the Cold War, these arguments found new resonance. Bill Clinton took the philosophical change that Reagan had pushed on the civilian economy, and moved it into the defense base. In 1993, Defense Department official William Perry gathered CEOs of top defense contractors and told them that they would have to merge into larger entities because of reduced Cold War spending. "Consolidate or evaporate," he said at what became known as "The Last Supper" in military lore. Former secretary of the Navy John Lehman noted, "industry leaders took the warning to heart." They reduced the number of prime contractors from 16 to six; subcontractor mergers quadrupled from 1990 to 1998. They also loosened rules on sole source -- i.e. monopoly -- contracts, and slashed the Defense Logistics Agency, resulting in thousands of employees with deep knowledge of defense contracting leaving the public sector.

    Contractors increasingly dictated procurement rules. The Clinton administration approved laws changing procurement, which, as the Los Angeles Times put it, got rid of the government's traditional goals of ensuring "fair competition and low prices." They reversed what the New Dealers had done to insulate American military power from financiers.

    The administration also pushed Congress to allow foreign imports into American weapons through waivers of the Buy America Act, and demanded procurement officers stop asking for cost data. Mass offshoring took place, and businesses could increase prices radically.

    This environment attracted private-equity shops, and swaths of the defense industry shifted their focus from aerospace engineering to balance sheet engineering. From 1993 to 2000, despite dramatic declines in Cold War military spending and declines in the number of workers in the defense industrial base and within the military, defense stocks outperformed the S&P.

    Today, the American defense establishment quietly finds itself in the same predicament it did in the 1930s. Despite spending large amounts of money on weapons systems, it often gets substandard equipment. It is dependent for key sources of supply on business arrangements with potentially hostile powers. The problem is so big, so toxic, and so difficult that few lawmakers even want to take it on. But the increasingly obvious danger of Chinese power means we can no longer ignore it.

    The Fix

    Fortunately, this is fixable. Huawei's predatory pricing success has shown policymakers all over the world what happens when we don't protect our vital industrial capacity. Last year, Congress strengthened the Committee on Foreign Investment in the United States, the committee that reviews foreign investment and mergers. The Trump tariffs have begun forcing a long-overdue conversation across the globe about Chinese steel and aluminum overcapacity, and Democrats like Representative Dan Lipinski are focused on reconstituting domestic manufacturing ability.

    Within the defense base itself, every example -- from TransDigm to L3 to Chinese infiltration of American business -- has drawn the attention of members of Congress. Representatives Ted Budd and Paul Cook are Republicans and Representatives Jackie Speier and Ro Khanna are Democrats. They are not alone. Democratic Senator Elizabeth Warren and Representative Tim Ryan have joined Khanna's demand for a TransDigm investigation.

    Moreover, focus on production is bipartisan. One of the most ardent opponents of consolidation in the 1990s is current presidential candidate Bernie Sanders, who in 1996 passed an amendment to block Pentagon subsidies for defense mergers, or what he called "Payoffs for Layoffs." On the other end of the spectrum, Trump has refocused national security and trade officials on the importance of domestic manufacturing.

    Defense officials have also become acutely aware of the problem. In a 2015 briefing at the Pentagon, in response to questions about Lockheed's acquisition of Sikorsky, then secretary of defense Ash Carter emphasized the importance of not having "excessive consolidation," including so-called vertical integration, in the defense industry because it is "[not] good for the defense marketplace, and therefore, for the taxpayer and warfighter in the long run." Carter's acquisition chief, Frank Kendall, also noted the "significant policy concerns" posed by the "continuing march toward greater consolidation in the defense industry at the prime contractor level" and the effect it has on innovation.

    American policymakers in the 1990s lost the ability to recognize the value of production capacity. Today, many of the problems highlighted here are still seen in isolation, perhaps as instances of corruption or reduced capacity. But the problems -- diminished innovation, marginal quality, higher prices, less redundancy, dependence on overseas supply chains, a lack of defense industry competition, and reduced investment in research and development -- are not independent. They are the result of the financialization of industry and of monopoly. It's time for a new strategic posture, one that puts a premium not just on spending the right amount on military budgets, but also on ensuring that financial actors don't capture what we do spend. We must begin once again to recognize that private industrial capacity is a vital national security asset that we can no longer allow Wall Street to pillage. By seeing the problem in its totality, we can attack the power of finance within the commercial and defense base and restore our national security capacity once again.

    There are many levers we can use to reorder our national priorities. The Defense Department, along with its new higher budgets, should have more authority to promote competition, break up defense conglomerates, restrict excess defense contractor profits, empower contracting officers to get cost information, and block private equity takeovers of suppliers. Congress could reinstate the authority of the Defense Department to simply take ownership of specialized tooling rights to create competition in monopolistic markets with specialized spare part needs, a power it once had.

    In the commercial sector, rebuilding the industrial base will require an aggressive national mobilization strategy. This means aggressive investment by government to rebuild manufacturing capacity, selective tariffs to protect against Chinese or foreign predation, regulation to stop financial predation by Wall Street, and anti-monopoly enforcement to block the exploitation of market power.

    Policymakers must recognize that industrial capacity is a public good and short-term actors on Wall Street have become a serious national security vulnerability. While private businesses are essential to our common defense, the public sector must once again structure how we organize our national defense and protect our defense industrial base from predatory finance. For several decades, Wall Street has been organizing not just the financing of defense contractors, but the capabilities of our very defense posture. That experiment has been a failure. It is time to wake up, before it's too late.

    Matt Stoller is a fellow at the Open Markets Institute. His book, Goliath: The 100-Year War Between Monopoly Power and Democracy, is due out this fall from Simon & Schuster. Lucas Kunce spent 12 years in the United States Marine Corps, and is a veteran of the Iraq and Afghanistan wars. The views presented are those of the authors and do not necessarily represent the views of the Department of Defense or its components. This article was supported by the Ewing Marion Kauffman Foundation. The contents of this publication are solely the responsibility of the authors.


    polistra24 13 hours ago

    Best article of the century. Gets everything right, in full detail.

    But I doubt that the problem is fixable. It could have been fixable if we turned around in 1980, but all the factories and SKILLS are gone now.

    kouroi 15 hours ago
    Sobering read. However, it is likely that only a major war will spur legislators and administrators into action. Until then Wall Street will reign and the US administrations will keep threatening countries with sanctions if they buy equipment that prevents the US to conduct an easy bombing campaign on them.
    chris chuba kouroi 8 hours ago
    I've heard similar stories about the imminent collapse of the Russian Defense sector, they can't make their own parts, they lack diversity of suppliers, there is a huge brain drain, no customers (somewhat true since we practice extortion).

    I'm not dismissing the author, actually quite the opposite and I am agreeing with you. The secret ingredient is an actual sense of danger. The Russians are terrified, we pretend to be terrified but know it's all threat inflation. If we had honest people in Congress proposing targeted budgets for real needs rather than 'freedom of navigation' when we know it's power projection then the fear of God might return to our habits. The author brought up the 20/30's I bet WW2 gave us that fear again.

    MontDLaw 6 hours ago
    Dude, your government stopped being able to do anything this complicated somewhere around 1995. Your infrastructure is in shambles and diabetics are dying because of an insulin monopoly that forces them to ration medication. The rope remark resembles you.
    soliton 7 hours ago
    No need to worry about L3. They were acquired by Harris, making another monster.
    vpurto 12 hours ago • edited
    This is the longest litany about demise of American prowess in technology that I've ever read in TAC so far. The story of destruction of Bell Labs, described in details by Matt Stoller is very accurate: I have been eyewitness to it from 1983 and up to its gruesome end. Carly Fiorina, one of the runners for President in 2016, delivered American icon coup-the-grace. She even justified her claim on presidency on business experience: destruction of another icon of American high-tech – Hewlett-Packard. Alas, there is the most fundamental reason for the current situation in the 21-st century USA, was formulated 100+ years ago by Vladimir Lenin: "For profit capitalists will be eager to sell us rope, with which we'll hung them" .

    Would anybody protest today that profit IS the Nature of capitalism ? And more: those who substitute Reality with their wet dreams might be cured by watching Democratic 2020 debates.

    soliton vpurto 6 hours ago
    CF pretty much destroyed the best test equipment house in the world to make printers PCs.
    Steve Smith 16 hours ago
    Great piece. There are lots of good articles here but not that many that tell something I really didn't already know. Great perspective on the whole China issue. Amazing how sick our financialized economy really is when you look under the hood.

    This is excellent information. Hope folks on the Hill are reading this.

    Kessler 11 hours ago
    The Wall Street and finance industry depend on US military, long-term this is a disaster, but they care only for short-term profits. Whoever thought that principles of free market apply internationally, where other goverments are free to influence "free trade" in any way they wish, while US goverment will do nothing is an idiot.

    [Jun 26, 2019] In the first five months of 2019, imports of agricultural products from the US to China declined by half

    Large part of it is probably diversification and it does not affect the US exporters as they also can diversify.
    Notable quotes:
    "... The bottom line is Trump and his misfit Cabinet didn't thoroughly think through all of the likely negative ramifications of "Making America Great Again" !! He impulsively makes decisions and when then fail - as they do often do - he blames others or creates diversionary chaos to change the subject. Trump's a fxxxxing overweight, repulsive imbecile, and the farmers are going to let him have it in 2020.....along with millions who rolled the dice him in 2016 but he crapped out on all of them..... ..."
    "... What is happening to US cars in China? I know the market has taken a dump there, but are US cars losing market share as well? Are Chinese consumers shunning goods from US manufacturers? ..."
    Jun 26, 2019 | www.zerohedge.com
    published new data Monday that shows agricultural imports from the US have fallen, as Chinese buyers shift supply chains out of the US to other countries because of the deepening trade war.

    In the first five months of 2019, imports of agricultural products from the US crashed 55.3% YoY . Much of decline was due to a 70.6% YoY decline of soybeans in the same period.

    Chinese importers went to Brazil, Argentina, and ASEN countries (Thailand, Indonesia, Malaysia, Singapore, Philippines, Vietnam, Brunei, Myanmar (Burma), Cambodia, and Laos). Data showed imports from the EU, Australia, and Canada also jumped in the first five months as Chinese buyers ditched American products.


    steverino999 , 8 minutes ago link

    The bottom line is Trump and his misfit Cabinet didn't thoroughly think through all of the likely negative ramifications of "Making America Great Again" !! He impulsively makes decisions and when then fail - as they do often do - he blames others or creates diversionary chaos to change the subject. Trump's a fxxxxing overweight, repulsive imbecile, and the farmers are going to let him have it in 2020.....along with millions who rolled the dice him in 2016 but he crapped out on all of them.....

    angle-asshole identity , 24 seconds ago link

    C'mon man, it's not a Trump thing, it's been the whole American policy since Ronald Reagan. Trump didn't start the fire, he's just half-assing things the best he can.

    hoytmonger , 12 minutes ago link

    What happened to all those articles stating that US farm production was devastated by weather?

    Corn, wheat, soy, cotton were all allegedly affected.

    If US farmers have no crop to sell, then what is the Chinese refusing to buy?

    rockstone , 11 minutes ago link

    We cannot withstand another year in which our most important foreign market continues to slip away and soybean prices are 20 to 25%, or even more, below pre-tariff levels," said John Heisdorffer, chairman of the American Soybean Association, in a statement published on May 13.

    Or.........what? You should've voted for Clinton and you'll vote for Bernie/Biden/Warren? Come on man, spit it out. Or what?

    haruspicio , 14 minutes ago link

    What is happening to US cars in China? I know the market has taken a dump there, but are US cars losing market share as well? Are Chinese consumers shunning goods from US manufacturers?

    angle-asshole identity , 13 minutes ago link

    Duh

    [Jun 26, 2019] Huawei Says US Ban Hurting More Than Expected, To Wipe $30 Billion Off Revenue

    Jun 26, 2019 | news.slashdot.org

    From a report: Ren's downbeat assessment that the ban will hit revenue by $30 billion , the first time Huawei has quantified the impact of the U.S. action, comes as a surprise after weeks of defiant comments from company executives who maintained Huawei was technologically self-sufficient. [...]

    Huawei had not expected that U.S. determination to "crack" the company would be "so strong and so pervasive," Ren said, speaking at the company's Shenzhen headquarters on Monday.

    Two U.S. tech experts, George Gilder and Nicholas Negroponte, also joined the session. "We did not expect they would attack us on so many aspects," Ren said, adding he expects a revival in business in 2021.

    [Jun 22, 2019] China Vows To Fight Trade War To The End As Huawei Sues Commerce Department

    It was neoliberalism that moved production to China and created condition for the Chinese own companies to compete. Now Trump goes against neoliberal dogma. So it is not accidental that he was under attack and Russiagate was launched to ensure his resignation.
    Notable quotes:
    "... in an editorial in the state-run People's Daily, Beijing has warned that China has "the strength and patience to withstand the trade war, and will fight to the end if the U.S. administration persists." ..."
    "... China's controversial telecom giant, Huawei, filed a civil lawsuit against the US Commerce Department over the mishandling of telecommunications equipment seized by American officials, demanding its release. ..."
    "... However, the equipment was not shipped back to China. It was "purportedly" seized en route and is currently sitting in Alaska, as US officials wanted to investigate whether the shipment required a special license . Such requests are usually processed within 45 days, but nearly two years have already passed since then. ..."
    "... "The equipment, to the best of HT USA's knowledge, remains in a bureaucratic limbo in an Alaskan warehouse," Huawei said in its lawsuit, which was filed on Friday in federal court in Washington. ..."
    "... Huawei contends that the equipment did not require a license because it did not fall into a controlled category and because it was made outside the United States and was being returned to the same country from which it came. ..."
    "... The lawsuit comes amid a bitter row between two world's largest economies, and Washington's crackdown on Huawei. In May, the Trump administration added Huawei to the entity list, barring it from buying needed U.S. parts and components without U.S. government approval. The US alleges that Huawei could be spying for the Chinese government, a claim which the company has repeatedly denied. ..."
    "... Of course, Huawei is not the only Chinese tech company that the White House decided to put on its trade blacklist. On Friday, five Chinese organizations – supercomputer maker Sugon, three its affiliates, and the Wuxi Jiangnan Institute of Computing Technology – were added to entity list on the grounds that their activities are allegedly contrary to US national security and foreign policy interests. ..."
    "... don't expect a breakthrough: as Goldman's trade deal odds index found last week... the probability of a breakthrough between the two nations is roughly one in five. ..."
    Jun 22, 2019 | www.zerohedge.com
    It's the weekend, which means the trade war between the US and China moved to the front page of the local propaganda media (in both the US and China). And while Trump has yet to slam Beijing, focusing this morning on the all time high in the market instead, China has been busy and in an editorial in the state-run People's Daily, Beijing has warned that China has "the strength and patience to withstand the trade war, and will fight to the end if the U.S. administration persists."

    Echoing what China's notorious twitter mouthpiece Hu Xijin said yesterday, the editorial said that just days ahead of the much anticipated G-20 summit in Osaka where Trump and Xi are set to meet, " the U.S. must drop all tariffs imposed on China if it wants to negotiate on trade, and only an equal dialogue can resolve the issue and lead to a win-win", according to Bloomberg.

    The communist party's official paper also said the US had failed to take into account the interests of its own people, and they are paying higher costs due to the trade dispute. "Wielding a big stick of tariffs" also disregards the condition of the U.S. economy and the international economic order, according to the editorial.

    Beijing's official warning to the US ended as follows: if the U.S. chooses to talk, "then it must show some good faith, take account of key concerns from both sides and cancel all tariffs."

    And just to prove that China isn't a paper tiger whose threats will be confined to the local newspapers, Reuters reported that overnight China's controversial telecom giant, Huawei, filed a civil lawsuit against the US Commerce Department over the mishandling of telecommunications equipment seized by American officials, demanding its release.

    In an almost absurd reversal, the company whose entire existence can be traced to stealing and reverse-engineering foreign technology and trampling over corporate ethics , the complaint alleges that the US government took possession of hardware, including an ethernet switch and computer server, which was transported from China to an independent laboratory in California for testing and certification back in 2017.

    However, the equipment was not shipped back to China. It was "purportedly" seized en route and is currently sitting in Alaska, as US officials wanted to investigate whether the shipment required a special license . Such requests are usually processed within 45 days, but nearly two years have already passed since then.

    "The equipment, to the best of HT USA's knowledge, remains in a bureaucratic limbo in an Alaskan warehouse," Huawei said in its lawsuit, which was filed on Friday in federal court in Washington.

    Huawei contends that the equipment did not require a license because it did not fall into a controlled category and because it was made outside the United States and was being returned to the same country from which it came.

    The company is not seeking any financial compensation and is not challenging the seizure itself, but is sending a message to Washington, saying "post-seizure failures to act are unlawful", in effect charging the Trump admin with doing precisely what it, itself has been accused of. Huawei wants to force the Commerce Department to decide whether an export license is really necessary and, if not, release the withheld equipment.

    The lawsuit comes amid a bitter row between two world's largest economies, and Washington's crackdown on Huawei. In May, the Trump administration added Huawei to the entity list, barring it from buying needed U.S. parts and components without U.S. government approval. The US alleges that Huawei could be spying for the Chinese government, a claim which the company has repeatedly denied.

    Huawei CFO Meng Wanzhou, daughter of the company's founder, has been detained in Canada since December on a U.S. warrant. She is fighting extradition on charges that she misled global banks about Huawei's relationship with a company operating in Iran.

    Of course, Huawei is not the only Chinese tech company that the White House decided to put on its trade blacklist. On Friday, five Chinese organizations – supercomputer maker Sugon, three its affiliates, and the Wuxi Jiangnan Institute of Computing Technology – were added to entity list on the grounds that their activities are allegedly contrary to US national security and foreign policy interests.

    The fresh US blacklisting comes ahead of crucial talks between US President Donald Trump and Chinese President Xi Jinping in Osaka, Japan, which are intended to ease tensions between the two sides. Still, don't expect a breakthrough: as Goldman's trade deal odds index found last week... the probability of a breakthrough between the two nations is roughly one in five.

    [Jun 22, 2019] Over 600 US Companies Sign Letter Supporting Trump Tariffs On China

    Jun 22, 2019 | www.zerohedge.com

    A letter from over 600 US companies businesses in support of President Trump's tariffs on approximately $300 billion of Chinese imports was scheduled to be submitted on Friday before the Office of the United States Trade Representative (USTR), according to the Daily Caller , which reviewed the document.

    It is the intention of Coalition for a Prosperous America (CPA), Chief Economist, Jeff Ferry to present the letter Friday morning during his testimony to the USTR. This letter pushes back on the letter last week that asks Trump to stop the tariffs on China. Those signers were mostly big-box retailers who manufacture their products in China.

    This all comes as President Donald Trump said that he is considering slapping China with more tariffs if Chinese President Xi Jinping does not meet with him during the G-20 summit in late June. Since, the warning, the two have agreed to meet. However, Trump said if Xi does not attend the event, he will immediately impose new tariffs on $300 billion in Chinese imports , including a number of consumer products. - Daily Caller

    In May, Trump raised tariffs on around $200 billion of Chinese goods from 10% to 25%. Three days later, China slapped around $60 billion in US goods with reciprocal tariffs.

    "The global integration project with China, through liberalized trade, has failed. The Communist Party of China has used its access to U.S. consumer and capital markets for a predatory economic strategy to grow its state-owned enterprises, finance its military build up, imprison its citizens in modern day concentration camps and challenge America's geopolitical power," according to Coalition for a Prosperous America CEO Michael Stumo.

    "Our American companies and workers have been weakened by this failed experiment. We want it to stop," he added.

    The Automotive Parts Remanufacturing Association (APRA) president, Joe Kripli. said, "for years now the Chinese 'knock-off' of starters and alternators that have been entering the country at ridiculously low cost and have been hurting the small [U.S.] remanufacturer that is located in every state and has been in our communities since WWII. - Daily Caller

    "Fitzgerald USA is one of the few Made in America truck conglomerates. We recently started a U.S. truck parts business as the trucking industry increasingly moves its operations to China. America needs a strong manufacturing economy for jobs and national security. We support President Trump and his use of tariffs on China," said Fitzgerald USA Director of Government Relations, Jon Toomey.

    Guess who didn't sign the letter? Apple - which is desperately trying to lobby the Trump administration to ease the tariffs - arguing this week in front of the USTR that "U.S. tariffs on Apple's products would result in a reduction of Apple's U.S. economic contribution," and "weigh on Apple's global competitiveness


    unklemunky , 4 hours ago link

    Cheap easy credit in USA has made us all debtors. The cheap money has been used to purchase lots of cheap chinese **** from the large global publicly traded companies. The big box stores partnered with American brands to move operations overseas and make **** real cheap and sell those well known household brand names back to unsuspecting consumers.....to the very people they have put out of a job. THIS is the largest redistribution of wealth in the history of the planet. Free money, low paying jobs and cheap ****. As far as I am concerned, if china steals a company's technology, cry me a ******* river. They deserve it.

    native grunt , 10 hours ago link

    The super-capitalists as usual screw everybody else - the honest manufacturers, labour - while destroying the fabric of society in their insane pursuit of profits for themselves and their confreres.

    tschanakya , 12 hours ago link

    Did Amazon also sign the petition? What about Facebook ,Google? I want to see the big MNC's signing the letter. Let me see the country before profit there.

    truthalwayswinsout , 15 hours ago link

    Automation is taking over.

    The key dynamic is low energy costs, cheap land, low corporate taxes and low shipping costs to the market.

    All four of those are in the US.

    Factories will be built where the demand is located and there is and will be no longer any advantage to produce products overseas.

    Plants that used to take 1000 workers to run now take just 50 or less.

    Automation would have impacted the work force in the US in 10 years but thanks to minimum wage hikes it is happening right now and will grow exponentially in 2 years.

    Insufferably Insouciant , 15 hours ago link

    "The Communist Party of China has used its access to U.S. consumer and capital markets for a predatory economic strategy... "

    ... which is a threat to our monopoly on such activity.

    Have they no sense of irony?

    merchantratereview , 15 hours ago link

    To all who profited from selling out America. Your money is worthless in hell. See you on purge night.

    MarkD , 15 hours ago link

    Why is it that folks put the blame on China? Our corporations are the ones that looked for manufacturers that could make their product for less than American workers could.

    Watch older episodes of Shark Tank and they all said time and time again that they have contacts in China and could have the product made for peanuts....... That's how our corporations make money.

    Why don't we boycott Apple? We can't because it's in everyone's retirement portfolio one way or another.

    francis scott falseflag , 16 hours ago link

    Tariffs are a great way to cut imports into your country.

    And retaliatory tariffs are a great way to cut your country's exports.

    Its a win-win for global depression. Yay for Trump

    DEDA CVETKO , 16 hours ago link

    "The Communist Party of China has used its access to U.S. consumer and capital markets for a predatory economic strategy... "

    A case of shark calling barracuda a piranha.

    Brazen Heist II , 16 hours ago link

    Them commies are under our beds!

    If the US was such a "free market" powerhouse, why not heed your own values instead of doing protectionism? Answer: another myth destroyed that America is all about "free markets". Add that to the mythology about being pro-dumbocracy, freedumb and all for international "law".

    [Jun 21, 2019] US Blacklists More Chinese Tech Companies Over National Security Concerns

    Jun 21, 2019 | news.slashdot.org

    (nytimes.com) 70 restricting China's access to American technology and stoking already high tensions as President Trump and President Xi Jinping of China prepare to meet in Japan next week. From a report: The Commerce Department announced that it would add four Chinese companies and one Chinese institute to an "entity list," saying they posed risks to American national security or foreign policy interests [Editor's note: the link may be paywalled; alternative source ] . The move essentially bars the entities, which include one of China's leading supercomputer makers, Sugon, and a number of its subsidiaries set up to design microchips, from buying American technology and components without a waiver from the United States government.

    The move could all but cripple these Chinese businesses, which rely on American chips and other technology to manufacture advanced electronics. Those added to the entity list also include Higon, Chengdu Haiguang Integrated Circuit, Chengdu Haiguang Microelectronics Technology, and Wuxi Jiangnan Institute of Computing Technology, which lead China's development of high performance computing, some of which is used in military applications like simulating nuclear explosions, the Commerce Department said. Each of the aforementioned companies does businesses under a variety of other names.

    Anonymous Coward , Friday June 21, 2019 @02:40PM ( #58800664 )

    Short term pain for long term gain ( Score: 1 )

    Blocking Chinese access to any particular technology just gives them an incentive to pour massive resources into developing their own versions. They've learned that US companies are not reliable suppliers. Same as many former allies have learned that being an ally of the US is a double edged sword.

    Cuts in sales to China by US companies means less money for US companies to invest in developing advanced products. Don't be surprised if by 2030 China will be the sole supplier of the worlds best, most advanced technology. Just look at what happened to the robotics industry. Or better yet, go back to the previous century, when the US decided to unload their steel mills to China at a huge discount to China to invest in financial instruments, then whined like crazy that China was able to make steel cheaper because their new-to-them steel mills had less debt to fund per to. Of steel produced.

    If China had had to buy new steel mills, the cost of production per ton would have been higher. But no, trading pieces of paper or bits in bank accounts was easier.

    hackingbear ( 988354 ) , Friday June 21, 2019 @02:42PM ( #58800686 )
    The Chinese should thank the US ( Score: 3 )

    The Chinese hi-tech companies should thank the US for clearing out American products from the biggest market [datenna.com], so they can eventually enter the lucrative cycles of being able to sell primitive products and re-invest the proceeds to create more advanced products, without having to compete with the most advanced American products upfront, and in a few short year they will produce more advanced ones.

    Oh, don't the US know that Chinese supercomputers already cleared out of American chips [wikipedia.org] and achieve top performance long time ago?

    [Jun 19, 2019] Dell, HP, Intel and Microsoft Join Forces to Oppose Trump Tariff

    Jun 19, 2019 | www.bloomberg.com

    Dell Technologies Inc ., HP Inc. , Intel Corp. and Microsoft Corp. are joining forces to oppose President Donald Trump's proposed tariffs on laptop computers and tablets among $300 billion in Chinese goods targeted for duties.

    The companies submitted joint comments opposing the tariff escalation, saying it would hurt consumer products and industry, while failing to address China's trade practices. The tariffs are poised to hit during the peak holiday and back-to-school sales period, they said.

    "The tariffs will harm U.S. technology leaders, hindering their ability to innovate and compete in a global marketplace," the companies said in comments posted online.

    Dell, HP, and Microsoft said they account for about half of the notebooks and detachable tablets sold in the U.S. Prices for laptops and tablets will increase by at least 19% -- about $120 for the average retail price of a laptop -- if the proposed tariffs are implemented, according to a study released this week by the Consumer Technology Association .

    The companies said they spent a collective $35 billion on research and development in 2018 alone, and tariff costs would divert resources from innovation while providing "a windfall" to manufacturers based outside the U.S. that are less dependent on American sales.

    The Trump administration is considering public comments on the proposed duties and hearing testimony from more than 300 U.S. companies and trade groups through June 25. The tariffs could be imposed after a rebuttal period ends July 2.

    The U.S. and China said their presidents will meet in Japan next week to relaunch trade talks after a month-long stalemate.

    [Jun 18, 2019] China prepares for economic 'prolonged war' with Trump

    Notable quotes:
    "... The facts of the US economy and politics show clearly the correctness of the analysis in China that any expectation of 'mercy' from the Trump administration will in reality lead to heightened attacks by the US. ..."
    "... The medium-term trajectory of the US economy [is] to slow down during 2019 and 2020 – which is necessarily a negative factor for President Trump's chances of re-election in 2020 and which interacts with the adverse effects of US tariff policy on US consumers such as price rises and falls in prices to farmers. ..."
    "... Trump administration already acknowledges in practice that its policies will be a US 'lose', that is they will inflict pain on the US economy, and it is merely attempting to ensure that the 'lose' for China is bigger than the 'lose' for the US. ..."
    "... Bloomberg and others calculate that the losses in a full year of the trade war would be $600 billion. ..."
    "... In addition to these tariff effects the Trump administration US is equally concerned about the consequences of consumer boycotts, or restrictions, on US companies which would be equivalent to those it has carried out against Huawei. ..."
    "... 'Beijing has scope for retaliation. Levers at its disposal include blocking access to its market -- a move that Goldman Sachs analysts estimate could reduce Apple's earnings per share by nearly 30 per cent.' ..."
    "... These specific examples clearly illustrate that in practice, despite its claims to the contrary, the Trump administration starts from the framework that its policies will inflict pain on the US economy, but that it will be able to limit this loss. China's route to success is therefore to inflict pain on the US economy to a point that is unacceptable for Trump in seeking re-election. ..."
    "... 'If Trump wants to slow China's ascent as a superpower, a trade war might be an effective way to do it. If the harm to the US is modest and the costs for China are severe and lasting, Trump might conclude that the former are acceptable losses.' On this logic: 'Geopolitical primacy, not maximum prosperity for Americans' was 'the president's true objective.' ..."
    "... Forces in China claiming that the Trump administrations attacks will be stopped by 'appeasement', or by appeals for mercy, are presenting the reverse of the truth – such policies will lead to the Trump administration becoming more aggressive. This flows inevitably from the fact that the Trump administration's policy is not to seek a 'win-win' for the US but to create a 'lose-lose' with the aim that the 'lose' in terms of economic pain for the US should be 'modest'. This logic of the Trump administration's position means that any weakening of China's position, any alleviation of the pain inflicted on the US, will lead to the Trump administration becoming more aggressive, not less. ..."
    "... it is also clear that Trump's measure of what is bearable is not the interests of the US people, but whether it affects the President's chances of re-election. In summary, only if the economic pain suffered by the US is sufficiently severe that it endangers Trump's re-election chances will the Trump administration desist from its attacks on China. ..."
    "... When the 'lose' or 'pain' in US financial markets is not great the Trump administration proceeds to attack China. When, on the contrary, China's reaction increases pain in US financial markets Trump acts more reasonably. That is, whenever the Trump administration feels in a stronger position it increases its attacks on China, whenever the Trump administration feels weaker due to the pain in US financial markets it acts more reasonably to China. ..."
    "... But once the Trump administration embarked on the course of a lose-lose confrontation then such a struggle can only be won by China relying on its own strength. Sufficient pain must be inflicted on the Trump administration that it decides it is better to abandon the lose-lose. And the criteria by which it will judge whether the pain in the 'lose-lose' is bearable is the effect on its chances of re-election. ..."
    Jun 18, 2019 | www.learningfromchina.net

    'At least two other organizations have more power over [US financial] markets than the White House. They are the US Federal Reserve and the Chinese Communist Party. Trump does not directly control either of them.'

    This brutal analysis is particularly significant as it is by one of the most senior and accurate Western specialists on financial markets – John Authers , Senior Bloomberg Editor for Markets and former Chief Markets Commentator for the Financial Times . It encapsulates the interaction of economic and political problems facing President Trump. As will be seen it also summarises the relative strengths of China and the US in the 'trade war', dictates the US administration's tactics in attacking China, and determines the policies which will prevent the Trump administration carrying out its attempt to block China achieving its development goals.

    Analysis of these real facts of US financial markets and policy strongly confirms the assessment emphasised by China's President Xi Jinping in his recent speech in Yudu County, the place being highly symbolic as it was the starting point for China's famous Long March, that China has to rely on its own strength in resisting this attempt by the US administration to prevent China achieving prosperity and national rejuvenation.

    While the situation of China itself in the trade/economic war is naturally the most important issue there are of course two sides involved in this conflict – the other aspect of the situation is within the US. Analysis of this, which forms the subject of this article, shows clearly why the Trump administration refuses to accept 'win-win' relations with China and what is the inevitable outcome of this administration's 'lose-lose' logic. Such analysis in turn shows that frequent comparisons made in China to the Long March of 1934-35, or to Mao Zedong's famous essay 'On Protracted War', are not simply rhetorical metaphors, or references to the historical traditions of the Communist Party of China (CPC), but provide an accurate framework to understand the situation.

    The Trump administration made a very serious miscalculation in launching the 'trade war' with China. It believed that either, or both, the leadership of China would submit to the Trump administrations threats or the Chinese population would not be prepared for a serious struggle with the US. Both calculations have proved entirely wrong. China's leadership did not surrender to but hit back against the US attacks. Furthermore anyone who follows China's domestic discussion, on what is now by far the world's largest internet community, knows that this line was strongly supported by the Chinese population.

    The difference to the historical comparisons now frequently used in China, of course, is that this is an economic war and not a military one. Therefore, the weapons are different, and it is necessary to analyse what are the pressure points on the US, and what armaments are most powerful for China. In turn this examination of the situation in the US economy fully confirms the analyses made of the situation in China and the reaction of different social layers to the present conflict with the US.

    Trends in China and the US

    Examining the Chinese side of the 'trade war' Wang Wen has presented an excellent analysis of the reaction of different social strata in China to the Trump administration's economic aggression. Its analysis can be noted: ' The vast majority of ordinary people are highly supportive of the state's policy of counter-bullying in the United States, and the current fear of the US exists mainly in some social elites.'

    But it is particularly striking that this analysis of trends within China, made by a Chinese citizen, is fully confirmed from another 'external' angle – that of the situation in the US and the forces operating on the Trump administration. The facts of the US economy and politics show clearly the correctness of the analysis in China that any expectation of 'mercy' from the Trump administration will in reality lead to heightened attacks by the US.

    Trump's economic policy is determined by the coming US Presidential electio. The starting point of any analysis of the situation in the US is that President Trump is already entirely aware of the most important date he faces – 3 November 2020, the next US Presidential election. Securing re-election is his paramount goal and this therefore determines the shaping of the Trump administration's policies. Three time frames are crucial for this.

    1. The impact of events in financial markets, which can occur in a very short time frame – in some cases minutes/hours and almost invariably having a strong impact over a period of days to months.
    2. The medium-term trajectory of the US economy [is] to slow down during 2019 and 2020 – which is necessarily a negative factor for President Trump's chances of re-election in 2020 and which interacts with the adverse effects of US tariff policy on US consumers such as price rises and falls in prices to farmers.
    3. Attempts to slow China's economy in the medium/longer term, through forcing or persuading it to abandon its socialist path of development.

    All three time frames however confirm a fundamental reality – that while China's relations with most countries, and indeed with some previous US presidents, can be most successful based on 'win-win' this will not occur with the Trump administration.

    This is due to the fact that the Trump administration already acknowledges in practice that its policies will be a US 'lose', that is they will inflict pain on the US economy, and it is merely attempting to ensure that the 'lose' for China is bigger than the 'lose' for the US.

    The Trump administration's 'lose-lose' analysis

    An illustration on a small scale of the Trump administration's understanding of the need to attempt to limit the extent of economic pain on the US is its recent announcement of $16 billion of subsidies to US farmers – the bill for which will be financed by other US taxpayers as is increasingly understood in the United States. As CNN noted: 'Just as Mexico was supposed to pay for the wall, but isn't, now China is supposed to pay for President Donald Trump's plan to bail out US farmers. Neither statement is true, of course.'

    Affecting wider sections of the US population, calculations by the Western economics company Oxford Economics, which has no connection with China, found: 'Chinese manufacturing lowered prices in the United States for consumer goods, dampening inflation and putting more money in American wallets trade with China saved these families up to $850 that year.' Regarding the overall impact on the global economy, including the adverse effect on US allies, Bloomberg and others calculate that the losses in a full year of the trade war would be $600 billion.

    In addition to these tariff effects the Trump administration US is equally concerned about the consequences of consumer boycotts, or restrictions, on US companies which would be equivalent to those it has carried out against Huawei. The Financial Times noted for example that the immediate goal of the US sanctions against Huawei are not simply or primarily to stop the supply of chips and software but to destroy the consumer market for Huawei's products in the West – where customers want guaranteed access to Google dependent products: 'Google's decision this week to stop selling its Android operating system to Huawei for new handsets makes little difference in China, where Huawei should be able to convince buyers to switch to its operating system, now under development.

    But customers are more wedded to Android in international markets. Independent analyst Richard Windsor estimates it will lose all those sales.' But the Financial Times simultaneously noted that consumer retaliation against China would have a devastating financial effect on Apple, one of the US's core and most valuable companies: 'Beijing has scope for retaliation. Levers at its disposal include blocking access to its market -- a move that Goldman Sachs analysts estimate could reduce Apple's earnings per share by nearly 30 per cent.'

    These specific examples clearly illustrate that in practice, despite its claims to the contrary, the Trump administration starts from the framework that its policies will inflict pain on the US economy, but that it will be able to limit this loss. China's route to success is therefore to inflict pain on the US economy to a point that is unacceptable for Trump in seeking re-election.

    US financial markets

    A decisive reason that such pain for the US is possible is that while the sums noted in relation to US consumers, farmers, and allies above sound large the Trump administration can in fact deal with amounts such as $16 billion to farmers. But even such sums as the $600 billion loss for the global economy are small compared to potential impacts on the size of US financial markets. The loss of $600 billion in a year for the global economy is less than the amount that can be lost in US financial markets in a single day, while a loss of $16 billion can occur in seconds.

    Due to the sheer scale of US financial markets the Trump administration does not remotely have the resources to control the more than $30,000 billion US share market or the $16,000 billion US Treasury bond market. Pain inflicted on the US in such financial markets is therefore on a scale which is destabilising to the Trump administration.

    Examination of all three time frames operating on the Trump administration considered above would require three separate analyses or an inordinately long article. Therefore, due to their sheer scale, this article examines only the first, most short term, but extremely powerful of these issues – the impact of the trade war on US financial markets.

    The real situation facing US presidents

    John Authers' blunt comment cited at the beginning of this article, reveals accurately the real domestic economic situation of a US President – which is very different to the frequent perception in China. Unlike China, under the US governmental system the President has little direct control over the most powerful levers of the economy – there is no large state owned economic sector which can be instructed by the President to increase its activity, the Federal budget is decided by the Congress not by the President, and interest rates are controlled by the Federal Reserve which under US law cannot be instructed by the President.

    The new factor in the trade war which Authers drew attention to, which is also outside the US President's control, is China itself. The facts amply confirm that the impact of China's statements and actions on US financial markets is now very large – as will be demonstrated.

    Larry Summers, former US Treasury Secretary, clearly spelt out this numerically in a commentary for the Washington Post: 'On Monday [13 May], China announced new tariffs on $60 billion of US exports, and the United States threatened new tariffs on up to $300 billion of Chinese goods. These actions were cited as the principal reason for a decline of more than 600 points in the Dow Jones industrial average, or about 2.4 percent in broader measures of the stock market. With the total value of US stocks around $30 trillion, this decline represents more than $700 billion in lost wealth.'

    This $700 billion loss to US shareholders directly resulted from China's response to President Trump's announcement he was raising US tariffs against China from 10% to 25%. To illustrate this direct impact Authers' accurately noted the difference on US share markets between the week following Trump's announcement of raising tariffs against China, during which there was no announcement of a precise Chinese response, and the US financial markets' reaction when China announced its counter tariffs: 'It's fair to say that Wall Street did not anticipate China's retaliation to US tariffs. Last week, the negative reaction to President Donald Trump's announcement of new tariffs on China was oddly muted. On Monday, after China's response was announced just before the market opened, the S&P 500 fell by more than it had done in the entire previous week.'

    Authers similarly noted the increasing skill of China's response and its impact on US markets: 'The problem is that China knows how to respond. China knows it can attack the presidential weak spot by acting in a way that damages the Dow. Hence, it not only retaliated with tariffs of its own, but announced them just as the New York market was about to open, at night in China, for maximum effect.'

    As already noted, the $700 billion loss in a single day on US share markets was larger than the projected loss to the world economy for an entire year due to the trade war – and over 40 times the $16 billion bill for Trump's subsidies to US farmers. But even this sum is small compared to losses on US financial markets that can occur due to others of China's economic actions. As Authers noted: 'In the last five years, the event that scared the US market the most, by a wide margin, was the surprise Chinese yuan devaluation in 2015.'

    The impact of this RMB devaluation was clear. Between 10 August and 24 August 2015, only 14 days, the RMB's exchange rate fell by 3.0%. The US S&P500 tracked the RMB down falling by 11.2% by 25 August. In terms of current valuations of US share markets this was equivalent to a loss of $3.8 trillion – more than six times the total projected loss to the global economy of the trade war in a year, or over 200 times Trump's subsidies to farmers.

    The real aim of Trump's policy

    This identification of the degree of pain which can be inflicted by China on US financial markets, and on the US economy, is crucial because Trump's tariff policies cannot, indeed are not intended to, improve the situation of the US itself. Bloomberg columnist Noah Smith summarised the Trump administration's real aim very accurately under the self-explanatory headline 'The Grim Logic of Trump's Trade War With China – Maximizing American prosperity probably isn't the goal.' Apart from comprador apologists for the US within China, noted by Wang Wen, this logic of Trump's policy is by now well understood in China. But, nevertheless, it is worth quoting this Bloomberg analysis at length as it summarises very accurately from a US perspective the logic of the Trump administration:

    'The trade war has cost to the US. Economists have shown that the actual burden of tariffs has fallen mostly on American consumers -- in other words, the prices consumers pay for imported goods has risen And higher prices on capital goods and intermediate goods is raising expenses for US manufacturers, making them less competitive. Meanwhile, Chinese retaliation has hurt US farmers

    'So with losses mounting, it looked like there was little reason to continue the trade war. Yet Trump is doubling down. Why?

    'If Trump wants to slow China's ascent as a superpower, a trade war might be an effective way to do it. If the harm to the US is modest and the costs for China are severe and lasting, Trump might conclude that the former are acceptable losses.' On this logic: 'Geopolitical primacy, not maximum prosperity for Americans' was 'the president's true objective.'

    In other words, as was already shown in the case of farm subsidies, the Trump administration quite accurately does not believe that tariffs and other forms of economic aggression against China aid US economic prosperity – on the contrary they cause economic pain. But it decides to inflict this pain on US citizens and companies in order to pursue neo-con policies trying to block China's prosperity and national rejuvenation. But this policy requires that 'the harm to the US is modest.' The problem is that the more tariffs are imposed , and above all if China retaliates, the greater the pain not only for US financial markets but for US consumers – that is US voters. As Authers noted: 'Meanwhile, the US can still impose more tariffs, but the goods it has chosen to attack have been largely invisible to consumers. Any further tariffs will take it into consumer products where price rises will be visible and painful, and might even, again, act as a spur to raise [interest] rates.' The effect on US financial markets, as already noted, can be far more severe than the direct effect of the tariffs.

    Why win-win will not work with the Trump administration

    Understanding the Trump's administrations real aim shows not only why its goal is not to improve the economic position of the US economy or US citizens but simultaneously makes clear why its policies will not be stopped by appeals to reason or 'win-win'. Forces in China claiming that the Trump administrations attacks will be stopped by 'appeasement', or by appeals for mercy, are presenting the reverse of the truth – such policies will lead to the Trump administration becoming more aggressive. This flows inevitably from the fact that the Trump administration's policy is not to seek a 'win-win' for the US but to create a 'lose-lose' with the aim that the 'lose' in terms of economic pain for the US should be 'modest'. This logic of the Trump administration's position means that any weakening of China's position, any alleviation of the pain inflicted on the US, will lead to the Trump administration becoming more aggressive, not less.

    This makes clear while most countries seek a 'win-win' with China, and can therefore rightly be approached on this basis, and indeed this forms the basis of China's foreign policy, this will not work with the Trump administration because it is not seeking a 'win' – it is merely seeking that the 'lose' for the US it knows will occur should not be sufficiently large to threaten Trump's re-election.

    It follows from this situation that the only thing that will deter the Trump administration, and force it off its path of attacks on China, is if the 'lose' for the US is bigger than it had anticipated – that is if the economic pain is too large to be bearable from the point of view of the interests of the Trump administration. From what has already been analysed, it is also clear that Trump's measure of what is bearable is not the interests of the US people, but whether it affects the President's chances of re-election. In summary, only if the economic pain suffered by the US is sufficiently severe that it endangers Trump's re-election chances will the Trump administration desist from its attacks on China.

    The only 'win' which the Trump administration takes into account is, therefore, if the 'lose/pain' of the confrontation with China is seen as endangering Trump's re-election chances and the 'win' is then simply the lessening of that pain to a point where it is no longer seen as endangering Trump's election campaign.

    Confirmation of the forces acting on the Trump administration

    This situation of the Trump administration which flows from its 'lose-lose' logic is fully confirmed even in the extremely short term by the chronology of President Trump's own personal responses to events in US financial markets in announcing the increase in tariffs against China from 10% to 25%.

    The short term pattern was therefore extremely clear. When there was no reaction from China, US financial markets did not fall, and Trump continued his aggression against China. When, on the contrary, China responded strongly, US financial markets fell and Trump attempted to present a picture he was lessening his attack on China.

    In addition to these short-term movements analysed above the same process over a longer term also explains the dynamic of the 'hardening' and 'softening' of the Trump administration's positions in the course of its negotiations with China.

    This therefore clearly reflects the 'lose-lose' framework in which the Trump administration operates. When the 'lose' or 'pain' in US financial markets is not great the Trump administration proceeds to attack China. When, on the contrary, China's reaction increases pain in US financial markets Trump acts more reasonably. That is, whenever the Trump administration feels in a stronger position it increases its attacks on China, whenever the Trump administration feels weaker due to the pain in US financial markets it acts more reasonably to China.

    What is the Trump administration's bottom line?

    While the above clearly shows why the Trump administration will not respond to a 'win-win' framework, but only to economic pain, to avoid any misunderstanding it should be made clear that it does not lead to the conclusion that the US and China are locked in a 'war to the death'. All the evidence is that President Trump is less interested in the long-term interests of the US than most Presidents. The precise economic pain which is unacceptable to his administration is that which would lead to endangering his re-election in 2020.

    A relevant comparison which helps understand this dynamic is that is to a real war, not just a trade one, which the US lost – the Vietnam war. Vietnam's tactics in this were skilful in that political impacts guided military goals. The two largest Vietnamese offensives of the war, the Tet Offensive in 1968 and the Easter Offensive in 1972, were launched in US presidential election years. Neither resulted in US military defeat but the political damage done to US presidents ensured Vietnam's victory – Johnson was forced to abandon as hopeless any attempt to run for re-election as president after Tet, and Nixon was so convinced that his position as president would be threatened by the war that he started a progressive US military withdrawal after 1968 and decided on a total US withdrawal of US forces after the 1972 Easter Offensive.

    In short, the 'bottom line' for Vietnam's victory against the US was not total military defeat of the US, which was never achieved, but inflicting such pain on US presidents that to safeguard their own position they were forced to withdraw. The military struggle in Vietnam was the means by which the decisive political victory in the US was achieved.

    But the precondition for that US political defeat was the military struggle in Vietnam. If Vietnam had ceased inflicting pain on the US, both economic in terms of the gigantic cost of the war and in terms of losses of American forces, then the US instead of withdrawing would have increased its attacks on Vietnam. This can be clearly seen in the opposite case in which the US achieved a great victory – the destruction of the USSR. Gorbachev attempted to appease the US and beg for mercy. The US did not lessen but increased its attacks as a result – culminating in the catastrophic disintegration of the USSR itself, characterised by Putin as 'the greatest geopolitical catastrophe of the [20th] century'.

    After this tremendous defeat of Russia this again did not lead to a lessening but to further intensification of attacks on Russia by the US – incorporating almost all of Eastern Europe and large parts of the former USSR into NATO and launching of attacks on Russia's position in its strategically decisive neighbour of Ukraine.

    The strategic conclusion of the present US attacks on China fully confirms the speech by Xi Jinping emphasising that the most important thing is to rely on ourselves. China has not been seeking a confrontation with the US, a lose-lose. On the contrary China has been seeking a win-win. But once the Trump administration embarked on the course of a lose-lose confrontation then such a struggle can only be won by China relying on its own strength. Sufficient pain must be inflicted on the Trump administration that it decides it is better to abandon the lose-lose. And the criteria by which it will judge whether the pain in the 'lose-lose' is bearable is the effect on its chances of re-election.

    Fortunately, the present struggle is an economic war and not a real war. The 'small arms' in that economic war are not rifles and revolvers but tariffs against farmers and the subsidies these require, its medium weapons are consumer boycotts, its heavy artillery are such issues as the impact on US financial markets analysed above. It is a measure of the gigantic historical progress made by China since 1949 under the People's Republic that it now only has to deal with economic attacks by the Trump administration – for a century before that China had to deal with actual military invasions.

    The sacrifices made by the heroes of the Long March were far greater than anything the people of China face today in the economic attacks by the Trump administration. But the comparisons made by Xi Jinping to the Long March are entirely apposite and not at all merely references to the CPC's historical tradition.

    The Kuomintang's Fifth Encirclement Campaign, the origin of Long March, was designed by the KMT to destroy and annihilate the forces opposing it – why it is also called the 'Fifth Extermination Campaign'. It was purposeless to have attempted to appease or beg for mercy from the KMT, which was determined to destroy the forces which later created the New China. Any appeasement, or appeal for mercy, would have been met by the KMT crushing and massacring the forces they opposed. Only resistance to the KMT created the possibility to later create the People's Republic of China and lay the basis for China's national rejuvenation.

    Similarly, the Trump administration is determined to block China's national rejuvenation. As already shown, there is no point to attempt to appease it or beg for mercy from it, this will merely lead to it becoming more aggressive. The ultimate aim of the neo-cons at present directing the Trump administration's policies is to block China's national rejuvenation and the final way to ensure that is to ensure that that China should suffer the same historical catastrophe as the USSR under Gorbachev.

    Who is the 'elite' of Chinese society?

    Analysis in China shows it is ordinary people who have understood the aggressive actions of the Trump regime and supported the firm positions against this taken by President Xi Jinping and other CPC leaders.

    It is some parts of the 'social elite' which have entirely misunderstood the situation and believed that appeasement and appeals for mercy would lead to the Trump administration lessening its attack on China. The latter forces are the exact opposite of an 'intellectual elite' – because to be an intellectual elite means to see the situation accurately and, as seen, they are entirely in error. It is the ordinary people of China who have shown they are the 'intellectual elite' in accurately understanding the Trump administration and supporting the positions taken by the CPC leadership. Those who wrongly analysed the situation may or may not be a social elite but they are an intellectual 'non-elite' – those who fail to see the situation accurately and have naïve illusions.

    Conclusion

    The analysis of the situation of the US economy and financial markets therefore fully confirms the analysis made by others of the situation in China.

    It shows why the Trump administration cannot be dealt with on the basis of 'win-win' but only on the basis of China's strength and through ensuring that the Trump administration suffers severely in the 'lose-lose' path it has unfortunately chosen. Only after the US administration has found that it suffers pain from its present path will it be possible to return to a 'win-win' framework between China and the US.

    * * * The Chinese version of this article appeared at Guancha.cn .

    [Jun 18, 2019] US-China Trade War Stepping Away from the Brink - FPIF

    Jun 18, 2019 | fpif.org

    US-China Trade War: Stepping Away from the Brink

    Trump's trade war with China could quickly morph into a shooting war.

    By Emanuel Pastreich , June 14, 2019 .

    Print Friendly, PDF & EmailPrint

    Shutterstock

    President Donald Trump has announced that he will decide whether or not to add another $300 billion in tariffs on imports from China, in addition to the $200 billion he has already imposed, and that he will do so in the two weeks following the G20 summit in Osaka. Trump's "Art of the Deal" pressure tactics are familiar. He wants to try to make China give even greater concessions, perhaps following a frosty meeting between the two leaders on the sidelines of the G20, or perhaps no meeting at all.

    China, however, is in no mood to make concessions.

    Behind Trump's impulsiveness can be glimpsed a profound shift in U.S. trade policy, and in US diplomacy, which has transformed the nature of international relations, with particularly disturbing implications in the case of U.S.-China ties.

    Donald Trump, acting on the advice of U.S. trade representative Robert Lighthizer and Secretary of the Treasury Steven Mnuchin, is making demands of China -- or for that matter Mexico, Germany, or France -- in a unilateral manner. He has attempted to immediately implement tariffs and other forms of punishment (such as bans for reasons of national security in the case of Huawei phones) without any institutional consultative process.

    The U.S. constitution has a "commerce clause" that clearly assigns to Congress the power "to regulate commerce with foreign Nations, and among the several states, and with the Indian Tribes." Since 2002, the trade promotion authority (an upgraded version of the fast-track authority established in 1974) gives the president the right to negotiate trade agreements that Congress can vote for or against, but cannot amend.

    Over the last 20 years, fast-tracking has become the center of trade policy to a degree that undermines the balance of powers and the constitution.

    Although the executive's usurpation of trade authority has a long history, only now is the president making such a transparent move to exclude the legislature -- not to mention economic experts, let alone citizens -- from the formulation of trade policy. That means that a handful of people can make decisions that impact every aspect of the U.S. economy.

    Newspapers rarely mention the role of Congress in trade negotiations with China. It's almost as if the various congressional committees involved in formulating trade policy have no role in this process.

    Equally striking is the absence from the policy debate of multilateral institutions that address trade issues according to common practices and international law. For instance, the World Trade Organization was established in 1993 with an explicit mandate to address trade and tariff issues. The WTO and its trade experts once played a central role in U.S. trade discussions -- when U.S. policy ostensibly conformed to established global norms, and Washington even set new models for the world to follow.

    Trump's unilateral demands of China make it crystal clear that Trump, and Trump alone, is empowered to decide trade policy. What institutions and mechanisms remain to assure that the president's authority in trade negotiations will not be abused and that trade is conducted with the long-term interests of the country in mind?

    But it goes further than that. Now Trump is demanding "detailed and enforceable commitments" from China as a condition for a trade deal, suggesting that the United States alone determines whether or not China is conforming with the agreement. Such an approach makes sense in Washington these days. After all, the U.S. Commerce Department imposed an export ban on the Chinese telecommunications company ZTE last year because it did not pay fines for violating U.S. sanctions against sales to North Korea and Iran. In other words, the United States thinks it can unilaterally set sanctions and punish violators without any consultation with multilateral institutions.

    This step goes beyond what the Chinese can tolerate.

    "China is not a criminal. Nor is it making any mistakes. Why does the US want to supervise us?" remarked Professor Wang Yiwei of Renmin University of China in a recent interview , "If there's a supervision team to oversee the implementation, just like what happened to ZTE, it is definitely directed at sovereignty and can't be accepted."

    These "enforceable commitments" are offensive to China for a reason. This approach to trade seems little different from the sanctions regimes that the United States put in place against Iraq before its military invasion, or against Iran as part of an increasing military buildup that could end in a military conflict. Moreover, the increased U.S. military drills off the Chinese coast has given the trade negotiations process a negative spin.

    The recent comments about the political protests in Hong Kong by secretary of state Mike Pompeo suggest that those tariffs could quickly become sanctions -- which require even less adherence to international norms.

    And then, in the midst of all that tension, the U.S. military released an Indo-Pacific Stategy Paper that refers to Taiwan as a "country," the first time the United States has done so officially in 40 years. The agreement between the United States and the People's Republic of China, after the normalization of diplomatic relations, required that the United States not recognize Taiwan as a country, and the People's Republic of China has stated explicitly that military action was an option in the case of U.S. interference in the Taiwan question.

    The combination of these actions threatens to erase all established norms between the two nations.

    The United States is now considering ending agricultural exports to China, and China is considering cutting off the sales of rare earth elements to the United States. The latter are essential for the guidance systems and for sensors in missiles and advance fighter planes. A F-35 Fighter, for instance, requires 920 pounds of rare earth elements like neodymium iron boron magnets and samarium cobalt magnets, according to the Asia Times .

    The risk of a rapid acceleration in tensions is no longer theoretical. Remember: the U.S. decision to end the sale of scrap metal and copper to Japan in 1940, followed by the oil embargo on August 1, 1941, transformed a trade war into a real war.

    Trade should remain separate from security concerns. Moreover, it should not be the plaything of a small number of men in the White House. The United States and China need to open a broad dialogue on common concerns, from climate change and rapid technological evolution to the growing concentration of wealth globally. That dialogue should rely more on citizen-led dialogues and scholar-led conferences in order to move beyond the narrow negotiation process that has brought the two countries to the brink of war.

    [Jun 17, 2019] How Americans Are Losers In The US-China Trade War

    No matter who pay them, tariffs improves government revernues. They are in essence another form of "value added tax".
    Jun 17, 2019 | www.youtube.com

    Kevin Fa , 1 week ago

    Jimmy carter : US is the most warlike nation in the history of the world.

    john hanrahan , 1 day ago div tabindex="0" role="artic

    le"> Tariffs raise the cost of goods. Higher generate the opportunities for alternative sources as well as incentivize domestic production. Never forget that the higher price of domestic production is offset by the reduction in the costs associated with domestic unemployment. The reduction of wealth leaving the nation is a primary goal and responsibility of the federal government. As is maintaining a secure border and civil and economic well being of it's citizens.

    [Jun 17, 2019] Why China Doesn't Want Your Trash Anymore

    Jun 17, 2019 | www.youtube.com

    Magnificent Birb , 2 months ago

    How ironic that western countries condemns the other countries to not pollute, yet they are exporting waste to Asian countries..

    huiyuforever , 1 month ago

    US: Send all the trash to China and blame China for pollution. China: No more trash. US:?????????????

    mr. phantom , 2 months ago

    Wow China taking care of trash unlike US which is creating trash I support your decision

    Dante X , 2 months ago

    Enjoyed that report. It's refreshing to see a seemingly non-biased examination of Chinese Economic and Geopolitical relationships. Enjoying the improved air in quality Beijing.

    Asim Alharbi , 3 weeks ago

    lol Americans are 4% of worlds population, yet they preduces 25% of the world trash. Is that even possible to happen?

    [Jun 16, 2019] The Misadventures of 'Tariff Man' by John Feffer

    Jun 05, 2019 | fpif.org

    For Donald Trump, tariffs are a substitute for diplomacy, just as harassment in his personal life is a substitute for normal human interaction

    Trump has two tools at his disposal as president. The first is his mouth: the insults and threats that he issues verbally or by Twitter.

    The second is the tariff. Trump has imposed trade restrictions left and right, on allies and adversaries, for economic and political reasons, as part of a long-term offensive and out of short-term pique.

    If Trump could use tariffs even more indiscriminately, no doubt he would. He would delight in slapping trade penalties on the Democratic Party, on Robert Mueller, on the mainstream media, on all the women who have accused him of harassment, even on the First Lady for slapping away his hand at the airport in Tel Aviv.

    Trump the man favored the legal suit as his attack of first resort; Trump the president has discovered the tariff.

    With his penchant for naming names, Trump calls himself "Tariff Man," as if boasting of a new superhero power. It's all-too-reminiscent of the cult film Mystery Men where the superpowers are either invisible or risible (Ben Stiller's character, Mr. Furious, for instance, gets really really angry).

    Trump uses tariffs like a bad cook uses salt. It covers up his lack of preparation, the poor quality of his ingredients, the blandness of his imagination. It's the only spice in his spice rack.

    The latest over-salted dish to come out of the White House kitchen is the president's threat to impose a 5 percent tariff on all Mexican goods on June 10. The threat has nothing to do with what Mexico has done economically (that's a different set of threatened tariffs). Rather, it's all about immigration. This time, Trump will keep inflating the cost of Mexican goods "until such time as illegal migrants coming through Mexico, and into our Country, STOP." The tariffs will, supposedly, rise 5 percent every month until they reach 25 percent in October.

    Trump promised as a candidate that Mexico would pay for the wall he wanted to construct along the southern border. Now, it seems, Mexico will pay for the lack of a wall as well.

    The escalation is quite clear. What Mexico has to do to avoid these tariffs is not.

    "So, there's no specific target, there's no specific percent, but things have to get better," Chief of Staff Mick Mulvaney told Fox News Sunday . "They have to get dramatically better and they have to get better quickly."

    Such is the usual Sunday morning quarterbacking that happens with White House officials as they scramble to explain the inexplicable to a baffled news media.

    Although they remain in the dark about what's expected of them, Mexican leaders have warned that they will apply counter-tariffs if necessary and that the United States will suffer economically from such a tariff war.

    These are not idle threats. Mexico is the third largest U.S. trading partner. Even congressional Republicans, desperate to avoid this spat, are talking about trying to block the tariffs. Trump has called them "foolish" to do so. He plans to move forward anyway.

    Full Spectrum Offensive

    Mexico is only the latest country to feel the wrath of Tariff Man.

    In 2018, Trump used Section 201 of the Trade Act to impose tariffs on solar cells and washing machines, targeting primarily East Asian countries. Shortly thereafter, he upped his game by assessing a 25 percent tariff on all steel imports, with Canada, Mexico, and the EU getting hit the hardest.

    China, however, has borne the brunt of Trump's animosity. In early May, the Trump administration announced a surge in tariffs from 10 percent to 25 percent on $200 billion worth of Chinese goods. He has also threatened to apply tariffs to the remaining $325 billion worth of Chinese goods entering the country.

    The escalation tactics don't seem to have done much to improve the prospects of a trade deal between the two countries. China has naturally countered with its own tariffs.

    When Trump lashed out against countries competing against the U.S. steel industry, one of the major exceptions was Australia. That probably won't last long. Just before his Mexico decision, the president was planning on imposing a tariff on Australian aluminum as well. His advisors managed to dissuade him , at least temporarily.

    Canada and Mexico, meanwhile, continue to get a pass on the steel tariffs as long as the two countries sign a replacement deal for NAFTA. But Trump's latest move against Mexico may throw that pending agreement into jeopardy.

    Push Back

    The threat and even the reality of retaliatory tariffs seem to have little effect on Trump. He likes such geopolitical games of chicken. Congressional opposition only whets his appetite for more confrontation, for he holds even his Republican allies in contempt.

    He disregards the more level-headed advice of economic mandarins -- as well as seven former ambassadors to Mexico -- because he relishes flouting conventional wisdom in favor of his own unconventional stupidity. If farmers in swing states protest that the markets for their soybeans have dried up, Trump will just authorize another massive government purchase of their product -- and suddenly prisoners all over America will be surprised by tofu and edamame on their cafeteria menus.

    Republican voters overwhelmingly support Trump's trade policies -- and the president really doesn't care a fig about anyone else.

    The only pushback that might have some influence with Trump might be the business community. The auto sector is forecasting billions of dollars in costs associated with the Mexico tariffs. The Chamber of Commerce, which has come up with a more precise annual price tag for U.S. consumers of $17.3 billion for a tariff level of 5 percent, is considering a legal challenge.

    If the stock market goes into bearish hibernation, then the president is out of luck. Tweeted Ian Shepherdson, the chief economist at Pantheon Macroeconomics, "he's going to have to blink on tariffs, because the market can't live with this level of crazy."

    Shepherdson is wrong. The market has lived with this kind of crazy for more than two years. And there are plenty of people who see profit in precisely the kind of volatility that Trump has brought to financial markets.

    When Trump went on a fundraising tour of New York recently, some big-name financiers leapt at the opportunity to fete the president. Howard Lutnick, the head of Cantor Fitzgerald, predicted in 2017 that Trump would provide a big bump for the world of finance (and, therefore, his own bottom line). Last month, as a reward for that bump, Lutnick invited Trump to his triplex penthouse in Manhattan and raised over $5 million toward his reelection.

    That's the kind of crazy that the market is entirely comfortable with.

    Misunderstanding Trade

    Tariffs make sense for certain countries.

    For instance, East Asian countries used tariffs very successfully to protect their infant industries -- steel, shipbuilding, information technology -- against the overwhelming market advantages of more advanced economies. Those tariffs raised the price of imports and encouraged consumers to buy domestic. Tariffs can be part of a smart industrial policy of picking potential economic winners.

    Tariffs can also protect a way of life -- Japanese rice culture, Mexican tortilla makers, Vermont dairy farmers. Without some kind of trade protection, cheaper goods from outside will completely overwhelm domestic producers and destroy long-standing traditions. Of course, there are other methods of preserving such traditions, from government price supports to geographical designations (think: champagne).

    Trump's tariffs have nothing to do with either of these aims. U.S. steel is not an infant industry in need of protection. Trump doesn't care about protecting traditional lifestyles. He has neither a progressive industrial policy of picking winners and losers in the economy nor a conservative approach to ensuring the integrity of communities.

    For Donald Trump, tariffs are a substitute for diplomacy, just as harassment in his personal life is a substitute for normal human interaction. Tariff Man can think of only one way of dealing with other countries: grabbing them by their trade policies until they squeal.

    He believes, mistakenly, that trade is zero-sum (if they lose, American wins). He also labors under the misconception that the U.S. Treasury somehow grows fat with the proceeds of tariffs (it doesn't). He is as ignorant of the relations among nations as he is of the relations among people.

    Tariff Man's superpower is even more ridiculous than that of Mr. Furious. It's worse than impotent. It's self-defeating. Let's hope that principle applies ultimately to the 2020 elections as well. Share this:

    John Feffer is the director of Foreign Policy In Focus and the author of the dystopian novel Frostlands.

    [Jun 15, 2019] Hollywood becomes unlikely victim of Trump's trade war

    Notable quotes:
    "... Trump's declaration of economic war against China is like everything he does - impulsive, ill-considered, ill-prepared, and without any coherent strategy or series of tactics to achieve that strategy. ..."
    "... NOTE - I am not pro-China, but anti-stupid, anti-disorganized, and anti-clueless, which is how everything gets done in the Trump WH, especially since his "economic advisors" really do not know anything about economics. ..."
    Jun 14, 2019 | www.washingtonpost.com

    Last month, "Avengers: Endgame" became the highest-grossing American film in the history of China. It was a seminal moment, suggesting the partnership between China and Hollywood, which over the years has moved in fits and starts, was finally firing on all cylinders. But the $614 million that Disney-Marvel booked may turn out to be an outlier.

    As the United States ups the stakes in a trade war, there are growing signs that China is quietly retaliating against the U.S. entertainment business.

    Beijing is now constricting Hollywood's ability to peddle its product in the country, say four people who conduct business in China or closely monitor its relations with Hollywood.

    "I don't want to use the words 'total freeze,' but it's real," said John Penotti, the producer of "Crazy Rich Asians" and head of SK Global who specializes in Asian productions. "They're not saying it officially, but the industry is operating as if it's close to a total shutdown."

    In contrast to many countries, distribution in China requires government approval, and according to these sources, the Chinese government is unlikely to offer distribution slots to more than a small handful of movies. The latest Spider-Man, Secret Life of Pets and Toy Story movies appear likely to get the nod, but most other summer and even fall hopefuls face being locked out of the world's second-largest film market.

    Hollywood relies on China to power its foreign box office, which in turn powers its film revenue, and the standoff reflects how much of a conundrum China represents for Hollywood.

    The availability of so many overseas ticket-buyers at a time of intense entertainment competition at home has been a boon for U.S. studios. But at the same time, the mercurial ways of Chinese regulators and the ways that market penetration is subject to geopolitical crosswinds also make the nation a vexing place for studios to do business.

    If the trade war wears on and the market remains cut off, it could result in a reduction of the budgets of studio movies, since it's Chinese yuan that make them possible.

    "I think this poses a dire situation for Hollywood," said Aynne Kokas, a professor at the University of Virginia and author of "Hollywood Made In China," about the complicated relationship between the two entities. "There definitely will be a trickle-back effect. It's a very dangerous financial position to be reliant on Chinese box office to recoup profits."

    The Chinese market has become a place of increasing importance to the American movie business. As the country has rapidly built theaters -- it now has more than 65,000 screens, a dozenfold increase compared to a decade ago -- it has become a cash cow for American studios. Three of Hollywood's top five movies at the worldwide box office last year -- "Avengers: Infinity War," "Jurassic World: Fallen Kingdom" and "Aquaman" -- each collected more than a quarter of their overseas dollars in China.

    Other movies owe the country even more of their success. The underwater adventure "The Meg" notched 40 percent of its foreign total in China, while Steven Spielberg's gamer-themed hit "Ready Player One" approached 50 percent. China could become the biggest film market as soon as 2020, according to PricewaterhouseCoopers.

    But to keep the dollars flowing, studios need those distribution slots. And that's where matters get dicey.

    China officially has a quota allowing in several dozen Hollywood movies per year -- 38 in 2019, 35 the year before. Those numbers are up by more than 20 percent in the past five years.

    The Film Bureau and its China Film Group division determine what movies are given a distribution slot. But with blackout periods, 11th-hour allowances and other unpredictable factors, even those who study the market say it can be impossible to parse what makes the cut. And lately, with the trade war raging, few movies are.

    Vanamali, 6 hours ago

    As they say, "Everything is fair in love and war" - the Chinese are using whatever means they have at their disposal
    Trump is using Tariffs to hurt the Chinese economy and business and the Chinese of course are going to retaliate with whatever weapon they have

    But gotta love the Trumptards "logic" - "They need our exports, without them they will starve, there will be rioting in the streets" and "We are doing them a big favor by importing their products, if we shut off our market, their companies will collapse, massive unemployment, there will be rioting in the streets"
    Bizarre "logic"

    jayster, 12 hours ago (Edited)

    Trump's declaration of economic war against China is like everything he does - impulsive, ill-considered, ill-prepared, and without any coherent strategy or series of tactics to achieve that strategy.

    China will defend its interests and retaliate as necessary, especially as they know Trump is an absolute moron.

    NOTE - I am not pro-China, but anti-stupid, anti-disorganized, and anti-clueless, which is how everything gets done in the Trump WH, especially since his "economic advisors" really do not know anything about economics.

    ES175GC 12 hours ago

    Trump is such a vengeful, hating person that it wouldn't surprise me at all that he deliberately wants to hurt all those Hollywood liberals who despise him so much. "When I get hit, I hit back 10 times harder" is a famous Trump saying.

    He operates on a juvenile level, as we all know, like a spoiled whining brat who has to get even with anyone who slights him. It makes perfect sense that Trump will do everything he can to destroy Hollywood's business with China.

    buhaobob, 12 hours ago

    I agree except your premise that Trump would do this deliberately would require that Trump have a plan, and he has demonstrated that his attention span is about the same as that of the average goldfish.

    Zop1066, 15 hours ago (Edited)

    We certainly do not need Chinese government influence in Hollywood or in any US media, period. Several films recently have shied away from any even marginally critical reference to China for fear of losing Chinese box office receipts or Chinese investment.

    And the Chinese investors have not even tried to hide that they do indeed influence film scripts to suit the Chinese government. Enough of that. Best they keep their money and invest perhaps in even harsher great wall internet controls, internment camps, and super creepy internal population controls.

    That'll sure keep the cinema in China boring and nonthreatening. Certainly wouldn't want anyone there to think for themselves and question their government, no siree.

    derek13, 3 hours ago

    But the economy needs the dollars.

    [Jun 15, 2019] Trump's Trade Threats are really Cold War 2.0 by Michael Hudson

    Notable quotes:
    "... Threats are cheap, but Mr. Trump can't really follow through without turning farmers, Wall Street and the stock market, Walmart and much of the IT sector against him at election time if his tariffs on China increase the cost of living and doing business. His diplomatic threat is really that the US will cut its own economic throat, imposing sanctions on its own importers and investors if China does not acquiesce. ..."
    "... China has a great sweetener that I think President Xi Jinping should offer: It can nominate Donald Trump for the Nobel Peace Prize. We know that he wants what his predecessor Barack Obama got. And doesn't he deserve it more? After all, he is helping to bring Eurasia together, driving China and Russia into an alliance with neighboring counties, reaching out to Europe. ..."
    Jun 13, 2019 | www.unz.com

    President Trump has threatened China's President Xi that if they don't meet and talk at the upcoming G20 meetings in Japan, June 29-30, the United States will not soften its tariff war and economic sanctions against Chinese exports and technology.

    Some meeting between Chinese and U.S. leaders will indeed take place, but it cannot be anything like a real negotiation. Such meetings normally are planned in advance, by specialized officials working together to prepare an agreement to be announced by their heads of state. No such preparation has taken place, or can take place. Mr. Trump doesn't delegate authority.

    He opens negotiations with a threat. That costs nothing, and you never know (or at least, he never knows) whether he can get a freebee. His threat is that the U.S. can hurt its adversary unless that country agrees to abide by America's wish-list. But in this case the list is so unrealistic that the media are embarrassed to talk about it. The US is making impossible demands for economic surrender – that no country could accept. What appears on the surface to be only a trade war is really a full-fledged Cold War 2.0.

    America's wish list: other countries' neoliberal subservience

    At stake is whether China will agree to do what Russia did in the 1990s: put a Yeltsin-like puppet of neoliberal planners in place to shift control of its economy from its government to the U.S. financial sector and its planners. So the fight really is over what kind of planning China and the rest of the world should have: by governments to raise prosperity, or by the financial sector to extract revenue and impose austerity.

    U.S. diplomacy aims to make other countries dependent on its agricultural exports, its oil (or oil in countries that U.S. majors and allies control), information and military technology. This trade dependency will enable U.S. strategists to impose sanctions that would deprive economies of basic food, energy, communications and replacement parts if they resist U.S. demands.

    The objective is to gain financial control of global resources and make trade "partners" pay interest, licensing fees and high prices for products in which the United States enjoys monopoly pricing "rights" for intellectual property. A trade war thus aims to make other countries dependent on U.S.-controlled food, oil, banking and finance, or high-technology goods whose disruption will cause austerity and suffering until the trade "partner" surrenders.

    China's willingness to give Trump a "win"

    Threats are cheap, but Mr. Trump can't really follow through without turning farmers, Wall Street and the stock market, Walmart and much of the IT sector against him at election time if his tariffs on China increase the cost of living and doing business. His diplomatic threat is really that the US will cut its own economic throat, imposing sanctions on its own importers and investors if China does not acquiesce.

    It is easy to see what China's answer will be. It will stand aside and let the US self-destruct. Its negotiators are quite happy to "offer" whatever China has planned to do anyway, and let Trump brag that this is a "concession" he has won.

    China has a great sweetener that I think President Xi Jinping should offer: It can nominate Donald Trump for the Nobel Peace Prize. We know that he wants what his predecessor Barack Obama got. And doesn't he deserve it more? After all, he is helping to bring Eurasia together, driving China and Russia into an alliance with neighboring counties, reaching out to Europe.

    Trump may be too narcissistic to realize the irony here. Catalyzing Asian and European trade independence, financial independence, food independence and IT independence from the threat of U.S. sanctions will leave the U.S. isolated in the emerging multilateralism.

    America's wish for a neoliberal Chinese Yeltsin (and another Russian Yeltsin for that matter)

    A good diplomat does not make demands to which the only answer can be "No." There is no way that China will dismantle its mixed economy and turn it over to U.S. and other global investors. It is no secret that the United States achieved world industrial supremacy in the late 19 th and early 20 th century by heavy public-sector subsidy of education, roads, communication and other basic infrastructure. Today's privatized, financialized and "Thatcherized" economies are high-cost and inefficient.

    Yet U.S. officials persist in their dream of promoting some neoliberal Chinese leader or "free market" party to wreak the damage that Yeltsin and his American advisors wrought on Russia. The U.S. idea of a "win-win" agreement is one in which China will be "permitted" to grow as long as it agrees to become a U.S. financial and trade satellite, not an independent competitor.

    Trump's trade tantrum is that other countries are simply following the same economic strategy that once made America great, but which neoliberals have destroyed here and in much of Europe. U.S. negotiators are unwilling to acknowledge that the United States has lost its competitive industrial advantage and become a high-cost rentier economy. Its GDP is "empty," consisting mainly of the Finance, Insurance and Real Estate (FIRE) rents, profits and capital gains while the nation's infrastructure decays and its labor is reduced to a prat-time "gig" economy. Under these conditions the effect of trade threats can only be to speed up the drive by other countries to become economically self-reliant.


    nsa , says: June 14, 2019 at 5:04 am GMT

    The crux of the "trade" dispute is never discussed: the Chinese refusal to allow the international financial services sector to penetrate the Chinese economy and operate freely. Get it? The Chinese won't let the Jews in to loot the place and the Jews are pissed. Trumpstein, the cryto Jew, has promised his sponsors to rectify the situation. The Chinese witnessed what happened when Yeltsin allowed the IMF to parachute Jeffrey Sachs and his Jew Boys into Russia in 1991 Jews looted the place mercilessly, calling it democracy and capitalism, and Russia is still recovering. The Chinese have a bright future, as long as they keep the Jews out.
    sally , says: June 14, 2019 at 5:35 am GMT
    I agree.
    I am afraid spokes person Trump and those he is speaking for have it wrong. They believe external trade is interfering with the La-Zi-Faire fat cat monopoly powered corporations the CPI (congress, president and Israeli governance represent.
    Few western companies can compete because only monopoly endowed Global corporations are allowed or licensed to compete. Individual ability, the creative mind of the lone rangers with highly disruptive inventions and ideas, are not allowed access to the knowledge or money to play. Making people pay for sleazy operating systems when better ones are free, allowing big corporations to hack the data of everyone, and on and on.

    Even when a person finds a way to play and actually produces a product or concept, the financial condition of the inventor is so weak or the barriers to promote his product is so strong that as soon as the idea or product is patented or copyrighted it somehow absorbed into one of the monopoly powered giants; in other words, competition is only allowed if the competitor gives the profits to one of the monopoly powered giants. China should be complaining, at least their competitors can produce, in the USA governed America unlicensed competition is denied.

    Copyright, patents, standardized testing and licensing every breath have terminated competition in America.
    America still competes with Americans as long as the business does not compete with the global corporations.

    The problem Trump thinks he can solve, is not sourced in India, China, Iran, Russia, or any other nation. The problem is at home, in government policy, laws that turn capitalistic competition into monopolistic fat-cat wealth storing private domain havens. Education by degree and license by examination and standardization of performance are used to restrict competition. Education, is a bureaucracy and no matter its efficiency; a degree cannot provide competitive performance. The USA governance over America has served only the interest of monopoly endowed corporations and their oligarch owners and investors. Trump is trying to overcome foreign competition, by threat and blocking maneuvers, to deny foreigners the fruits of their competitive successes I do not believe he can be successful. Already the Russian and Chinese have developed a new currency and banking system to circumvent the Trump block. Work around-s are in progress everywhere.. Soon even the USA will not be allowed to compete I fear.
    It is not a matter of where the competition comes from, its that the monopoly powers have used the behavior enforcing rule making capacity of the USA to deny native American creativity; creativity that America needs to be competitive. USA policy continues to be to enrich a few by channeling and encapsulating all effort within the confines of the monopoly holders instead of encouraging every back yard to be a new competitor. It will be many years before Americans will be able to compete..

    Trade is not the issue, competition is!

    schrub , says: June 14, 2019 at 6:15 am GMT
    What Trump is now demanding reminds me of the brutally efficient system that Trump grew up in: New York City business. (Author Tom Wolfe has a great line in his book The Bonfire Of The Vanities that the strange, unrelenting background droning sound one hears in NYC is that of "people constantly braying for money").

    New York City real estate in particular is an area of business that is so brutally competitive, unscrupulous , and backstabbing that it is best described as war under another name. It is a business arena where a close friend one day can turn into a staunch enemy the next. Trust is rare.

    New York real estate, in fact, brings to mind the old saying about sausage making: You would never eat it if you saw it being made. Yet deals are made. In fact, a lot of them. This is the milieu Trump comes from.

    Trump isn't one of those more genteel, old-time American negotiators of prior years the author of this article speaks fondly of. These are the very same people who so readily agreed to disasters like NAFTA or allowed, for instance, Or allowed Japan to levy two hundred percent duties on things like American made Harley Davidson motorcycles while the USA was pressured (or bribed) to apply few if any comparable duties on Japanese motorcycles or automobiles (or virtually anything else Japan sold in the USA). These toothless. genteel types also stood back for decades and allowed Japan to use red tape (like obscure safety regulations for instance) to make it almost impossibly difficult to sell American products like automobiles in Japan.

    These very same US negotiators, politicians, and bureaucrats have more recently stood back and allowed China to absolutely devastate American manufacturing.

    Screw China, It's now payback time. The Chinese are shaking in their boots because the previously hoodwinked and comatose Americans are finally waking up. No more wimpy Obama or Bush looking out for our interests. It is now Truly Scary Trump instead.

    Wait until the negotiations are concluded to see if they are successful. The sausage that comes out of them might be very appealing for the first time in many, many decades.

    Sam J. , says: June 14, 2019 at 6:38 am GMT
    " His diplomatic threat is really that the US will cut its own economic throat, imposing sanctions on its own importers and investors if China does not acquiesce "

    I get that the US financial system is up to no good with their positions on China but the criticisms Trump made of China are correct. They have lots of tariffs on finished goods from the US. They require technology transfer to do business there. Their government and industry are tied at the hip and they are manipulating their currency. All these things are true and if we keep trading with them with the same terms we have been we would lose ALL our industrial infrastructure. Now we hear over and over how we can't build anything but the Chinese went from being dirt farmers to the largest industrial power in a fairly short period of time. Could we not do the same at least for our own countries market? Certainly global trade destruction between countries is not a good thing but we'd be fools to keep on as we are now. At some point when you dig a hole you have to stop to get yourself out.

    I don't think we have a choice if we wish to continue to be an industrialized country. All those that say China will do fine without us are not taking into account how all the other countries who are being handled the exact same way as we are, are going to handle China's trade with them. Will they keep allowing China to have large tariffs on their products while they Chinese ship whatever they wish into theirs? I'm not so sure they will. If the US starts refusing the Chinese free entry without reciprocal trade then I can easily see others following our lead.

    We should have stopped this many years ago but as bad as the situation is now it will only get worse if we don't act.

    Let them remove their tariffs. We should take every single anti-trade act and tariff they have on us, weigh them on China and "then" negotiate. If they don't wish to it's their country they can do what they please and so can we.

    animalogic , says: June 14, 2019 at 6:39 am GMT
    "The crux of the "trade" dispute is never discussed: the Chinese refusal to allow the international financial services sector to penetrate the Chinese economy and operate freely. Get it? "
    Absolutely. Like inviting a handful of worms into your apple -- economy hollowed out in an eye blink.
    However, there is another side to this "trade dispute" coin.
    FIRE want to economicly destroy China. The neocon', MIC, security sector wants to destroy China's 2025 plan to become high-tech world leaders. 5G, AI, semi conductors etc are some of the areas that China's public/private sectors are voraciously pushing. Hence, the (wonderfully "free market") US attacks on Heiwai.
    These short term US gambles are more than likely to pay off by the medium-long term undermining of US hegemony via Eurasian integration led by China & Russia.
    And all the time we are left wondering whether the US will choose the "Samson Option" rather than accept reduced status. (Insane with power lust, the US can't even accept "first among equals")
    Justsaying , says: June 14, 2019 at 9:54 am GMT

    The US is making impossible demands for economic surrender – that no country could accept. What appears on the surface to be only a trade war is really a full-fledged Cold War 2.0

    .

    Typical mobster protection racket threats. Now the US has moved from waging military wars on behalf of their Jewish owners to aggressively push their neoliberal economic warfare for them. The facade for promoting democracy and human rights is no longer required.

    And to call attempts at starving the population and murdering children by denying them essential medicines as has happened in Iraq and now is going on in Iran and Venezuela, a Cold War 2.0 is a gross understatement. It is a flagrant act of war. America is launching a war of attrition on the world and who better to spearhead that war than an idiot manipulated by Zionist Jews? The fact that many countries remain silent is testament to their surrender. But China may prove to be a different proposition.

    PeterMX , says: June 14, 2019 at 10:51 am GMT
    "the United States achieved world industrial supremacy in the late 19th and early 20th century" That is a myth. The US may have had the highest GDP because it was the leader in manufacturing, as China is now, but Europe and in particular Germany was far ahead of the US in technology and science. If you compare China to the US today the situation is very similar to comparing the US to Germany before 1939. Germany was far ahead of the US in the number of Nobel Prizes received thru 1945 and very few of the Americans that did receive the Nobel Prize were native born. The US received a few Nobel Prizes starting in the 1940's because some recent European immigrants that became US citizens received it for work they had done in Europe. The three biggest technological breakthroughs of WW II were the jet, the rocket and the atomic bomb. Germany invented the jet, built the first modern rockets and the German scientist Otto Hahn split the atom in 1939 (for which he received the Nobel Prize in 1944) kicking off the USA's atomic bomb project and Germany's limited attempt. The people that eventually achieved success in the US were almost all recent European immigrants (Bethe, Teller, etc.), many being Jewish.

    I basically agree with the rest of the article. I believe Trump's tactics make sense. The problem is it's too late. The US economy can't be fixed by anyone. The US has 22 trillion dollars in debt and will never be able to pay it back. The dollar is going to take a deep dive within the next few years and it will lose its status as the reserve currency. I believe this based upon what people like Peter Schiff, Paul Craig Roberts, David Stockman and Ron Paul say.

    I think the two biggest events of the last 75 years were WW II, completely changing the countries that run the world and the emergence of a backwards and dirt poor China to become an economic powerhouse and I think they will get stronger.

    Sean , says: June 14, 2019 at 11:02 am GMT

    The US is making impossible demands for economic surrender – that no country could accept.

    Yes country. If the world was one big free trade area, it there were no bloks or even no countries in the sense we understand them then the population of the would be wealthier, on average. But countries are not primarily economic units, even if one can look at them as such.

    Nation states exist and have the emergent quality that they to survive against other nation states and the best way to do that is to gain extra power relative to other states, or at least maintain their position. Why would America agree to terms of trade that do not maintain its position relative to China.

    U.S. negotiators are unwilling to acknowledge that the United States has lost its competitive industrial advantage

    There is no absolute standards by which such an advantage could be judged. The terms of trade that are finally settled on will be a compromise and reflect the interests of both, and the total balance of forces between the two.

    Sally Snyder , says: June 14, 2019 at 11:48 am GMT
    As shown in this article, both Russia and China have plans in place to work around American sanctions:

    https://viableopposition.blogspot.com/2019/06/putin-and-xi-defeating-american.html

    The combination of both nations will make it extremely difficult for Washington to impose its hegemonic agenda without serious repercussions as two of the world's leading military forces seek to increase the level of co-operation between their nations.

    Incitatus , says: June 14, 2019 at 11:50 am GMT
    Trump's Trade Tariff Theatre 2018 results:
    Country/Trade Balance/2018 vs. 2017

    Mexico: trade DEFICIT -$81.5 billion; up 14.9% from 2017;
    Canada: trade DEFICIT -$19.8 billion; up 15.8% from 2017;
    China: trade DEFICIT -$375.6 billion; up 11.6% from 2017;
    South Korea: trade DEFICIT -$17.9 billion; down 22.4% from 2017;
    Japan: trade DEFICIT -$67.7 billion; down 1.8% from 2017
    Germany: trade DEFICIT -$68.3 billion; up 7.2% from 2017;
    France: trade DEFICIT -$16.2 billion; up 5.8% from 2017;
    Kingdom of Saudi Arabia: trade DEFICIT -$10.5 billion; up 313.3% from 2017;
    Russia: trade DEFICIT -$14.1 billion; up 40.9% from 2017;

    Asia: trade DEFICIT -$622.2 billion; up 8.8% from 2017;
    Europe: trade DEFICIT -$202.4 billion; up 16.6% from 2017;
    World: trade DEFICIT -$795.7 billion; up 10.4% from 2017

    https://www.census.gov/foreign-trade/balance/index.html

    'Art of the Deal'?

    rafael martorell , says: June 14, 2019 at 11:57 am GMT
    To all of the "free traders", the media ,and academia ,i have this simple question:
    why i cant purchase a Toyota work van(the best and must popular of the world),neither here in the USA nor abroad and bring it in?
    how come that even in Cuba there are more of those Toyota work van than here in all continental USA.
    In 25 year i has to purchase more than 6 work vans,and like Penelope i have been waiting for the Toyota ,and still waiting.
    They ,the free traders,did not has allowed not even one.
    DESERT FOX , says: June 14, 2019 at 12:27 pm GMT
    The problem with the zio/US is the control of the US by the zionists and this control is derived via the zionist privately owned FED and IRS that they got installed in 1913 and then came the debt and wars and the hijacking of the foreign policy by the satanic zionists and the US gov was started on a down hill slide pushed started by the zionists!

    The trade policy of the zio/US has turned Russia into the largest grain exporter in the world and turned Russia into an agriculture miracle , this can be shown by watch videos of Russian agriculture on youtube. Germany is also in Russia building cars and other industrial products for Russia thus bypassing the zio/US trade sanctions and last but not least Russia is trading in non dollars in trade with more and more countries such as China thus effectively rendering the dollar non and void in international trade.

    So the people of the zio/US can thank their zionist masters for the demise of America and true to form the zionist parasites are killing their American host

    Agent76 , says: June 14, 2019 at 1:08 pm GMT
    May 14, 2019 Trade Wars: The Truth About Tariffs

    Join Mike Maloney as he examines the latest moves in the US/China trade war, and visits some compelling arguments from the Foundation for Economic Education.

    https://www.youtube.com/embed/c1r7uO0D-R0?feature=oembed

    Aug 26, 2015 How the West Re-colonized China

    The "Chinese dragon" of the last two decades may be faltering but it is still hailed by many as an economic miracle. Far from a great advance for Chinese workers, however, it is the direct result of a consolidation of power in the hands of a small clique of powerful families, families that have actively collaborated with Western financial oligarchs.

    https://www.youtube.com/embed/WxFSvPUY_oc?feature=oembed

    Realist , says: June 14, 2019 at 1:15 pm GMT
    @Thinking Out Loud Plus E-verify.
    George , says: June 14, 2019 at 1:20 pm GMT
    "Threats are cheap, but Mr. Trump can't really follow through without turning farmers, Wall Street and the stock market, Walmart and much of the IT sector against him at election time if his tariffs on China increase the cost of living and doing business. "

    Tariffs are taxes and both governments like collecting taxes.

    Farmers. Farmers sell a commodity so if they cannot sell to China one result is they will sell to other customers while China buys more from other producers.

    Cost of living. DC does not care. There is a solid inflation lobby in the fed that supports increasing the cost of living.

    "Walmart and much of the IT sector against him." I am not buying it.

    Rogue , says: June 14, 2019 at 2:20 pm GMT
    @PeterMX

    Germany invented the jet

    Well, more accurate to say that Germany and Britain invented the jet engine independently of each other. Just as they both invented radar independently of each other as well.

    As it is, the post-war jet engine was based primarily on the British design of Frank Whittle, though some of the German ideas were also later incorporated.

    But, overall, the British design was superior.

    Miggle , says: June 14, 2019 at 2:26 pm GMT
    @schrub It wasn't the Chinese who hoodwinked the Americans, it was American financiers who hoodwinked the Americans.

    [Jun 12, 2019] Huawei asks Verizon to pay over $1 billion for over 230 patents source by David Shepardson

    Jun 12, 2019 | finance.yahoo.com

    Huawei Technologies Co Ltd has told Verizon Communications Inc that the U.S. carrier should pay licensing fees for more than 230 of the Chinese telecoms equipment maker's patents and in aggregate is seeking more than $1 billion, a person briefed on the matter said on Wednesday.

    Verizon should pay to "solve the patent licensing issue," a Huawei intellectual property licensing executive wrote in February, the Wall Street Journal reported earlier. The patents cover network equipment for more than 20 of the company's vendors including major U.S. tech firms but those vendors would indemnify Verizon, the person said. Some of those firms have been approached directly by Huawei, the person said.

    The patents in question range from core network equipment, wireline infrastructure to internet-of-things technology, the Journal reported. The licensing fees for the more than 230 patents sought is more than $1 billion, the person said.

    Huawei has been battling the U.S. government for more than a year. National security experts worry that "back doors" in routers, switches and other Huawei equipment could allow China to spy on U.S. communications. Huawei has denied that it would help China spy.

    Companies involved, including Verizon have notified the U.S. government and the dispute comes amid a growing feud between China and the United States. The licensing fee demand may be more about the geopolitical battle between China and the United States rather than a demand for patent fees.

    Huawei and Verizon representatives met in New York last week to discuss some of the patents at issue and whether Verizon is using equipment from other companies that could infringe on Huawei patents.

    Verizon spokesman Rich Young declined to comment "regarding this specific issue because it's a potential legal matter."

    However, Young said, "These issues are larger than just Verizon. Given the broader geopolitical context, any issue involving Huawei has implications for our entire industry and also raise national and international concerns."

    Huawei and U.S. wireless carriers T-Mobile US Inc and AT&T Inc did not respond to Reuters' requests for comment. Sprint Corp declined to comment.

    The United States last month put Huawei on a blacklist that barred it from doing business with U.S. companies on security grounds without government approval, prompting some global tech firms to cut ties with the world's largest telecoms equipment maker.

    Washington is also seeking the extradition of Huawei Chief Financial Executive Meng Wanzhou from Canada after her arrest in Vancouver last December on a U.S. warrant.

    China has since upped the pressure on Canada, halting Canadian canola imports and in May suspended the permits of two major pork producers.


    (Reporting by Arjun Panchadar in Bengaluru and David Shepardson in Washington; Editing by Anil D'Silva, Sriraj Kalluvila and Sandra Maler)

    [Jun 10, 2019] Chinese in the US are reporting harassment and interrogations by US immigration authorities

    Jun 08, 2019 | off-guardian.org

    On June 4th the Chinese government issued a travel alert for Chinese tourists thinking of visiting the United States, a day after it issued a similar advisory to Chinese students thinking of studying in the US over concerns for their safety and security.

    Chinese in the US are reporting harassment and interrogations by US immigration authorities and many now have the impression they are not welcome in the US.

    The Global Times , speaking on behalf of the government stated:

    The Chinese people find it difficult to accept the fact that they are being taken as thieves. The US boasts too much superiority and has been indulged by the world. Due to its short history, it lacks understanding of and respect for the rules of countries and laws of the market.

    The Americans of the early generations accumulated prosperity and prestige for the US, while the current US administration behaves like a wastrel generation by ruining the world's respect for the US."

    ... ... ...

    The situation has become so tense that the Global Times on June 6,th in an op ed by Wei Jianguo, said:

    China is able to withstand US maximum pressure, due to the country's economic resilience, and Chinese people's resolute determination. Suffering from a century of humiliation, the Chinese nation has been accustomed to such pressure, as shown in the War of Resistance against Japanese Aggression, as well as the Korean War or the War to Resist US Aggression and Aid Korea. The unity of Chinese people is a vital reason for the country's fundamental victory in history."

    The Peoples' Daily stated, "America is the enemy of the world."

    [Jun 10, 2019] China to roll out export controls on sensitive technology

    Trump is not a thinker, and never was. He is an impulsive narcissist. So the question is whether the USA committed a blunder by unleashing open trade war with China, the war which now extent the Cold War 2 to another nation (cementing emerging alliance between Russia and China which is a death sentence to the USA global hegemony) and where the USA faces very resilient and inventive opponent. And they will lose even if they win.
    I actually am amazed by the level of reclines and arrogance the USA democratic is such topic. I do not see multiyear preparation, mobilization of engineering talent and resources that is needed for successfully procuring such a war. It looks like completely impulsive decision partially based on the attempt to get some additional concessions from China. That attempt which spectacularly failed and fueled very dangerous for the USA a wave of Chinese nationalists within mainland china.
    The key issue here is that is current stage of neoliberal decine the USA can't rely on loyalty of its own key players and citizets ("greed is good" is the motto of neoliberalism; plus Chinese have probably a very good access to Taiwan high technology industry, the access which is impossible to cut). Such a low level loyalty previously existed just before the USA collapse, when the CIA was able to tranfere to the West a mid level cipher officer from KGB headquarters ( Sheymov defected to the United States in May 1980) and recruit at least one general (Kalugin). Actually KGB was at the center and the main driving force of neoliberal counterrevolution in Russia (Trojan Horse so to speak), as under Andropov they switch sides. So they were naturally allied with CIA at this point
    the point is that it does not take too much efforts for foreign intelligence agency now to recruit the US citizens as the collapse of neoliberal ideology creates fertile ground for such an efforts, much like the collapse of Bolsheviks ideology did for the USA. Some can just volunteer appalled by the actions of neoliberal empire. In this sense cases of Manning and Snowen should serve the US administration a stern warning sign that it is a very dangerous to rock the boat if the country experience a collapse of imperial ideology (Neoliberalism). In this case the trade war might be more difficult then they think.
    China has more people and produce per year more engineers in STEM. So the USA does not hoild allthe cards. it it has some advantages over the USA in the long term. Also the current technologies are pretty established and "innovation" is often is limited to shriking the silicon die and adding more core for CPUs.
    Actually Intel CPUs have a horrible really outdated CISC instruction set and there might be chance to use different instruction set with better overall chanracteristics. Only the billions that Intel get from sales allow it to outpace the rivals. Failed stqrtup Transmeta, for exampel, in late 1990th tried to emulate it via RISK. If throwing out emulation layer speeds up things twice or more, why not to use this path giving enough man power, money and level of animosity toward the USA?
    Jun 10, 2019 | businesstelegraph.co.uk

    The mechanism would "prevent and resolve national security risks", Xinhua said. Details would be released soon, it added.

    The announcement comes amid a souring of relations with the US after the most recent round of trade negotiations ended without a deal in May.

    Since then, the Trump administration has blacklisted Chinese telecommunications equipment maker Huawei, while China has threatened to punish foreign companies that cut off ties with Huawei by listing them as "unreliable".

    The new Chinese regulations could prove similar to US export controls on strategic technologies. Those controls -- covering military equipment, some encryption technologies, and some dual-use products -- have long irked China. Chinese negotiators have often claimed that their trade surplus could be trimmed if the US would relax controls on high-tech goods.

    The mechanism will be developed by the National Reform and Development Commission under the guidelines of China's national security law , passed in 2015, Xinhua said.

    "This is a major step to improve [China's system] and also a move to counter the US crackdown," tweeted Hu Xijin, editor-in-chief of the Global Times, a nationalist tabloid that is sometimes used to float ideas that are not official policy. "Once taking effect, some technology exports to the US will be subject to the control." Last month, the NDRC implied it would block exports of rare earths , a material with many strategic applications. After the trade talks broke down in May, Chinese president Xi Jinping visited a manufacturer of rare earths magnets, used in electric vehicles and other new technology applications, as a reminder that China holds some trump cards of its own. READ Massages and free fish help east Europe tackle labour shortages

    Rare earth are used in smartphones, lasers, instrument panels, wind turbines and MRI machines and more than 90 per cent of hybrid and electric cars.

    [Jun 10, 2019] China Threatens 'Dire Consequences' If Tech Giants Comply With Trump Ban

    Notable quotes:
    "... Now, each of the two superpowers appears to be crafting new economic weapons to aim at the other. What was once a fraught, but deeply enmeshed, trade relationship is threatening to break apart almost entirely, raising the specter of a new geopolitical reality in which the world's two superpowers would compete for economic influence and try to freeze each other out of key technologies and resources. - New York Times ..."
    "... "This is now extremely delicate [time] because the Trump administration, through its brinkmanship tactics, has destabilized the entire relationship, commercial and otherwise," according to China expert Scott Kennedy - senior adviser at the Washington-based Center for Strategic and International Studies who studies Chinese economic policy. ..."
    Jun 08, 2019 | www.zerohedge.com
    Beijing put big tech on notice last week, threatening 'dire consequences' if companies such as Microsoft, Dell and Samsung comply with the Trump administration's ban on sales of key American technology to Chinese companies, according to the New York Times . Any companies which cooperate with the new policy ' could face permanent consequences ,' according to the Times. Chinese authorities also suggested using DC lobbyists to resist the government's moves.

    China - which is already ditching Microsoft Windows for military applications - held a flurry of meetings on Tuesday and Wednesday after tech firms for discussions amid the backdrop of Beijing's planned blacklist of blacklisting of US firms on an "unreliable entities list."

    Also participating in meetings were semiconductor companies Arm of Britain and SK Hynix of South Korea, according to the report, which cites a KPMG estimate that around 60% of all semiconductors sold are connected to China's supply chain, so maybe by that new computer sooner than later.

    The breakneck unraveling of the world's most important trade relationship has left companies and governments around the world scrambling . While the dispute had already been nettlesome for Chinese-U.S. relations, the sudden ban on Huawei last month caught many by surprise , raising the stakes by striking at the heart of China's long-term technological ambitions.

    Now, each of the two superpowers appears to be crafting new economic weapons to aim at the other. What was once a fraught, but deeply enmeshed, trade relationship is threatening to break apart almost entirely, raising the specter of a new geopolitical reality in which the world's two superpowers would compete for economic influence and try to freeze each other out of key technologies and resources. - New York Times
    "This is now extremely delicate [time] because the Trump administration, through its brinkmanship tactics, has destabilized the entire relationship, commercial and otherwise," according to China expert Scott Kennedy - senior adviser at the Washington-based Center for Strategic and International Studies who studies Chinese economic policy.

    More broadly, the warnings also seemed to be an attempt to forestall a fast breakup of the sophisticated supply chains that connect China's economy to the rest of the world . Production of a vast array of electronic components and chemicals, along with the assembly of electronic products , makes the country a cornerstone of the operations of many of the world's largest multinational companies. - New York Times

    "The Chinese government has regularly resorted to jawboning multinationals to try to keep them in line when there are disputes between China and others that could lead these companies to reduce their business in China."

    For example, in 2015 Xi dropped by Seattle before heading to meet with President Obama. While there, he had a chat with Amazon executives and Chinese tech executive in order to woo them on the prospect of future business, while the Obama administration was reportedly trying to push back against China's anticompetitive trade practices .

    That said, China is far less likely to succeed this time around , according to Kennedy, who says that " American companies aren't going to violate American laws, especially in such a high-profile context where their actions are scrutinized."

    "The companies are between a rock and a hard place, but that hard place will win out."

    Three Chinese government bodies are involved in the recent discussions; the National Development and Reform Commission (China's central economic planning agency), the Ministry of Commerce and the Ministry of Industry and Information Technology. The Times posits that the fact that the three are all involved suggests the meetings came from the top-down in an attempt to rally support for Huawei - which was not specifically named.

    " There is a strong perception in Beijing that the U.S. government is intent on blunting China's technology rise , and that if this process is not slowed or stopped, the future of China's entire digital economy is at risk," said Eurasia Group head of geotechnology, Paul Triolo, adding "Mr. Xi and the party will be seen as unable to defend China's economic future" it Huawei's 5G rollout is derailed by the Trump administration.

    As the trade relationship between the United States and China has broken down, fears have risen in China that major companies will seek to move production elsewhere to avoid longer-term risks . In the meetings this week, Chinese officials explicitly warned companies that any move to pull production from China that seemed to go beyond standard diversification for security purposes could lead to punishment , according to the two people. - New York Times


    SuzSez , 31 minutes ago link

    "China Threatens 'Dire Consequences' If Tech Giants Comply With Trump Ban"

    "And US Threatens Jail If They Don't"

    Love it love it love it. Reminds me of the great line from Pride & Prejudice, "You're mother will never speak to you again if you marry him, and I (your father) will never speak to you again if you don't."

    john.b , 49 minutes ago link

    In R&D spending, China ranks 2nd place after US. China has over 8M new grads each year. Do you really believe stealing can make a country great. The trade war is about suppressing a new rising power of technology and economy.

    VisionQuest , 4 hours ago link

    There's a whole lot more to what China is up to than buying and selling. They've been working on how to rule the whole earth for 5000 years and the CCP thinks maybe now is the time. Here's a brief history of Chinese power games. They play for keeps. https://www.newenglishreview.org/custpage.cfm?frm=189701&sec_id=189701

    straightershooter , 6 hours ago link

    China's fightback strategy is simple: Force non-us corporations to abandon us-sourced technologies, and, hence, non-us corporations will not be bound by US laws, and, hence, won't subject to us blackmail laws.

    The strategy already worked. ARM's founder said it will have to abandon US-sourced technology ( eventually abandon US-located headquarters) to keep the Chinese market, and, so other non-us corporations, such as Europe, Japanese, or Korean based corporations will have to follow. They have no other feasible choices.

    In short, the world is divided into two groups: US group and non-us group. Congratulations to Trump: He has succeeded in isolating US from the world.

    First step is to encourage, urge and force non-us corporations to make the choice using the gigantic china market.

    Second step is to drive out us corporations at the time when there is alternative for US-made parts. Whenever US corporation is not the sole supplier, then China will declare that any product containing that part will be forbidden in the Chinese market. And, to make the situation even worse for US-sourced technology, any parts produced by non-us corporations using US-sourced technology will not be allowed in the Chinese market.

    This is the reverse of the entity list.

    In this game, one that has a bigger market prevails. China just happened to have 1.4 billion consumers while US has less than 0.4 billion. China wins. By poisoning American sourced technology, China will succeed in isolating US corporations.

    LifeLibertyProperty , 5 hours ago link

    You seem to be confused. ARM created a separate joint venture in China called ARM mini China that will license existing tech to China as a way to circumvent US rules. However, this creates a Chinese ARM license separate from the rest of the world. So it is China that is actually separated from further innovation outside of China.

    JeanTrejean , 8 hours ago link

    Today China, tomorrow EU.

    Washington had always saboted what could be a strong competitor for the USA

    Cheap Chinese Crap , 11 hours ago link

    The Roman Emperor Caligula is best known for appointing his horse to one of the vacant consulships. Given the current quality of professional politicians on offer in the western world, he does not seem as crazy as he once was thought to be.

    But he is also known for something else-- the phrase "Oderint dum Metuant" -- which is Latin for "Let them hate (us), so long as they fear (us)."

    Not my favorite motto but I'll take it over "Here's my wallet. Don't you like me now?"

    [Jun 09, 2019] Much More Than A Trade War

    Notable quotes:
    "... The US has decided that China can't be allowed to become a technological power any more than it is now. It's fine if all they do is make T-shirts, and low-tech crap, but anything more advanced then a digital alarm clock can not be allowed. ..."
    "... Anytime you weaponize something (the dollar), countermeasures will be invented to neutralize that weapon........only a matter of time. ..."
    "... We're so balls deep in debt la la land now that having a conversation about wealth creation via production feels a lot like making balloon animals while wearing a clown suit. ..."
    "... Much More Than a Trade War ..."
    "... it signals the implosion of America's tinsel, derivative-based economy ..."
    "... the high dive of the middle class into serfdom ..."
    "... Politicians here in the US are desperate for me to believe it is all China's fault. Not the lying, stealing politicians and MBAs that have stolen my future but China. I am not buying it. Even if China has stolen America's wealth, who let them? Who helped and got rich? That's right, US politicians and MBAs. ..."
    "... The only reason why this is a trade war in the first place, is because we're attempting to undo the shitty deals signed by Bill Clinton. Let this be a lesson: Don't sign shitty deals. No matter how much they donate to your campaign. ..."
    "... Asking this of a politician is like asking a leech to stop living off blood. ..."
    Jun 09, 2019 | www.zerohedge.com
    frankthecrank , 12 minutes ago link

    I watch Fox News Sunday and today all of the usual suspects were blaming Trump for everything under the sun--including committing crimes and needing to be put in jail. It bears repeating that they said the same things about Reagan and his trade wars--which benefited Americans immensely.

    Trump will win unless the Dems can get rid of him. China is a paper tiger and always has been.

    They are a totalitarian communist state and as such are a sworn enemy of the US and its historic peoples. They must be taken down and that is not hyperbole--they never should have been allowed to trade with the civilized world in the first place without first shutting down the Kims in Norkland and dismantling their communist state.

    Russia would have been more in order in 1992 than China. ******* Clintons.

    sgt_doom , 21 minutes ago link

    America's Wall of Shame:

    (Those companies and organizations which have contributed to and/or financed the creation of the Chinese Communist Party's ultra-Orwellian system for command and control: Social Credit System.)

    Recommended Reading:

    Recommended Viewing:

    Further sources and reading:

    Tiananmen Square referenced:

    blueseas , 22 minutes ago link

    Is it so hard to understand that the chinks KNOW that the yuan is trash and that's why both the CB and the public are stacking gold. They're preparing for what comes next. According to Jim Willie, that will be an Asian gold trade note as proposed by the PM of Malaysia.

    monty42 , 21 minutes ago link

    Which would mean war if the D.C. regime's past behavior is any indication.

    quesnay , 23 minutes ago link

    "China and its citizens would greatly benefit from eliminating barriers."

    It's too bad they never did this, but now it no longer matters. The US has decided that China can't be allowed to become a technological power any more than it is now. It's fine if all they do is make T-shirts, and low-tech crap, but anything more advanced then a digital alarm clock can not be allowed.

    China would do best to forget about the US and hope that it can make due with it's domestic market. With 1.3 billion people this seems like it should be possible.

    bshirley1968 , 9 minutes ago link

    They need dollars to buy US goods and services. They also need them to buy oil from Saudis. They have dollar based loans that require payment in dollars.

    bshirley1968 , 24 minutes ago link

    "The United States has discovered the Achilles heel of China. The same one Japan had in the 80s when it seemed that it was going to invade the world. Its dependence on the US dollar to maintain its large domestic imbalances, a very fragile house of cards of excess capacity, real estate bubble and unproductive spending."

    Oh, yeah. .......we just "figured" that one out. It's not like we haven't used that scheme on.......well, EVERYONE. Even our own citizens are slaves to a debt dollar system. It is all we got left......well that and the A-bomb. But at the same time, it is our biggest weakness because if we can't get the world to expand dollar debt, 5 hen we will have to do it ourselves. Hence the, "China is not the largest holder of US bonds in the world, not even close. It's the US . In fact, China has already reduced part of its holdings in US bonds and yields fell ."

    We are the largest holder of our own debt.....and can print up what we need to buy what is necessary to drive yields down. But at some point it will be like playing monopoly with yourself......a zero sum game. Anytime you weaponize something (the dollar), countermeasures will be invented to neutralize that weapon........only a matter of time.

    schroedingersrat , 23 minutes ago link

    Yeah like the US is any less totalitarian than China.

    bshirley1968 , 18 minutes ago link

    Indeed. Anyone pushing that narrative is part of the totalitarian regime or is dumb as a bag of hammers. Either way, they lose all credibility in my opinion.

    Scipio Africanuz , 28 minutes ago link

    Propaganda is also a tool of warfare, but in war, resilience wins, cheers...

    Mustafa Kemal , 19 minutes ago link

    "**** Communism"

    **** Finance Capitalism

    smacker , 12 minutes ago link

    China went from communism to fascism in 20 years. It wasn't a big step. Do try to keep up ;-) 🙄

    Mike Rotsch , 9 minutes ago link

    They still seem to use the hammer and sickle though. . . the conniving sneeky bastards.

    He–Mene Mox Mox , 31 minutes ago link

    The author has never been to China to know anything about it, much less write about it, and he knows even less about the trade relationships of the two countries.

    For instance, He says: " China has a trade deficit with most of its other partners".... WRONG!!!! It is the U.S. who has the deficits with other countries, not China! China has a manufacturing economy, not a consumer economy, so the trade balance is in its favor, as manufacturing economies are in demand and have very little deficit.

    And the author also reveals his biases about China by saying: "China's Achilles heel has been to try to be a reserve currency whilst maintaining capital controls and increasing state intervention...." What do you think the U.S. Federal Reserve does, if it is not the very same thing? Weren't they the ones who sets interest rates, control the rates of inflation, dictating the supply of money, and doing economic bailouts to the banks in 2008 and 2009 with our money?

    Secondly, he is just regurgitating the same old propaganda already put out about China, and really doesn't provide anything new. Why can't ZH find better writers to publish than this?

    Marman , 20 minutes ago link

    You are correct. China usually runs surpluses. But not with everyone.

    In 2018, China posted a trade surplus of USD 351.76 billion, the lowest since 2013, as exports increased 9.9 percent, its strongest performance in seven years, while imports were up 15.8 percent. The biggest trade surpluses were recorded with Hong Kong, the US, the Netherlands, India, the UK, Vietnam, Singapore and Indonesia. China recorded trade deficits with Taiwan, South Korea, Australia, Germany, Brazil and South Africa.

    https://tradingeconomics.com/china/balance-of-trade

    Author is wrong here.

    "China's Achilles heel has been to try to be a reserve currency whilst maintaining capital controls and increasing state intervention...."

    This is impossible. One cannot institute strong capital controls and have a reserve currency at the same time. China knows this and has never tried to become the reserve currency.

    francis scott falseflag , 36 minutes ago link

    wait till Muricans have to pay Trumps Tariff Tax

    monty42 , 35 minutes ago link

    yeah, they said they'd work on "migration" into their country, and try to do something about those staged caravans..but what they didn't do is say they'd stop their citizens from invading the US like they have been doing for decades, and they didn't say they'd secure their side of the border between the US and Mexico. So, how is the border more secure exactly? Oh, and they didn't say they'd pay for a wall.

    These same games go on, round and round, between both parties, with people twisting everything, including nothing burgers and actual defeats into some kind of bizarre "winning" ********, to avoid legitimate criticism of their idol in the White House. Trumpets and Obamabots are peas in a pod in more ways than they realize, but watch out, you'll get an eye jab if you walk between them, with all the fingers pointing.

    DingleBarryObummer , 28 minutes ago link

    Winning, like alcohol, is addictive. Sometimes you find yourself all out of booze, so you find yourself taking swigs of Aqua Velva. Lots of Aqua Velva heads around here.

    Marman , 43 minutes ago link

    Same old script: China bad. China steals. China need to shape up or else. USA good. USA too soft on China. USA will be great again when China surrenders to US slavery. Think that about sums up these articles.

    medium giraffe , 26 minutes ago link

    It's a battle between rich assholes who just want you to pay your taxes and stfu.

    Duc888 , 18 minutes ago link

    I agree. The "investor" class. And by that i do not mean all investors, just the non productive LEECHES at the top playing games with fake "financial instruments"

    They are non producers. They are lampreys. Same as on the bottom. I have absolutely no problem with rich people. I am blessed to hang with many self made millionaires who are all about designing / manufacturing unique products sold all over the world. They produce wealth and a product, not by skimming.

    medium giraffe , 5 minutes ago link

    Lampreys is right.

    We're so balls deep in debt la la land now that having a conversation about wealth creation via production feels a lot like making balloon animals while wearing a clown suit.

    Duc888 , 2 minutes ago link

    But.... it actually works. There will ALWAYS be a market for well engineered quality products . ALWAYS.

    Don't chase that race to the bottom. That is what was sold to the Us Consooooooooooooooooooooooooooomer (**** I hate that name, I am not a consumer) for the last thirty year. They bought the ****, they own it. **** em, let 'em choke on the icrapple and other swarf.

    Ha.

    I am not balls deep in debt. My total life debt so far is $800. USA incorporated... THEY have debt. That is not my debt.

    Deep Snorkeler , 45 minutes ago link

    Much More Than a Trade War

    1. it signals the implosion of America's tinsel, derivative-based economy
    2. the high dive of the middle class into serfdom
    3. the permanent collapse of the real estate circus
    4. the end of family farms
    5. the attack of robot droids on jobs
    Marman , 35 minutes ago link

    Yes.

    Politicians here in the US are desperate for me to believe it is all China's fault. Not the lying, stealing politicians and MBAs that have stolen my future but China. I am not buying it. Even if China has stolen America's wealth, who let them? Who helped and got rich? That's right, US politicians and MBAs.

    rickv404 , 31 minutes ago link

    Yes, we have Democrat and Republican pols at the federal level spending this country into decline by trillions, and financing it all with inflation, which is why we're paying higher prices for virtually everything now, than we've ever paid.

    francis scott falseflag , 29 minutes ago link

    You forgot 6.

    The annual Thank You Big Brother Day parade

    frankthecrank , 4 minutes ago link

    you just make **** up. 93% of American farms that do more than $1,000,000.00/year in business are family owned . even higher percentage below that.

    Mike Rotsch , 55 minutes ago link

    The only reason why this is a trade war in the first place, is because we're attempting to undo the shitty deals signed by Bill Clinton. Let this be a lesson: Don't sign shitty deals. No matter how much they donate to your campaign.

    sticky_pickles , 45 minutes ago link

    Asking this of a politician is like asking a leech to stop living off blood.

    HideTheWeenie , 38 minutes ago link

    Everybody bitches about tariffs but domestic tariffs, in the form of legislative monopolies are ok ?

    [Jun 09, 2019] Xinhua Headlines Long-arm jurisdiction exposes U.S. law-of-the-jungle mentality - Xinhua English.news.cn

    Jun 09, 2019 | www.xinhuanet.com
    by Xinhua writer Zhao Wencai

    BEIJING, June 9 (Xinhua) -- For years, non-U.S. transnational firms, vying to carve a niche in the global market with cutting-edge technologies or products, often find themselves fronting an opponent far more powerful and brutal than any commercial rival they have ever contested with -- the U.S. government.

    Many foreign entities, whose business may seem irrelevant to the United States, have been forced by Washington with threats of sanctions to comply with U.S. domestic laws and regulations.

    "After so many years fancying itself as the champion of the Rule of Law, the U.S. seems to be making headway in forging a world under the rule of law," said Zhou Qing'an, an analyst of international relations at China's Tsinghua University. "Only it's the American law of the jungle."

    WEAPONIZED JURISDICTIONAL SYSTEM

    In recent years, the U.S. government has slapped sanctions on and posed threats to an increasing array of foreign entities under the pretext of infringements of its tailor-made rules and regulations concerning anticorruption, taxation, investment and arms exports, crafting a long-range weapon with its jurisdictional system, the very foundations undergirding a country's authority.

    Citing Cuba as an example of the U.S. jurisdictional overreach, Mauricio Santoro, head of the Department of International Relations at the State University of Rio de Janeiro, said that for many times, the United States has enacted new laws and regulations to justify its punishments on foreign companies having commercial contacts with Cuba, a country that has long been taken as a thorn in the flesh by Washington.

    In the latest round of sanctions against the Caribbean country, Washington activated Title III of the Helms-Burton Act, which put companies operating on properties confiscated by the Cuban government at risk of being sued in U.S. courts.

    It's not just the entities from countries deemed by the United States as rivals or competitors that were exposed to the arbitrary abuse of Washington's jurisdictional power. Firms of its allied countries which refuse to yield to the U.S. supremacy can also find themselves under fire of such an overstretched jurisdictional "weapon."

    In 2014, the U.S. Department of Justice fined Alstom, a French power and transportation conglomerate, 772 million U.S. dollars, alleging the French company has broken America's Foreign Corrupt Practices Act, which eventually led to the partial acquisition of Alstom by General Electric, its arch rival in the United States.

    Last month, the U.S. Commerce Department put Huawei, a Chinese company that has taken the lead in 5G technology, and its affiliates on a blacklist that requires the federal government approval for any sale and transfer of U.S. technologies to the Chinese firm.

    Up to now, the United States is still lobbying other countries to exclude Huawei from 5G networks construction over groundless accusations of spying.

    "What is the most effective way to win a losing race? You change the rules and draw a foul on your competitors, rude but effective," Zhou explained with a metaphor. "That is exactly what the United States is doing to its competitors, even allies."

    UNABASHED INTERNATIONAL DARWINIST

    For decades, the United States has been touting itself as the flag-bearer of "freedom, equality, justice and humanity," but in recent words and deeds, the Washington government is exposing itself as an international Darwinist who sees the world as a jungle where the powerful preys on the vulnerable.

    By overstretching its jurisdiction and applying unilateral sanctions, the United States is challenging the sovereignty of other countries, said Philippe Bonnecarrere, a French senator, denouncing the U.S. extraterritorial jurisdiction as power logic.

    Echoing the senator's words, Swaran Singh, professor at School of International Studies in Jawaharlal Nehru University, noted that extending jurisdiction of U.S. domestic laws beyond its border "has no legal standing whatsoever."

    "It's only its position of power in international system that has allowed the United States to arbitrarily impose its domestic laws abroad while rejecting several other universally recognized international laws and norms," said the professor.

    However, it is also the "universally recognized international laws and norms," which the United States once paid, even sacrificed so much to build several decades ago and now is turning its back on, that helped the country build its advantages over other countries.

    Thanks to economic globalization, large European firms all have capital from different countries, including the United States, and due to Washington's threat of sanctions, they have to comply with American rules, said Bonnecarrere.

    Even though an international Darwinist's obsession with the jungle law can not be changed overnight, if the past is any prologue, "the obsession with power relations," as the French senator put it, "is mortifying."

    BACKLASHES FROM ALL AROUND

    In a world where multilateralism and win-win cooperation are still the mainstream of the times, an international Darwinist with zero-sum mentalities like the United States is bound to face backlashes from within and outside the country.

    David S. Cohen, a former deputy director of the CIA and former undersecretary of U.S. Treasury Department, warned in an article published in April that the U.S. sanctions will not only weaken countries being punished, but "breed resentment and alienate would-be international partners."

    "In the long run, it works against U.S. foreign policy interests and threatens the American economy," said the article.

    As the world's biggest economy, the United States enjoys "an outsize role in business transactions around the world." The U.S. extraterrestrial jurisdiction, a typical prelude to economic sanctions, would certainly cast a bigger shadow over the whole world.

    Managing Director of the International Monetary Fund (IMF) Christine Lagarde said earlier this week that the existing and potential tariff hikes resulted from the U.S.-initiated trade tensions with China could reduce global gross domestic product (GDP) by 0.5 percent in 2020.

    Earlier this year, The Economist sounded a warning in an article for Washington. "Far from expressing geopolitical might, America's legal overreach would then end up diminishing American power," it said.

    (Xinhua reporters Tang Ji and Ying Qiang in Paris, Hu Xiaoming in New Delhi, Zhou Xingzhu in Brasilia contributed to the story.)

    [Jun 09, 2019] The looming 100-year US-China conflict by Martin Wolf

    Highly recommended!
    Notable quotes:
    "... Across-the-board rivalry with China is becoming an organising principle of US economic, foreign and security policies. ..."
    "... An effort to halt China's economic and technological rise is almost certain to fail. Worse, it will foment deep hostility in the Chinese people. In the long run, the demands of an increasingly prosperous and well-educated people for control over their lives might still win out. But that is far less likely if China's natural rise is threatened. ..."
    "... The tragedy in what is now happening is that the administration is simultaneously launching a conflict between the two powers, attacking its allies and destroying the institutions of the postwar US-led order. ..."
    Jun 04, 2019 | archive.fo
    The disappearance of the Soviet Union left a big hole. The "war on terror" was an inadequate replacement. But China ticks all boxes. For the US, it can be the ideological, military and economic enemy many need. Here at last is a worthwhile opponent. That was the main conclusion I drew from this year's Bilderberg meetings.

    Across-the-board rivalry with China is becoming an organising principle of US economic, foreign and security policies.

    Whether it is Donald Trump's organizing principle is less important. The US president has the gut instincts of a nationalist and protectionist. Others provide both framework and details. The aim is US domination. The means is control over China, or separation from China.

    Anybody who believes a rules-based multilateral order, our globalised economy, or even harmonious international relations, are likely to survive this conflict is deluded. The astonishing white paper on the trade conflict , published on Sunday by China, is proof. The -- to me, depressing -- fact is that on many points Chinese positions are right.

    The US focus on bilateral imbalances is economically illiterate. The view that theft of intellectual property has caused huge damage to the US is questionable . The proposition that China has grossly violated its commitments under its 2001 accession agreement to the World Trade Organization is hugely exaggerated.

    Martin Wolf chart on US/China

    Accusing China of cheating is hypocritical when almost all trade policy actions taken by the Trump administration are in breach of WTO rules, a fact implicitly conceded by its determination to destroy the dispute settlement system .

    The US negotiating position vis-à-vis China is that "might makes right". This is particularly true of insisting that the Chinese accept the US role as judge, jury and executioner of the agreement .

    A dispute over the terms of market opening or protection of intellectual property might be settled with careful negotiation. Such a settlement might even help China, since it would lighten the heavy hand of the state and promote market-oriented reform.

    But the issues are now too vexed for such a resolution. This is partly because of the bitter breakdown in negotiation. It is still more because the US debate is increasingly over whether integration with China's state-led economy is desirable. The fear over Huawei focuses on national security and technological autonomy.

    [Neo]liberal commerce is increasingly seen as "trading with the enemy".

    Martin Wolf chart on US/China

    A framing of relations with China as one of zero-sum conflict is emerging. Recent remarks by Kiron Skinner, the US state department's policy planning director (a job once held by cold war strategist George Kennan) are revealing. Rivalry with Beijing, she suggested at a forum organised by New America , is "a fight with a really different civilisation and a different ideology, and the United States hasn't had that before".

    She added that this would be "the first time that we will have a great power competitor that is not Caucasian". The war with Japan is forgotten.

    But the big point is her framing of this as a civilizational and racial war and so as an insoluble conflict. This cannot be accidental. She is also still in her job. Others present the conflict as one over ideology and power.

    Those emphasising the former point to President Xi Jinping's Marxist rhetoric and the reinforced role of the Communist party . Those emphasising the latter point to China's rising economic might. Both perspectives suggest perpetual conflict.

    Martin Wolf chart on US/China

    This is the most important geopolitical development of our era. Not least, it will increasingly force everybody else to take sides or fight hard for neutrality. But it is not only important. It is dangerous. It risks turning a manageable, albeit vexed, relationship into all-embracing conflict, for no good reason. China's ideology is not a threat to liberal democracy in the way the Soviet Union's was. Rightwing demagogues are far more dangerous.

    An effort to halt China's economic and technological rise is almost certain to fail. Worse, it will foment deep hostility in the Chinese people. In the long run, the demands of an increasingly prosperous and well-educated people for control over their lives might still win out. But that is far less likely if China's natural rise is threatened.

    Moreover, the rise of China is not an important cause of western malaise. That reflects far more the indifference and incompetence of domestic elites. What is seen as theft of intellectual property reflects, in large part, the inevitable attempt of a rising economy to master the technologies of the day. Above all, an attempt to preserve the domination of 4 per cent of humanity over the rest is illegitimate.

    Martin Wolf chart on US/China

    This certainly does not mean accepting everything China does or says. On the contrary, the best way for the west to deal with China is to insist on the abiding values of freedom, democracy, rules-based multilateralism and global co-operation. These ideas made many around the globe supporters of the US in the past.

    They still captivate many Chinese people today. It is quite possible to uphold these ideas, indeed insist upon them far more strongly, while co-operating with a rising China where that is essential, as over protecting the natural environment, commerce and peace.

    Martin Wolf chart on US/China

    A blend of competition with co-operation is the right way forward. Such an approach to managing China's rise must include co-operating closely with like-minded allies and treating China with respect.

    The tragedy in what is now happening is that the administration is simultaneously launching a conflict between the two powers, attacking its allies and destroying the institutions of the postwar US-led order.

    Today's attack on China is the wrong war, fought in the wrong way, on the wrong terrain. Alas, this is where we now are.

    [email protected]

    [Jun 09, 2019] The unintended consequences of Trump's ban on Huawei are starting to appear

    This is end of the classic neoliberal globalization and the start of isolation of the USA from China and forming an alternative, led by China trading block, unless the deal is reached. WTO rules were the door openers, which allowed Google and Facebook pollute millions of smartphones outside the USA. By rejecting them the USA start the process of self-isolation. Now local government who were afraid to act might want to get even and you can get a stronger backlash then anticipated.
    The only factor here is that while the USA citizens are afraid of their own government snooping more then snooping by Chinese's government, the same is true to many foreign countries too. Citizens of those countries move to Gmail because they care less about the USA snooping then the snooping of their local government by the local webmail providers. This is a widespread illusion. They should use foreign based ISP for that.
    Removal of Facebook is actually a big plus which increases attractiveness of Huawei phones. But truth be told the value of smartphone is exaggerated. Combination of a tablet and basic flip flop phone works even better. The same but to lesser extent is true with Google spying applications, especially Gmail. Only complete idiot uses Gmail as Web client, as Gmail is the central point of collection of data for both Google and the US government (actually all "Five eyes" goverments). It is like giving keys for you home or apartment to them. Not the Microsoft is much better. Using your own Internet Service Provider (ISO) is the best option in the current environment. It also allows more effectively to combat spam. Unless you want to be a bug under microscope -- no Google on you your phone is a good, sound policy
    Notable quotes:
    "... These actions add to the potential fallout for American companies to reckon with. US tech enterprises will lose out on sales to Huawei ..."
    "... Restrictions could boomerang back on Google and Facebook, which count on their apps being widely installed around the world to collect data and sell advertising against. And then there's the potential for damaging retaliation by China, which could blacklist important US companies like Apple that do business there. ..."
    "... And if the crackdown lasts (an important if -- some expect the Huawei restrictions to be lifted should a trade deal be reached) and the Chinese telecom comes out intact, it could emerge even stronger, having been forced to develop new technology in-house. If the American blacklist fails to strangle Huawei, it could come out stronger and more innovative than it was before. ..."
    Jun 09, 2019 | qz.com

    The US crackdown on Huawei was bound to have unintended consequences. Some of them are starting to come to the surface.

    The Trump administration is looking to shut out the Chinese telecom company from selling its technology in the US, as well as banning American firms from selling products to the company. Now Google, which banned Huawei from updates of its ubiquitous Android operating system, is warning that the restriction could become a national security issue, according to the Financial Times (paywall). That's because Huawei, the world's No. 2 handset maker, will likely move quickly to develop its own parallel version of Android, which could have more software bugs and be more susceptible to hacking.

    That's just one of many potential consequences as the US clampdown ripples through everything from semiconductor supplies to ambitions for self-driving cars. The American government blacklisted Huawei for long-simmering espionage concerns after trade talks between the world's two largest economies broke down. The Trump administration has since given companies a 90-day window to adjust to the new restrictions.

    In the meantime, chipmakers including Qualcomm, Intel, and Xilinx are reportedly halting sales of technology (paywall) to Huawei. The embattled Chinese company has responded by stockpiling chips and components and ramping up its development of alternatives.

    Facebook, which has more than 2 billion users around the world, will no longer allow its app to come preinstalled on Huawei phones, according to Reuters . Huawei phone buyers can still download the app from the Google Play store for now, but that option will go away if Google's relationship with the Chinese company is severed.

    These actions add to the potential fallout for American companies to reckon with. US tech enterprises will lose out on sales to Huawei, and the ban could also slow the implementation of new technologies around the world. The rollout of self-driving cars, for instance, may get a boost from 5G gear, and Huawei appears to be the only supplier that can provide reliable 5G kit widely and at low cost. Restrictions could boomerang back on Google and Facebook, which count on their apps being widely installed around the world to collect data and sell advertising against. And then there's the potential for damaging retaliation by China, which could blacklist important US companies like Apple that do business there.

    And if the crackdown lasts (an important if -- some expect the Huawei restrictions to be lifted should a trade deal be reached) and the Chinese telecom comes out intact, it could emerge even stronger, having been forced to develop new technology in-house. If the American blacklist fails to strangle Huawei, it could come out stronger and more innovative than it was before.

    [Jun 09, 2019] The US and China on a collision course

    Jun 03, 2019 | www.wsws.org

    In a series of provocative actions, the United States is making clear it is prepared to fight a war to block Beijing's rise as an economic and geostrategic competitor.

    The "cold war" between the United States and China took a major step toward becoming a "hot" war over the weekend at the annual Shangri-La defense summit in Singapore. The Financial Times, not known for hyperbole, wrote that "The growing dispute between the US and China on trade and technology is increasing the risk of military conflict or outright war."

    At the summit, representatives of the Pacific nations that would be caught in the crossfire of such a conflict warned of the imminent possibility of a new Pacific war.

    "Our greatest fear, therefore, is the possibility of sleepwalking into another international conflict like World War One," said Philippines Defense Minister Delfin Lorenzana. "With the untethering of our networks of economic interdependence comes growing risk of confrontation that could lead to war."

    US officials used the summit to continue their efforts to encircle China militarily and strangle it economically, with acting US Defense Secretary Patrick Shanahan declaring China to be "the greatest long-term threat to the vital interests of states across this region."

    Just days earlier, Vice President Mike Pence, addressing the graduating class at West Point, predicted war in the Pacific, in Europe and in the Americas within the graduates' lifetimes.

    "It is a virtual certainty that you will fight on a battlefield for America at some point in your life Some of you will join the fight on the Korean Peninsula and in the Indo-Pacific, where North Korea continues to threaten the peace, and an increasingly militarized China challenges our presence in the region. Some of you will join the fight in Europe, where an aggressive Russia seeks to redraw international boundaries by force. And some of you may even be called upon to serve in this hemisphere.

    "And when that day comes, I know you will move to the sound of the guns and do your duty, and you will fight, and you will win."

    The United States' actions are extraordinarily reckless and provocative. Seeing a challenge to its dominance, it is seeking to use every tool at its disposal, including military force, to compel China's submission to its will. The United States is simultaneously escalating conflicts around the world -- including its regime change operation in Venezuela and its dispatch of additional troops to the Middle East to "counter" Iran -- to shore up its flagging global hegemony through military means.

    Chinese Defense Secretary Wei Fenghe responded to the US threats with militarist bluster of his own, saying, "Should anybody risk crossing the bottom line, the [People's Liberation Army] will resolutely take action and defeat all enemies." He warned the United States against encouraging Taiwanese separatism, declaring, "If anyone dares to split Taiwan from China, the Chinese military has no choice but to fight at all costs."

    The divisions between the United States and China are centered on the Chinese state initiative called "Made in China 2025." The plan envisions a substantial expansion of Chinese industry into high-value-added and high-technology manufacturing, areas traditionally dominated by the United States and its allies.

    In recent decades, Chinese companies have made substantial developments in the high-technology sector, including robotics, mobile phones and IT infrastructure. This development was expressed most directly in the growth of Huawei, the Chinese mobile phone and telecommunications firm, which was on track to become the world's leading smartphone maker by the end of the year.

    Last month, the United States moved to effectively destroy Huawei as a global competitor to Apple and Samsung by banning US companies from selling it software and components. Google locked the company out of the Android operating system and associated services, while Broadcom and Qualcomm announced they would no longer sell the company chips it needs to continue production.

    The move enjoys broad bipartisan support beyond the Trump White House. There is an emerging consensus within the American ruling class that China must be prevented from becoming a global technological, and thus military, peer of the United States.

    The growth of US-China tensions has overshadowed the 30th anniversary of the Tiananmen Square massacre. At the summit, Wei defended the bloody crackdown against the 1989 protests by workers and students, declaring the protests were "political turmoil that the central government needed to quell, which was the correct policy."

    He continued, "Due to this, China has enjoyed stability, and if you visit China you can understand that part of history."

    But three decades of "stability" -- the effective transformation of China into a gigantic sweatshop for American and world capitalism -- have come at a tremendous cost. China is not an imperialist country. It remains dependent on foreign corporate investment and finance. Now, it is once again in the crosshairs of a nuclear-armed United States determined to go to any lengths to secure its global hegemony.

    In the immediate aftermath of the Tiananmen Square massacre, the International Committee of the Fourth International wrote, "The repression in China is being carried out in the direct interests of the imperialists. In attacking the Chinese workers, the bureaucracy is acting as their agent, seeking to restore 'labor discipline' and to repress the mass opposition of the working class to the policies of capitalist restoration and the rampant exploitation and social inequality which it has engendered."

    While publicly condemning the massacre, the first Bush administration secretly made clear to the Chinese government that the event was an "internal affair" and affirmed the value of the Sino-American relationship "to the vital interests of both countries."

    The ICFI statement continued, "Imperialism gloats over the broken bodies of the Chinese workers, seeking to exploit them for the purpose of crude anticommunist propaganda, while at the same time calculating that the brutal state repression will translate into higher rates of exploitation and even greater profits from the tens of billions of dollars worth of direct investment and joint ventures already operating on Chinese soil."

    This is precisely what happened. Following Deng Xiaoping's Southern Tour of 1992, in which he encouraged Chinese entrepreneurs to "get rich," US investment in China ballooned, leading to a profit bonanza for American corporations, along with the fantastic enrichment of the upper echelons of the Chinese Communist Party, through the exploitation of the Chinese working class.

    The arguments by leading Chinese figures that an accommodation and partnership with US imperialism would offer a peaceful road toward China's national development have proven to be a pipe dream.

    If Chinese officials accept US demands, it will be a massive blow to the Chinese economy, causing mass unemployment and engendering protests and political turmoil. But to stand up to the United States means, sooner or later, to fight a war between nuclear powers, in which millions dead on both sides would be an optimistic scenario.

    Thirty years after the Tiananmen Square massacre, all the arguments that the laws of imperialism identified by Lenin after the outbreak of World War I had been superseded by globalization and technological development have proven false. The capitalist system, riven by a new scramble for a re-division of the world, is hurtling toward a new world war.

    The only thing standing between humanity and this catastrophe is the international working class. It is urgently necessary for the workers of China, the United States and the whole world to unify their struggles in a common fight against the capitalist system, which is the root cause of imperialist war. This means building sections of the International Committee of the Fourth International in China and all over the world as the vanguard of a working class movement against imperialist war.

    Andre Damon

    [Jun 09, 2019] US defense secretary issues military threat against China by Nick Beams

    Jun 03, 2019 | www.wsws.org

    The US trade war against China, which started just over a year ago, has now escalated to a full-scale economic confrontation backed by the military might of American imperialism.

    The rapid acceleration of the US drive against China and its increasingly bellicose character was underscored in a major speech delivered by the acting US Defense Secretary Patrick Shanahan on the weekend.

    Over the past month, the US has hiked tariffs on hundreds of billions of dollars worth of Chinese goods, threatened the imposition of new imposts on all Chinese imports and virtually black banned the telecoms giant Huawei from the supply of US-made components in an attempt to cripple its global operations.

    Speaking at the annual Shangri-La Dialogue in Singapore, organised by the International Institute for Strategic Studies, which included participants from China, Shanahan delivered a 40-minute blast against Beijing in which he emphasised US readiness to use military power to secure its interests.

    The speech coincided with the release of an Indo-Pacific Strategy Report by the US Defense Department accusing China of seeking "Indo-Pacific hegemony in the near-term and, ultimately global pre-eminence in the long-term."

    The report called China a "revisionist" power that sought to undermine the international system from within, attempting to exploit its benefits while eroding the values and principles of the "rules-based order" -- the standard reference to US dominance.

    While claiming that the US "does not seek conflict," Shanahan said "we know that having the capability to win wars is the best way to deter them." The US had already committed $125 billion for "operational readiness and sustainment" for the next financial year and is preparing to allocate an additional $104 billion for research and development of emerging technologies.

    "This finding will boost the depth and capacity of our armed forces, and also help expand our training -- including with allies and partners -- to improve mission readiness critical to meeting this region's challenges" he said.

    The read out of his remarks provided by the Defense Department said the Indo-Pacific was "our priority theatre." The US Pacific Command had four times more assigned forces than in any other area, with more than 370,000 service members devoted to the region.

    The US had "more than 2000 aircraft, providing the ability to project power across the vast distances of this region" together with "more than 200 ships and submarines to ensure freedom of navigation."

    The integrated character of the US offensive -- on the economic, diplomatic, political and military fronts -- was emphasised in remarks clearly directed against China.

    "[Some] actors undermine the system by using indirect, incremental actions and rhetorical devices to exploit others economically and diplomatically, and coerce them militarily. They destabilise the region, seeking to reorder its vibrant and diverse communities towards their exclusive advantage."

    This characterisation most closely fits the actions of the United States, extending over decades -- from the dropping of two atomic bombs on Japan in the dying days of World War Two, the launching of the Korean War in 1950 in which an estimated 2.5 million people lost and the Vietnam War in which killed more than three million.

    US intervention has not been confined to military action. In the wake of the Asian financial crisis of 1997-98, the International Monetary Fund, at the direction of Washington, imposed an economic "restructuring" program across the region which plunged it into a crisis, equivalent in scope and depth to the Great Depression of the 1930s.

    The enduring image of that intervention is the photograph of IMF managing director Michel Camdessus standing over seated Indonesian president Suharto as he signed a so-called IMF bailout program to impose what was known as the "Washington consensus."

    Economic devastation resulted in Indonesia and across the region as "structural adjustment" was imposed. Indonesian real wages feel by 30 percent, the incidence of poverty doubled and more than 20 million workers were made jobless. Unemployment rates in South Korea and Malaysia tripled.

    In the years since then, the IMF policies -- directed by the US Treasury Department -- have been branded as a "mistake." They were anything but. The economic firestorm was a consciously directed operation.

    At that point the US feared its economic supremacy in the region was being threatened by Japan. When the crisis broke in July 1997, with the devaluation of the Thai baht, setting off currency devaluations and a financial crisis across Southeast Asia, Tokyo intervened with a proposal to set up a $100 billion Asian Monetary Fund in order to safeguard its economic interests in the region.

    This was forcefully rejected at a September 1997 meeting of the IMF and G7 in Hong Kong. Faced with the prospect of a conflict with the US, Japan withdrew its proposal, opening the way for the imposition of Washington's "restructuring" demands, based on the breaking up of the economic and financial ties between the countries of the region and Japan.

    However, the Asian crisis was to bring about a major economic shift in which China was to become the major global manufacturing centre. Following Deng Xiaoping's southern tour in 1992, foreign capital flowed into the country, secure in the knowledge that, as the Tiananmen Square Massacre of June 1989 and the far broader suppression of the working class in all the major industrial centres had demonstrated, the regime would act as the guarantor of its profit interests.

    By the end of the 1990s, China had become integrated into the global circuit of capital and on that basis its entry into the World Trade Organisation (WTO) was backed by the Clinton administration. After China's admission into the WTO in 2001, the flow of global capital increased as the regime committed itself to further market opening.

    The policy of the US was grounded on the premise that collaboration with China would be encouraged so long as it remained a producer and assembler of consumer goods, boosting the profits of US and other corporations that used it as a base for their manufacturing operations. A new term was coined to describe this collaboration "Chimerica."

    However, the eruption of the global financial crisis in 2008, centred in the US financial system, marked another major turning point, with far-reaching consequences in China as more than 23 million workers lost their jobs. Fearful of an eruption in the working class, the Chinse regime undertook a massive stimulus program, spending more than $500 billion and opening up credit for the provision of vast infrastructure projects.

    This policy, based on a rapid expansion of credit, could not continue indefinitely and under President Xi Jinping a new turn was initiated. In order to maintain economic growth and prevent a crisis that would call into question the legitimacy of the regime, a new policy had to be initiated.

    This was the origin of the "Made in China 2025" plan in which China would move up the value chain, not only producing cheap consumer goods and relying on infrastructure spending but also moving into the development of high-tech manufacturing in areas such as telecommunications, health and pharmaceutical products and artificial intelligence.

    This, however, is regarded by the US as an existential threat to its global economic and military dominance, which, as the latest strategic report by the Defense Department and the speech by Shanahan has underscored, it is determined to crush by all means necessary including war.

    [Jun 08, 2019] US-China Trade War The New Long March

    Notable quotes:
    "... The short-term impact on China could be smaller than previously expected. Factories that sold only to the United States have developed new markets over the past year. Even if those factories stop exporting to the U.S., they will not go bankrupt immediately. It helps that the service sector is experiencing a labor shortage and could absorb some slack. For example, in China a delivery man sometimes makes more than an average office worker. ..."
    "... Shipments to the United States and shipping prices have dropped since the new tariffs were announced. ..."
    "... Researchers at the New York Fed have determined that the new round of tariffs on Chinese products will cost the typical American household an additional $831 per year. ..."
    "... "China has been slaughtering USA" It is American corporations not China. ..."
    "... “The Communist Party didn’t fight Japan,” said the sprightly 97-year-old, who once served as a translator with the storied Flying Tigers aviation brigade. “They made up a whole bunch of stories afterward, but it was all fabricated.” ..."
    Jun 08, 2019 | www.zerohedge.com

    ... ... ...

    ...The main takeaway from our notes below: The Chinese are buckling up for a long ride.

    The consequences of a protracted trade war are manifold. The economic impact includes a drag on economic growth, import price inflation which will allow U.S. domestic and other foreign policy makers to raise prices, and the knock-on effects to other trading partners as the shuffle begins to find new sources and markets for different products. Researchers at the New York Fed have determined that the new round of tariffs on Chinese products will cost the typical American household an additional $831 per year. Trade barriers between the world's economic superpowers will slow global growth and put political pressure on all affected governments, stoking increasing nationalism and protectionism overseas while increasing inflation and reducing living standards at home.

    The investment implications of a protracted trade war are still playing out. We have seen how sensitive markets have been to the trade news, with a strong risk-off bias resulting from adverse developments in the fourth quarter. While volatility will continue, there is no indication that the Chinese will attempt to liquidate their large holdings of U.S. Treasury securities. To do so would only drive down the value of the dollar, which would run counter to Beijing's desire for a weaker yuan. There is also no imminent change to monetary policy from the Federal Reserve as a result of trade saber-rattling, but if the financial markets begin to spiral out of control because of tariffs, then we could see a repeat of 1998, when the Fed eased as a result of the Asian financial crisis. With neither side apparently willing to step back from the brink, investors should be discounting a higher probability for a drawn-out fight.

    ... ... ...

    The conclusions are obvious. Unless the current trajectory is quickly changed, the Chinese are digging in for a long fight. The cost to the United States will be high; the cost to the Chinese will be higher. The only question is who will endure and be the most innovative in this battle of wills. As I have written before in "No One Wins a Trade War," the short-term costs are likely to outweigh the long-term benefits regardless of who "wins."

    Sign in to comment filter_list Viewing Options arrow_drop_down

    Tachyon5321 , 13 minutes ago link

    Several important point. They are:

    1. Guggenheim Partners is based in Chicago and represent Obama's point of view

    2. Apr 4, 2018 Scott Minerd predicted at 50% plunge in the stock market

    3. Once again Scott predicting a 50% drop in the market in 2020

    4. April 29, 2019 Scott predicted a rate hike by the Fed

    The Long march is a propaganda piece hoping people will invest more in their bond mutual funds. Scott should spend a lot less time on TV and more time in the office.

    The longer this trade war goes on the more and more unstable the Chinese economy will become. Because the current tariffs on China are small peanuts to the remaining $200+ billion which will shut down their electronics industry.

    mervyn , 27 minutes ago link

    Agreed with the second point, that they are finding new markets and shifting production line to new place. A new leather goods factory just opened in Cambodia, majority owner is a Chinese friend, rest is a Cambodian business group. His products are in every major markets, and third party label for our brand names. Business as usual for him, he can’t close his China shops because he lives there.

    john.b , 8 minutes ago link

    "China has been slaughtering USA" It is American corporations not China.

    mervyn , 13 minutes ago link

    You don’t get the point. We are printing worthless paper to exchange the actual products, such as computers, furniture and machines. We don’t “eat” money, we consume products. To an extent that we can maintain dominance is to innovate and turn into “affordable” products domestically and overseas.

    Now all the foreigners including not white anglo saxon protestant waking up and will circumvent dollars/sterlings, that’s bad trend. Germany and Russian would be pleased.

    OLD-Pipe , 57 minutes ago link

    Umm.. If you want to gauge the effect of the Chino - Mericah Trade Tariff Circus, then it doesn't get real until Trump goes after the mid-point trans shipment points....all those mutually accessible ports of call that have equal access to both party's...Geeezzze, is everyone working for CNN, Clown News Network......Trump and Friends are just going to set up different ways to ship goods into and out of the Merikah.... it's that simple!!!!!

    BIWEEE , 1 hour ago link

    Most 'Muricans think in terms of seconds or minutes. The Chinks think in terms of decades.

    LaugherNYC , 1 hour ago link

    China - a great society??

    https://www.nytimes.com/2019/06/07/world/asia/china-journalist-liu-wanyong.html

    The LAST man brave enough to publish anything critical of Chicoms throws in the towel. Not worth the prison terms, the violence, the relentless state attacks on journalists and their families. Totalitarian cuks with their asshat trolls. Glad Trump will starve them out with tariffs. Be happy never to trade with China until their people throw out the commie murderous imperialists - let them do business with their like-minded asshat buddies in Moscow -

    https://www.bbc.com/news/world-europe-48561980

    Staged arrest with planted drugs, beaten upon arrest, protesters immediately arrested (even though they protested one at a time to avoid the law making group protests illegal - the mark of every totalitarian regime). THIS is your brave PUTIN. Cannot allow any TRUTH about his corrupt kleptostate, lest Russians finally have ENOUGH of the rape and thievery that pillages their national assets and resources for the oligarchs' gain, with their lips on Putin's sphincter as he gives them a reach around.

    Tell me again how GREAT China and Russia are, and how the USA sucks. We don't arrest and kill our journalists. In fact, they are allowed to stage absurd, fact-free assaults on the ruling party without end.

    I'll take freedom over tyranny every time.

    Proud-Christian-White-American-Man , 1 hour ago link

    Laugher NYC: Best post of the afternoon! This is the type of post that makes Zero Hedge comments worth reading.

    Proud-Christian-White-American-Man , 1 hour ago link

    "As I have written before in No One Wins a Trade War ,” the short-term costs are likely to outweigh the long-term benefits regardless of who “wins.""

    Translation: The US should give up fighting the trade war and go back to losing the trade war. Americans don't want to withstand short term pain , so just give up and surrender to the Chinese communist government.

    Reality Check: If the US stays the course then the following will happen:

    New factories will open up to replace the Chinese suppliers.

    More US workers will be employed with rising wages.

    The US will reopen critical industries like rare earths making the US much more militarily secure.

    Existential menaces like Fentanyl exported from China will be drastically reduced.

    Sounds like a win to me.

    B-Bond , 1 hour ago link

    "New Long March" Cross Rubicon─Save/Lose. The CCP Didn’t Fight Imperial Japan; the KMT Did. While the KMT military defended China against Japan during WWII, the CCP built up strength for the civil war.

    This was not by accident but by design. The CCP had a choice: it could have prioritized defending the country against Japan during the war, or it could have prioritized seizing control of China from those who did fight the Japanese. It chose the latter. Meanwhile, by choosing to actually try to defend China against Japan during the war, the Nationalists handed the country to the CCP afterwards.

    Which is why Xi and the CCP’s decision to create a national observance day to honor its defense of China during the second Sino-Japanese War represents the height of hypocrisy. It’s one thing to try to suppress all information exposing the Party’s failings, which killed millions of Chinese, while demanding Japan take a correct view of history (which Tokyo should do). It’s another thing altogether to falsely claim credit for one of the defining moments of your country’s modern history. And it’s really something unprecedented to create a national holiday to honor your Party for doing something it consciously avoided; namely, putting China’s defense over the CCP itself. Classy.

    https://thediplomat.com/2014/09/the-ccp-didnt-fight-imperial-japan-the-kmt-did/

    ✅ China gives little credit — and less help — to Kuomintang vets who fought in WWII

    “The Communist Party didn’t fight Japan,” said the sprightly 97-year-old, who once served as a translator with the storied Flying Tigers aviation brigade. “They made up a whole bunch of stories afterward, but it was all fabricated.”

    Most independent historians agree that it was the forces of the Kuomintang, led by Mao’s archrival, Chiang Kai-shek, that led the anti-Japanese struggle and suffered the vast majority of casualties.

    Following the war’s end, the exhausted and divided Kuomintang were defeated by the communist s in a renewed civil war and fled to Taiwan, cementing Mao’s claim to having defeated imperialism, unified the country and overthrown the old feudal order.

    “This joint victory over the external enemy and the internal one, including the landlord class, is a fundamental component of (the party’s) founding myth,” said Harvard University China scholar Anthony Saich.

    https://www.japantimes.co.jp/news/2015/08/31/asia-pacific/china-gives-little-credit-and-less-help-to-kuomintang-vets-who-fought-in-wwii/#.XPh60IgzaDI

    Proud-Christian-White-American-Man , 1 hour ago link

    B-Bond: Interesting history background. The commies have always been the cowards waiting to pounce on an exhausted opponent. Same formula in Russia 1917. The Czar exhausted his soldiers in WWI which opened the door for Lenin to cowardly sneak in on a sealed train courtesy the German government. That treachery only got the Germans a very temporary victory in the Treaty of Brest Litovsk for a few months. Post war, the commies came close to overthrowing the new Weimar republic. That's what happens when you make deals with a Godless murderous cult based on hate and envy called communism.

    Cheap Chinese Crap , 1 hour ago link

    So, if I understand this correctly one globalist stooge contacted a bunch of other globalist stooges and asked them to confirm his pre-conceived talking points.

    Big surprise, they were happy to do so. As usual, they blather about no winners in a trade war-- then launch into an explanation of how badly the US consumer will lose and how beneficial this will ultimately be to China. That sure sounds like an apportionment of trade war winners and losers if you ask me.

    What emerges is a picture of cynical beneficiaries of the current global order trying to frighten the Americans into giving up by harping upon the costs, yet trying to assuage their national pride by suggesting that giving up will actually be scored as a draw, which is the best result they can ever hope for due to the fact that there are no winners and losers in a trade war.

    Yet it is China who is comparing this event to the Long March -- not a time of glory but of acknowledgement of crushing defeat and gigantic sacrifice to set the table for a future triumph. They seem to understand that they could lose this war if they are not fanatically dedicated to victory. They sure as **** aren't telling their people that nobody wins a trade war. Wonder why this dichotomy exists?

    Well, Scott Guggenheim can tell you. It's because HE LOSES if Trump wins. Him and his profitable Chinese pals. They'd all have to go out and find a new gig rather than keep sucking off their current comfy one.

    Creative destruction starts with knocking **** down and it is high time and beyond that we knocked this **** down. Even if it puts Scott and his buddies on the unemployment line.

    Proud-Christian-White-American-Man , 1 hour ago link

    Cheap Chinese Crap:" So, if I understand this correctly one globalist stooge contacted a bunch of other globalist stooges and asked them to confirm his pre-conceived talking points." Good cogent analysis of Scott Guggenheim's real motivation. it's the old WIFFM mentality. What's In It For Me. If Scott is such a cheerleader for the Chinese, then it might be time for him to move to China and 'enjoy' his social credit score.

    holmes , 1 hour ago link

    I don't give a **** about who wins the "trade war". We are fighting for our national security against the Chinks. That I care about. MAGA

    ExPat2018 , 35 minutes ago link

    **** the USA and **** you. Bullies and warmongers always get their comeuppance. Its your turn, Americunt asswipe!!!

    JibjeResearch , 20 minutes ago link

    National security? .... You need to think harder .. How was 911? If you serious about national security... you should inspect DC more often!

    libfrog88 , 2 hours ago link

    It's not about who wins but about who looses. Chinese are used to hardship, not the Americans. Even if the pain is greater for Chinese, it will be political suicide in the USA for their administration to pursue this policy....

    iSage , 2 hours ago link

    A centrally planned, in huge debt, social credit focused country like China, will NOT survive the long term damage. They have one billion plebes to feed and keep happy. Think T Square.

    JibjeResearch , 2 hours ago link

    Are you talking about this debt at $22 Trillions? lolz

    hoytmonger , 2 hours ago link

    The business of China is business. The business of the US is war. China is better situated to endure a long fight. They've made themselves self sufficient, have ambitious economic plans with the Belt and Road initiative, and are sitting on a mountain of gold. The US depends on an economic hegemony that is dwindling and doesn't think long term. The US empire is in a managed decline

    Cheap Chinese Crap , 2 hours ago link

    Self sufficient in what? Oil? Raw Materials? Food?

    hoytmonger , 2 hours ago link

    The Chinese can manufacture anything. The US can't say that. Their agricultural technology is second to none and their energy sector is advancing by leaps and bounds. They are innovative, the US has lost it's innovative curiosity. Too many public education mouth breathers staring at their TVs and phones to be bothered with thinking. Just the way the state like it.

    Chinese investment in Africa is solving their raw materials and energy issues, hence the Belt and Road initiative. People think that building roads and ghost cities in the African desert is a bad idea, but they know the desert is greening and are thinking long term. The US, on the other hand, sends troops.

    LaugherNYC , 1 hour ago link

    "Their agricultural technology is second to none..." Stop reading there.

    China can not come close to feeding itself, and its agritech is decades behind the US. TFP ranking, growth..by any measure, China's ag sector, while it has improved, is far behind the US.

    Population growth and the "growing middle class" has also reversed the growth in ag acreage, while fewer young Chinese are going in to farming. Even with the most optimistic growth projections from CHINA itself, it won't reach even 75% of its needs domestically by 2030, far less if growth continues to slow.

    If China pisses off enough of the world, it will once again starve. That's one way to control population growth.

    libfrog88 , 2 hours ago link

    You really don't understand Chinese culture. Wishfull thinking does not become reality. Americans will revolt a lot faster than the Chinese will.

    Ghost-of-Vince-Foster , 2 hours ago link

    Why are all these Democrats and RINOs siding with China instead of Americas?

    Simple. It's because like China -- Joe Biden, Sen. Mitch McConnell, Rep. Justin Amash, the U.S. Chamber of Commerce, etc., etc., they have all been bought off with Chinese money.

    Kayman , 1 hour ago link

    @Ghost

    The dumb American Political Sellouts have been bought with U.S. dollars. Now how dumb is that, when the Thief that is buying your favor, plucks it out of your right pocket to hand you the loot.

    Mustafa Kemal , 2 hours ago link

    "n 20 years China has destroyed our manufacturing, and we are supposed to give in to this? "

    The US is a victim? Lordy lordy, poor us.

    Duc888 , 2 hours ago link

    "Why are all these Democrats and RINOs siding with China instead of Americas?"

    It's simple. They are not Nationalistic. They are complete Globalist sell outs . In their book, USA comes LAST. Anything that weakens mom and pop USA makes them stronger.

    Cheap Chinese Crap , 1 hour ago link

    That large scale competitive advantage is moving offshore from China as well. You are suggesting a rust belt world ultimately ruled by Vietnam.,

    Dogspurt , 1 hour ago link

    Destroyed? Didn't the USA kick itself where it hurts by outsourcing to places such as China? Well now those chickens are coming home to roost.

    Cheap Chinese Crap , 1 hour ago link

    Yes, and its high time we reversed this disastrous error, don't you agree?

    blindfaith , 2 hours ago link

    Scott Minerd, Global CIO of Guggenheim

    Click bait investment firm with Chinese investments that are not going well, so he wants your support. This should be an add off the the side not a FEATURE Tylers.

    mikee2481 , 2 hours ago link

    This is a GOOD thing. We have lost our manufacturing to China (and Asia) to benefit Wall street and the globalist and the Rich. There is no solution except to have these tariffs. With our government taxes and structure there is no way we can have 1 or 2 dollar wages. It might take an adjustment, but we MUST stop this cheap stuff from coming in. Sad but True>

    RealRussianBot99 , 2 hours ago link

    WRONG. you have not LOST, you GAVE IT AWAY

    Cheap Chinese Crap , 2 hours ago link

    Okay, and now we're taking it back. It's all heading your way instead because you want to be junior partners in the Chinese Empire.

    boostedhorse , 1 hour ago link

    Good luck pinning your hopes on Trump for bringing jobs back lol. Why would you want those jobs back anyway, I thought you had a ton more job openings than needed?

    HopefulJoe , 2 hours ago link

    Please, this is not a trade war, this is a trade reset, it is needed to make MAGA. China is dependent on foreign trade to be successful. Well over 40% of their economy is dependent on exporting.

    Trump knows the central bank economy is on a path to total destruction. He knows that soon we will have a global reset. Anything he can do to weaken China now will ensure they continue to be weak at the time of the reset. By diverting the USA supply chain away from China by bringing it back to the USA or getting new suppliers from other nations he is helping to ensure a better position for the USA at the time of the reset.

    Yes, this is no trade war, it is a trade reset...people are being filled with propaganda like the wording "trade war" even though the truth is right there in front of them...it is a big puzzle, just need to find the pieces and they then fit like a glove (not OJ'S glove) and you have the real truth...

    Bull Bear Nice Pair , 1 hour ago link

    Only 18% of Chinese GDP is export. Of this, only 18% goes to the U.S. So less than 4% of Chinese GDP is export to the U.S. The fact that you could not set such records straight makes the rest of your post pointless.

    blindfaith , 2 hours ago link

    Researchers at the New York Fed have determined that the new round of tariffs on Chinese products will cost the typical American household an additional $831 per year.

    Why is it these so called experts never say what doing nothing HAS cost the American household...like lost jobs?

    Duc888 , 2 hours ago link

    Correct, NOT doing this has cost Americans billions in lost earnings / revenue over the last 30 years. They certainly don't want to factor THAT wet mess into the equation.

    [Jun 08, 2019] Washington's Huawei hypocrisy US government is instrument of American corporations

    Jun 08, 2019 | www.rt.com

    US Secretary of State Mike Pompeo doubled down on vilification of Сhinese telecoms giant Huawei as "an instrument of government" suggesting that the company was a national security threat by acting as an agent for Beijing. Like his boss, President Trump, and many others in Washington, Pompeo seems blind to an alternative glaring reality. The US government is the consummate instrument of American corporations. Its congenital service to corporate profit-making is the real national security risk to American citizens and a global security threat for all people of the world due to the wars that Washington unswervingly pursues on behalf of US corporate interests.

    The irony could not be richer. President Trump has banned Huawei from US markets by executive order on the grounds that the company's smartphones could be spying devices for the Chinese government. This move by a nation whose government espionage agencies were exposed using every US telecom, tech and social media company as a conduit for their global harvesting of private citizens' data as well as that of foreign heads of state.

    Also on rt.com 'Naked economic terrorism': China rails against trade war provocateurs & bullies

    Moreover, the White House claim that Huawei is an instrument of Beijing state authorities is a risible form of guilt projection. The Trump administration's ban on Huawei is nothing more than US government abusing its state power to hamper a Chinese competitor from outperforming American tech corporations. Huawei's products are reputedly cheaper and smarter than US rivals. Some observers also point out that the Chinese technology is invulnerable to hacking by the American spy agency, the NSA, further adding to its consumer appeal. Outperformed on market principles, the US government takes a legalistic, propagandistic sledge hammer to smash Huawei from the marketplace in order to bestow an unfair advantage to inferior American corporations.

    So, just who exactly is being an instrument for whom?

    Governments in all nations of course use their legislative, fiscal and policy resources to try to build up key companies for their national economic development. It's standard practice throughout history and the world over. Governments can use subsidies and grants to boost companies, or tariffs to shield them from foreign competition.

    Also on rt.com Huawei ban will harm over 1,200 American firms & billions of global consumers, company warns

    The US, however, is a stellar example of how government intervenes strenuously at every stage in the market to benefit private corporations. Without massive injections of public money for grants, tax deductions, subsidies, and so on, American corporations would not have risen to the scale they have, as Michael Parenti documents in 'Democracy for the Few'. This relationship, of course, negates the myth of US " free market capitalism ." In reality, American corporations are publicly supported entities whose profits go to private shareholders. The overarching agent for this process of centrally-planned corporate capitalism is the American government.

    From its earliest days as a European colony, it was the newfound federal authorities who rolled back frontiers with the native Americans through genocidal wars in order to benefit cattle and cereal companies, mining magnates, transport and telecoms, oil firms, and firearms manufacturers.

    In its young years as an imperial power, it was Washington that organized and dispatched federal troops to wage wars in the Caribbean and Latin America – all for the sole benefit of Wall Street and the expanding agro-industry. Retired Marine Major General Smedley Butler, in his 1930s book 'War is a Racket', described the American military as a henchman for US corporate profits. But without the government acting as recruiter, financier and commander-in-chief, the US Army could not function as a henchman for the corporations.

    Let's take a few specific examples in history to illustrate the instrumental role of the US government in advancing or defending corporate interests. In 1953, President Eisenhower authorized the coup in Iran organized by the CIA and Britain's MI6. A main objective of that intervention was to seize Iranian oil. Five US corporations subsequently exploited the Iranian feast, until the revolution in 1979 kicked them out along with the American puppet dictator, Shah Mohammad Reza Pahlavi. It's a fair bet that current military threats from the Trump administration against Iran are prompted by a strategic desire to reclaim American corporate interests.

    Also on rt.com US-China trade war could cost global economy $600 billion

    In 1954, Guatemala's elected leader Jacobo Arbenz set out to nationalize underused agricultural land to benefit the rural poor. His land reforms involved expropriating properties belonging to the American-owned United Fruit Company, as William Blum details in 'Killing Hope.' Acting on United's interests, Washington intervened with a CIA-backed coup against Arbenz, which subsequently led to decades of mass murder of indigenous Guatemalans under US-backed military dictatorships.

    Following the Cuban revolution in 1959, one of the main protagonists for US military invasion of the island and for covert sabotage operations was the American soft drinks industry, headed up by Coca-Cola and Pepsi. They feared the nationalization of sugar plantations by the Castro government would hit their profits.

    There are also suggestions that President John F Kennedy may have been assassinated by powerful US state forces, working in cahoots with American corporate interests, because he didn't adopt a sufficiently aggressive policy towards Cuba after the Bay of Pigs fiasco in 1961. Related to JFK's assassination was his reluctance to go to war in Vietnam in the early 1960s, which big oil companies and weapons manufacturers were all avidly pushing. His successor, the Texan Senator Lyndon Baines Johnson, who was close to both industries, duly obliged by paving the way for all-out war in Indochina after 1964. Up to two million Vietnamese were killed, as were some 58,000 US troops. Millions more maimed. The corporations made huge profits from the decade-long slaughter. But the US economy began a long descent that continues today from incurring fiscal debts over Vietnam, which prompted Washington to abandon the gold standard, and heralded the age of funny money with the dollar acting as an overrated international reserve currency.

    Many more examples could be cited to illustrate how US government – both the White House and Congress – are agents for corporate profits, often to the horrendous detriment of international peace and the common good of ordinary Americans.

    Read more  Trump's backing of Saudi war in Yemen is 'business decision' © Reuters / Naif Rahma Trump's backing of Saudi war in Yemen is 'business decision'

    The 2003 war on Iraq – killing over one million civilians and maiming tens of thousands of Americans – was widely seen as a pretext for grabbing Iraqi oil for US corporations like Halliburton, for whom then vice president Dick Cheney was previously an executive board member.

    The present warmongering towards Venezuela by Washington is openly touted by White House National Security Advisor John Bolton as being about US corporate lust for the country's oil reserves – which are reckoned to be the biggest on the planet.

    Out of the top 12 corporate financial donors to politicians in Washington, three of them are weapons companies: Boeing, Lockheed Martin, and Northrop Grumman; a fourth is oil titan Exxon-Mobil. There is an obvious correlation between corporate bidding and foreign policies embarked on by US governments which leads to conflict and wars, which in turn repays these corporations with soaring profits.

    The American government is the best instrument that corporate money can buy.

    Thus, when Trump, Pompeo and other Washington political (and media) prostitutes pontificate and rail against Huawei, just remember: these talking heads are bought and paid for – lock, stock and barrel.

    Like this story? Share it with a friend!

    The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.

    [Jun 06, 2019] What A Technology 'Cold War' Could Look Like

    Technoimperialism is effective, but what it Huawei can switch to some derivative CPU and chipsets?
    Notable quotes:
    "... Authored by Fan Yu via The Epoch Times, ..."
    "... A wide-ranging ban similar to the one imposed on Huawei and its affiliates would effectively bar other foreign companies whose products contain at least 25 percent U.S.-sourced technology from supplying the Chinese. ..."
    "... What does this mean in practice? More companies may begin to adopt localized R&D and manufacturing practices. Instead of Chinese factories supplying the world when labor costs were low, localized operations to directly supply the China market may be set up. ..."
    "... Around 33.2 percent of American companies operating in China are delaying or cancelling investments in China altogether, according to the most recent American Chamber of Commerce in China survey released on May 22. If the tariffs are more permanent in nature, U.S. companies will likely move production outside of China, which is increasingly seen as a prudent choice given rising political instability within China and growing labor costs. ..."
    "... If Bibi ask Chump to drop the tariffs on China for the security of Israel, What do you think will be Chump's answer? ..."
    Jun 06, 2019 | www.zerohedge.com
    Authored by Fan Yu via The Epoch Times,

    During the Cold War , around half of the world ran on the technologies, machinery, and political ideologies developed by the Soviet Union. The other half - the free world - adopted those of the United States and its allies.

    As trade war tensions between the United States and China escalate, could we be on the cusp of a new version of the cold war, one which is driven by technology and finance?

    Since U.S. President Donald Trump has deemed Chinese telecommunications giant Huawei Technologies as a national security threat and barred it from purchasing key U.S. equipment, Beijing has engaged in an escalating tit-for-tat that could have lasting ramifications on the technology industry going forward.

    And Huawei may just be the beginning. Several other Chinese companies are being considered to join the blacklist with Huawei.

    If a technology cold war does come to pass, it would significantly alter the existing technology landscape, dismantle global supply chains, and cleave off the global trade network that has underpinned China's rise as a global economic power .

    Decoupling of the Global Supply Chain

    Global consumers are used to seeing this familiar description donning Apple products' packaging for years: "Designed by Apple in California. Assembled in China."

    That's the model followed by most technology companies during the past few decades. American companies develop new technologies and products in the United States, which are assembled by comparatively cheap labor in China, and then shipped for sale globally.

    Going forward, purchase orders would likely need to be rerouted.

    A wide-ranging ban similar to the one imposed on Huawei and its affiliates would effectively bar other foreign companies whose products contain at least 25 percent U.S.-sourced technology from supplying the Chinese.

    What does this mean in practice? More companies may begin to adopt localized R&D and manufacturing practices. Instead of Chinese factories supplying the world when labor costs were low, localized operations to directly supply the China market may be set up.

    Around 33.2 percent of American companies operating in China are delaying or cancelling investments in China altogether, according to the most recent American Chamber of Commerce in China survey released on May 22. If the tariffs are more permanent in nature, U.S. companies will likely move production outside of China, which is increasingly seen as a prudent choice given rising political instability within China and growing labor costs.

    Another 35.5 percent of respondents are adopting an "In China, for China" approach to mitigate the impact of tariffs , according to the AmCham survey. That refers to manufacturing products to be sold in China, within China. That strategy may be broadened in a full-on technology cold war, as research and innovation may also need to be localized and companies may need to erect internal information barriers.

    Losers, Big and Small

    Chinese companies will be the main losers -- there are no existing domestic replacements for many U.S.-sourced components. For example, Huawei's chip-making arm HiSilicon currently derives its Kirin chip architecture on license from UK-based semiconductor firm ARM Holdings. But in May, ARM notified Huawei that it would stop licensing its chip designs to HiSilicon due to having certain U.S.-sourced origins.

    Huawei also lost access to Google's Android software platform, which is the main operating system running on all Huawei smartphones. As of the end of May, the U.S. Commerce Department gave Huawei a temporary, 90-day license to provide security patches to existing phones.

    In addition, Huawei has been suspended from the Wi-Fi Alliance, an industry standard-setting body for technology protocols.

    These events don't just hobble Huawei -- they effectively ground its ambitions to a halt. Without access to these technologies, there's simply no way for Huawei to reach its goal of overtaking Samsung as the world's No. 1 smartphone supplier. And on the networking front, Japan's SoftBank became the latest potential customer to reject Huawei for 5G networking equipment, announcing on May 31 that it would be turning to European telecom giants Nokia and Ericsson instead.

    Should similar bans extend to other Chinese companies -- many of which have far smaller operational support and balance sheets than Huawei -- many of them could cease operations altogether.

    Sign in to comment filter_list Viewing Options arrow_drop_down

    holyvanguard , 46 minutes ago link

    The article writer seems to be pro trade war. I am no expert but I feel this article is not seeing a bigger picture.

    black rifles are cool , 32 minutes ago link

    Epoch Times is a Falun Gong newspaper: https://en.wikipedia.org/wiki/The_Epoch_Times That's likely why it sounds pro trade war.

    MarkD , 1 hour ago link

    China's empire is growing and the US empire s shrinking. Unfortunately many can't grasp that and will deny it till the end instead of accepting it and working with the next world power. All empires come to an end.

    Our economy is a consumer based economy not a manufacturing based economy like it once was. Can we return to a manufacturing based economy? Not sure if Americans are ready to push their kids into getting a job at the factory making boots, footballs, washing machines...... instead of swaying them into going to college. Don't forget, someone has to work in the factories if we are going to make stuff.

    Winston Churchill , 42 minutes ago link

    Twenty years lead time on them as well, if you reformed public education tomorrow.

    youshallnotkill , 29 minutes ago link

    If you study high wage manufacturing driven economies like Germany, you will notice that the productivity of their workers is sky high (as it has to be in order to remain competitive). The plants are highly automated. Workers are very well trained and have expert skills in keeping the production line running at peek pace and quality.

    Frankly, I just don't think American workers have what it takes to adopt that kind of model.

    Nunny , 24 minutes ago link

    Not with the education system we have now....the Fed has killed off the industrial trades, and everyone thinks they will can spend $100,000 a year for an education to sit behind a desk and play solitaire......or become a politician.

    Nunny , 27 minutes ago link

    Someone has to fix the machines and get their hands dirty. Not all our kids are IT 'coders'. Now we want the gooberment to give them 'free' college for a 'diversity degree' and they graduate with NO SKILLS and no knowledge. So we drug up our youth with drugs imported by China and open the flood doors for worker bees. Sounds like a plan.

    frankthecrank , 1 hour ago link

    The free world flourished during the cold war. it was great for the West. Technology advanced by leaps and bounds and the middle class grew. Nothing bad about this at all.

    youshallnotkill , 28 minutes ago link

    We were competing with a command and control economy. Contemporary China is much more dynamic and market oriented.

    Bull Bear Nice Pair , 1 hour ago link

    So you believe Epoch Times, a Falun Gong publication? What's missing in the article is the most obvious: the trade war will force China to climb the value chain a lot quicker. The most like scenario is that China will become a high-tech manufacturing powerhouse before much, if anything, is moved back to U.S.

    DCFusor , 1 hour ago link

    What would make any sane person believe that stopping the ARM license would stop them being made in China? Has that ever worked for anything else, ever?

    frankthecrank , 1 hour ago link

    their tech will fall behind as the US advances. Same thing happened with the Soviet Union once they ran out of Germans and US tech. By '91, they were woefully behind the West--like 35 years.

    Winston Churchill , 58 minutes ago link

    There was never anything wrong with Research in the USSR, Development was their problem, now as Russia again they remain at the leading edge of Research, and seem to have finally gotten a handle on Development. They have never been behind in Research, any serious scientist in the West can and will read Russian just to keep up.

    Its been that way all my life, the US seems to have forgotten it though, because they believe they're exceptional and only they can do research.Hubris will kill you.

    The Russians are pulling way ahead because of that Ubermensch stupidity, laughing the whole time at it. That smirk of Putins, its there for a reason.

    Shemp 4 Victory , 33 minutes ago link

    What would make any sane person believe that stopping the ARM license would stop them being made in China?

    No kidding. For instance, take this statement:

    Chinese companies will be the main losers -- there are no existing domestic replacements for many U.S.-sourced components.

    Propaganda via lies of omission. This could easily be turned around to say:

    American companies will be the main losers -- there are no existing domestic replacements for many Chinese-manufactured "U.S.-sourced" components.

    But hey, the Epoch Times is a propaganda mill for the Falun Gong cult which the Chinese government banned 20 years ago, so it's kind of the anti-China equivalent of The Gatestoned Institution .

    https://www.zerohedge.com/news/2019-05-13/fighting-communism-yen-shun-evil-cult-or-meditation-group

    besnook , 1 hour ago link

    the chinese domestic market is the new big dog on the block. it is big enough to dictate what the rest of the world will use. the hubris of the usa is arrogance squared. the consequences are potentially damning to usa tech. this is the dumbest move in business and geopolitical history.

    Normal , 1 hour ago link

    Western central bankers are not Chinese, but China can now proceed without the West. I think we have a problem.

    oneno , 1 hour ago link

    The West is in for a big surprise. China has technologically advanced neighbors (Russia, India) and a host of countries who want to do business who are also technologically advanced. The Silk Road is well advanced to supplant trade with North America. Germany is already in place in Russia and China and will not lose sleep with the loss of North America. It is the US that has the most to lose.

    Winston Churchill , 1 hour ago link

    They cannot see past their own jingo. The Chinese just thanked Trump at the Moscow summit, for forcing them to do what inertia stopped them doing years ago. Seems like its already backfiring, and now full dedollarization is now the official agenda. Yuan futures in most everything, convertible to gold, were just announced at one press conference. The ruble looks around -95% undervalued right now.

    frankthecrank , 1 hour ago link

    umm--you do know that it wasn't so long ago that Russia defaulted on all of its loans, right? and that no one with a brain is going back into that market again, right?

    Nunny , 1 hour ago link

    No worries, the PTB in our fed government (both sides) and the globalists want cheap labor from the illiterates that are allowed to flood our country and Europe. We will look much like the cheap labor in China. I find it funny that 'open border' morons like the D's demand $15/hour min wage laws for flipping a hamburger. They are nuts. Can't have it both ways.

    The central planners , 1 hour ago link

    To the chumptards: If Bibi ask Chump to drop the tariffs on China for the security of Israel, What do you think will be Chump's answer?

    Winston Churchill , 1 hour ago link

    No they didn't, they were disconnected from Gargoyle Play.Android is open source and HW played a big part in its development. Maybe more than Gargoyle.. This kind of disinformation discredits the whole article, the author is a no nothing hack, probably Mosley moonlighting from his janitors job.

    Nunny , 2 hours ago link

    My small anecdotal experience was back in 2008 when I worked for a US Company who made large components for nuclear projects. Like AP1000. Within a year of my working there, we were hosting the chinese and actually sending our engineers and quality people to live in China for 6 months at a time to TEACH THEM HOW TO MAKE THE PRODUCT. The quality people came back disgusted because they didn't care about 'tolerances'. I have since left there, but it was eye opening how US companies willingly sell our technology to them.

    In the meantime, the corp bosses built a huge addition onto our building with luxurious soundproof walls/doors/windows to move in. Big bucks stuff. No expense spared.

    nmewn , 1 hour ago link

    Not really, the Chi-Com government OWNERSHIP of businesses is dramatic.

    When a chinese government entity (think strawman, shell company, a "holding company") answerable and subservient to the state party apparatus owns the majority of any company's stock and/or gives it direction from on high, it cannot be said to be "a private company". At least not by any kind of western standard of the meaning of the word "private".

    They're trying to fake people out (and succeeding to some degree) as the western mind may misinterpret it as merely being crony-socialism but in fact it's communist via the shell corps.

    quesnay , 1 hour ago link

    What you describe sounds like fascism i.e. capitalism is allowed, private companies are allowed but are directly answerable to government.

    Anyways you look at it, China has a strong capitalist element. They have private property now. They have billionaires as a result of these companies FFS. They have a stock market . They have realestate developers. That's no longer 'communism'.

    nmewn , 51 minutes ago link

    The largest corporations are government owned and a "private company" is not given direction by any government entity in what to supply or in what quantities to supply to "the market", there are no government mandated quotas.

    And you are confused (or being evasive) about what socialism and capitalism are, fascism & communism are both Marxist.

    With capitalism, the market decides all, from pricing to profits to wages and companies rise & fall on what is sold into that market ...thats why rickshaws never caught on here because people didn't have to eat their horses for meat and we eventually produced affordable cars for transport...lol.

    Need I remind you that the CCP means the Chinese Communist Party?

    Perhaps they need some better capitalist marketers to "rebrand" their, ahem, operation ;-)

    ted41776 , 2 hours ago link

    this statement would be true 10 years ago. today there are no secrets or intellectual property left to steal

    The central planners , 2 hours ago link

    You complain more about China stealing manufacturing secrets than the manufacturers himself.

    [Jun 02, 2019] Trump clearly undermines neoliberalism rules of the game, fastening its demise

    Notable quotes:
    "... China assembled an "unreliable entities list" for retaliation against foreign companies, individuals and organizations that "do not follow market rules, violate the spirit of contracts, blockade and stop supplying Chinese companies for noncommercial reasons, and seriously damage the legitimate rights and interests of Chinese companies." ..."
    "... And out of nowhere, Trump warned Mexico to stop the immigrant flow in 10-days or face tariffs. Global CEOs who were rushing to rearchitect their China supply chains, digested the risk that these investments could be instantly devastated by some future tariff - imposed to achieve Americas geopolitical objectives - and they prepared to warn shareholders they're putting new investment on hold. As the US treasury yield curve inverted, with 3mth bills at 2.34% and 10yrs at 2.12%. Which of course, is one of the most reliable warnings of looming recession. ..."
    "... "Tariffs are being used as a proactive, combative tool. The GDP hit will be at least double. Modelling these tariffs require more complex frameworks." ..."
    "... " Global trade was already in the process of fracturing ," added the strategist. "Now Huawei can't use Google's operating system." Their phones are as good as paperweights. "But do you really want to bet that Huawei can't spend the next 6mths building a competing operating system?" We're entering a world of competing superpowers. " The overall impact will be to operate economies with redundant technologies, fewer efficiencies, lower ROEs, lower ROAs. And ironically, or perhaps by design, it'll be bad for profits, but okay for labor ." ..."
    Jun 02, 2019 | www.zerohedge.com

    China Used This Exact Phrase Ahead Of Their War With India And Vietnam -

    Submitted by Eric Peters, CIO of One River Asset Management

    "Don't say we didn't warn you!" declared the China People's Daily. And historians rushed to remind us that Beijing used the phrase in advance of their 1962 border war with India and 1979 war with Vietnam.

    China assembled an "unreliable entities list" for retaliation against foreign companies, individuals and organizations that "do not follow market rules, violate the spirit of contracts, blockade and stop supplying Chinese companies for noncommercial reasons, and seriously damage the legitimate rights and interests of Chinese companies."

    Pence responded by warning Beijing we could double tariffs. "Engaging in activities that run afoul of US sanctions can result in severe consequences, including a loss of access to the US financial system," warned the US Treasury's undersecretary for terrorism – you see, the Europeans are building systems to circumvent American sanctions. Today, those sanctions are directed at Iran, Russia, North Korea, Venezuela, but tomorrow they may be directed at China.

    Naturally, the Europeans threatened only themselves - 1,500-year habits are hard to break. Germany and France fought bitterly over who would become European Commission President. Brussels warned Rome to honor its obligation to contain its growing debt. Italy's Salvini threatened to launch a parallel currency – step #1 in the process to abandon the euro and default.

    And out of nowhere, Trump warned Mexico to stop the immigrant flow in 10-days or face tariffs. Global CEOs who were rushing to rearchitect their China supply chains, digested the risk that these investments could be instantly devastated by some future tariff - imposed to achieve Americas geopolitical objectives - and they prepared to warn shareholders they're putting new investment on hold. As the US treasury yield curve inverted, with 3mth bills at 2.34% and 10yrs at 2.12%. Which of course, is one of the most reliable warnings of looming recession.

    Framework

    "Economists generally use tax frameworks to evaluate the trade war," said my favorite strategist. "They calculate a -0.4% hit to GDP, which is not such a big deal. But they're using the wrong tool." Tax frameworks treat tariffs as a tax. They then model how a nation's currency adjusts to the tax, how corporate profit margins shrink to absorb the tax, and how consumers shoulder the remaining burden. "Tariffs are being used as a proactive, combative tool. The GDP hit will be at least double. Modelling these tariffs require more complex frameworks."

    "If all of the affected nations simply agreed to adopt new tax regimes, then the tax framework would work fine," continued my favorite strategist. "But the world has built specialized supply chains. So if Nation A tries to hurt Nation B, and Nation B is part of critical supply chains that impact Nation A, then there are many things B can do to harm A in non-linear ways." Banning rare earth metal exports is a small example. "Once Apple locks down their product production for Nov 2019 release, China knows exactly how to push that past Feb 2020."

    " Global trade was already in the process of fracturing ," added the strategist. "Now Huawei can't use Google's operating system." Their phones are as good as paperweights. "But do you really want to bet that Huawei can't spend the next 6mths building a competing operating system?" We're entering a world of competing superpowers. " The overall impact will be to operate economies with redundant technologies, fewer efficiencies, lower ROEs, lower ROAs. And ironically, or perhaps by design, it'll be bad for profits, but okay for labor ."

    [Jun 02, 2019] Trade War Has Not Made America Great Again-- China Lashes Out At US Which Is -Solely To Blame- -

    Notable quotes:
    "... "It is foreseeable that the latest U.S. tariff hikes on China, far from resolving issues, will only make things worse for all sides," according to the white paper, which also listed details of what it described as U.S. backtracking. ..."
    "... As Vice Commerce Minister Wang Shouwen, who led the working-level team in the negotiations, said China is willing to work with the US to find solutions, but the latter's strategy of maximum pressure and escalation can't force concessions from China: "When you give the U.S. an inch, it takes a yard", he said. ..."
    Jun 02, 2019 | www.zerohedge.com

    And, as of this weekend, we now appear to be in the "despondent acceptance" phase (unlike the Kubler-Ross model, acceptance precedes anger and nuclear war), because as Xinhua reported overnight, China is now laying the blame squarely on the US for the breakdown of trade talks between the world's two biggest economies, but hinted at its willingness to resume stalled negotiations with Washington while rejecting any attempt to force concessions from Beijing.

    In a white paper on China's official position on the trade talks released by the State Council Information Office on Sunday, Beijing made it clear the US government "should bear the sole and entire responsibility" for the current stalemate, and hit back at allegations that Beijing had backtracked from its earlier promises.

    The trade war has not " made America great again," the white paper said, but has done serious harm to the U.S. economy by increasing production costs, causing higher prices hikes, damaging growth and people's livelihoods, as well as creating barriers to U.S. exports to China.

    "It is foreseeable that the latest U.S. tariff hikes on China, far from resolving issues, will only make things worse for all sides," according to the white paper, which also listed details of what it described as U.S. backtracking.

    "The Chinese government rejects the idea that threats of a trade war and continuous tariff hikes can ever help resolve trade and economic issues," according to the white paper. "Guided by a spirit of mutual respect, equality and mutual benefit, the two countries should push forward consultations based on good faith and credibility in a bid to address issues, narrow differences, expand common interests, and jointly safeguard global economic stability and development," it said, according to Bloomberg .

    As Vice Commerce Minister Wang Shouwen, who led the working-level team in the negotiations, said China is willing to work with the US to find solutions, but the latter's strategy of maximum pressure and escalation can't force concessions from China: "When you give the U.S. an inch, it takes a yard", he said.

    Meanwhile, when asked about US firms’ complaints that customs clearance was taking longer since the start of the trade war, he advised companies to contact the relevant authorities. “If certain firms are faced with specific issues, they can talk to local commerce departments,” he said.

    On the increasingly touchy matter of exports of rare earth minerals, Wang repeated Beijing’s comments of the past week. “With the world’s richest rare earth resources we are willing to satisfy the normal needs of other countries,” he said. “But it’s unacceptable if other countries use rare earths imported from China to suppress China’s development.”

    But in what could be the worst news for bulls who are clutching at any straw now to indicate an improvement in diplomatic relations, when asked about the possibility of a summit between Xi and Trump on the sidelines of the Group of 20 summit in Osaka, Japan later this month – as suggested by the American president in May – Wang said he had no information on the matter, according to the SCMP.

    Shi Yinhong, an adviser to China’s State Council and a specialist in US affairs at Renmin University in Beijing, said that despite the pressure from the US, Beijing had shown restraint in its efforts to fight back... which it has indeed, suggesting that Trump's read of the calculus - one according to which China has more to lose than gain from taking trade war to the next level - is the correct one.

    “In the areas of trade and technology, China has less leverage than the US, but it has kept its retaliatory measures within these areas,” he said. “If it extended its efforts to areas like North Korea and Iran, it could do much greater damage to Trump.”

    The punchline: when addressing the chances of the two sides achieving a breakthrough in their trade negotiations by the time of the G20 summit, Shi said: “The difference is too wide and would be impossible for them to bridge in a month.”

    The full White Paper can be found here.

    [Jun 02, 2019] Pompeo Again Threatens Germany- Drop Huawei Or Intelligence Sharing Blocked -

    Notable quotes:
    "... Meanwhile on Thursday a Chinese Foreign Ministry spokesman responded to the White House position at a moment Pompeo keeps up the pressure campaign on European allies, saying, the US has not offered proof that Huawei's products present a security risk. ..."
    "... "We hope that the United States can stop these mistaken actions which are not at all commensurate with their status and position as a big country," said spokesman Geng Shuang, according to Reuters. ..."
    "... And Huawei, for its part, is reportedly taking steps to block its employees from taking part in technical meetings with American contacts, which has even included sending home American employees that were based at its Chinese headquarters in Shenzen. ..."
    Jun 02, 2019 | www.zerohedge.com

    Pompeo Again Threatens Germany: Drop Huawei Or Intelligence Sharing Blocked

    me title=

    by Tyler Durden Sun, 06/02/2019 - 07:35 5 SHARES Twitter Facebook Reddit Email Print

    Secretary of State Mike Pompeo has again put Germany and the rest of Europe on notice regarding China's controversial telecom giant Huawei, warning they could be cut off from crucial US intelligence sharing over Huawei's 5G networks now being built.

    Pompeo issued the ultimatum following a meeting with German Foreign Minister Heiko Maas on Friday, saying the decision on whether to allow Huawei equipment would have severe consequences, according to Reuters . His words came at the start of a five-day European tour: "They [Germany] will take their own sovereign decisions, [but we] will speak to them openly about the risks ... and in the case of Huawei the concern is it is not possible to mitigate those anywhere inside of a 5G network ," Pompeo said .

    U.S. Secretary of State Mike Pompeo with German Foreign Minister Heiko Maas. File photo via RFERL

    Germany, alongside the UK and France, has refused to budge amidst the ratcheting pressure from the US over worries that China's intelligence is using its next generation networks as "back door" for aggressive telecommunications eavesdropping.

    Pompeo told the news conference further: "(There is) a risk we will have to change our behavior in light of the fact that we can't permit data on private citizens or data on national security to go across networks that we don't have confidence (in)."

    As we reported previously the Trump administration first notified its Berlin counterparts of the intelligence sharing concerns in early March, when US Ambassador to Germany Richard A. Grenell told Germany's economics minister in an official letter that the European ally and intelligence partner "wouldn't be able to keep intelligence and other information sharing at their current level if Germany allowed Huawei or other Chinese vendors to participate in building the country's 5G network."

    It was noted at the time the warning is "likely to cause alarm among German security circles" amid persistent terror threat, largely the result of Merkel's disastrous "Open Door" policies which allowed over 1 million middle eastern immigrants into he country. And yet it appears Germany's national security state establishment has remained unmoved, or at least unable to prevail over Merkel's government.

    Meanwhile on Thursday a Chinese Foreign Ministry spokesman responded to the White House position at a moment Pompeo keeps up the pressure campaign on European allies, saying, the US has not offered proof that Huawei's products present a security risk.

    "We hope that the United States can stop these mistaken actions which are not at all commensurate with their status and position as a big country," said spokesman Geng Shuang, according to Reuters.

    And Huawei, for its part, is reportedly taking steps to block its employees from taking part in technical meetings with American contacts, which has even included sending home American employees that were based at its Chinese headquarters in Shenzen.

    [Jun 01, 2019] PATRICK LAWRENCE- The US-China Decoupling by Patrick Lawrence

    Notable quotes:
    "... The long, dense economic relationship appears to have passed its peak, writes Patrick Lawrence. ..."
    "... The fallout from these mutually imposed taxes on trade will be considerable all by itself. Global supply chains will inevitably be disrupted -- a potential threat to worldwide economic stability. U.S. importers are expected to start shifting purchases away from China in favor of alternative suppliers with lower cost structures. American investors are likely to reconsider the mainland as a production platform, in many cases diverting investment dollars elsewhere. ..."
    "... In the financial markets, this process is termed "decoupling." The long, dense economic relationship between the U.S. and China, the reasoning runs, appears to have passed its peak. ..."
    "... With bilateral trade talks stalled, both sides have begun to indicate -- directly or by inference -- that they are now prepared to draw blood. Once the long-term damage begins, as appears increasingly likely, it is difficult to see how there will be any turning back from it. ..."
    "... The only known back door into Huawei systems was created by the National Security Agency, which hacked its servers at some point between 2010 and 2012; this was revealed in the documents Edward Snowden made public in mid -- 2013. In effect, the U.S. accuses China of doing what it has already done. ..."
    "... "When it comes to policy caprice motivated by paranoia and Deep State lies, the attack on Huawei is in a class all by itself," David Stockman, the former White House budget director, wrote on his blog earlier this month. "The whole case has been confected by Washington-domiciled economic nationalists who think prosperity stems from the machinations of the state and that state-sponsored 'national champions' are essential to winning the race for global economic and technological dominance." ..."
    "... Last week the president suggested that the Huawei dispute can be negotiated as part of a broader agreement on trade. At the same time, Dan Coats, the director of national intelligence, has been crisscrossing the country to warn U.S. companies, universities, and other institutions of the perils of doing business with China. Coats's focus is on the high-technology sector. ..."
    "... There are two lessons to draw from this spectacle. Trump's position on Huawei gives the game away: If the company is truly a national security threat, it makes no sense to offer it as a chip to be bargained in trade talks with Beijing. Equally, Coats's barnstorming tour is a clear indication that the national security apparatus is actively seeking to cast China as a strategic threat to the U.S. -- as the Pentagon declared it to be in a defense review earlier this year. ..."
    "... Turning off the supply of rare earths is not the "nuclear option" China may consider it, as there are alternative suppliers. At the same time, the mainland accounts for nearly three-quarters of world supplies. When it blocked sales to Japan during a diplomatic dispute in 2010, prices rose precipitously and there was mayhem among manufacturers dependent on Chinese supplies. ..."
    "... Xi made a remark in Jiangxi that is not to be missed. "We are now embarking on a new Long March," he said, referencing the famous retreat Mao led after Chinese Nationalists defeated the Red Army in 1934. "And we must start all over again." ..."
    "... Unless Washington opens to a more cooperative partnership with Beijing -- an unlikely prospect -- this could be the moment China begins to displace the U.S. as the preeminent power in the western Pacific. ..."
    "... The US has to regain a real economy and stop the insane military spending. Regardless of China. ..."
    "... ‘”Trump’s position on Huawei gives the game away: If the company is truly a national security threat, it makes no sense to offer it as a chip to be bargained in trade talks with Beijing.” Absolutely the case. Trump has been caught before in this same kind of contradictory stance, as with tariffs on steel and aluminum. ..."
    "... Trump seems to think he can command the wind and the waves. He has an immense ego, and there is the fact that he is a good deal less clever than he thinks he is. ..."
    "... Trump believes that by intimidation and threats, he can make something happen that cannot happen through the ordinary operations of the economies. In this we see him most like the thugs that came to run a number of European countries in the 1930s. ..."
    "... Trump’s “MAGA” is nothing more than thinking you can make that heart-warming post-WWII slogan, “the American Dream,” come alive again, many decades later and in an entirely different set of circumstances. “The American Dream” was based in a world where almost every competitor was prostrate from war while America remained relatively unscathed. So, America supplied, for a while, a huge share of the world’s demands, but its share has been declining ever since. ..."
    "... Naturally, many Americans want to believe otherwise. Trump’s base – the nation’s Wal-Mart shoppers and the residents of its huge gulag of trailer parks – certainly does, and its hopes comes tinged with everything from superstition to religiosity. ..."
    "... America’s elites, the members of its power establishment, do not believe in the same way, but they are deeply concerned about America’s relative decline. ..."
    "... They do believe that America’s still great remaining strength can be used to extract concessions from the world without sacrificing anything at home and without sacrificing its role as the center of world empire, a role that comes with many perks and privileges ..."
    "... One thinks of the infamous German industrialists and bankers’ – as well as notable American ones – early support for Hitler, although I do not mean to say the situations are identical. ..."
    "... You can try fighting by the methods Trump is using, but those methods risk, through acts like the blithe laying on of massive new tariffs and sanctions, not only reduced economic activity in the world, they risk ultimately real wars. ..."
    "... The real pity is that Trump at his core is not that much different from the rest of the fools who have been leading this country for the past several decades. He’s just “old school” in his style: he doesn’t wear soft kid gloves whilst attempting to strangle his geopolitical competitors the way all his chums before him did, the sonorous Barack Obama included. ..."
    "... Constant warfare is a big part of US consumption. ..."
    "... It is becoming increasingly clear that the US is subject to an arms industry racket which is draining its resources and ruining its real potential. ..."
    "... We are becoming a country of idle over-weight vets running around on motorcycles wearing red MAGA hats, supported by billionaires, while the rest toil. ..."
    "... This will likely come to a head sooner rather than later, and the conflict can be understood in broader terms as between a hegemonic global model and a multi-polar global model ..."
    "... While confidence that such measures can inflict enormous harm is justified, the corresponding confidence that America’s preeminent position atop the world’s economic structures is not subject to challenge or change is misguided. The challenge has been ongoing for over five years now, and the change will likely appear suddenly. The preference would be for the U.S. guided to a soft landing into a multi-polar world, but Washington’s policy hawks seem committed to rolling the dice. ..."
    "... Washington’s policy setters are gangsters who operate largely through intimidation, extortion and racketeering. ..."
    "... This trade war sounds dangerous – didn’t the Smoot Hawley tariffs precipitate the great depression? And the inevitable economic war (even if it is a faux war based on lies, driven by the neocons) could well lead to a real war if we let it….. ..."
    "... But trade wars are easy to win! Our very smart cheeto-in-chief has told us. You wouldn’t doubt him would you? ..."
    "... The US has abdicated their manufacturing and innovative technologies, shutting down heavy industry under Reagan and Bush I (replacing it with a “service economy”) while outsourcing high end technology and offshoring technical jobs, initially to China mostly under Clinton and Bush II. ..."
    "... It’s tempting to conclude that tariffs and action against Huawei are part of the same strategy. I don’t think they are. The tariffs are playing to Trump’s voter gallery. ..."
    "... So long as the Chinese can find a way to save face AND give face to Trump, compromise is possible. Huawei is about the Deep State being unable to access Huawei’s facilities. Its a double bluff. The NSA etc (via 5 Eyes) have great access to western controlled telecoms. ..."
    Jun 01, 2019 | consortiumnews.com

    May 28, 2019 • 32 Comments

    The long, dense economic relationship appears to have passed its peak, writes Patrick Lawrence.

    Special to Consortium News

    P resident Donald Trump's trade war with China is swiftly taking a decisive turn for the worse.

    Step by step, each measure prompting retaliation, a spat so far limited to tariff increases, now threatens to transform the bilateral relationship into one of managed hostility extending well beyond economic issues. Should Washington and Beijing define each other as adversaries, as they now appear poised to do, the consequences in terms of global stability and the balance of power in the Pacific are nearly incalculable.

    The trade dispute continues to sharpen. Later this week Beijing is scheduled to raise tariffs already in place on $60 billion worth of American exports -- the latest in a running series of escalations Washington set in motion nearly a year ago. Two weeks later the U.S., having increased tariffs on $200 billion worth of Chinese products earlier this month, is to consider imposing levies on an additional $325 billion worth of imports from the mainland.

    The fallout from these mutually imposed taxes on trade will be considerable all by itself. Global supply chains will inevitably be disrupted -- a potential threat to worldwide economic stability. U.S. importers are expected to start shifting purchases away from China in favor of alternative suppliers with lower cost structures. American investors are likely to reconsider the mainland as a production platform, in many cases diverting investment dollars elsewhere.

    For its part, China is already rotating its gaze westward toward the Middle East and Europe. As if to underscore the point, the East Hope Group, a large Chinese manufacturer, announced late last week that it plans to invest $10 billion in Abu Dhabi's industrial sector. Beijing is already drawing Western Europe into its trillion-dollar Belt and Road Initiative . In time, Europe could begin to replace the U.S. as a source of the foreign investment capital China needs.

    Decoupling

    In the financial markets, this process is termed "decoupling." The long, dense economic relationship between the U.S. and China, the reasoning runs, appears to have passed its peak.

    With bilateral trade talks stalled, both sides have begun to indicate -- directly or by inference -- that they are now prepared to draw blood. Once the long-term damage begins, as appears increasingly likely, it is difficult to see how there will be any turning back from it.

    Two weeks ago, the White House issued an executive order barring purchases of telecommunications equipment from any foreign company deemed to pose a threat to U.S. national security. It also requires American companies to obtain licenses before exporting U.S. telecoms technology to such firms. While an administration official described the order as "company and country agnostic," it is all but explicitly intended to damage the global position of Huawei, the highly competitive Chinese company that is a leader in cellular telephone sales and 5G telecommunications networks.

    Huawei has long been in Washington's sights. Chief among the allegations against it , the company is accused of providing China with a "back door" into its telecoms networks, so allowing Beijing to spy on any entity using Huawei equipment. The U.S. has never provided evidence of this, and both Huawei and Beijing vigorously deny any such arrangement. The only known back door into Huawei systems was created by the National Security Agency, which hacked its servers at some point between 2010 and 2012; this was revealed in the documents Edward Snowden made public in mid -- 2013. In effect, the U.S. accuses China of doing what it has already done.

    "When it comes to policy caprice motivated by paranoia and Deep State lies, the attack on Huawei is in a class all by itself," David Stockman, the former White House budget director, wrote on his blog earlier this month. "The whole case has been confected by Washington-domiciled economic nationalists who think prosperity stems from the machinations of the state and that state-sponsored 'national champions' are essential to winning the race for global economic and technological dominance."

    Contradictory Narrative

    There is little question that freezing Huawei out of the U.S. market and depriving it of U.S. -- made components will do damage, in all likelihood lasting, to the company. The Eurasia Group terms the administration's executive order "a grave escalation with China that at a minimum plunges the prospect of continued trade negotiations into doubt." But as it has on other policy questions, the Trump administration is tripping over its own contradictory narratives at this point.

    Last week the president suggested that the Huawei dispute can be negotiated as part of a broader agreement on trade. At the same time, Dan Coats, the director of national intelligence, has been crisscrossing the country to warn U.S. companies, universities, and other institutions of the perils of doing business with China. Coats's focus is on the high-technology sector.

    There are two lessons to draw from this spectacle. Trump's position on Huawei gives the game away: If the company is truly a national security threat, it makes no sense to offer it as a chip to be bargained in trade talks with Beijing. Equally, Coats's barnstorming tour is a clear indication that the national security apparatus is actively seeking to cast China as a strategic threat to the U.S. -- as the Pentagon declared it to be in a defense review earlier this year.

    Beijing has so far shown restraint in its responses, but there are signs it is stiffening its spine. On Friday it issued a draft of its own set of tighter regulations governing potential cyber-security breaches. Xi Jinping had earlier visited a rare-earth processing facility in Jiangxi Province -- a move read as the Chinese leader's subtle suggestion that Beijing may consider blocking exports of minerals that are essential components in a variety of high-tech devices.

    Turning off the supply of rare earths is not the "nuclear option" China may consider it, as there are alternative suppliers. At the same time, the mainland accounts for nearly three-quarters of world supplies. When it blocked sales to Japan during a diplomatic dispute in 2010, prices rose precipitously and there was mayhem among manufacturers dependent on Chinese supplies.

    Xi made a remark in Jiangxi that is not to be missed. "We are now embarking on a new Long March," he said, referencing the famous retreat Mao led after Chinese Nationalists defeated the Red Army in 1934. "And we must start all over again."

    With formal talks lapsed for the time being, there is now no shortage of signaling from either Washington or Beijing. But Xi, China's most assertive leader since the Great Helmsman, appears to understand the moment as larger than mere gestures. U.S. -- China relations have entered a decisive phase. America cannot win in a long-term confrontation with China. Unless Washington opens to a more cooperative partnership with Beijing -- an unlikely prospect -- this could be the moment China begins to displace the U.S. as the preeminent power in the western Pacific.

    Patrick Lawrence, a correspondent abroad for many years, chiefly for the International Herald Tribune , is a columnist, essayist, author, and lecturer. His most recent book is "Time No Longer: Americans After the American Century" (Yale). Follow him @thefloutist . His web site is www.patricklawrence.us. Support his work via www.patreon.com/thefloutist .

    If you value this original article, please consider making a donation to Consortium News so we can bring you more stories like this one.


    dean 1000 , May 31, 2019 at 11:12

    The Empire the US built and acquired after WWII could not last no matter who is president. We have been advised of this coming reality for 30 or 40 years. Washington can’t adjust b/c it is controlled by a two party system that is owned by the 10%.

    Since wall street bought a bunch of manufacturing companies and exported them to China the US hasen’t had a real economy. It has been one bubble economy after another. A stock bubble, tech bubble, dot com bubble, and a killer 8 trillion $ housing bubble, and a completely unnecessary bank bailout.

    The US has to regain a real economy and stop the insane military spending. Regardless of China.

    Zhu , May 31, 2019 at 06:14

    Trump, in effect, is walling the US off from the rest of the world, as Ming-Qing dynasty China did until 1911.it turned out badly for Chinese people. It’s likely to turn out badly for the US.

    Truth , May 29, 2019 at 17:27

    One solution to rare minerals is to break the illegal clinton & bush era mining agreements around the Grand canyon and Nevada which has turned our resources into cash from russia and canada into the pockets of the deep state “elected” in D<C and these states. It would be nice if every now and then a real journalist who publishes a full story would get a complete story published. Consortium does better than most but still needs to step up their game.

    An article that includes explaining why all NAFTA and trade agreements since Kennedy have been total sellouts of USA in exchange for party owned companies of the "elected"

    JOHN CHUCKMAN , May 29, 2019 at 11:19

    ‘”Trump’s position on Huawei gives the game away: If the company is truly a national security threat, it makes no sense to offer it as a chip to be bargained in trade talks with Beijing.” Absolutely the case. Trump has been caught before in this same kind of contradictory stance, as with tariffs on steel and aluminum.

    I think the truth is that he is a man ready to use any gimmick to get what he wants, regardless of logic or facts or principle. Another way to say that is to speak of a criminal mentality.

    It is exactly what the mob has always done in making someone an offer they can’t refuse. “Don’t want to pay protection money? Well, don’t be surprised if your joint gets burned down.”

    Trump essentially wants to transfer huge amounts of trade surplus from China to the United States, not by any change in the economic activity or policies of the two countries but by fiat.

    But of course, the world doesn’t work that way.

    The United States’ trade deficits are its own doing, not China’s. The United States doesn’t save, and it doesn’t tax adequately. It consumes, and a productive country like China is only too pleased to supply what it wants. That makes a flow of goods in one direction and a flow of money in the other. Economics 101.

    Trump seems to think he can command the wind and the waves. He has an immense ego, and there is the fact that he is a good deal less clever than he thinks he is.

    Trump believes that by intimidation and threats, he can make something happen that cannot happen through the ordinary operations of the economies. In this we see him most like the thugs that came to run a number of European countries in the 1930s.

    He genuinely does not understand – or if he understands, he doesn’t care – what is behind the surpluses and deficits and just insists that they will be changed as a matter of his personal will. Does that not remind us of anyone from history?

    At any rate, it comes down to his admiring “the strong man” and believing he, and he alone, can play that role for the United States. And there are more than a few Americans that believe him too. After all, the great American journalist and historian who documented the rise and fall of the Nazis, William L. Shirer, once said that he thought the United States might be the first country to go fascist voluntarily. He based that thought on his observation of many attitudes and beliefs and trends in the United States.

    Trump’s “MAGA” is nothing more than thinking you can make that heart-warming post-WWII slogan, “the American Dream,” come alive again, many decades later and in an entirely different set of circumstances. “The American Dream” was based in a world where almost every competitor was prostrate from war while America remained relatively unscathed. So, America supplied, for a while, a huge share of the world’s demands, but its share has been declining ever since.

    In today’s world, all the old competitors have not only come roaring back, but a lot of new ones have come into being, and that reality is the future.

    Naturally, many Americans want to believe otherwise. Trump’s base – the nation’s Wal-Mart shoppers and the residents of its huge gulag of trailer parks – certainly does, and its hopes comes tinged with everything from superstition to religiosity.

    America’s elites, the members of its power establishment, do not believe in the same way, but they are deeply concerned about America’s relative decline. They have been working away for years on the problem, as in their past bashing of Japan or China, but they are not ready to work for fundamental change in America, as, for example, in its tax and savings structures and its grotesque inequalities.

    They do believe that America’s still great remaining strength can be used to extract concessions from the world without sacrificing anything at home and without sacrificing its role as the center of world empire, a role that comes with many perks and privileges. And while most of them do not like Trump’s style or background, I think for now they are willing to see whether he can get the ugly job done. One thinks of the infamous German industrialists and bankers’ – as well as notable American ones – early support for Hitler, although I do not mean to say the situations are identical.

    You can try fighting by the methods Trump is using, but those methods risk, through acts like the blithe laying on of massive new tariffs and sanctions, not only reduced economic activity in the world, they risk ultimately real wars.

    Even if they don’t go so far as war, they are shaking up some fundamental post-WWII arrangements that America is going to miss. Decades-old allies, like some of those in Europe, are beginning to re-think their relationship with such a hostile, single-minded America and to glance around in other directions, as towards the very China Trump attacks and towards Russia, a country whose openness to business would have resembled a miracle under the communists and whose wealth of natural resources offers altogether new opportunities.

    Realist , May 30, 2019 at 01:32

    The real pity is that Trump at his core is not that much different from the rest of the fools who have been leading this country for the past several decades. He’s just “old school” in his style: he doesn’t wear soft kid gloves whilst attempting to strangle his geopolitical competitors the way all his chums before him did, the sonorous Barack Obama included.

    Zhu , May 31, 2019 at 06:25

    Constant warfare is a big part of US consumption.

    Daniel Good , May 29, 2019 at 04:36

    The problem that bothers the US policy makers is real: what to do about the balance of payments deficit? The Trump team seems to be nit-picking areas where imports can be reduced, for instance by blocking Chinese tech exports.

    All of these moves are nonsense because they miss the real problem: the US economy has a long standing structural quandary. It devotes so much of its resources to flashy, ornamental and useless defense high tech weapons and gismos that it is running itself into the ground.

    It is becoming increasingly clear that the US is subject to an arms industry racket which is draining its resources and ruining its real potential. What needs to be done is to cut the military budget in half and redirect the resources to improving the infrastructure of the country and making investment once again profitable inside the USA. Where is the politician who dares make these proposals? Wake up America. We are becoming a country of idle over-weight vets running around on motorcycles wearing red MAGA hats, supported by billionaires, while the rest toil.

    bardamu , May 29, 2019 at 00:07

    It is strange to discuss confrontation with China only in terms of trade deals so soon after Obama’s “pivot to Asia,” Trump’s militarism with respect to North Korea, and the militarism of both the Obama and Trump regimes as regards Russia and also through western and central Asia, which are clearly areas in which China has no less natural interest than the United States.

    Among these, surely tariffs are the least of most anyone’s worries.

    jaycee , May 28, 2019 at 16:27

    This will likely come to a head sooner rather than later, and the conflict can be understood in broader terms as between a hegemonic global model and a multi-polar global model.

    The hegemonic global model has been an American project since the demise of the Soviet Union, usually presented in euphemism – “globalization”, the “exceptional” nation, the “rule-based international system”, etc. In recent years, US politicians have overstepped by a reckless use of the international financial system to deter designated adversaries.

    Presently moving through Congress are bills designed to use sanctions (“maximum pressure”) to attack both Russia’s Nordstream natural gas pipeline to Europe and China’s claims in the South China Sea.

    While confidence that such measures can inflict enormous harm is justified, the corresponding confidence that America’s preeminent position atop the world’s economic structures is not subject to challenge or change is misguided. The challenge has been ongoing for over five years now, and the change will likely appear suddenly. The preference would be for the U.S. guided to a soft landing into a multi-polar world, but Washington’s policy hawks seem committed to rolling the dice.

    Realist , May 28, 2019 at 17:41

    Washington’s policy setters are gangsters who operate largely through intimidation, extortion and racketeering. If you look up the definitions of those words you will see they describe to a tee what the American government does. Shutting down Nordstream (and all the other sanctions over transparently absurd claims) is meant entirely to damage the Russian economy and destabilise the country’s government, plus to steal away customers in the energy sector.

    They are protecting nobody’s “rights of navigation” in the South China Sea, rather they are telegraphing to Bejing that Chinese trade with the world can be shut down on a moment’s notice by Uncle Sam, specifically they are trying to put the kibosh on the Chinese “Belt and Road Initiative.” The cusses in Washington have gone so far as to tell Canada that it does not have control over the Northwest Passage, long considered to be within its internal waters–you know, all those islands connected by ice for most of the year. Hence forth, Washington decreed that they are international waters and that it would control them. If that’s being a good neighbor to a country that has supported your every crazed demand for over 200 years, the “Great White North” needs to get a restraining order from the World Court against Uncle Sam, plus they need to find better friends elsewhere on the planet.

    C Thomas Payne , May 28, 2019 at 19:37

    I tend to substitute the euphemism “rogue nation” for those others.

    Excellent comment.

    Realist , May 28, 2019 at 16:22

    India, Vietnam, and the Philippines will thank China for the opportunity to manufacture schlock for sale at Wal*Mart and for the major investments that new Chinese shareholders will have made in their companies. These countries will now have wares to trade along the Belt and Road linking all of Eurasia where everyone keeps getting richer by the day. Since people the world over, except for congenitally retarded neocons, know a good deal when they see one, all these countries will start telling Uncle Sam to cram it when he keeps demanding they sanction their new found friends and trading partners because freedom and democracy, Putin and the other names on Sam’s shit list. They’ll start deciding that all those American bases give them no clout, no influence, no pay-off and no security… nothing useful at all, unless prosecuting the crimes and repairing the damage caused by the garrison soldiers provides local entertainment. It will be time to relocate those rat-holes to the American side of Trump’s Wall.

    Will the silver lining be new American self-sufficiency in manufacturing? The development of needed resources using new innovative technologies? A plethora of jobs at good pay for working American men and women? Will American oligarchs once again begin investing in America itself? If you can arrange that with American greenbacks now buying a tenth as many Yuans, Euros, Yen, Rupees, Rubles and even Pesos than they once did because Trump decided to “shake things up,” maybe you can sell all those treasuries needed to run the government in Washington to the Tooth Fairy.

    It’s not true that “you can never go home again:” just watch the dollars come flooding back to North America when the whole rest of the world stops trading in them. This whole bit of history should be engaging to watch on some future television show similar to James Burke’s “Connections.”

    If only Barack Obama had eased up on the extreme Trump bashing at that White House Correspondents’ Dinner.

    Harpo Kondriak , May 28, 2019 at 20:13

    “Watch those dollars come flooding back” – when the real fun starts. Those that don’t understand why there has been little inflation from the bank bailouts will get their answer. And they won’t like it.

    Seamus Padraig , May 28, 2019 at 14:46

    As a life-long protectionist, I always believed that our foolish dependence on imports would ultimately end in tears, and it is now clear how right I was. Just to think: we could have saved ourselves all this trouble and misery simply by voting down NAFTA and declining to extend Most-Favored Nation trade status (as it used to be called) to China 25 years ago. But now, putting our industry back on track is really gonna hurt. Pity …

    Zhu , May 31, 2019 at 06:39

    Any US reindustrialization is likely employ robots. The homeless will just keep on increasing.

    Godfree Roberts , May 28, 2019 at 12:29

    “Europe could begin to replace the U.S. as a source of the foreign investment capital China needs.”?
    China is the leading recipient of FDI but its need for foreign capital is rapidly diminishing and it is the world leader in IP

    Zhu , May 31, 2019 at 06:40

    A fair amount of foreign investment is laundered bribe money from China.

    evelync , May 28, 2019 at 11:28

    This trade war sounds dangerous – didn’t the Smoot Hawley tariffs precipitate the great depression? And the inevitable economic war (even if it is a faux war based on lies, driven by the neocons) could well lead to a real war if we let it…..

    I can’t help but secretly imagine that perhaps the retaliation that Patrick Lawrence writes about – namely China’s shift to other trade partners – happens smoothly and quickly enough to deprive our neocons of their super power resources to put an end to what Charles Misfeldt in his comments refers to as Crooks, liars, thieves, cowards and traitors running things…..errr ruining things. I know that’s not the answer because it could be devastating too.

    It’s up to the electorate to shift away from the ideologues, both neoliberal and neocons. But will we demand better government?

    Most politicians in power have been too afraid to challenge the idea of “exceptionalism” which is used to keep the primitive war machine going.

    Thanks for the article and the interesting and informative comments….much appreciated…

    Jeff Harrison , May 28, 2019 at 11:19

    But trade wars are easy to win! Our very smart cheeto-in-chief has told us. You wouldn’t doubt him would you?

    Actually, one wonders why anyone takes the US and its accusations seriously. Especially by the European vassal states. Yes, your equipment/software will have a backdoor if the US wants one there. That much is clear from the Snowden releases. And a Reuters report this morning gives a hint at how it’s done. Huawei apparently is continuing to make the mistake of sending things out via FedEx. Magically, two of the parcels wound up in the US without the benefit of Huawei changing their shipping request. Huawei would never have known if they hadn’t looked at the routing of the parcel after they got it. Hopefully, there wasn’t any sensitive information in the documents routed to the US because it’s a sure thing that the USG now has copies of them. Same for the European vassals. Angela Merkel’s phone hacked. Electronic interception equipment installed on undersea telephone cables. That’s before we get to the NSA office in all the telecoms spying on us. Most of the world’s telecommunications run through the US. So, not only do we get to listen in on a phone call from Paris to Des Moines, we get to listen in on one from Paris to Shanghai.

    And the European vassals continue to toe the American line albeit a bit more reluctantly.

    michael , May 28, 2019 at 11:15

    The US has abdicated their manufacturing and innovative technologies, shutting down heavy industry under Reagan and Bush I (replacing it with a “service economy”) while outsourcing high end technology and offshoring technical jobs, initially to China mostly under Clinton and Bush II.

    Short-term profits soared with the cheaper labor, but giving away high end technologies leading to innovations for China was resoundingly stupid. Chinagate was (is) much more dangerous than Russiagate to National Security.

    Having given away America’s capabilities to China, no amount of negotiating will “level the playing field” . We can no longer compete with China not because of labor costs, but because of the improvements the Chinese have made in so many fields over twenty years, while America sat stagnant (except of course for overpriced weapons and surveillance tools to watch American citizens).

    Zhu , May 31, 2019 at 06:47

    The US has always imported its Einsteins and Teslas. We Americans are educated to be cannon fodder in wars of vanity. At best, we’re educated to be Trump – Romney style connivrrs and crooks.

    peter mcloughlin , May 28, 2019 at 09:14

    Historically, when two hegemonic powers clash the result is always war. What we are witnessing between Washington and Beijing today is no different. But Washington will not allow China to ‘displace the US as the preeminent power in the western Pacific.’ The trade war will become world war.
    https://www.ghostsofhistory.wordpress.com/

    Dave Henderson , May 28, 2019 at 10:18

    I am afraid you are right.

    T , May 29, 2019 at 15:50

    Peter McLoughlin, your Web site

    http://www.ghostsofhistory.wordpress.com/

    does not have a valid certificate (Firefox warned me).

    Charles Misfeldt , May 28, 2019 at 08:44

    I look at this picture and see all the representative’s on America’s side of the table are conservative scumbags who have no intention of engaging in behavior that benefits myself or the majority in America. Crooks, liars, thieves, cowards and traitors…

    MichaelWme , May 28, 2019 at 06:55

    “a spat so far limited to tariff increases”

    Not quite. The US has announced that any Chinese person travelling outside of China can be arrested, as it had Meng Wanzhou arrested in Canada for selling Huawei phones to Iranians. China threatened to execute 3 Canadians in retaliation, so Canada released Ms Meng from prison and put her under house arrest while the legal processes of extradition are now thought to require many years.

    China hasn’t executed the 3 Canadians, and Ms Meng is in her C$20 million home, and is likely to remain there for the foreseeable future. What happened to Ms Meng can happen to any Chinese executive who travels outside China to the EU or the Americas or Japan.

    E Wright , May 28, 2019 at 04:50

    It’s tempting to conclude that tariffs and action against Huawei are part of the same strategy. I don’t think they are. The tariffs are playing to Trump’s voter gallery.

    So long as the Chinese can find a way to save face AND give face to Trump, compromise is possible. Huawei is about the Deep State being unable to access Huawei’s facilities. Its a double bluff. The NSA etc (via 5 Eyes) have great access to western controlled telecoms.

    They don’t want to lose that access by allowing an outside operator, so they accuse Huawei of what they are doing, on the assumption that Beijing does what they do.

    [May 31, 2019] It is very unlikely that China can buy less US bonds because doing so would almost certainly be costly for Beijing. And even if China took this step, it would have either no impact or a positive impact on the U.S. economy.

    May 31, 2019 | www.moonofalabama.org

    John Smith , May 30, 2019 9:03:56 PM | 36

    Why China Likely Won't Buy Fewer U.S. Treasury Bonds

    A January 2018 Bloomberg article suggests that Chinese officials may reduce their purchases of U.S. government bonds. It is very unlikely that China can do so in any meaningful way because doing so would almost certainly be costly for Beijing. And even if China took this step, it would have either no impact or a positive impact on the U.S. economy.

    China Cannot Weaponize Its U.S. Treasury Bonds

    A number of recent articles suggest that Chinese officials may reduce their purchases of U.S. government bonds.

    This is an updated version of a previously published January 2018 blog post.


    John Smith , May 30, 2019 9:10:24 PM | 38

    "Trade war" between the United States and China in pictures:

    https://pbs.twimg.com/media/D7jk1cuVsAEG7dQ.jpg

    https://pbs.twimg.com/media/D7jk1r5U8AAqcyh.jpg

    psychohistorian , May 30, 2019 9:13:53 PM | 39
    @ John Smith with speculations about what China can/can't do with its trove of US Treasuries...I admit not following your links

    How about if China used them to "pay off" a bunch of countries IMF and World Bank debt?

    Just a little beyond the think tank box rumination for you.....

    BM , May 31, 2019 2:56:51 AM | 56

    China reduced its holdings of U.S. debt in March by about $20.5 billion, bringing its overall ownership down to $1.12 trillion.

    There was some more detailed coverage of this not long ago, probably on Strategic Culture. China has largely stopped buying US treasuries for a few years now, and more recently has been very slowly reducing its holdings. It has to recycle its US dollars from its exports to the US somehow - instead of buying US treasuries and thereby funding the US military encirclement of China, it is using them for infrastructure investments in Eurasia under BRI - much of that is denominated in US dollars.

    So that Carnegie Endowment crap is nothing but mindless bullshit propaganda*. No wonder the US fails in everything it tries to do these days - these are the sort of idiots who "advise" the US government what to do!!

    As to that troll - B's advice is always this: Don't feed the trolls

    * Disclaimer - I haven't read the troll's links, nor do I intend to.

    BM , May 31, 2019 3:06:23 AM | 57

    Russia has largely eliminated its holdings of US treasuries. Many other countries have also reduced their holdings, including several US allies (eg Japan, if I recall correctly). Many countries in Eurasia now have huge gold reserves instead, which is a much better bet - not just Russia and China but also Kazakhstan, for example.

    Leser , May 31, 2019 8:55:17 AM | 63

    China reduced its holdings of U.S. debt in March by about $20.5 billion, bringing its overall ownership down to $1.12 trillion.

    Those U.S. Treasuries fluctuations are very likely following trade movements rather than political intentions. As commented before, China's enormous exports require large-scale FX handling and USTs are the easiest way to do that.

    It's not a credible political threat to sell those off, as the next wave of 'QE' money printing is imminent and it will specifically target USTs (per Bloomberg article two days ago, with projected Fed balance sheet to soon grow beyond the recent peak). In other words, anything China might sell will be absorbed by the Federal Reserve with freshly printed money. In the scheme of the money printing madness, another trillion USD is not a large amount.

    Why has Russia then sold their USTs? Probably for fear of being disconnected from the SWIFT system and being stuck with worthless paper. In any case Russia's total divestment of their entire UST stock didn't register in the ebb and flow of the market.

    [May 29, 2019] No, Mr. President- China didn't steal our jobs. Corporate America gave them away by Cody Cain

    May 28, 2019 | www.informationclearinghouse.info

    Trump's trade war points the finger in the wrong direction. China behaved normally; corporate CEOs betrayed us

    " Information Clearing House " - China is not "stealing" American jobs.

    President Trump loves to blame China for the job losses that have devastated American workers under globalization. But the truth is that Trump is blaming the wrong party. Trump's reckless trade war against China is misguided and amounts to a colossal charade that will not solve the actual problem.

    Yes, it is true that numerous American manufacturing jobs have been shipped overseas to China, thereby leaving American workers jobless and suffering. But China did not steal these jobs.

    No. These jobs were given to China. It was all legal and legitimate. China merely accepted the gift.

    What would anyone expect China to do? Accepting these jobs was a perfectly rational course of action.

    China was an underdeveloped nation with a large population of poor people willing to work for a fraction of the hourly wages of American workers. And then corporations came along and presented China with an attractive offer: We would like to build manufacturing plants in China and hire droves of your unemployed people to work there. What was China supposed to do? Naturally, China said yes.

    This is hardly stealing.

    Are You Tired Of The Lies And Non-Stop Propaganda?

    Get Your FREE Daily Newsletter No Advertising - No Government Grants - This Is Independent Media

    It is true that these new jobs in China were intended to displace American workers. But does that concern belong to China? Does China have the responsibility to care for the well-being of American workers? Is China supposed to prioritize American workers over its own workers?

    Of course not.

    China is supposed to look out for itself and for its own workers, not for American workers. Thus it was perfectly proper for China to allow the manufacturing plants to be built in China and employ Chinese workers. China did not steal these jobs.

    So if China is not at fault, then who is to blame for the devastation caused to American workers?

    The answer is plain to see, and it lies within our own shores. The fault belongs squarely with corporate America.

    It was corporate America that made these decisions. Corporate America decided to close their American plants and open new plants in China. Corporate America decided to lay off multitudes of American workers and ruin entire American communities.

    And who profited from the destruction to American workers? It was the wealthy executives and shareholders of American corporations. They earned millions of dollars for themselves by cutting the costs of their workforce.

    This is part of the larger trend of economic inequality that is eroding the entire middle class in America. Wealth is being shifted away from the workers down below and transferred up into the hands of the wealthy executives and shareholders at the top.

    Trump blaming China is nonsense. China is not at fault. To be sure, China is hardly an angel and indeed engages in improper trade practices. But even if China agreed to whatever bone-headed demands Trump is seeking, the problem still would not be solved. The truth is that America cannot possibly compete against China on labor costs. The standard of living is much lower in China and thus Chinese workers are willing to accept wages far below living wages in America. So corporate America will continue to transfer more and more jobs to China and elsewhere. If we do not address this fundamental economic reality, then we will never solve the problem.

    Trump blaming China has an insidious aspect to it as well. Focusing all the ire upon China is a grand misdirection that conceals the true culprit, namely, the super-rich corporate executives and shareholders in America.

    This is part of Trump's standard playbook. Trump falsely proclaims to be fighting for blue-collar workers, when in truth, Trump acts entirely in favor of the rich at the top.

    Surprisingly, this seems to work. Some of the hard-working Americans who are being crushed by Trump's idiotic trade war and who should be denouncing Trump, nonetheless praise him for standing up to China, believing that Trump is fighting for blue-collar jobs. It is painful to witness such good people falling victim to Trump's despicable con job.

    In order to actually save the middle class, we need to focus on the true cause of the problem. We must direct our great powers of reform where they belong -- upon the wealthy executives and shareholders of corporate America who caused this problem in the first place.

    The nature of the problem is that corporate America has no incentive to protect American workers. In fact, corporate America has every incentive to harm American workers by shifting their jobs overseas.

    So the financial incentives must be reconfigured. If corporate America is going to ship American jobs overseas, it must not be permitted to pocket all the profits themselves and leave their displaced workers with nothing. Instead, corporations that send jobs offshore must be required to sufficiently compensate their displaced American workers. Executives and shareholders must not be permitted to enrich themselves unless and until their workers are financially secure.

    Our society must favor people over profits, not profits over people.

    This article was originally published by " Salon " -

    [May 29, 2019] Global Times China Holds Three Trump Cards In War Against US

    In reality China best option is outwait Trump. With the recession caused by the current trade war Trump has very little chances to be reelected.
    May 29, 2019 | www.zerohedge.com
    Tyler Durden Tue, 05/28/2019 - 22:45 Via Oriental Review,

    Amid the escalating economic war between the US and China, discussions have intensified on how Beijing might stand up to the economic power of America, especially given that the global economy is increasingly dependent on the US dollar as the main currency for international trade, and the closing of US markets could do some serious damage to China's export-oriented companies. China's main foreign-policy publication, the Global Times , points to three trump cards that Beijing could use to at least level the playing field in its fight with the Trump administration and cause appreciable harm to the US economy, possibly forcing its opponent to temporarily scale back its ambitions.

    According to an article in the Global Times by a professor at the Renmin University of China, the three trump cards are:

    1) banning the export of rare earths to the US;

    2) blocking US companies' access to Chinese markets; and

    3) using China's portfolio of US Treasury bonds to bring down the US government debt market.

    me width=

    Each of these trump cards are worth looking at in detail, both in terms of their impact on the US economy and also in terms of any possible retaliation from the US and the repercussions for the global economy as a whole.

    Banning the export of rare earths to the US would actually be a pretty serious blow for US electronics manufacturers and, indeed, US high-tech manufacturers generally. This is because rare earths are a key raw material for the production of smartphones, various chips, and other high-value-added products that are the biggest cash cows of US companies such as Apple and Boeing.

    President Donald Trump during a meeting with Chinese Vice Premier Liu He over trade talks in the Oval Office, February 22, 2019

    Reuters, an agency one could hardly accuse of sympathising with Beijing, reports : "The United States has again decided not to impose tariffs on rare earths and other critical minerals from China, underscoring its reliance on the Asian nation for a group of materials used in everything from consumer electronics to military equipment."

    China does not exactly have a monopoly on such materials, but the market would definitely be in short supply without Chinese exports, with all the price implications that would bring. Moreover, it is likely that some deficit positions will be impossible to close no matter how much money is involved.

    Not everything is that simple, however. Should such a ban be introduced, then Beijing will encounter certain technical difficulties. If sanctions are only imposed on US companies, then they will still be able to purchase the necessary materials through Japanese or European straw buyers, making the embargo pointless. But if China imposes a total export ban, then it won't just be US companies that suffer but European ones as well, leading to EU reprisals against Chinese exporters to Europe. This would be very painful for China, especially given the economic war with the US that is making access to European markets invaluable to the Chinese economy.

    It appears that a ban on rare earth exports is a powerful weapon, but its use will require the utmost delicacy and serious diplomatic efforts to avoid any extremely unpleasant side effects.

    The second trump card mentioned by the Global Times is blocking US companies' access to the fast-growing and extensive Chinese market. This should be looked at from a political, rather than economic, point of view (although the latter may seem logical). The aim of such restrictive measures is not to inflict unacceptable damage on the US economy, but to make the full might of America's corporate lobbying machine work against Donald Trump and support his political opponents.

    According to the S&P Dow Jones Indices, Asia only accounts for around 14 per cent of the sales of S&P 500 companies. If we assume that China makes up the majority of this, then not even a complete closure of the Chinese markets would be a disaster. There are a few important details, however.

    https://tpc.googlesyndication.com/safeframe/1-0-33/html/container.html

    As a result, the profits of US companies and the future of the American stock market (which is a key political barometer given that many Americans have invested their savings in shares) would be at risk. It might be possible to offset these problems by transferring production to other Asian countries with cheap labour and favourable terms, but this couldn't be done quickly and it would be risky, given that Trump is waging trade wars with everyone from the European Union to loyal US allies such as Japan and India. In light of this, US companies will have a huge incentive to prevent Trump from being elected for a second term, and the lobbying and political capabilities of that part of the US corporate sector that will suffer the most from this trump card could really play a key role in the political victory of Trump's opponents.

    The third trump card involves China dumping its portfolio of US Treasury bonds. The Global Times writes: "China holds more than $1 trillion of US Treasury bonds. China made a great contribution to stabilizing the US economy by buying US debt during the financial crisis in 2008. The US would be miserable if China hits it when it is down." One can conclude from this that Beijing will most probably save dumping its portfolio of US treasury bonds for dessert – in that it will have the biggest impact when the US stock market is experiencing its next crisis.

    China's Vice Premier Liu He (left) speaks during a meeting with President Donald Trump (right) in the Oval Office of the White House on February 22, 2019

    The move is not likely to cause catastrophic damage in and of itself (although the value of US bonds will definitely fall), but if it is done at the moment when America is most vulnerable, then China's portfolio may well end up being the straw that breaks the camel's back.

    Beijing is not displaying a particularly cocksure attitude. As the Global Times ' editor-in-chief quite rightly notes on Twitter :

    "Most Chinese agree that the US is more powerful than China and Washington holds initiative in the trade war. But we just don't want to cave in and we believe there is no way the US can crush China. We are willing to bear some pain to give the US a lesson."

    As China lays its trump cards on the table, the world's globalised economy will creak and collapse. Globalisation is going backwards, and chances are we'll end up with a completely different economic system that has more protectionism. Instead of a global market, there will be several large regional markets with their own rules, dominant currencies, technical standards, and financial systems.


    popeye , 51 minutes ago link

    Just as the US attack on Huawei is shortsighted and will have serious consequences for USA, the same would apply to China if they were to reciprocate.

    China wants to boost international trade, not harm it, so they will work around the bans to promote trade with others (long term strategic play), not go head to head. I suspect China may do something small just for domestic optics, but the smart play is to let the consequences of US actions play out on US businesses, whilst boosting import substitution and alternative supply chains.

    I don't believe rare earth exports will be banned (they may be restricted a bit as part of a long term protection of domestic supply) and I don't expect US Treasuries to be dumped (buying at any scale had already ceased).

    This isn't about backing one side over the other - I just think one party is going to play this smarter than the other.

    yvhmer , 8 hours ago link

    This is a copy paste article. Why are all these so called articles parrotting the same line: Rare earth monopoly, whereas in reality, they can' t even name the product of dependency and how much it would cost to find a different supplier.

    freedommusic , 8 hours ago link

    China has a 1.6 billion population and imports approx 30% food and 90% oil.

    CDOGS , 8 hours ago link

    If sanctions are only imposed on US companies, then they will still be able to purchase the necessary materials through Japanese or European straw buyers, making the embargo pointless. But if China imposes a total export ban, then it won't just be US companies that suffer but European ones as well, leading to EU reprisals against Chinese exporters to Europe. This would be very painful for China, especially given the economic war with the US that is making access to European markets invaluable to the Chinese economy.

    And there is exactly why this won't happen.....

    Let it Go , 9 hours ago link

    If that is all the options they have, they got nothing!

    China watchers, economists, and investors have been forming battle-lines for years as they debate the true strength and sustainability of China's economy and its role as a global player. Those of us that paint a picture of future collapse and a day of reckoning are often accused of spreading "doom-****" when we claim that the Chinese have masked over their dire situation by continually expanding credit.

    In January, Beijing injected a staggering $685 billion in new credit into its financial system and the money continues to leak out causing assets to rise across the globe. Today China continues to prop up the unpropable, and yes, while no such word exists, when it comes to China's economy it should, for "unpropable" describes the financial collapse that can only be postponed but not stopped. The article below argues that this will have a major impact in currency markets going forward.

    https://China Continues To Prop Up Its "Unpropable" Economy .html

    sfcjoebob , 9 hours ago link

    Big Bad Wolf, 5G can wait, it's a luxury not a necessity. Our networks run plenty fast and, like Europe, we can pay higher prices for a local workforce. China works due to slave labor, if the people there wake up they are done. That's why a complete security state is necessary. Nip that awareness in the bud. Now, go back to Germany and celebrate Islam.

    sfcjoebob , 9 hours ago link

    We'll just starve the rats out. China has zero hold over us, there is nothing that they make or export that cannot be replaced. Will prices of some goods rise, yes, but at the end of the day we don't need them as much as they need us.

    GrosserBöserWolf , 9 hours ago link

    3 dumb cards. Strategical US dumb thinking. US have a very short term strategy. That's easy to understand. US will have elections in 1.5 years and the campaign for election is knocking at the door. China has a long term strategy. China do not have elections. Those US guys simply do not understand this.

    1. rare earths (RE). Look at Russia. It provides US with rocket engines and take US cosmonauts to ISS. Why? To slower the research. If Ru will not sale, the US will accelerate the development of space ships. So will do China with RE. They will provide RE, maybe it will increase the price a bit.
    2. blocking US companies' access to Chinese markets. Why you should do this? China needs some US products which do not have replacements or are protected by IP laws. And to be clear. It is also easier to import legally a product and reverse engineer it, that to acquire it illegal or spying in other countries
    3. dumping US Treasury. Russia had far more less US Treasury. They gradually dump them not to interfere with the market price. They do not want to loose large amounts of money. But if China sells all of them together US dollar may crash and with it all China's financial assets. What if US will print trillions of dollars? US will loose, but also China.

    US is still the larger economy. Those measures are affordable only if China is far ahead of US. All this dumb cards will backfire in less than 5 years. US sanctions just showed the week points in China's development. They will address them in order to neutralize the effects. What should they do? They have to look north and do what Russia did. They will invest in software, research, they will substitute the products. They should just develop themselves independent from US system. Also they will gradually sale dollars and US Treasury.

    Wild E Coyote , 9 hours ago link

    1) banning the export of rare earths to the US; (Hurts China exporters too)
    2) blocking US companies' access to Chinese markets; (US companies pull back US dollar invested)
    3) using China's portfolio of US Treasury bonds to bring down the US government debt market. (US buys back without a problem).

    If China depends on this 3 matters, then it has no Trump Cards,

    The Herdsman , 9 hours ago link

    President Xi's trade war is a threat, no doubt. China's trade war against the United States has resulted in hollowed out cities where a once strong manufacturing sector supported communities across the nation. Have no illusions, this war that Xi is waging against America is something that has hurt us for thirty years and will likely continue to do so. Best to fight back now while we still can.

    God bless America and God bless president Trump!

    Josef Stalin , 10 hours ago link

    China will do none of these -- neoliberalism is the reason. The key to imploding the amerikan rat regime is to STOP buying amerikan goods and especially services of ANY kind...... much of the stuff is junk anyway and can be replaced with far higher quality goods and services available from other states and nations.

    beemasters , 10 hours ago link

    Banning the export of rare earths to the US....Not everything is that simple, however. Should such a ban be introduced, then Beijing will encounter certain technical difficulties. If sanctions are only imposed on US companies, then they will still be able to purchase the necessary materials through Japanese or European straw buyers, making the embargo pointless. But if China imposes a total export ban, then it won't just be US companies that suffer but European ones as well, leading to EU reprisals against Chinese exporters to Europe. This would be very painful for China, especially given the economic war with the US that is making access to European markets invaluable to the Chinese economy.

    Alternatively, China could impose quotas on its exports to Japan and Europe based on their current need of rare earth. It'll be their prerogative if they want to re-export to the US at (much higher) price. OR they could use the US trademarked brute, thuggish method of sanctioning those who dare to do business with the US.

    The second trump card mentioned by the Global Times is blocking US companies' access to the fast-growing and extensive Chinese market. This should be looked at from a political, rather than economic, point of view (although the latter may seem logical). The aim of such restrictive measures is not to inflict unacceptable damage on the US economy, but to make the full might of America's corporate lobbying machine work against Donald Trump and support his political opponents.

    It takes more than corporate sponsorship to get a presidential hopeful nominated. It's really up to Deep State - the very same Deep State that has allowed Trump launch and take the trade war as far as he has now. Trump's defeat in the poll would only indicate Deep State's defeat in the trade war with China. But the election of a new president will not change the game. The entire experience has left a bad taste in China's mouth. They know about the shadow government and no figure head will be able to tame the angry dragon now. They could demand the lasts of these corporations to move and invest in China if they want access to the 1.5 billion people's market. This will facilitate more technology transfers or the so-called "theft."


    The third trump card involves China dumping its portfolio of US Treasury bonds. The Global Times writes: "China holds more than $1 trillion of US Treasury bonds. China made a great contribution to stabilizing the US economy by buying US debt during the financial crisis in 2008. The US would be miserable if China hits it when it is down." One can conclude from this that Beijing will most probably save dumping its portfolio of US treasury bonds for dessert – in that it will have the biggest impact when the US stock market is experiencing its next crisis.

    Understanding that China may likely dump their holdings, other nations (Japan, the UK, Ireland, etc) might rush to dump theirs before China gets the chance to have their "dessert." Nobody wants to be left holding the bag (of worthless treasury notes). So it's not China's act of dumping that will trigger the avalanche. It's the fear that they might. So far, they are saying they won't and giving no indication they would for good reasons. They don't want to start the panic now.

    He–Mene Mox Mox , 10 hours ago link

    The Chinese have a fourth Trump card..........stop doing business with the U.S. all together. The U.S. does this with Venezuela and it works very well at collapsing the economy of the country.

    The 5th option would be to get OPEC to stop trading oil in dollars. Just that alone would make the U.S. currency worthless, and bring America to its knees. 9 of the 14 OPEC nations are already toying with the idea of doing just that.

    Pliskin , 9 hours ago link

    China to Saudi Arabia 'we'll be paying in Yuan in future, or you can forget our business!"

    America would collapse soon after!

    Justin Case , 11 hours ago link

    (Bloomberg) -- U.S. President Donald Trump's decision to blacklist Huawei Technologies Co. is making it more expensive to fatten up China's seafood.

    Futures on rapeseed meal, which is used to feed China's massive aquaculture industry, posted their longest winning streak since October on expectations supplies will tighten. The world's top fish producer has stopped buying Canadian rapeseed, also known as canola, for the coming months -- a time when China usually boosts purchases.

    "There have so far been no purchases of Canadian canola for arrival between April to August," said Hou Xueling, an analyst at Everbright Futures Co. That means "the bulls could drive up prices to an unimaginable level."

    China, the largest buyer of Canadian canola, typically increases imports from April to August to make rapeseed meal. This period is the peak demand season for its fish farming sector, Hou said. The official China National Grain and Oils Information Center also confirmed that the Asian country hasn't bought any Canadian canola for the coming months.

    The ongoing diplomatic spat after Canada's arrest of Huawei's Chief Financial Officer Meng Wanzhou late last year on a U.S.

    [May 28, 2019] Huawei was maybe 3% of the global smartphone market in Q4 of 2011 but it is set to pass both Samsung and Apple in marketshare within the next five years

    May 28, 2019 | www.unz.com

    Anon [104] Disclaimer , says: May 17, 2019 at 6:37 pm GMT

    "I have been making this point for some time, that immigration leading to lower average IQs, while bad, cannot logically lower scientific productivity because in absolute numbers the talented fraction remains unaffected. There are still the same numbers of smart people."

    I wouldn't say that at all; or at least I would say the situation isn't quite what you may think of it. Changing demographics* can certainly change economic/scientific/national policy, perhaps disastrously so. Karlin's piece ends with an ominous reference to the Brazilian president, but it just as easily might have been someone like America's AOC and her very unwise 100% green energy in 10 years scheme. Changing demographics means more AOC's and more turns at the economic disaster roulette wheel. In a democracy (or a representative republic), it's easy for a lower IQ population to impose its disastrous ideas on the higher IQ former majority; hence, the election of Hugo Chavez in Venezuela and the resultant economic dysfunction.

    In the future, not only will China produce quality scientific research, but efficiencies conferred by its cultural and ethnic homogeneity may allow its corporations to out compete American companies to a much greater degree than mere scientific discovery might otherwise suggest. Additionally, China's economy will be so large that its companies will be able to afford the massive R&D costs required for making ever more difficult discoveries. Their smaller global competition likely won't be able to match spending, so China's corporations could one day become far more dominant than you might anticipate. After all, it's really about who can best exploit new discoveries and not just about who makes them first. Otherwise, ancient China would have ruled the world; they invented paper, gunpowder, and the compass.

    Huawei was maybe 3% of the global smartphone market in Q4 of 2011 but it is set to pass both Samsung and Apple in marketshare within the next five years. You see a bit of this cultural/linguistic/ethnic homogeneity = efficiency phenomenon with the video game industry, specifically in regards to competition between Sony and the much larger, but more multicultural and less efficient Microsoft. Japan's Sony corporation dominates Microsoft in sales just like their car companies dominate their American competition; GM was recently chased out of Europe because it couldn't compete and none of these companies can sell anything in Japan.

    Also, notice that the EU core area has a white European population probably on par with the white European-American population, but the US still has the greater share of scientific discovery. I would posit this has much to do with the efficiency conferred by language homogeneity in the United States (English) -- among other things. China in the future will enjoy many of the same efficiencies the US has now, in terms of both language and culture. And this is why India isn't as dynamic as some have predicted. Despite having a "smart fraction", it is a low trust society deeply divided by color and class. Its leadership, imposed by the lower IQ fraction, is also somewhat inept. The same fate awaits the United States under current demographic trends.

    *Has there been a single example of a global superpower in modern history that has lost its ethnic majority but still retained functional status and prosperity over the long term? Maybe Singapore (but they weren't a superpower), although I admittedly know little about that country. Austria-Hungary? In any case, I would suspect the sample size here is far too small to make any definitive prediction about the future of scientific discovery and resultant economic success for the United States of America.

    [May 28, 2019] Chinese Military Ditching Microsoft Windows To Avoid CIA's 'Hefty Arsenal Of Hacking Tools'

    May 28, 2019 | www.zerohedge.com

    While the decision hasn't been made official, it was reported earlier this month by Canadian military magazine Kanwa Asian Defense , which noted that Beijing won't just jump over to Linux - and will instead develop their own over fears of US surveillance (and of course, in retaliation for Huawei's blacklisting).

    Thanks to the Snowden, Shadow Brokers, and Vault7 leaks, Beijing officials are well aware of the US' hefty arsenal of hacking tools , available for anything from smart TVs to Linux servers, and from routers to common desktop operating systems, such as Windows and Mac.

    Since these leaks have revealed that the US can hack into almost anything, the Chinese government's plan is to adopt a "security by obscurity" approach and run a custom operating system that will make it harder for foreign threat actors -- mainly the US -- to spy on Chinese military operations. - ZDnet

    me width=

    The new OS will be developed by a newly established "Internet Security Information Leadership Group" as reported by the Epoch Times , citing Kanwa.

    The group does not trust the "UNIX" multi-user, multi-stroke operating system either , which is used in some of the servers within the People's Liberation Army (PLA), Kanwa reported. Therefore, Chinese authorities ordered to develop an operating system dedicated to the Chinese military.

    The group also believes that the German-developed programmable logic controller (PLC), used in 70 percent of China's industrial control system today, poses huge risks to China's national security . In its opinion, China is not a "network superpower," but merely a "network giant," Kanwa reported. Therefore, Chinese authorities have laid out plans to upgrade China's network -- to become more advanced in cyber technology. - Epoch Times

    Huawei, meanwhile, is dropping Android OS for its own operating system, code-named HongMeng. It should be ready to launch in late 2019 domestically, and sometime in 2020 for international markets, according to TechRadar .

    Google announced on May 20 that it would partially cut off Huawei devices from using the Android operating system, however the Mountain View - based company was given an extension until August 19 by the White House. Other tech companies which have blacklisted Huawei include Qualcomm, ARM, Micron and several tech industry standards organizations such as Bluetooth, SD and WiFi alliances.

    "Huawei knew this was coming and was preparing. The OS was ready in January 2018 and this was our 'Plan B'. We did not want to bring the OS to the market as we had a strong relationship with Google and others and did not want to ruin the relationship. Now, we are rolling it out next month," said Huawei's Managing Director and VP of the Middle East Enterprise Business Group.

    The OS, which could be called Ark OS when launched , is expected to be compatible with mobile phones, computers, tablets, TVs, connected cars, smartwatch, smart wearables and others.

    All applications that work with Android are expected to work with this new OS without any need for further customization, Elshimy claims, adding that users will be able to download apps from the Huawei AppGallery. - TechRadar

    It is unknown whether apps available via Google's Play Store will be carried in Huawei's store.


    dunlin , 3 minutes ago link

    The propagandists don't want us to do this kind of thing. So I'm doing it:

    https://www.marketwatch.com/story/with-china-today-as-with-japan-in-1980s-the-us-is-in-denial-about-source-of-deficits-2019-05-28?mod=mw_latestnews

    NEW HAVEN, Conn. (Project Syndicate) -- "When governments permit counterfeiting or copying of American products, it is stealing our future, and it is no longer free trade." So said President Ronald Reagan, commenting on Japan after the Plaza Accord was concluded in September 1985.

    Today resembles, in many respects, a remake of this 1980s movie, but with a reality-television star replacing a Hollywood film star in the presidential leading role -- and with a new villain in place of Japan.

    Back in the 1980s, Japan was portrayed as America's greatest economic threat -- not only because of allegations of intellectual-property theft, but also because of concerns about currency manipulation, state-sponsored industrial policy, a hollowing out of U.S. manufacturing, and an outsize bilateral trade deficit.

    In its standoff with the U.S., Japan ultimately blinked, but it paid a steep price for doing so -- nearly three "lost" decades of economic stagnation and deflation. Today, the same plot features China.

    Notwithstanding both countries' objectionable mercantilism, Japan and China had something else in common: They became victims of America's unfortunate habit of making others the scapegoat for its own economic problems.

    Like Japan bashing in the 1980s, China bashing today is an outgrowth of America's increasingly insidious macroeconomic imbalances. In both cases, a dramatic shortfall in U.S. domestic saving spawned large current-account and trade deficits, setting the stage for battles, 30 years apart, with Asia's two economic giants.

    Deficits made in America

    When Reagan took office in January 1981, the net domestic saving rate stood at 7.8% of national income, and the current account was basically balanced. Within two and a half years, courtesy of Reagan's wildly popular tax cuts, the domestic saving rate had plunged to 3.7%, and the current account and the merchandise trade balances swung into perpetual deficit.

    In this important respect, America's so-called trade problem was very much of its own making. Yet the Reagan administration was in denial. There was little or no appreciation of the link between saving and trade imbalances. Instead, the blame was pinned on Japan, which accounted for 42% of U.S. goods trade deficits in the first half of the 1980s.

    Japan bashing then took on a life of its own with a wide range of grievances over unfair and illegal trade practices. Leading the charge back then was a young deputy U.S. trade representative named Robert Lighthizer. Fast-forward some 30 years and the similarities are painfully evident.

    Predictable decline in savings

    Unlike Reagan, President Donald Trump did not inherit a U.S. economy with an ample reservoir of saving. When Trump took office in January 2017, the net domestic saving rate was just 3%, well below half the rate at the onset of the Reagan era. But, like his predecessor, who waxed eloquently of a new "morning in America," Trump also opted for large tax cuts -- this time to "make America great again."

    The U.S. national savings rate has fallen from 7.8% of GDP when Reagan took office to just 2.8% today. The result was a predictable widening of the federal budget deficit, which more than offset the cyclical surge in private saving that normally accompanies a maturing economic expansion. As a result, the net domestic saving rate actually edged down to 2.8% of national income by late 2018, keeping America's international balances deep in the red -- with the current-account deficit at 2.6% of gross domestic product and the merchandise trade gap at 4.5% in late 2018.

    And that's where China assumes the role that Japan played in the 1980s. On the surface, the threat seems more dire.

    After all, China accounted for 48% of the U.S. merchandise trade deficit in 2018, compared to Japan's 42% share in the first half of the 1980s. But the comparison is distorted by global supply chains, which basically didn't exist in the 1980s.

    Data from the OECD and the World Trade Organization suggest that about 35%-40% of the bilateral U.S.-China trade deficit reflects inputs made outside of China but assembled and shipped to the U.S. from China. That means the made-in-China portion of today's U.S. trade deficit is actually smaller than Japan's share of the 1980s.

    Like the Japan bashing of the 1980s, today's outbreak of China bashing has been conveniently excised from America's broader macroeconomic context. That is a serious mistake. Without raising national saving -- highly unlikely under the current U.S. budget trajectory -- trade will simply be shifted away from China to America's other trading partners.

    With this trade diversion likely to migrate to higher-cost platforms around the world, American consumers will be hit with the functional equivalent of a tax hike.

    Lighthizer as clueless today as he was then

    Ironically, Trump has summoned the same Robert Lighthizer, veteran of the Japan trade battles of the 1980s, to lead the charge against China. Unfortunately, Lighthizer seems as clueless about the macro argument today as he was back then.

    In both episodes, the U.S. was in denial, bordering on delusion.

    Basking in the warm glow of untested supply-side economics -- especially the theory that tax cuts would be self-financing -- the Reagan administration failed to appreciate the links between mounting budget and trade deficits.

    Today, the seductive power of low interest rates, coupled with the latest strain of voodoo economics -- Modern Monetary Theory -- is equally alluring for the Trump administration and a bipartisan consensus of China bashers in the Congress.

    The tough macroeconomic constraints facing a saving-short U.S. economy are ignored for good reason: there is no U.S. political constituency for reducing trade deficits by cutting budget deficits and thereby boosting domestic saving.

    America wants to have its cake and eat it, with a health-care system that swallows 18% of its GDP, defense spending that exceeds the combined sum of the world's next seven largest military budgets, and tax cuts that have reduced federal government revenue to 16.5% of GDP, well below the 17.4% average of the past 50 years.

    This remake of an old movie is disconcerting, to say the least. Once again, the U.S. has found it far easier to bash others -- Japan then, China now -- than to live within its means. This time, however, the movie might have a very different ending.

    motherjones , 5 minutes ago link

    Why would anyone use Microsoft Windows for an operating system, when Linux is free and open source?

    tonye , 2 minutes ago link

    I use both. Up to Ubuntu with Mint. Plus Raspbian and Android.

    But, for somethings, you can't beat Microsoft for ease of use and interoperability. I rip and transcode my DVDs in Windows 7. I use Microsoft Office '13. Browse using Firefox, Thor and Chrome. And I have some specific audio processing tools that only exist in Windows.

    ...

    Son of Captain Nemo , 7 minutes ago link

    Makes perfect sense to me.

    And if you are a Chinese military or other intelligence professional with access to a "SIPR" class network it probably would be safe bet that US manufactured computer systems and networking gear has been appropriately "modified" not to use those chipsets since long before the "deal" of "deals" was made with the Yankee Dog ( http://www.911research.wtc7.net/wtc/groundzero/cleanup.html ) to send the remaining American technical manufacturing labor force out on the street!...

    Rinse and repeat for India's government intel and military professionals as well!....

    me or you , 7 minutes ago link

    I'm FOSSY: How Huawei Fans Can Beat Google's Play Store Ban, US-China Trade War

    RedBaron616 , 12 minutes ago link

    If only the Chinese military runs it, who's going to search for bugs? Only the NSA. LOL

    Building a unique operating system for their military isn't going to be a cakewalk, that's for certain.

    silverer , 13 minutes ago link

    Hooray! The Chinese will pick up the tab to refine Linux. Open source. No CIA in there without seeing it.

    Winston Churchill , 8 minutes ago link

    Doesn't deal with the hardware back doors, but its a start. I do believe they have their own o/s already waiting after Kaspersky got banned a few years ago for finding both the hardware and s/w backdoors.

    That hard disk firmware that called home was a classic.

    Kafir Goyim , 15 minutes ago link

    Oh, yes. They're going to develop their own OS, just like Huawei. What ********. Huawei will use vanilla android and China will pull an Apple, and rebrand Linux. But it sounds good, to say you're going to crank out a brand new operating system, like it's a CRUD web app.

    youshallnotkill , 11 minutes ago link

    iOS runs the Mach kernel not Linux.

    [May 28, 2019] Apple Braces For China's Wrath As Citi Slashes China iPhone Shipments, Cowen Warns Of Profit Plunge

    Notable quotes:
    "... Since Apple gets 20% of its revenue from China and manufactures its iPhones (which generated 60% of its total 2018 revenue) there, few companies are as exposed to Beijing's retaliation. Apple has already been suffering in the region, seeing sliding revenue as consumers buy more phones from Huawei and other local brands. ..."
    "... Citi warns that independent due diligence reveals " a less favorable brand image desire for iPhone and this has very recently deteriorated." As a result, Citi is materially lowering its sales and EPS estimates below consensus as China represents 18% of Apple sales "which we believe could be cut in half. " ..."
    May 28, 2019 | www.zerohedge.com

    "Apple's iPhone, iPad, and Mac systems are at risk of experiencing demand destruction due to collateral damage from the sales ban to Huawei." U.S. companies such as Apple and Nike, which rely on China for a major part of their growth and which have targets painted on their backs as Beijing and Washington ratchet up trade-war tensions, are "bracing for China's retaliatory wrath" according to Bloomberg .

    While Beijing has yet to formally retaliate after Trump blacklisted Huawei, Chinese state media last week said China is "well armed to deliver counterpunches," without giving specific details. And as companies await China's next move, there is rising, if unwelcome, suspense over what form retaliation might take. Companies might "just have to read the tea leaves on how their business operations are being treated,'' Erin Ennis, senior vice president of the U.S.-China Business Council, said in an interview with Bloomberg Television on Saturday.

    As Bloomberg notes, one option China could use is from the 2017 "template" when relations with South Korea deteriorated over Seoul's decision to deploy a missile shield. The government curbed travel to South Korea, hurting cosmetics companies that rely on Chinese tourists, while local authorities shut most of Lotte Shopping's China stores, alleging fire safety violations. Consumers boycotted South Korean products, dealing a devastating blow to Hyundai Motor sales. A similar pattern of action took place during the 2013 trade feud with Japan which escalated over territorial disagreements in the East China Sea.

    ... ... ...

    Since Apple gets 20% of its revenue from China and manufactures its iPhones (which generated 60% of its total 2018 revenue) there, few companies are as exposed to Beijing's retaliation. Apple has already been suffering in the region, seeing sliding revenue as consumers buy more phones from Huawei and other local brands. According to relatively optimistic research by Wedbush analyst Dan Ives, blowback from Trump's Huawei ban could cost Apple about 3% to 5% of its iPhone sales in China.

    ... ... ...

    Citi warns that independent due diligence reveals " a less favorable brand image desire for iPhone and this has very recently deteriorated." As a result, Citi is materially lowering its sales and EPS estimates below consensus as China represents 18% of Apple sales "which we believe could be cut in half. "

    [May 27, 2019] Hobbling Huawei- Inside the U.S. war on China's tech giant

    The article is devoid any technical substance and operated with value threat notion. As such this attempt of to spread FUD. In this case the USA are fighting to preserve their technological edge by trying to destroy the leading China company which became a competitor to domestic firms.
    Control of Wi-Fi network is damaging to the targeted nation security. The question is: who would allow such a control? All measures will be deployed against foreign powers exploitation.
    But what about control of telecoms and putting NSA equipment directly in telecom data centers like the NSA practices domestically and in vassal countries, for example, in Ukraine. And they manages to spy of Angela Merkel phone in Germany. Please note that Germany is one of the most sophisticated technically nations in the world.
    Notable quotes:
    "... The anti-Huawei campaign intensified last week, when President Donald Trump signed an executive order that effectively banned the use of Huawei equipment in U.S. telecom networks on national security grounds and the Commerce Department put limits on the firm's purchasing of U.S. technology. Google's parent, Alphabet, suspended some of its business with Huawei , Reuters reported. ..."
    "... The Americans are now campaigning aggressively to contain Huawei as part of a much broader effort to check Beijing's growing military might under President Xi Jinping. Strengthening cyber operations is a key element in the sweeping military overhaul that Xi launched soon after taking power in 2012, according to official U.S. and Chinese military documents. The United States has accused China of widespread, state-sponsored hacking for strategic and commercial gain. ..."
    "... "Restricting Huawei from doing business in the U.S. will not make the U.S. more secure or stronger," the company said in a statement in response to questions from Reuters. Such moves, it said, would only limit "customers in the U.S. to inferior and more expensive alternatives." ..."
    May 27, 2019 | www.reuters.com

    n early 2018, in a complex of low-rise buildings in the Australian capital, a team of government hackers was engaging in a destructive digital war game.

    The operatives – agents of the Australian Signals Directorate, the nation's top-secret eavesdropping agency – had been given a challenge. With all the offensive cyber tools at their disposal, what harm could they inflict if they had access to equipment installed in the 5G network, the next-generation mobile communications technology, of a target nation?

    What the team found, say current and former government officials, was sobering for Australian security and political leaders: The offensive potential of 5G was so great that if Australia were on the receiving end of such attacks, the country could be seriously exposed. The understanding of how 5G could be exploited for spying and to sabotage critical infrastructure changed everything for the Australians, according to people familiar with the deliberations.

    Mike Burgess, the head of the signals directorate, recently explained why the security of fifth generation, or 5G, technology was so important: It will be integral to the communications at the heart of a country's critical infrastructure - everything from electric power to water supplies to sewage, he said in a March speech at a Sydney research institute.

    Washington is widely seen as having taken the initiative in the global campaign against Huawei Technologies Co Ltd, a tech juggernaut that in the three decades since its founding has become a pillar of Beijing's bid to expand its global influence. Yet Reuters interviews with more than two dozen current and former Western officials show it was the Australians who led the way in pressing for action on 5G; that the United States was initially slow to act; and that Britain and other European countries are caught between security concerns and the competitive prices offered by Huawei.

    The Australians had long harbored misgivings about Huawei in existing networks, but the 5G war game was a turning point. About six months after the simulation began, the Australian government effectively banned Huawei, the world's largest maker of telecom networking gear, from any involvement in its 5G plans. An Australian government spokeswoman declined to comment on the war game.

    After the Australians shared their findings with U.S. leaders, other countries, including the United States, moved to restrict Huawei.

    The anti-Huawei campaign intensified last week, when President Donald Trump signed an executive order that effectively banned the use of Huawei equipment in U.S. telecom networks on national security grounds and the Commerce Department put limits on the firm's purchasing of U.S. technology. Google's parent, Alphabet, suspended some of its business with Huawei , Reuters reported.

    Until the middle of last year, the U.S. government largely "wasn't paying attention," said retired U.S. Marine Corps General James Jones, who served as national security adviser to President Barack Obama. What spurred senior U.S. officials into action? A sudden dawning of what 5G will bring, according to Jones.

    "This has been a very, very fast-moving realization" in terms of understanding the technology, he said. "I think most people were treating it as a kind of evolutionary step as opposed to a revolutionary step. And now that light has come on."

    The Americans are now campaigning aggressively to contain Huawei as part of a much broader effort to check Beijing's growing military might under President Xi Jinping. Strengthening cyber operations is a key element in the sweeping military overhaul that Xi launched soon after taking power in 2012, according to official U.S. and Chinese military documents. The United States has accused China of widespread, state-sponsored hacking for strategic and commercial gain.

    If Huawei gains a foothold in global 5G networks, Washington fears this will give Beijing an unprecedented opportunity to attack critical infrastructure and compromise intelligence sharing with key allies. Senior Western security officials say this could involve cyber attacks on public utilities, communication networks and key financial centers.

    In any military clash, such attacks would amount to a dramatic change in the nature of war, inflicting economic harm and disrupting civilian life far from the conflict without bullets, bombs or blockades. To be sure, China would also be vulnerable to attacks from the U.S. and its allies. Beijing complained in a 2015 defense document, "China's Military Strategy," that it has already been a victim of cyber-espionage, without identifying suspects. Documents from the National Security Agency leaked by American whistleblower Edward Snowden showed that the United States hacked into Huawei's systems, according to media reports. Reuters couldn't independently verify that such intrusions took place.

    However, blocking Huawei is a huge challenge for Washington and its closest allies, particularly the other members of the so-called Five Eyes intelligence-sharing group – Britain, Canada, Australia and New Zealand. From humble beginnings in the 1980s in the southern Chinese boom town of Shenzhen, Huawei has grown to become a technology giant that is deeply embedded in global communications networks and poised to dominate 5G infrastructure. There are few global alternatives to Huawei, which has financial muscle – the company reported revenue for 2018 jumped almost 20 percent to more than $100 billion – as well as competitive technology and the political backing of Beijing.

    "Restricting Huawei from doing business in the U.S. will not make the U.S. more secure or stronger," the company said in a statement in response to questions from Reuters. Such moves, it said, would only limit "customers in the U.S. to inferior and more expensive alternatives."

    For countries that exclude Huawei there is a risk of retaliation from Beijing. Since Australia banned the company from its 5G networks last year, it has experienced disruption to its coal exports to China, including customs delays on the Chinese side. In a statement, China's foreign ministry said it treated "all foreign coal equally" and that to assert "China has banned the import of Australian coal does not accord with the facts."

    Tension over Huawei is also exposing divisions in the Five Eyes group, which has been a foundation of the post-Second World War Western security architecture. During a trip to London on May 8, U.S. Secretary of State Mike Pompeo issued a stark warning to Britain, which has not ruled out using Huawei in its 5G networks. "Insufficient security will impede the United States' ability to share certain information within trusted networks," he said. "This is exactly what China wants; they want to divide Western alliances through bits and bytes, not bullets and bombs."

    Chinese President Xi Jinping (left) is shown around the offices of Huawei in London by company founder Ren Zhengfei in 2015. Ren has rejected allegations that Huawei would engage in espionage on behalf of the Chinese government. REUTERS/Matthew Lloyd/Pool
    Employees work on a mobile phone production line at Huawei's factory campus in the southern Chinese city of Dongguan. Huawei has eclipsed telecom equipment giants Ericsson and Nokia in terms of market share. REUTERS/Tyrone Siu

    Huawei's 74-year old founder, Ren Zhengfei, is a former officer in China's military, the People's Liberation Army. "Mr. Ren has always maintained the integrity and independence of Huawei," the company said. "We have never been asked to cooperate with spying and we would refuse to do so under any circumstance."

    In an interview with Reuters at the company's headquarters in Shenzhen, Eric Xu, a deputy chairman, said Huawei had not allowed any government to install so-called backdoors in its equipment - illicit access that could enable espionage or sabotage - and would never do so. He said 5G was more secure than earlier systems.

    "China has not and will not demand companies or individuals use methods that run counter to local laws or via installing 'backdoors' to collect or provide the Chinese government with data, information or intelligence from home or abroad," the Chinese foreign ministry said in a statement in response to questions from Reuters.

    Washington argues that surreptitious backdoors aren't necessarily needed to wreak havoc in 5G systems. The systems will rely heavily on software updates pushed out by equipment suppliers - and that access to the 5G network, says the United States, potentially could be used to deploy malicious code.

    So far, America hasn't publicly produced hard evidence that Huawei equipment has been used for spying.

    Asked whether the United States was slow to react to potential threats posed by 5G, Robert Strayer, the State Department's lead cyber policy diplomat, told Reuters that America had long been concerned about Chinese telecom companies, but that over the past year, as 5G loomed closer, "we were starting to talk more and more with our allies." Banning Huawei from 5G networks remains "an end goal," he said.

    [May 24, 2019] No Huawei out: Prez Trump s game of chicken with China has serious consequences -- Techno balkanization by Thomas Claburn

    Notable quotes:
    "... The sort of result that's to be expected from a Fire-Aim-Ready approach to policy making ..."
    "... They're trying real hard to take a large company out of business without any evidence of said company doing anything wrong. Never even looked at them before but this definitely makes me want to get a Huawei phone next. And to stay well clear of everything from any US based company. ..."
    "... Nothing here is really Huawei's fault - they're just the coincidental closest target to impact point of a greater trade war. All the posturing against Huawei specifically is just that - posturing. ..."
    "... Basically it's because Mr. President is paranoid and somewhat crazy. A sane president would not be so childish, ..."
    "... It's an empire in decline fighting the was for global supremacy, the democrats are just as crazy, not that I like Trump ..."
    "... It's often said that wounded animals are the most dangerous. That's what this looks like to me. The US empire might be near dead, but one swipe of its huge tail can still break you if you get in the way. ..."
    "... The US will never be as dominant as it was in the decades after WW II, but that was a one shot deal mainly because it had the only large industrial base that hadn't been blown to smithereens by the end of the war. ..."
    "... Indeed. And how much have we heard about backdoors in Cisco and others here of late - it's a multiple, not a percentage. They all need a bit of pointing and laughing in a sense. IIRC, the telnet "backdoor" required one to be inside the LAN already...while the other baddies the Reg has reported on did not. ..."
    May 24, 2019 | theregister.co.uk

    No cybersecurity rules means networks are destined to be balkanized

    ... ... ...

    One possible consequence, Steven Weber, professor of political science and international relations at UC Berkeley, told The Register , is a world where boundaries are shaped more by technology standards than geographic features.

    That is to say, we may be headed toward nationalized technology stacks that don't interoperate and nationalized supply chains. This defeats the entire purpose of an open internet

    ... ... ...

    Google has suspended Huawei's license to use its Android mobile operating system. The decision prevents the Chinese company from adding Google services like Gmail, Google Maps, Play Store and other Google apps to new devices, though existing ones will continue to function . It also complicates security updates and all but guarantees Huawei will forge ahead with its rumored fork of the Android Open Source Project.

    Microsoft has pulled the Huawei MateBook X Pro from its online store; Huawei devices are no longer available at BestBuy.com. At Amazon.com, however, Huawei laptops, tablets and phones can still be had.


    Huawei forward

    Huawei could open up a branch company in the USA. Design, program, manufacture, and market those USA products as a USA company. Nothing left to target.

    Of course, still sending the profits home.

    Re: Huawei forward

    Also Chinese investors could buy a significant number of shares of US companies, making them suspect of Chinese affiliation, and the US government will be faced with the dilemma of closing US companies. Re: Huawei forward

    Trump conveniently forgets..

    Anything that doesn't accord with his very, very limited world view. He also tends to forget which lies he told last time and will happily contradict himself.. Re: Huawei forward

    Unless the Chinese govt rolls over and declares Trump the winner of his trade war, apparently. If that happens, all the security worries will blow away like a fart in the wind.

    How does that work, exactly? Well, since Trump has never bothered to spell out what he wants the Chinese to do, he can declare victory at any moment, but he wants a statement of surrender to show the faithful.

    3 , Collateral Damage

    Sounds like there's going to be a lot of it in this war. I wonder if our leader has heard of it?

    Re: Collateral Damage

    The sort of result that's to be expected from a Fire-Aim-Ready approach to policy making

    Anonymous Coward , 2 days
    Disgusting

    They're trying real hard to take a large company out of business without any evidence of said company doing anything wrong. Never even looked at them before but this definitely makes me want to get a Huawei phone next. And to stay well clear of everything from any US based company.

    Anonymous Coward , 2 days Anonymous Coward , 2 days
    Re: Disgusting

    Nothing here is really Huawei's fault - they're just the coincidental closest target to impact point of a greater trade war. All the posturing against Huawei specifically is just that - posturing.

    But that's not the same as saying the greater trade war is without merit. It absolutely makes a difference how overall trade between the US and China is structured, and a certain segment of our market has been saying for a long time that we had the short end of the stick here and needed to change things. Even the El Reg author acknowledged that.

    Of course it's much more complex to ask whether this tactic is actually going to fix anything, or just make things worse. Your mileage may vary.

    And I can imagine that if you are neither an American nor a Chinese citizen, then you don't really stand to gain anything from this fight no matter who wins, so it's understandable if you're more frustrated than anything else. I don't blame anyone for not wanting to jump into a fight that doesn't affect them - just remember that it does affect someone else.

    Anonymous Coward ,

    It will be interesting to see what the Chinese targets are going to be. Probably GM and farmers since that hits Trump's base - just as electioneering starts for 2020.

    Then wait for Boeing to be really suffering from the 737Max before announcing a ban on Boeing in China (airbus manufacture there)

    Anonymous Coward

    Re: Airbus & China

    There is a lot of 'good ole boy' stuff that goes into every Airbus plane no matter where it is made so Trump could easily stop Airbus from operating in China.

    China could retaliate by treatening to start calling in all the US Debt that it carries. That will sink the DOW in a flash. The Trump bubble will burst and he'll be impeached (well that's what I hope)

    The Yuan could easily replace the USD as the world's currency.

    Trump had better watch out or this will end badly for him. His grasp of history relating to trade wars can probably be measured on a pinhead.

    Doctor Syntax , 2 days
    Re: Airbus & China

    "His grasp of history relating to trade wars can probably be measured on a pinhead."

    Just trade wars?

    Doctor Syntax , 2 days
    Nuts in May

    Basically it's because Mr. President is paranoid and somewhat crazy. A sane president would not be so childish,

    Doctor Syntax , 2 days Doctor Syntax , 2 days
    Re: Nuts in May

    It's an empire in decline fighting the was for global supremacy, the democrats are just as crazy, not that I like Trump

    Doctor Syntax ,
    Re: Nuts in May

    It's often said that wounded animals are the most dangerous. That's what this looks like to me. The US empire might be near dead, but one swipe of its huge tail can still break you if you get in the way.

    Doctor Syntax ,
    Empire in decline?

    I seem to remember the same being said in the 80s when it was Japan that had the huge trade advantage over the US. Now granted China is FAR larger and will easily overtake the US as world's largest economy without its per capita GDP needing to exceed 30% of the US's, but like Japan did with its aging population China has some demographic challenges awaiting it when the parents of the two "one child" generations reach retirement age, which is just beginning.

    The US will never be as dominant as it was in the decades after WW II, but that was a one shot deal mainly because it had the only large industrial base that hadn't been blown to smithereens by the end of the war.

    Doctor Syntax ,
    Re: Excellent article El Reg

    Indeed. And how much have we heard about backdoors in Cisco and others here of late - it's a multiple, not a percentage. They all need a bit of pointing and laughing in a sense. IIRC, the telnet "backdoor" required one to be inside the LAN already...while the other baddies the Reg has reported on did not.

    Doctor Syntax ,
    Re: Excellent article El Reg

    What makes the Huawei router telnet backdoor (now patched) unusual is that for 8 long years GCHQ has been code-reviewing Huawei products in a dedicated department. Didn't that include routers?

    Doctor Syntax , 2 days
    Japanese CPU designer Arm has a facility in Austin, Texas, USA, that validates Arm-compatible and licensed chip designs for customers around the world, including those in China, and thus is restricted by the White House's latest crackdown.

    Moral of this story. Don't do business with the US, they will turn on you whenever it's financially beneficial for them and unilaterally break deals, without any means for recourse.

    An unreliable partner. Like any other bully, best to let them play in the sandbox by themselves.

    el kabong
    Having a presence in the US has become a liability

    ARM would be wise to shut their operations in Texas.

    el kabong
    5G patents....

    What is interesting is that Huawei got some fundamental patents in connection to 5G, without licensing these patents there will be no 5G role out, and Nokia and Ericsson are at least 1 year behind Huawei in development of 5G ...

    This is political, and is being used by Trump to get China to move on the Trade agreement, which he want to "fix", but it might end up causing the rollout of 5G to be delayed by years.

    , el kabong , veti
    Re: 5G patents....

    Hmm. Delay 5G by five years? Not a bad idea.

    , veti , Lars
    Re: 5G patents....

    "Trade agreement, which he want to "fix"".

    The problem is that he has no idea of what to fix and how, and he still claims China is paying for his import tariffs, or is he just lying.

    Lock him up...

    , Lars , Lars , Doctor Syntax
    Re: 5G patents....

    "What are the Chinese going to do - sue them in Federal court ?"

    What could happen is that Huawei starts to sue every competitor, in every market the competitor sells in, whose competing products use the components they're not allowed to use on the basis of unfair competition, illegal government subsidy or whatever fits in the jurisdiction. There are a lot more courts around the world than Federal courts.

    , Doctor Syntax , Kabukiwookie
    Re: 5G patents....

    As if the US is goi g to honour those patents when it's no longer convenient.

    International law is for everyone else, just look at the US' violations of the the Venezuan embassy in Washington and railroading the UN's investigation into US war crimes.

    We have a US govt that thinks that 'might makes right'. Literally the definition of a rogue state.

    little while back on El Reg , Anonymous Coward where it was quoted in the article as saying:

    "The 'backdoor' that Bloomberg refers to is Telnet, which is a protocol that is commonly used by many vendors in the industry for performing diagnostic functions. It would not have been accessible from the internet," said the telco in a statement to The Register, adding: "Bloomberg is incorrect in saying that this 'could have given Huawei unauthorized access to the carrier's fixed-line network in Italy'.

    "This was nothing more than a failure to remove a diagnostic function after development." little while back on El Reg , Anonymous Coward little while back on El Reg , Anonymous Coward , Steve Davies 3

    re: Bloomberg Journalism

    Remember it was Bloomberg that published the article about motherboards that were made in China having an extra chip that 'leaked' stuff back to china.

    Apple and Supermicro were the main targets (amongst others).

    Both companies undertook extensive investigations and found no evidence of these chips.

    Despite repeated appeals Bloomberg refused to relase their evidence to the world.

    To me this implies that it was a bit of fiction designed to make certain stocks go down so that shorters could make a killing.

    Who would you rather believe eh?

    , Steve Davies 3
    Techno-balkanisation

    People may take it for granted that their 'phones work everywhere but it was not ever thus. I used to have to borrow a tri-band 'phone for visits to the US. My normal mobile worked everywhere except the US. Later on I had the same problem with South Korea.

    There was a time (back in the analogue TV days) when a TV bought in one European country wouldn't work in many of the others. Digital TV is based on common underlying compression standards. (Although, even here there is scope for creating artificial incompatibilities.) Unfortunately there is no common transmission standard, although DVB satellite transmission schemes are fairly widely adopted.

    People can now move almost anywhere in the world reasonably cheaply. Some of their gadgets are useless outside their home country.

    Many of these problems are caused by "special interest groups", manufacturer inspired protectionism and plain political stupidity.

    , Steve Davies 3 , Steve Davies 3
    Re: Techno-balkanisation

    People can now move almost anywhere in the world reasonably cheaply. Some of their gadgets are useless outside their home country.

    Many outside electrical gadgets have problems in the USA. They use a different voltage and AC frequency from that used by developed countries. Happily, that means that their stuff doesn't work outside the "land of the fee".

    , Steve Davies 3
    Difficult to back out

    The Trump administration has started a trade war with China, which has responded in kind. Trade wars eventually come to an end even if it takes a long time. The "Cold War" with the Soviet Union was carried out as both an arms race, and a trade war and while that took 45 years to conclude, it did end.

    Masking the US/China trade war as a security issue doesn't work very well. Threatening to stop the sale of mobile phones using a US designed open source operating system because of concerns about security holes in a yet to be rolled out 5g core network is a weak argument. If there are 5G issues, why not 4G?. Where is the evidence, given that Huawei have set up a joint venture with GCHQ to examine the core network software.? Is this another "Weapons of Mass Destruction" report where we are asked to believe without evidence. We all ended up with egg on our collective faces then. Tony Blair's reputation was, and still is, trashed. May's reputation could similarly ............ (Ok, I concede that would be a stretch!)

    The weakest part of the argument is that it denies itself a way out when the trade war ends (or is suspended). Donald and Xi could come to a truce tomorrow (a beautiful victory?) but that would leave the declared security issues unresolved. If the US removes the trade ban on Huawei surely they will be letting Chinese spying tools into strategic national networks. What about the mobile phones?. They are said to be a security risk now because the US (parroted by 5 eyes) says so. That won't magically disappear because the US and China come to an agreement on steel imports. Will the UK and other countries who have followed the lead of the US similarly change track when the US and China make up. ?

    We are following our special relationship partners down a deep rabbit hole based on the assertions of some highly suspect political operators.

    , Steve Davies 3 Reg Reader 1 , 2 days
    Re: Difficult to back out

    Well said. Much of this problem is due to the deregulation of Corporate financials. I'm not a finance person so am not sure that's the correct term. What I'm talking about is at the time of globalization/free trade when RRSPs were allowed to participate in corporate stock outside of national scope. Such was the case in Canada at the time. Since then, these corporations outsource as much work as possible to developing economies to reduce cost and most no longer have any R&D worth mentioning, all in the name of increasing profit for the Ponzi/Pyramid scheme that is the deregulated stock market and that is effect of changing the corporate tax burden. Since the late 1970s corporations have been able to increasingly buy their own taxation system, it seems. The more regulated, or in authoritarian regimes financially controlled, corporations still seem to have effective R&D.

    The above boils down to the populace having been duped by bad faith politicians. As much I don't like Trump and his crazy train this all started a long time before him.

    DCFusor , 1 day
    Re: Difficult to back out

    Actually, the politicians themselves were duped by the bad faith bankers and in general people who got compensated in options. It can even look like good intentions.

    The deregulation that allowed for evil things like CDS (being able to buy fire insurance on your neighbor's house...without his knowledge, and even get a can of gasoline in the deal) - was sold as a way to make getting loans easier for minorities so they could buy homes and have a stake in society - a good thing that would result in less crime and violence and more self-policing.

    What it actually was is more interesting - in the insurance biz it's illegal to sell insurance to other than the entity directly involved, and there are also regulations that the insurance company has to keep the buck to pay claims in hand - this was all missing from the Frank-Clinton removal of Glass Steagall.

    The road to hell is indeed paved with good intentions, or at least can be sold as such.

    In hindsight, we know that some of the financialization tech new instruments invented as a result by Blythe Masters of JP Morgan and some others developed in the City of London turned out to be "weapons of financial mass destruction".

    There was plenty of blame to go around (in this case the left side of the aisle started the ball rolling, but...no one was at all innocent). From the banks making loans that were obviously never going to be paid off - no need to care as now Goldman Sachs, AIG, JP Morgan, and of course Deutsche bank were standing there buying the loans to sell tranches at a profit - to the people taking those loans, to the people buying the tranches of them....

    cjrcl , 2 days
    Re: Difficult to back out

    It seems that China will be the latest name on the list including Iran, Syria, North Korea ecetera.

    If so I think it is time for China to take Taiwan back.

    Kabukiwookie , 1 day
    Re: Difficult to back out

    If so I think it is time for China to take Taiwan back.

    That wouldn't the US modus operandus. There'd need to be a false flag operation like the USS Liberty (but done without exposing it's actually a false flag.

    BebopWeBop , 1 day
    Re: Difficult to back out

    USS Liberty a false flag operation - ahh setting up a US intelligence vessel to be shot up by the Israelis. How did rhapsody work or were they hit by US aircraft in disguise?

    Werepaws , 2 days
    America's mental illness

    Wow. The Americans have certainly let their paranoia show immensely

    But this move of what they have done is bassically similar to what the USA were claiming Huawei and China could do shutting off 5G services because of their kit

    America certainty have a paranoid schizophrenia mental illness building

    Steve Davies 3 , 2 days
    Re: America's mental illness

    If you of a certain age you can remember the

    "Are you now or were you ever a member of the Communist party" questions of the 1950's. The reds under every bed paranoia of that age is alive and kicking.

    WonkoTheSane , 1 day
    Re: America's mental illness

    "Are you now or were you ever a member of the Communist party?"

    That question was STILL on the forms they used to hand out on flights into the USA in 2001 (pre-9/11).

    DCFusor , 1 day
    Re: America's mental illness

    Yeah, I had to answer that one for a security clearance in the '70's myself. One wonders how Brennan, Chief of CIA for the previous admin, was an avowed communist yet still managed to get that job?

    His role in the current thrashing is interesting to say the least.

    JohnFen , 1 day
    Re: America's mental illness

    Brennan is not an "avowed communist". That lie came about based on the fact that he voted for Gus Hall, the Communist Party presidential candidate in 1976. There is no evidence that Brennan himself was ever a member of the Communist Party or even that his political viewpoint is communist generally.

    But that his political enemies consider calling him a communist to be an effective attack says a lot about American paranoia.

    Yet Another Anonymous coward , 1 day
    Re: America's mental illness

    >That question was STILL on the forms they used to hand out on flights into the USA in 2001

    Do they still ask 3 year olds if they were involved in Nazi war crimes?

    Milton , 2 days
    Right ... but perhaps for the wrong reasons

    Ok: Trump is a nasty, corrupt, ignorant child and his motivations in this are probably as petty and wrong as is ever the case. And you can't ignore the fact that this is happening in the context of a wider trade war, which, while it may have some logical underpinnings (China does steal and cheat on a an epic scale) is also contaminated by the Orange Idiot's floundeing incompetence and wayward spite.

    So I am no apologist for Trump or his toxically incompetent administration: it may actually be almost as vile as the Chinese regime at this point in time.

    But the fact that the attack on Huawei is being mounted by people who are stupid, ignorant and explicitly odious doesn't mean it is the wrong thing to do.

    I've said before that it is irrelevant whether Huawei has been caught producing dodgy hard- or software and I have framed my point in terms of capabilities and intentions: emphasising that capabilities are what count here.

    It's simply this: China has an authoritarian, undemocratic, repressive, ofttimes murderous regime; it ruthlessly oppresses minorities among its citizens; practises draconian censorship; has shown every sign of territorial aggressiveness and growing military adventurism; is building up its armed forces at a worrying rate; is becoming ever wealthier and more powerful; and has the ability both in technological know-how and in industrial capacity to supply a sizeable fraction of the free world's communications and computing infrastructure. With no checks or balances or transparency, the Chinese state could compel any of its companies to do whatever it wishes ("Make this happen for us, and keep your mouths shut about it, or next month you will be executed for corruption"), and every aspect of its behaviour in the last 20 years proves that it will use technology -- a wonderful equaliser in the world of asymmetric warfare -- for its own ends, lying, stealing and cheating at every turn. I don't see how this is even a controversial statement by this point.

    So the question is not what China intends, but what it can do, and this ought to worry us very badly. Given everything we know of China's government, it would be suicidally stupid to gift it with power, influence or any kind of entry into our just-about-free societies.

    As the west wakes up to the threat of China, actual conflict becomes ever more likely (I would personally suggest, inevitable, unless regime change occurs, which seems most improbable). China will become ever more strongly motivated to resort to technological sabotage and espionage. Right now we don't want China stealing data on our (for example) nuclear submarine fleet. If it comes to conflict, we don't want them bricking those boats while they're still dockside.

    So Huawei is just the start. China certainly could use its companies for malign ends: so we must act protectively, as if it is doing so, and will do so in the future.

    jmch , 2 days
    Re: Right ... but perhaps for the wrong reasons

    "So the question is not what China intends, but what it can do"

    This goes against pretty much every standard the Western world stands for. China COULD compel Huawei to put in backdoors. But then again Huawei kit is probably the most closely-studied kit in the world, and it is trivially easy to compare firmware releases to make sure that the kit you have is running the same version as a trusted reference version. It might be more difficult to check that the hardware you get isn't a one-off specially modified version instead of the standard one, but the organisations likely to be targeted in this way are either big enough to have the resources for deep checks or would not be buying Huawei kit anyway.

    For the vast majority of commercial customers and 100% of retail customers, having eg GCHQ check out the kit is a perfectly acceptable safeguard, indeed one which they do not even get from other vendors' kit (eg Cisco) which might be backdoored with other countries' spying malware.

    jmch , 2 days jmch , 2 days jmch , 2 days
    Re: Right ... but perhaps for the wrong reasons

    > China COULD compel Huawei to put in backdoors.

    Which is exactly why you should use them.

    Which is better security?

    A, buy kit from china and check it for backdoors, weaknesses, vulnerabilities.

    C, buy kit from a company HQ in Finland (but with chips made all over the world) and don't bother checking for any flaws, vulnerabilities etc but trust it implicitly cos Finns are really nice people.

    jmch , 2 days jmch , 2 days
    Re: Huawei equipment can't be trusted?

    And therein is the problem. It is not pres Trump, he is only supporting the US 3 letter agencies and they are the ones with the big problem. Their problem is that they want to put backdoors in Huawei networking equipment but if they do that it means that the Chinese government will have samples of the US spying software and there is the big problem. The 3 letter agencies can only see one way out of that and it is banning Huawei equipment, in their eyes that makes the problem go away and leaves their spying on the population as normal using the so called American equipment.;

    jmch , 2 days
    "deal with longstanding issues like government favoritism toward local companies"

    How is it that that can be a point of contention ? Name me one country in this world that doesn't favor local companies.

    These people company representatives who are complaining about local favoritism would be howling like wolves if Huawei was given favor in the US over any one of them.

    I'm not saying that there are no reasons to be unhappy about business with China, but that is not one of them.

    [May 24, 2019] Lets say the sake of argument Huawei is not guilty of putting spyware in their 5G stuff. How would US prove it? Huawei basically given out there source code, and apart from such slack security features nothing was found, but that was apparently no enough.

    May 24, 2019 | theregister.co.uk

    Here's the problem. Lets say the sake of argument Huawei is not guilty of putting spyware in their 5G stuff. How would they prove it? They basically given out there source code, and apart from such slack security features nothing was found, but that was apparently no enough.

    Apart from proving a negative there is nothing they can do. I'm not saying that China is not a repressive regime, but to be honest I don't think they have the resources to filter out the juicy bits of the 5G traffic, and have enough on their hands just monitoring their internal massive population without having to take on the US as well. And why should they, since the NSA is already doing such a great job of it already.

    The problem is that the great Orange one and is motley collection of right wing hawks are thinking that is what i would do in China's place and getting themselves lathered up in a right wing frenzy where they see reds under every bed.

    If China was smart (and they are), what they should do is announce that all Apple phones are banned in China and all Chinese companies are not allowed to do business with Apple, until Apple can prove they do not provide back doors for the US government in their equipment. I wonder what effect a 10% drop in apple share price and all those pension funds that depend on them will have

    [May 24, 2019] This is going to get ugly

    May 24, 2019 | theregister.co.uk

    ..and we're all going to be poorer for it. Americans, Chinese and bystanders.

    I was recently watching the WW1 channel on youtube (awesome thing, go Indy and team!) - the delusion, lack of situational understanding and short sightedness underscoring the actions of the main actors that started the Great War can certainly be paralleled to the situation here.

    The very idea that you can manage to send China 40 years back in time with no harm on your side is bonkers.

    [May 24, 2019] Currently everybody else is losing. Forcing other countries (supposedly friends and allies) to abandon equipment of one manufacturer for that of your own company is not very nice and for us quite expensive

    Dumping Google is actually not so bad idea ;-)
    Notable quotes:
    "... The ban might actually provide a bit of a boost to other software developers, if it prompts users to look beyond the Google offerings that came with their phone and seek out some alternatives. In most cases, the alternatives are far better. ..."
    May 24, 2019 | theregister.co.uk
    Michael H.F. Wilkinson
    Re: Disgusting

    Currently everybody else is losing. Forcing other countries (supposedly friends and allies) to abandon equipment of one manufacturer for that of your own company is not very nice and for us quite expensive. And that is not even factoring in the known fact that some of these manufacturers had backdoors in their equipment - for which actual proof exists. So considering our own national security we should forbid companies to do business with e.g. Cisco...

    Michael H.F. Wilkinson
    Powerful vs Lawful

    Powerful is not the same as lawful, no matter what those in positions of power might claim or like to imagine.

    Is this a distinction worth making? Yes, because otherwise law enforcement officers come to think that their word is law, and that they are themselves above the law. The result of that is a police state.

    Michael H.F. Wilkinson
    Re: Disgusting

    Nothing here is really Huawei's fault

    Probably true. Huawei are probably just collateral damage in the inevitable socio-economic conflict between the US and China. The US is used to running the world (not especially well if you ask me). China with four times the population and an economy about the same size as the US that is growing much faster doesn't actually seem to have that much interest in running the world. But since the US is run by folks with no principles, poor memories, few useful skills,and no planning ability whatsoever, I have to guess that the Chinese will "win" in the long run.

    Welcome to the Chinese Century folks.

    Michael H.F. Wilkinson , 1 day Michael H.F. Wilkinson , 1 day
    Re: Disgusting

    Pretty irritating that Huawei is simply leverage while the US and China thrash out a trade deal.

    I have a Mate 10 Pro and the best phone I've had, was planning to go for the Mate 30 Pro when it comes out.

    Reckon I still will, I've already been reducing dependence on Google before this happened anyway. I'll have to shift my business email over to ProtonMail like I already do with my personal accounts. I'm trying out OSM instead of gmaps. I've already ditched gplay music. Just need Proton calendar which is in development and that's another service binned off.

    Not sure what's going to happen with apps I've bought through Google and have active subs though...

    Michael H.F. Wilkinson , 1 day Michael H.F. Wilkinson , 1 day Michael H.F. Wilkinson , 1 day
    Re: Disgusting

    The problem isn't the apps you use, there certainly are equivalents of the Google ones. But they still mostly rely on the Google Play API to interface with your phones devices and storage mechanisms. OSM is a pretty good replacement for gmaps, but will be of little use without Google Location Services.

    Michael H.F. Wilkinson , 1 day Michael H.F. Wilkinson , 1 day Michael H.F. Wilkinson , 1 day
    Re: Disgusting

    Will the ban actually prevent anyone using a Huawei device from accessing a Google service (eg. Gmail) or just prevent them from downloading the official Google apps to do so? I suspect the latter as the first would seem impossible to police. In which case there are better alternatives out there.

    The ban might actually provide a bit of a boost to other software developers, if it prompts users to look beyond the Google offerings that came with their phone and seek out some alternatives. In most cases, the alternatives are far better.

    For email, try AquaMail. Easily handles my many email addresses split across Gmail, own domains using Google's mailservers, Yandex and own domains using Yandex's mailservers.

    OSMAnd+ provides as good mapping as Google Maps (better in remote and off-road areas), is much more customiseable and you can download entire country maps to your phone, without pissing about with Google Maps's silly area selection download. And its navigation is pretty decent, lthough it lacks the Googley stuff like weather and nearest junk food shop listings.

    Wire is an encrypted messaging/video-calling/VOIP app, offering everything Hangouts (or whatever Google's offering is called this week) does.

    Yandex browser or Kiwi browser are Chrome but with added support for extensions

    PulseSMS is text messaging with built in backup and the ability to send and receive SMS through your phone from your laptop.

    etc. etc.

    [May 24, 2019] Networks are usually highly segmented and protected via firewalls and proxy. so access to routers from Internet is impossible

    You can put backdoor in the router. The problem is that you will never be able to access it. also for improtant deployment countires inpect the source code of firmware. USA is playing dirty games here., no matter whether Chinese are right or wrong.
    May 24, 2019 | theregister.co.uk
    Re: Technological silos

    They're not necessarily silos. If you design a network as a flat space with all interactions peer to peer then you have set yourself the problem of ensuring all nodes on that network are secure and enforcing traffic rules equally on each node. This is impractical -- its not that if couldn't be done but its a huge waste of resources. A more practical strategy is to layer the network, providing choke points where traffic can be monitored and managed. We currently do this with firewalls and demilitarized zones, the goal being normally to prevent unwanted traffic coming in (although it can be used to monitor and control traffic going out). This has nothing to do with incompatible standards.

    I'm not sure about the rest of the FUD in this article. Yes, its all very complicated. But just as we have to know how to layer our networks we also know how to manage our information. For example, anyone who as a smartphone that they co-mingle sensitive data and public access on, relying on the integrity of its software to keep everything separate, is just plain asking for trouble. Quite apart from the risk of data leakage between applications its a portable device that can get lost, stolen or confiscated (and duplicated.....). Use common sense. Manage your data.

    [May 24, 2019] Internet and phones aren't the issue. Its the chips

    Notable quotes:
    "... The real issue is the semiconductors - the actual silicon. ..."
    "... China has some fabs now, but far too few to handle even just their internal demand - and tech export restrictions have long kept their leading edge capabilities significantly behind the cutting edge. ..."
    "... On the flip side: Foxconn, Huawei et al are so ubiquitous in the electronics global supply chain that US retail tech companies - specifically Apple - are going to be severely affected, or at least extremely vulnerable to being pushed forward as a hostage. ..."
    May 24, 2019 | theregister.co.uk

    Duncan Macdonald

    Internet, phones, Android aren't the issue - except if the US is able to push China out of GSM/ITU.

    The real issue is the semiconductors - the actual silicon.

    The majority of raw silicon wafers as well as the finished chips are created in the US or its most aligned allies: Japan, Taiwan. The dominant manufacturers of semiconductor equipment are also largely US with some Japanese and EU suppliers.

    If Fabs can't sell to China, regardless of who actually paid to manufacture the chips, because Applied Materials has been banned from any business related to China, this is pretty severe for 5-10 years until the Chinese can ramp up their capacity.

    China has some fabs now, but far too few to handle even just their internal demand - and tech export restrictions have long kept their leading edge capabilities significantly behind the cutting edge.

    On the flip side: Foxconn, Huawei et al are so ubiquitous in the electronics global supply chain that US retail tech companies - specifically Apple - are going to be severely affected, or at least extremely vulnerable to being pushed forward as a hostage.

    Interesting times...

    [May 24, 2019] We shared and the Americans shafted us. And now *they* are bleating about people not respecting Intellectual Property Rights?

    Notable quotes:
    "... The British aerospace sector (not to be confused with the company of a similar name but more Capital Letters) developed, amongst other things, the all-flying tailplane, successful jet-powered VTOL flight, noise-and drag-reducing rotor blades and the no-tailrotor systems and were promised all sorts of crunchy goodness if we shared it with our wonderful friends across the Atlantic. ..."
    "... We shared and the Americans shafted us. Again. And again. And now *they* are bleating about people not respecting Intellectual Property Rights? ..."
    May 24, 2019 | theregister.co.uk

    Anonymous Coward

    Sic semper tyrannis

    "Without saying so publicly, they're glad there's finally some effort to deal with longstanding issues like government favoritism toward local companies, intellectual property theft, and forced technology transfers."

    The British aerospace sector (not to be confused with the company of a similar name but more Capital Letters) developed, amongst other things, the all-flying tailplane, successful jet-powered VTOL flight, noise-and drag-reducing rotor blades and the no-tailrotor systems and were promised all sorts of crunchy goodness if we shared it with our wonderful friends across the Atlantic.

    We shared and the Americans shafted us. Again. And again. And now *they* are bleating about people not respecting Intellectual Property Rights?

    And as for moaning about backdoors in Chinese kit, who do Cisco et al report to again? Oh yeah, those nice Three Letter Acronym people loitering in Washington and Langley...

    [May 24, 2019] Oh dear. Secret Huawei enterprise router snoop 'backdoor' was Telnet service, sighs Vodafone The Register

    May 24, 2019 | theregister.co.uk

    A claimed deliberate spying "backdoor" in Huawei routers used in the core of Vodafone Italy's 3G network was, in fact, a Telnet -based remote debug interface.

    The Bloomberg financial newswire reported this morning that Vodafone had found "vulnerabilities going back years with equipment supplied by Shenzhen-based Huawei for the carrier's Italian business".

    "Europe's biggest phone company identified hidden backdoors in the software that could have given Huawei unauthorized access to the carrier's fixed-line network in Italy," wailed the newswire.

    Unfortunately for Bloomberg, Vodafone had a far less alarming explanation for the deliberate secret "backdoor" – a run-of-the-mill LAN-facing diagnostic service, albeit a hardcoded undocumented one.

    "The 'backdoor' that Bloomberg refers to is Telnet, which is a protocol that is commonly used by many vendors in the industry for performing diagnostic functions. It would not have been accessible from the internet," said the telco in a statement to The Register , adding: "Bloomberg is incorrect in saying that this 'could have given Huawei unauthorized access to the carrier's fixed-line network in Italy'.

    "This was nothing more than a failure to remove a diagnostic function after development."

    It added the Telnet service was found during an audit, which means it can't have been that secret or hidden: "The issues were identified by independent security testing, initiated by Vodafone as part of our routine security measures, and fixed at the time by Huawei."

    Huawei itself told us: "We were made aware of historical vulnerabilities in 2011 and 2012 and they were addressed at the time. Software vulnerabilities are an industry-wide challenge. Like every ICT vendor we have a well-established public notification and patching process, and when a vulnerability is identified we work closely with our partners to take the appropriate corrective action."

    Prior to removing the Telnet server, Huawei was said to have insisted in 2011 on using the diagnostic service to configure and test the network devices. Bloomberg reported, citing a leaked internal memo from then-Vodafone CISO Bryan Littlefair, that the Chinese manufacturer thus refused to completely disable the service at first:

    Vodafone said Huawei then refused to fully remove the backdoor, citing a manufacturing requirement. Huawei said it needed the Telnet service to configure device information and conduct tests including on Wi-Fi, and offered to disable the service after taking those steps, according to the document.

    El Reg understands that while Huawei indeed resisted removing the Telnet functionality from the affected items – broadband network gateways in the core of Vodafone Italy's 3G network – this was done to the satisfaction of all involved parties by the end of 2011, with another network-level product de-Telnet-ised in 2012.

    Broadband network gateways in 3G UMTS mobile networks are described in technical detail in this Cisco (sorry) PDF . The devices are also known as Broadband Remote Access Servers and sit at the edge of a network operator's core.

    The issue is separate from Huawei's failure to fully patch consumer-grade routers , as exclusively revealed by The Register in March.

    Plenty of other things (cough, cough, Cisco) to panic about

    Characterising this sort of Telnet service as a covert backdoor for government spies is a bit like describing your catflap as an access portal that allows multiple species to pass unhindered through a critical home security layer. In other words, massively over-egging the pudding.

    Many Reg readers won't need it explaining, but Telnet is a routinely used method of connecting to remote devices for management purposes. When deployed with appropriate security and authentication controls in place, it can be very useful. In Huawei's case, the Telnet service wasn't facing the public internet, and was used to set up and test devices.

    Look, it's not great that this was hardcoded into the equipment and undocumented – it was, after all, declared a security risk – and had to be removed after some pressure. However, it's not quite the hidden deliberate espionage backdoor for Beijing that some fear.

    Twitter-enabled infoseccer Kevin Beaumont also shared his thoughts on the story, highlighting the number of vulns in equipment from Huawei competitor Cisco, a US firm:

    me title=

    For example, a pretty bad remote access hole was discovered in some Cisco gear , which the mainstream press didn't seem too fussed about. Ditto hardcoded root logins in Cisco video surveillance boxes. Lots of things unfortunately ship with insecure remote access that ought to be removed; it's not evidence of a secret backdoor for state spies.

    Given Bloomberg's previous history of trying to break tech news, when it claimed that tiny spy chips were being secretly planted on Supermicro server motherboards – something that left the rest of the tech world scratching its collective head once the initial dust had settled – it may be best to take this latest revelation with a pinch of salt. Telnet wasn't even mentioned in the latest report from the UK's Huawei Cyber Security Evaluation Centre, which savaged Huawei's pisspoor software development practices.

    While there is ample evidence in the public domain that Huawei is doing badly on the basics of secure software development, so far there has been little that tends to show it deliberately implements hidden espionage backdoors. Rhetoric from the US alleging Huawei is a threat to national security seems to be having the opposite effect around the world.

    With Bloomberg, an American company, characterising Vodafone's use of Huawei equipment as "defiance" showing "that countries across Europe are willing to risk rankling the US in the name of 5G preparedness," it appears that the US-Euro-China divide on 5G technology suppliers isn't closing up any time soon. ®

    Bootnote

    This isn't shaping up to be a good week for Bloomberg. Only yesterday High Court judge Mr Justice Nicklin ordered the company to pay up £25k for the way it reported a live and ongoing criminal investigation.

    [May 24, 2019] The advantages of China going after Boeing, as opposed to making life miserable for US technology companies, would be considerable

    Notable quotes:
    "... The US Department of Commerce said it would put Huawei on its so-called Entity List, meaning that the American companies will have to obtain a licence from the US government to sell technology to Huawei. At the same time, US president Donald Trump signed an executive order declaring the US telecoms sector faced a "national emergency" -- giving the commerce department the power to "prohibit transactions posing an unacceptable risk" to national security . ..."
    "... "The US has basically openly declared it is willing to engage in a full-fledged technology war with China," he said. ..."
    "... Huawei has few alternatives for critical semiconductors to Qualcomm, which would likely be denied an export license if the US follows through on its threat of putting Huawei on the "Entity List" (the second most stringent category, but still sufficient for the US to bar licensing). One is Murata, but Japan has joined the US ban on Huawei 5G products, and would presumably fall in line if the US were to ask Japan to tell Murata not to sell semiconductors to Huawei. ..."
    "... On top of that, Ethiopian Air's forceful criticism of the 737 Max gives China air cover. Unlike Lion Air, which is widely seen as a questionable operator, readers who fly emerging economy carriers give Ethiopian Air high marks for competence and safety. One even wrote, "I have flown Ethiopian Air. It's certainly far better than Irish-owned and operated Ryan Airlines (even though the latter has white pilots with nice Irish accents)." ..."
    "... Chinese interests have made large investments many countries in Africa, so it's conceivable it could get other countries on the continent to follow its lead. Admittedly, China plus those countries collectively may not be large enough to do considerable damage to Boeing. But this action would break the hegemony of the FAA as certifier for US manufacturers, and that could prove crippling in the long run. ..."
    May 17, 2019 | www.ft.com

    Gregory Travis and Marshall Auerback Anatomy of a Disaster – Why Boeing Should Never Make Another Airplane, Again naked capi

    The White House and US Department of Commerce took steps on Wednesday night that would in effect ban Huawei from selling technology into the American market, and could also prevent it from buying semiconductors from suppliers including Qualcomm in the US that are crucial for its production .

    The US Department of Commerce said it would put Huawei on its so-called Entity List, meaning that the American companies will have to obtain a licence from the US government to sell technology to Huawei. At the same time, US president Donald Trump signed an executive order declaring the US telecoms sector faced a "national emergency" -- giving the commerce department the power to "prohibit transactions posing an unacceptable risk" to national security .

    Paul Triolo, a technology policy expert at Eurasia Group, a risk consultancy, said it was a "huge development" that would not only hurt the Chinese company but also have an impact on global supply chains involving US companies such as Intel, Microsoft and Oracle.

    "The US has basically openly declared it is willing to engage in a full-fledged technology war with China," he said.

    Huawei has few alternatives for critical semiconductors to Qualcomm, which would likely be denied an export license if the US follows through on its threat of putting Huawei on the "Entity List" (the second most stringent category, but still sufficient for the US to bar licensing). One is Murata, but Japan has joined the US ban on Huawei 5G products, and would presumably fall in line if the US were to ask Japan to tell Murata not to sell semiconductors to Huawei.

    The advantages of China going after Boeing, as opposed to making life miserable for US technology companies, would be considerable. Targeting, say, Microsoft would be an obvious tit for tat. By contrast, China was the first country to ground the 737 Max, and its judgment was confirmed by other airline regulators and eventually the FAA. China does not have a credible competitor to Boeing, so it could wrap continued denial of certification of the 737 Max in the mantle of being pro-safety, even if independent parties suspected this was a secondary motive.

    On top of that, Ethiopian Air's forceful criticism of the 737 Max gives China air cover. Unlike Lion Air, which is widely seen as a questionable operator, readers who fly emerging economy carriers give Ethiopian Air high marks for competence and safety. One even wrote, "I have flown Ethiopian Air. It's certainly far better than Irish-owned and operated Ryan Airlines (even though the latter has white pilots with nice Irish accents)."

    Chinese interests have made large investments many countries in Africa, so it's conceivable it could get other countries on the continent to follow its lead. Admittedly, China plus those countries collectively may not be large enough to do considerable damage to Boeing. But this action would break the hegemony of the FAA as certifier for US manufacturers, and that could prove crippling in the long run.

    Another issue that hasn't gotten the attention it warrants is that Boeing appears to lack the stringent software development protocols necessary for "fly by wire" operations. Boeing historically has relied on pilots being able to reassert control over automated functions'; Airbus has "fly by wire" systems as far more prominent and accordingly the expectation and ability of pilots to override these systems is lower.

    However, many articles noted that MCAS took the 737 further into a fly-by-wire philosophy than it had been before. Yet Boeing was astonishingly lax, having only two angle of attack sensors, of which only one would be providing input to MCAS, and then on an arbitrary-seeming basis.

    By contrast, the Airbus philosophy stresses redundancy, not only in hardware -- they use not three but four angle of attack sensors -- but in software, and even software development. "Two or more independent flight control computing systems are installed using different types of microprocessors and software written in different languages by different development teams" and verified using formal methods (" Approaches to Assure Safety in Fly-By-Wire Systems: Airbus Vs. Boeing ").

    [May 24, 2019] Microsoft Cuts Ties With Huawei

    Notable quotes:
    "... Win 10 is invasive garbage. I don't want anything managing my computer "automatically". ..."
    "... Huawei is a real wakeup call for the world... the US is an unreliable trader. They can never be trusted. ..."
    May 24, 2019 | www.zerohedge.com

    Microsoft will reportedly become the latest tech giant to 'suspend' its relationship with Huawei, according to the South China Morning Post .

    One week after Washington first imposed strict limits on Huawei and its affiliates that will make it almost impossible for American firms buy Huawei products or sell American-made components to the company, a handful of chipmakers, telecoms companies and tech firms (Alphabet) have reportedly scaled back or severed their relationship with Huawe.

    Though Microsoft said yesterday that it hadn't made a decision, the SCMP reported Friday morning that Microsoft had decided to stop accepting new orders from Huawei for operating systems and other content-related services: Windows operating systems for laptops and other content-related services. The US software giant has already removed Huawei laptops from its online stores.


    CatInTheHat , 1 minute ago link

    Yeah but Microsoft and Google aren't part of the military security apparatus and have nothing to do with foreign policy.

    Funny Google and Microsoft have operations out of China .

    Cant wait til China retaliated bigly on these assholes.

    me or you , 11 minutes ago link

    Just follow India steps.:

    Indian State Saves Over $400 Million by Choosing Linux

    CheapBastard , 29 minutes ago link

    Feinstein and Biden are not going to like this.

    GrosserBöserWolf , 38 minutes ago link

    Good by US monopoly on software. This will only accelerate new developments.

    CashMcCall , 38 minutes ago link

    Just one more prime example why no companies should use Microsoft software.

    The issue is clear as a bell. Become dependent on a US supplier and the Gov of the USSA could cut off your contracts with impunity. That risk is too high for any manufacturing entity.

    I am not a fan of Linux. I do not like the way it manages memory. Also while it has gotten better, it remains something of an unmade bed in that much of the software doesn't work particularly well. But the same cold be said for Microsoft. How many times does Windows OFFICE have to lock up before you comprehend the nightmarish patch system which has become Windows?

    GNU meaning not Unix never developed into a GUI. Ghost BSD looks interesting, BSD PC has limited compatibility but UNIX is flatly superior in how it handles memory. Unix is brilliant. I also love Open Office, it is better than Microsoft Office and you can save all your files to the Microsoft format if you want. Open Office is perfect transitional software and FREE! Why are school districts paying microsoft instead of using Open Office.

    Win 10 is invasive garbage. I don't want anything managing my computer "automatically".

    Huawei is a real wakeup call for the world... the US is an unreliable trader. They can never be trusted. This is not just about that lunatic Turmp. If AOC ever got to the White House she could do the same under the New Green Deal NATIONAL SECURITY EMERGENCY.

    The Constitution gave Congress the exclusive power over Commerce but over time, the Congress delegated more and more power to the Exec with this kind of dreadful outcome. Founding Fathers wanted checks and balances. But here you have one person, interrupting commerce and contracts with the stroke of a pen that has never been approved by Congress. That is simply too much risk.

    The Chinese like anyone else make mistakes. BUT CHINA does not repeat the same mistake twice unlike the USSA that seems to be caught in the revolving door of mistakes.

    Better that this happens early in the life of Huawei than much later. China could actually lead the world into the adaptation of open source destroying both Microsoft, Google and Apple at the same time. Remember Apple took BSD and then made proprietary changes. That is the APPLE OS which is much more stable than anything Windows ever made.

    While people knock apple Iphone for cost, the Apple laptops are very stable and essentially virus and worm immune. For a novice users that's why Apples are great.

    I have had Unix based machines run for years with never being turned off, always rock stable. It is head and shoulders above everything. FreeBSD

    https://www.ghostbsd.org/

    Here is a UNIX GUI. I know nothing about these guys but will check it out. A non power user only needs a solid browser, and a good word processor, Open Office works with BSD.

    Personally I don't think Apple should be grouped with Google and microsoft. I don't see as Apple has done anything wrong other than selling their products at a premium to the novices. That's not a crime and novices benefit. So quit packaging Apple in with Google and Microsoft.

    BTW, Blackberry OS is Unix based. It is a canadian company so likely a US poodle.

    john.b , 12 minutes ago link

    Canada is a US puppet, but treated like a **** by US.

    SMD , 45 minutes ago link

    Huawei were attacked because they are a threat to Apple, not to "our national security." The only thing Trump cares about are the profits of big companies.

    Wild Bill Steamcock , 43 minutes ago link

    BuyDash cut ties with Microsoft years ago.

    Yes, but the real question is did you cut ties with the NBA, Nike, grape Kool-Aid, McDonald's, Popeye's, your parole officer, KFC, crotch-grabbing, your six illegitimate children and the local welfare office?

    JailBanksters , 1 hour ago link

    WHoAreWe made Microsoft's Phones, and Microsoft killed the Phone without any help from anyone.

    silverer , 40 minutes ago link

    I knew Nokia was doomed when it partnered with Microsoft. They should have instead partnered with and help fund the Open Source Software community. By now, we'd have spectacular phones, free of logjams of spyware, bloatware, and ads.

    JailBanksters , 23 minutes ago link

    Now you have Windoze PC's with logjams of spyware, bloatware, and ads. Well, unless you hack it to make it a Workable PC. It's weird having to Hack your own PC to make it sane.

    dark fiber , 1 hour ago link

    EU take note. You are not even building or developing the damn things. But you want to dictate policy to the US. Asshats.

    Cassandra.Hermes , 1 hour ago link

    Why shouldn't Corning glass or Micron flash memory be sold to Huawei for use in phones bound for Europe? Huawei sells 30 times more phone in Europe than USA. I bought Huawei phone in Norway and I think is my best phone ever, I use Samsung Galaxy Note 9 in USA, but I carry the Huawei for photos and for WiFi calls from Norway. Try to do wifi calls from the Galaxy using Starbucks wifi and then using the same wifi try Huawei, you would see the difference right away.

    Coin Techs , 1 hour ago link

    They were up to dirty tricks with the dirty dems and DT is shutting them down.

    Reality_checkers , 1 hour ago link

    The US is going to sanction itself into economic irrelevance as the rest of the world says F you. We only have two friends now, Israel and KSA. Nice work, Donnie.

    [May 23, 2019] Why Trump s Huawei Ban Is Unlikely To Persist

    Notable quotes:
    "... However, nothing in the actual piece talks about security concerns. (I point this out because I perceive a trend towards such misleading summaries and headlines which contradict what the actual reporting says.) ..."
    "... These companies do not have security concerns over Huawei. But the casual reader, who does not dive down into the actual piece, is left with a false impression that such concerns are valid and shared. ..."
    "... South China Morning Post ..."
    "... This move by Google-USG is mostly a propaganda warfare move. Huawei doesn't depend on smartphone sales to survive. It's American market was already small, while China's domestic market is huge. China is not Japan. ..."
    "... Trump's heavy handed move against Huawei will backfire. The optic is unsettling; the US looks to be destroying a foreign competitor because it is winning. ..."
    "... Until the reserve currency issue favoring the "exceptional" nation changes, the economic terrorism will continue.. ..."
    "... What is funny in all these stories, is that there is little to no Huawei equipment (not the end-user smart phone, home router and stuff, but backbone routers, access equipment,..) anywhere in the US -- they are forbidden to compete. Most telcos are quite happy to sell in the US, as the absence of these Chinese competitors allows for healthy margins, which is no longer true in other markets. ..."
    "... The US is trying desperately to quash tech success / innovation introduced by others who are not controlled by (or in partnership with) the US, via economic war, for now just politely called a trade war - China no 1 adversary. ..."
    "... Attacking / dissing / scotching trade between one Co. (e.g. Huawei) and the world is disruptive of the usual, conventional, accepted, exchange functioning, and throws a pesky spanner in the works of the system. Revanchard motives, petty targetting, random pot-shots, lead to what? ..."
    "... The war against Huawei is only one small aspect within the overall Trade War, which is based on the false premise of US economic strength. Most of the world wants to purchase material things, not financial services which is the Outlaw US Empire's forte and most of the world can easily forego. Trump's Trade War isn't going as planned which will cause him to double-down in a move that will destroy his 2020 hopes. ..."
    May 23, 2019 | www.moonofalabama.org

    However, nothing in the actual piece talks about security concerns. (I point this out because I perceive a trend towards such misleading summaries and headlines which contradict what the actual reporting says.)

    The British processor company ARM, which licenses its design to Huawei, cites U.S. export controls as the reason to stop cooperation with Huawei:

    The conflict is putting companies and governments around the world in a tough spot, forcing them to choose between alienating the United States or China .

    Arm Holdings issued its statement after the BBC reported the firm had told staff to suspend dealings with Huawei.

    An Arm spokesman said some of the company's intellectual property is designed in the United States and is therefore " subject to U.S. export controls ."

    Additionally two British telecom providers quote U.S. restrictions as reason for no longer buying Huawei smartphones:

    BT Group's EE division, which is preparing to launch 5G service in six British cities later this month, said Wednesday it would no longer offer a new Huawei smartphone as part of that service. Vodafone also said it would drop a Huawei smartphone from its lineup. Both companies appeared to tie that decision to Google's move to withhold licenses for its Android operating software from future Huawei phones.

    These companies do not have security concerns over Huawei. But the casual reader, who does not dive down into the actual piece, is left with a false impression that such concerns are valid and shared.

    That the Trump administration says it has security reasons for its Huawei ban does not mean that the claim is true. Huawei equipment is as good or bad as any other telecommunication equipment, be it from Cisco or Apple. The National Security Agency and other secret services will try to infiltrate all types of such equipment.

    After the sudden ban on U.S. entities to export to Huawei, chipmakers like Qualcomm temporarily stopped their relations with Huawei. Google said that it would no longer allow access to the Google Play store for new Huawei smartphones. That will diminish their utility for many users.

    The public reaction in China to this move was quite negative. There were many calls for counter boycotts of Apple's i-phones on social media and a general anti-American sentiment.

    The founder and CEO of Huawei, Ren Zhengfei, tried to counter that. He gave a two hour interview (vid, 3 min excerpt with subtitles) directed at the Chinese public. Ren sounds very conciliatory and relaxed. The Global Times and the South China Morning Post only have short excerpts of what he said. They empathize that Huawei is well prepared and can master the challenge:


    Andreas , May 23, 2019 10:00:52 AM | 1

    It's really huge, that Huawei may no longer use ARM processors.

    Huawei is thus forced to develop it's own processor design and push it into the market.

    p , May 23, 2019 10:04:34 AM | 2

    @1

    I do not believe this is precisely what will happen. Huawei already has its licenses purchased. In addition they could decide to disrespect the IP if this was the case.

    Arioch , May 23, 2019 10:05:39 AM | 3
    Huaweis's suppliers in Japan, South Korea, Taiwan (ROC), and Britain are examining if they can continue to make business with Huawei, while some have already declared a suspension in cooperation.

    The issue is that these non-American companies nonetheless use some American components of technology, and if they proceed they will be sanctioned by the US themselves.

    It is the same reason why Russia's Sukhoi did not in the end sell its SSJ-100 airliners to Iran -- East Asian tech companies can hardly be expected to be more gung-ho on defying the US than Russia's leading defense plant......

    http://www.checkpointasia.net/big-blow-for-huawei-as-japanese-korean-british-firms-reconsider-or-suspend-cooperation-as-well/

    Arioch , May 23, 2019 10:10:32 AM | 4
    > the Trump administration has created discord where unity is urgently needed

    IOW Trump keeps sabotaging USA global integration and keeps steering it into isolation as he long said it should be

    Arioch , May 23, 2019 10:14:28 AM | 5
    @p #2 - Huawei surely has their processors *as of now*.

    That - if USA would not ban Huawei (HiSilicon) processors, because of using that ARM technology. Thing is, Huawei would be isolated from next-generation ARM processors. They are locked now in their current generation.

    Even Qualcomm today, for what I know, bases their processors on ARM's "default" schemes, instead of doing their development "from scratch", in a totally independent way. It would push for slow but steady decline as "top" smartphone vendor into "el cheapo" niche.

    Arioch , May 23, 2019 10:16:54 AM | 6
    At the same time Qualcomm would probably be forced to slash prices down for their non-Huawei customers. https://www.zdnet.com/article/qualcomms-licensing-practices-violated-us-antitrust-laws-judge-rules/
    Red Ryder , May 23, 2019 10:17:21 AM | 7
    Boeing is the counter-part in the contest to destroy Huawei. China has great leverage over Boeing's future. It is the nation with the biggest market now and downstream for 10-20 years. China need planes, thousands of them.

    As for Huawei's chief doubting the prowess of the Chinese students, he only needs to look at the rapidity of the conversion of his nations' economy to a 98% digital economy. All that conversion was done by local, entrepreneurial innovators in the software and hardware tech sector. It happened only in China and completely by Chinese young people who had phones and saw the future and made it happen.

    It has been Chinese minds building Chinese AI on Chinese Big Data.

    Yes, they need Russian technologists and scientists. Those Russian minds in Russia, in Israel, in South Korea are proven difference makers.

    The need China now has will meet the solution rapidly. For five years, the Double Helix of Russia-China has been coming closer in education and R&D institutes in both nations. China investors and Chinese sci-tech personnel are in the sci-tech parks of Russia, and Russians are in similar facilities in China. More will happen now that the Economic War against China threatens.

    Huawei will have solutions to replace all US components by the end of the year. It will lose some markets. but it will gain hugely in the BRI markets yet to be developed.

    In the long run, the US makers will rue the day Trump and his gang of Sinophobes and hegemonists took aim at Huawei and China's tech sector.

    oglalla , May 23, 2019 10:40:03 AM | 8
    Let's all boycott Most Violent, Biggest Brother tech. Don't buy shit.
    vk , May 23, 2019 10:46:37 AM | 9
    This move by Google-USG is mostly a propaganda warfare move. Huawei doesn't depend on smartphone sales to survive. It's American market was already small, while China's domestic market is huge. China is not Japan.

    Besides, it's not like Europe is prospering either. Those post-war days are long gone.

    And there's no contradiction between what the CEO said and the Government line: both are approaching the same problem from different points of view, attacking it from different fronts at the same time. "Patriotism" is needed insofar as the Chinese people must be prepared to suffer some hardships without giving up long term prosperity. "Nationalism" ("politics") is toxic insofar as, as a teleological tool, it is a dead end (see Bannon's insane antics): the Chinese, after all, are communists, and communists, by nature, are internationalists and think beyond the artificial division of humanity in Nation-States.

    Ptb , May 23, 2019 11:09:35 AM | 0

    Ren Zhengfei's attitude is remarkable, considering his daughter ia currently held hostage.
    ken , May 23, 2019 11:15:25 AM | 1
    Talking Digital and security in the same sentence is laughable.... NOTHING Digital is 'secure',,, never has,,, never will.

    Digital destroys everything it touches. At present, excepting for now the low wage States, it is destroying economies ever so slowly one sector at a time. This has nothing to do with security and everything to do with the dying West, especially the USA which is trying desperately to save what's left of its production whether it be 5G, Steel plants or Nord Stream. The West created China when it happily allowed and assisted Western corporations to move the production there in order to hide the inflation that was being created for wars and welfare and now has to deal with the fallout which eventually will be their undoing.

    Jackrabbit , May 23, 2019 11:22:20 AM | 2
    A full-blown trade war was probably inevitable, driven by geopolitical concerns as much or more than economics.

    One wonders what each of China and US has been doing to prepare. It seems like the answer is "very little" but since it's USA that is driving this bus, I would think that USA would've done more to prepare (than China has).

    PS It's not just Boeing. China also supplies the vast majority of rare earth minerals.

    Red Ryder , May 23, 2019 11:24:39 AM | 3
    @10,

    Her captivity and probable imprisonment in the US explain his attitude. She is a high profile pawn. The US must convict her in order to justify what they have done to her so far. She may not serve time, in the US prisons, but she will be branded a guilty person, guilty of violating the Empire's rules (laws).

    Imagine Ivanka in the same situation. Her daughter singing in Mandarin would be little help. The Trump Family will be a number one target for equal treatment long after "45" leaves office.

    The US Empire is wild with Power. All of that Power is destructive. And all the globe is the battlefield, except USA. But History teaches that this in-equilibrium will not last long.

    Jackrabbit , May 23, 2019 11:26:33 AM | 4
    We've seen how Europe caved to US pressure to stop trading with Iran. Now Japan and others are caving to pressure to stop trading with China. There is already pressure and negotiation to stop Nordstream. And all of the above leads to questions about Erdogan's resolve.
    alaric , May 23, 2019 11:38:11 AM | 5
    Trump's heavy handed move against Huawei will backfire. The optic is unsettling; the US looks to be destroying a foreign competitor because it is winning.

    The ramifications of trade war with China (where the supply and manufacturing chain of most consumer electronics is these days) is disruptive. Trump has created uncertainty for many manufacturers since there is Chinese part content is just about everything these days. Some manufacturers might relocate production to the US but most will try to simply decouple from the US entirely.

    Exposure to the US is really the problem not exposure to China.

    Jackrabbit , May 23, 2019 11:53:44 AM | 8
    b: Why Trump's Huawei Ban Is Unlikely To Persist

    The trade war with Iran was also unlikely to persist. But it has persisted, and deepened as European poodles pretended to resist and then pretended not to notice that they didn't.

    A new Bloomberg opinion piece agrees with that view

    No, it doesn't b. You say USA trade war will fail because it lacks international support. Bloomberg says USA should get international support to make it more effective. The difference is that it is highly likely that USA will get international support. It already has support from Japan.

    USA has proven that it can effectively manipulate it's poodle allies. Another example is Venezuela where more than two dozen countries recognized Guido only because USA wanted them to.

    <> <> <> <> <> <> <>

    It's not Trump but the US Deep State that causes US allies to fall in line. Any analysis that relies on Trump as President is bound to fail as his public persona is manipulated to keep Deep State adversaries (including the US public) off-balance.

    Like President's before him, Trump will take the blame (and the credit) until another team member is chosen to replace him in what we call "free and fair elections".

    ben , May 23, 2019 11:54:24 AM | 9
    Until the reserve currency issue favoring the "exceptional" nation changes, the economic terrorism will continue..
    Jeff , May 23, 2019 12:00:34 PM | 0
    What is funny in all these stories, is that there is little to no Huawei equipment (not the end-user smart phone, home router and stuff, but backbone routers, access equipment,..) anywhere in the US -- they are forbidden to compete. Most telcos are quite happy to sell in the US, as the absence of these Chinese competitors allows for healthy margins, which is no longer true in other markets.

    So the Huawei ban hits first and foremost the US' partners.

    bjd , May 23, 2019 12:00:38 PM | 1
    @ben (19)

    China can only undo the US-exceptionalsim if and when it can visibly project military power. The only way to achieve that is tt has to make great haste in building a few fleets of aircraft carriers, fregats and destroyers, etc. It must build a grand, visibly magnificent Chinese Navy.

    ben , May 23, 2019 12:02:59 PM | 2
    big time OT alert;

    Modi wins in India, another victory for the world oligarchs. Exactly mimicking conditions in the U$A. Media and governmental capture by the uber wealthy...

    Noirette , May 23, 2019 12:04:16 PM | 3
    (Ignorant of tech aspects.)

    The US is trying desperately to quash tech success / innovation introduced by others who are not controlled by (or in partnership with) the US, via economic war, for now just politely called a trade war - China no 1 adversary.

    Afaik, the entire smart-phone industry is 'integrated' and 'regulated' by FTAs, the WTO, the patent circuit, the Corps. and Gvmts. who collaborate amongst themselves.

    Corps. can't afford to compete viciously because infrastructure, aka more encompassing systems or networks (sic) are a pre-requisite for biz, thus, Gvmts. cooperate with the Corps, and sign various 'partnerships,' etc.

    sidebar. Not to mention the essential metals / components provenance, other topic. see

    https://bit.ly/2K1pj3d - PDF about minerals in smarphones

    Attacking / dissing / scotching trade between one Co. (e.g. Huawei) and the world is disruptive of the usual, conventional, accepted, exchange functioning, and throws a pesky spanner in the works of the system. Revanchard motives, petty targetting, random pot-shots, lead to what?

    karlof1 , May 23, 2019 12:05:01 PM | 4
    As I wrote in the Venezuela thread, major US corps are already belt tightening by permanently laying off managers, not already cut-to-the-bone production staff, and another major clothing retailer is closing its 650+ stores. And the full impact of Trump's Trade War has yet to be felt by consumers. As Wolff, Hudson and other like-minded economists note, there never was a genuine recovery from 2008, while statistical manipulation hides the real state of the US economy. One thing that cannot be hidden is the waning of revenues collected via taxes which drives the budget deficit--and the shortfall isn't just due to the GOP Congress's tax cuts.

    The war against Huawei is only one small aspect within the overall Trade War, which is based on the false premise of US economic strength. Most of the world wants to purchase material things, not financial services which is the Outlaw US Empire's forte and most of the world can easily forego. Trump's Trade War isn't going as planned which will cause him to double-down in a move that will destroy his 2020 hopes.

    Arioch , May 23, 2019 12:05:34 PM | 5
    @vk #9

    > Huawei's phones American market was already small, while China's domestic market is huge

    Here is that data, for 2017, outside the paywall: https://imgur.com/a/8bvvX9B

    Data for 2019 is probably slightly different, but the trends should keep on. That data also does not separate Android-based phones from non-Android phones. So, segmenting Android into Google and China infrastructures would mean

    1) Huawei retains a $152B market - China
    2) Huawei retains an unknown share in $87B market - APAC
    3) Huawei loses a $163,9B market - all non-China world.

    At best Huawei looses 40,7% of world market. That if all APAC population would voluntarily and uniformly drop out of Google services into Huawei/China services (which they would not). At worst Huawei retains 37,7% of the marker (if APAC population would uniformly follow Google, which they would not either).

    [May 22, 2019] Averting World Conflict with China

    Notable quotes:
    "... Since the end of the Cold War, the American government has become increasingly delusional, regarding itself as the Supreme World Hegemon. As a result, local American courts have begun enforcing gigantic financial penalties against foreign countries and their leading corporations, and I suspect that the rest of the world is tiring of this misbehavior. Perhaps such actions can still be taken against the subservient vassal states of Europe, but by most objective measures, the size of China's real economy surpassed that of the US several years ago and is now substantially larger , while also still having a far higher rate of growth. Our totally dishonest mainstream media regularly obscures this reality, but it remains true nonetheless. ..."
    "... Provoking a disastrous worldwide confrontation with mighty China by seizing and imprisoning one of its leading technology executives reminds me of a comment I made several years ago about America's behavior under the rule of its current political elites: ..."
    "... Normal countries like China naturally assume that other countries like the US will also behave in normal ways, and their dumbfounded shock at Ms. Meng's seizure has surely delayed their effective response. In 1959, Vice President Richard Nixon visited Moscow and famously engaged in a heated "kitchen debate" with Premier Nikita Khrushchev over the relative merits of Communism and Capitalism. What would have been the American reaction if Nixon had been immediately arrested and given a ten year Gulag sentence for "anti-Soviet agitation"? ..."
    "... But Bolton's apparent involvement underscores the central role of his longtime patron, multi-billionaire casino-magnate Sheldon Adelson, whose enormous financial influence within Republican political circles has been overwhelmingly focused on pro-Israel policy and hostility towards Iran, Israel's regional rival. ..."
    "... Although it is far from clear whether the very elderly Adelson played any direct personal role in Ms. Meng's arrest, he surely must be viewed as the central figure in fostering the political climate that produced the current situation. Perhaps he should not be described as the ultimate puppet-master behind our current clash with China, but any such political puppet-masters who do exist are certainly operating at his immediate beck and call. In very literal terms, I suspect that if Adelson placed a single phone call to the White House, the Trump Administration would order Canada to release Ms. Meng that same day. ..."
    May 22, 2019 | www.unz.com

    See also: The PRC Should Retaliate by Targeting Sheldon Adelson's Chinese Casinos Ron Unz December 13, 2018 1,800 Words 944 Comments Reply Huawei CFO Meng Wanzhou

    As most readers know, I'm not a casual political blogger and I prefer producing lengthy research articles rather than chasing the headlines of current events. But there are exceptions to every rule, and the looming danger of a direct worldwide clash with China is one of them.

    Consider the arrest last week of Meng Wanzhou, the CFO of Huawei, the world's largest telecom equipment manufacturer. While flying from Hong Kong to Mexico, Ms. Meng was changing planes in the Vancouver International Airport when she was suddenly detained by the Canadian government on an August US warrant. Although now released on $10 million bail, she still faces extradition to a New York City courtroom, where she could receive up to thirty years in federal prison for allegedly having conspired in 2010 to violate America's unilateral economic trade sanctions against Iran.

    Although our mainstream media outlets have certainly covered this important story, including front page articles in the New York Times and the Wall Street Journal , I doubt most American readers fully recognize the extraordinary gravity of this international incident and its potential for altering the course of world history. As one scholar noted, no event since America's deliberate 1999 bombing of China's embassy in Belgrade , which killed several Chinese diplomats, has so outraged both the Chinese government and its population. Columbia's Jeffrey Sachs correctly described it as "almost a US declaration of war on China's business community."

    Such a reaction is hardly surprising. With annual revenue of $100 billion, Huawei ranks as the world's largest and most advanced telecommunications equipment manufacturer as well as China's most internationally successful and prestigious company. Ms. Meng is not only a longtime top executive there, but also the daughter of the company's founder, Ren Zhengfei, whose enormous entrepreneurial success has established him as a Chinese national hero.

    Her seizure on obscure American sanction violation charges while changing planes in a Canadian airport almost amounts to a kidnapping. One journalist asked how Americans would react if China had seized Sheryl Sandberg of Facebook for violating Chinese law especially if Sandberg were also the daughter of Steve Jobs.

    Indeed, the closest analogy that comes to my mind is when Prince Mohammed bin Salman of Saudi Arabia kidnapped the Prime Minister of Lebanon earlier this year and held him hostage. Later he more successfully did the same with hundreds of his wealthiest Saudi subjects, extorting something like $100 billion in ransom from their families before finally releasing them. Then he may have finally over-reached himself when Washington Post columnist Jamal Khashoggi, a Saudi dissident, was killed and dismembered by a bone-saw at the Saudi embassy in Turkey.

    We should actually be a bit grateful to Prince Mohammed since without him America would clearly have the most insane government anywhere in the world. As it stands, we're merely tied for first.

    Since the end of the Cold War, the American government has become increasingly delusional, regarding itself as the Supreme World Hegemon. As a result, local American courts have begun enforcing gigantic financial penalties against foreign countries and their leading corporations, and I suspect that the rest of the world is tiring of this misbehavior. Perhaps such actions can still be taken against the subservient vassal states of Europe, but by most objective measures, the size of China's real economy surpassed that of the US several years ago and is now substantially larger , while also still having a far higher rate of growth. Our totally dishonest mainstream media regularly obscures this reality, but it remains true nonetheless.

    Provoking a disastrous worldwide confrontation with mighty China by seizing and imprisoning one of its leading technology executives reminds me of a comment I made several years ago about America's behavior under the rule of its current political elites:

    Or to apply a far harsher biological metaphor, consider a poor canine infected with the rabies virus. The virus may have no brain and its body-weight is probably less than one-millionth that of the host, but once it has seized control of the central nervous system, the animal, big brain and all, becomes a helpless puppet.

    Once friendly Fido runs around foaming at the mouth, barking at the sky, and trying to bite all the other animals it can reach. Its friends and relatives are saddened by its plight but stay well clear, hoping to avoid infection before the inevitable happens, and poor Fido finally collapses dead in a heap.

    Normal countries like China naturally assume that other countries like the US will also behave in normal ways, and their dumbfounded shock at Ms. Meng's seizure has surely delayed their effective response. In 1959, Vice President Richard Nixon visited Moscow and famously engaged in a heated "kitchen debate" with Premier Nikita Khrushchev over the relative merits of Communism and Capitalism. What would have been the American reaction if Nixon had been immediately arrested and given a ten year Gulag sentence for "anti-Soviet agitation"?

    Since a natural reaction to international hostage-taking is retaliatory international hostage-taking, the newspapers have reported that top American executives have decided to forego visits to China until the crisis is resolved. These days, General Motors sells more cars in China than in the US, and China is also the manufacturing source of nearly all our iPhones, but Tim Cook, Mary Barra, and their higher-ranking subordinates are unlikely to visit that country in the immediate future, nor would the top executives of Google, Facebook, Goldman Sachs, and the leading Hollywood studios be willing to risk indefinite imprisonment.

    Canada had arrested Ms. Meng on American orders, and this morning's newspapers reported that a former Canadian diplomat had suddenly been detained in China , presumably as a small bargaining-chip to encourage Ms. Meng's release. But I very much doubt such measures will have much effect. Once we forgo traditional international practices and adopt the Law of the Jungle, it becomes very important to recognize the true lines of power and control, and Canada is merely acting as an American political puppet in this matter. Would threatening the puppet rather than the puppet-master be likely to have much effect?

    Similarly, nearly all of America's leading technology executives are already quite hostile to the Trump Administration, and even if it were possible, seizing one of them would hardly be likely to sway our political leadership. To a lesser extent, the same thing is true about the overwhelming majority of America's top corporate leaders. They are not the individuals who call the shots in the current White House.

    Indeed, is President Trump himself anything more than a higher-level puppet in this very dangerous affair? World peace and American national security interests are being sacrificed in order to harshly enforce the Israel Lobby's international sanctions campaign against Iran, and we should hardly be surprised that the National Security Adviser John Bolton, one of America's most extreme pro-Israel zealots, had personally given the green light to the arrest. Meanwhile, there are credible reports that Trump himself remained entirely unaware of these plans, and Ms. Meng was seized on the same day that he was personally meeting on trade issues with Chinese President Xi. Some have even suggested that the incident was a deliberate slap in Trump's face.

    But Bolton's apparent involvement underscores the central role of his longtime patron, multi-billionaire casino-magnate Sheldon Adelson, whose enormous financial influence within Republican political circles has been overwhelmingly focused on pro-Israel policy and hostility towards Iran, Israel's regional rival.

    Although it is far from clear whether the very elderly Adelson played any direct personal role in Ms. Meng's arrest, he surely must be viewed as the central figure in fostering the political climate that produced the current situation. Perhaps he should not be described as the ultimate puppet-master behind our current clash with China, but any such political puppet-masters who do exist are certainly operating at his immediate beck and call. In very literal terms, I suspect that if Adelson placed a single phone call to the White House, the Trump Administration would order Canada to release Ms. Meng that same day.

    Adelson's fortune of $33 billion ranks him as the 15th wealthiest man in America, and the bulk of his fortune is based on his ownership of extremely lucrative gambling casinos in Macau, China . In effect, the Chinese government currently has its hands around the financial windpipe of the man ultimately responsible for Ms. Meng's arrest and whose pro-Israel minions largely control American foreign policy. I very much doubt that they are fully aware of this enormous, untapped source of political leverage.

    Over the years, Adelson's Chinese Macau casinos have been involved in all sorts of political bribery scandals , and I suspect it would be very easy for the Chinese government to find reasonable grounds for immediately shutting them down, at least on a temporary basis, with such an action having almost no negative repercussions to Chinese society or the bulk of the Chinese population. How could the international community possibly complain about the Chinese government shutting down some of their own local gambling casinos with a long public record of official bribery and other criminal activity? At worst, other gambling casino magnates would become reluctant to invest future sums in establishing additional Chinese casinos, hardly a desperate threat to President Xi's anti-corruption government.

    I don't have a background in finance and I haven't bothered trying to guess the precise impact of a temporary shutdown of Adelson's Chinese casinos, but it wouldn't surprise me if the resulting drop in the stock price of Las Vegas Sands Corp would reduce Adelson's personal net worth were by $5-10 billion within 24 hours, surely enough to get his immediate personal attention. Meanwhile, threats of a permanent shutdown, perhaps extending to Chinese-influenced Singapore, might lead to the near-total destruction of Adelson's personal fortune, and similar measures could also be applied as well to the casinos of all the other fanatically pro-Israel American billionaires, who dominate the remainder of gambling in Chinese Macau.

    The chain of political puppets responsible for Ms. Meng's sudden detention is certainly a complex and murky one. But the Chinese government already possesses the absolute power of financial life-or-death over Sheldon Adelson, the man located at the very top of that chain. If the Chinese leadership recognizes that power and takes effective steps, Ms. Meng will immediately be put on a plane back home, carrying the deepest sort of international political apology. And future attacks against Huawei, ZTE, and other Chinese technology companies would not be repeated.

    China actually holds a Royal Flush in this international political poker game. The only question is whether they will recognize the value of their hand. I hope they do for the sake of America and the entire world.

    [May 22, 2019] Commentary Politicized ban on Huawei shows U.S. losing spirit of openness - Xinhua English.news.cn

    Notable quotes:
    "... Launching a tech war or a trade war against any country is not appropriate, nor is it the best way to defend national security, Macron said. ..."
    "... Out of the total of 70 billion U.S. dollars Huawei spent on buying components in 2018, some 11 billion dollars went to U.S. companies, the Reuters reported Friday. ..."
    "... The spirit of openness is what helped the United States develop. However, Washington's restrictions on Huawei, based on unfounded allegations and political speculations, fall foul of the golden rules it once embraced ..."
    May 22, 2019 | www.xinhuanet.com

    javascript:void(0)

    WASHINGTON, May 22 (Xinhua) -- Washington last week declared a national emergency over what it claimed are technological threats, and announced restrictions on sale and transfer of American technologies to China's Huawei.

    The telecom company has long been accused by the United States of being able to use its network equipment to spy on foreign nations for the Chinese government. However, "no intelligence service has published clear evidence that Huawei inserted 'backdoors' for Chinese authorities to access the data that passes through its networks," according to a December 2018 article by U.S. media Politico.

    Given the lack of proof that Huawei threatens U.S. security, last week's twin moves by Washington -- the use of state apparatus to oppress a company -- are a reflection of nothing but bullying.

    The smearing campaign against Huawei aside, the United States has also been trying to rally Europe to abandon Huawei products, citing security threats. It was not welcome.

    "Europe must not be dragged into the trade dispute between China and the United States," Germany's powerful BDI industrial lobby group was quoted by media reports as saying in a statement on Thursday.

    France too refused to take orders from the United States. "Our perspective is not to block Huawei or any company," President Emmanuel Macron told the VivaTech conference in Paris on Thursday.

    Launching a tech war or a trade war against any country is not appropriate, nor is it the best way to defend national security, Macron said.

    The ban on the supply of U.S.-made chips to Huawei is a lose-lose in any sense, as it poses a threat to Huawei's viability and U.S. companies also pay the price.

    Out of the total of 70 billion U.S. dollars Huawei spent on buying components in 2018, some 11 billion dollars went to U.S. companies, the Reuters reported Friday.

    "The ban will financially harm the thousands of Americans employed by the U.S. companies that do business with Huawei," said Catherine Chen, a Director of the Board at Huawei, in a The New York Times article on Friday. "A total ban on Huawei equipment could eliminate tens of thousands of American jobs."

    Although Huawei does not do much business in the United States, the company is the sole provider of networking equipment to many rural American internet providers, according to a CNN article on Tuesday.

    "Those companies have said it will take time -- or may be impossible -- to replace their Huawei technology with a rival's," it added.

    As a move to ease the repercussion of the ban, the U.S. Department of Commerce on Monday issued a 90-day temporary license loosening restrictions on business deals with Huawei.

    Huawei doesn't intend to isolate itself from others, but wants to make as many friends as possible, its founder Ren Zhengfei told Chinese media on Tuesday when asked why Huawei didn't use substitutes before the United States took the latest aggressive measures.

    "We don't want to do harm to friends," he said. "We want to help them achieve good balance sheets. Even if we make adjustments, we still ought to render help."

    The spirit of openness is what helped the United States develop. However, Washington's restrictions on Huawei, based on unfounded allegations and political speculations, fall foul of the golden rules it once embraced

    .

    For Washington to win in an era of cooperation and inter-dependence, it would be better to revive the spirit of openness.

    [May 22, 2019] Japan, UK Join US Blockade Of China: ARM Tells Staff To Stop Working With Huawei

    That's real hardball...
    Notable quotes:
    "... In a company-wide memo, ARM told employees that their designs contain "US origin technology," which would be affected by the Trump administration's May 15 Executive Order to "protect our country against critical national security threats." ..."
    "... Also cunning thing would be to change brand name a bit like change/remove 1 letter. ..."
    "... Yet, they find out they are buying from another vendor that complies with China's demands and poof there goes another company ..."
    "... Xi should have listen to Deng Xiaoping. Keep your head down, go about your business and shut the **** up. But Xi the chest pounding panda declared Made in China 2025 and spooked everyone. China should de-robe him then hang him high! ..."
    "... There has been a suspiciously sudden rise in China hawkishness among American citizens (e.g., commentators on these boards) coincident with what to outside observers has been a very obvious post-Russia tsunami of political and MSM anti-China propaganda (it's often easier to see propaganda from the outside than from the inside). ..."
    "... Yes, but not all of China is restricted from using ARM. Only Huawei. Other phone manufacturers will be unaffected. ..."
    May 22, 2019 | www.zerohedge.com

    Japanese-owned chip designer ARM Holdings has notified its staff to halt " all active contracts, support entitlements, and any pending engagements " with Huawei and its subsidiaries in order to comply with the recent US clampdown, according to the BBC . Based in the UK and owned by Japan's Softbank, ARM designs and licenses processors used in all types of electronic devices, including smart phones, tablets, laptops, televisions, automotive systems and more.

    " ARM is the foundation of Huawei's smartphone chip designs, so this is an insurmountable obstacle for Huawei ," said Geoff Blaber of CCS Insight, adding: "That said, with an abundance of companies in Huawei's supply chain already having taken action to comply with the US order, Huawei's ability to operate was already severely affected ."

    In a company-wide memo, ARM told employees that their designs contain "US origin technology," which would be affected by the Trump administration's May 15 Executive Order to "protect our country against critical national security threats."

    The US has argued that the Chinese government could force companies such as Huawei to install backdoors on their devices to allow for spying on US networks - an accusation Huawei has repeatedly denied.

    Softbank - which is also one of Japan's largest mobile carriers - has joined with Japan's largest carriers DoCoMo and KDDI in announcing that they will stop taking orders for Huawei handsets.


    wadalt , 14 minutes ago link

    ARM does not manufacture computer processors itself,

    but rather licenses its semiconductor technologies to others.

    This option gives chip-makers greater freedom to customise their own designs.

    China can

    a) buy from other suppliers

    b) continue using the already-paid-for blueprints and say F@#@ U

    ... ... ...

    brokebackbuck , 1 minute ago link

    Seriously, like china isnt just going to stop sending money to ARM

    saldulilem , 21 minutes ago link

    Huawei purchased licenses for ARM chip architecture (Cortex CPU and Mali GPU). If ARM is rescinding the licenses, it will mean a lawsuit.

    hooligan2009 , 20 minutes ago link

    good luck with that. which court? the court of "oh ****" in the hague?

    wadalt , 13 minutes ago link

    They'll just keep using it. They already paid for it.

    Pft!

    Ruler , 15 minutes ago link

    You need to read their licensing scheme. ARM reserves the right to cut you off at any point in time.

    1033eruth , 23 minutes ago link

    Blockade is inappropriate. Boycott is appropriate. Damn 25 year old journalists.

    medium giraffe , 26 minutes ago link

    Let's have our 18 year olds line up in front of their 18 year olds and watch them all kill each other while we cheer them on.

    What a ******* great plan that would be. Consider my consent manufactured. Let's do this!

    Where the hell is my TV remote?

    free corn , 22 minutes ago link

    also China could be stimulated put effort in their own IP house and win long term.

    free corn , 29 minutes ago link

    Would not work, as chines still can access required ARM component via other companies like i. e. NXP.

    Also cunning thing would be to change brand name a bit like change/remove 1 letter.

    Ruler , 22 minutes ago link

    Nope, cross licensing is strictly forbidden under the licensing ARM uses. If uou want to use ARM based designs, you have two choices. Buy the chips already made, or license a core and fab the package yourself.

    If you fab it yourself, you have to market the cores and chips as being nased on theirs.

    That's it. I learned this when looking to have some Asics made up for compute decices and decided to review all of my options. I decided two things looking into that.

    1 I wouldn't have anything made until I could have them made here in the US. Still waiting for a FAB with older equipment to for such things to pop up. I simply don't trust China.

    2 I would start from scratch using a RISC design with MIT license to avoid the decades of no development by actually having a real open licensing scheme. The GPL crap sucks.

    free corn , 6 minutes ago link

    Licenses to independent third parties do not matter yet. "ARM Holdings has notified its staff to halt " all active contracts, support entitlements, and any pending engagements " with Huawei and its subsidiaries"

    Ruler , 3 minutes ago link

    Yet, they find out they are buying from another vendor that complies with China's demands and poof there goes another company.

    I am 100% with Arm and TI on all of this.

    johnny two shoes , 29 minutes ago link

    KASHGAR, China -- A God's-eye view of Kashgar, an ancient city in western China, flashed onto a wall-size screen, with colorful icons marking police stations, checkpoints and the locations of recent security incidents. At the click of a mouse, a technician explained, the police can pull up live video from any surveillance camera or take a closer look at anyone passing through one of the thousands of checkpoints in the city...

    https://www.nytimes.com/2019/05/22/world/asia/china-surveillance-xinjiang.html

    TotalMachineFail , 30 minutes ago link

    There's no such things a national security. This is U.S. corporate security protecting the corporate interests of the other telecom corporations that license to operate through the U.S. corporation. Comprendo?

    The way this gloal fraud operates really is a laughable pathetic joke with what's hidden because is criminal. That includes everything globally that alleged to be classified or some level of so called top secret but none of it is. The sedtion and treason of the government saw to those eliminations along with the cancellation of all NDA's, or other similar docments to attempt to use threat, coercion, murder as a consequence.

    When is there going to be a fully functional so called smart phone that is not hackable, trackable, fully compliant with all unalienable rights, usable globally, with a degree of voice and data encryption to ensure no possibility of interception or monitoring? Oh and free phone w/ $25 unlimited voice and data monthly.

    BT , 32 minutes ago link

    Xi should have listen to Deng Xiaoping. Keep your head down, go about your business and shut the **** up. But Xi the chest pounding panda declared Made in China 2025 and spooked everyone. China should de-robe him then hang him high!

    schroedingersrat , 32 minutes ago link

    Thats a real stinger! Wonder how China retaliates

    He–Mene Mox Mox , 26 minutes ago link

    Simple! Send the Chinese navy to Venezuela at the time when the U.S. is sending its naval forces to Iran. That should rattle Washington greatly. That should up the ante greatly too. Then see who blinks first.

    dunlin , 33 minutes ago link

    There has been a suspiciously sudden rise in China hawkishness among American citizens (e.g., commentators on these boards) coincident with what to outside observers has been a very obvious post-Russia tsunami of political and MSM anti-China propaganda (it's often easier to see propaganda from the outside than from the inside).

    A good discussion of the opposing point of view has just aired on RT, among the host, an American living in Russia, Fred Teng, President of the America China Public Affairs Institute, and James Bradley (American), author of The China Mirage. You may think this is just propaganda from the opposite direction, but if so you will at least have two poles to position yourself between rather than just one side of the story. If you have an open mind.........it is well worth watching. https://m.youtube.com/watch?v=6C1kYnrm1cA

    schroedingersrat , 31 minutes ago link

    Americans are inherently white supermacist nazis. They don't need a lot of propaganda to rage against anyone the governments wants them to :)

    johnny two shoes , 22 minutes ago link

    Actually, the Chinese are contemptuous and xenophobic to the degree of paranoia, both towards "foreigners" and their own populace.

    hoytmonger , 33 minutes ago link

    Being that most electronic components are manufactured in China, I don't believe they're sweating at all.

    aberfoyle_crumplehausen , 33 minutes ago link

    All I see here is insouciance.

    All you ignorant fuckers need to take a one month vacation to China. Come back and lets talk then. Your world outlook will have been greatly humbled and you would be more willing to be of the cooperative model of world politics rather than this senseless belligerence I see here.

    hooligan2009 , 31 minutes ago link

    no sane person would want to go to the Chinese equivalent of Disneyland

    https://www.amnesty.org/en/latest/news/2018/09/china-up-to-one-million-detained/

    EHM , 10 minutes ago link

    I remember being photographed at every highway underpass. I remember not being able to view You Tube or any video on Facebook because it was blocked...

    Tachyon5321 , 35 minutes ago link

    This is an major O'sh2t because all of China's cell phones use ARM! China is now like African no internet village because they don't have smart phones... LOL

    Kafir Goyim , 26 minutes ago link

    Yes, but not all of China is restricted from using ARM. Only Huawei. Other phone manufacturers will be unaffected.

    [May 22, 2019] White House Planned To Use Huawei As Trade 'Bargaining Chip'

    Notable quotes:
    "... And once trade talks had broken down, there was a 'scramble' to implement the measures against Huawei. ..."
    "... this report effectively confirms that the administration wasn't being entirely truthful when it said there was 'no link' between Huawei and the trade talks. Trump said back in December that he would go so far as to intervene in efforts to extradite Meng Wanzhou if it would help with the trade talks. And although that would be extreme, we should rule it out just yet. ..."
    May 21, 2019 | www.zerohedge.com

    If there was any lingering doubt that President Trump has treated Huawei like a 'bargaining chip' during trade talks with the Chinese, Bloomberg just put the issue to rest.

    In a report sourced to administration insiders, BBG reported that the Trump administration waited to blacklist Huawei until talks with the Chinese had hit an impasse, because they were concerned that targeting Huawei would disrupt the talks. Plans to punish Huawei - including possible economic sanctions - had been kicking around for months. And prosecutors took their first tentative steps toward holding Huawei 'accountable' by convincing Canada to arrest Huawei CFO Meng Wanzhou.

    And once trade talks had broken down, there was a 'scramble' to implement the measures against Huawei.

    Though BBG doesn't offer a definitive answer on this, it reports that some are suspicious that Trump is pressuring Huawei to 'gain a negotiating edge' with Beijing (meanwhile, the Chinese leadership are furious about the decision).

    Timing of the U.S. action raised questions about whether President Donald Trump is punishing the company in part to gain a negotiating edge with Beijing in a deepening clash over trade. Talks between Beijing and Washington deadlocked this month as Trump accused China of backing out of a deal that was taking shape with U.S. officials, saying China reneged on an agreement to enshrine a wide range of reforms in law.

    Another take on what happened suggested that the decision to hold back on Huawei actually came from the bureaucracy, as administration officials were worried President Trump would just scrap the measures as a favor to Xi, like he did last year with ZTE Corp. Those concerns haven't entirely abated.

    Washington has offered Huawei some wiggle room by suspending the new restrictions for 90 days. The company has been stockpiling chips, and reportedly already has enough to keep its business running for three months.

    But this report effectively confirms that the administration wasn't being entirely truthful when it said there was 'no link' between Huawei and the trade talks. Trump said back in December that he would go so far as to intervene in efforts to extradite Meng Wanzhou if it would help with the trade talks. And although that would be extreme, we should rule it out just yet.


    AChinese , 22 minutes ago link

    What the art of deal? When the talk hits an impasse, threat them!

    B-Bond , 9 minutes ago link

    "impasse"? Who's Your Friend─ChiCom 🤔 N. Korea 😆

    EU and China struggle over key concerns ahead of summit😲

    Yet the summit might not produce a joint statement - as previous Chinese pledges on speeding-up talks on an investment agreement, plus opening up its markets more to European companies, have failed to materialise.

    "We can certainly agree on a joint statement, the question is how substantive this will be," a senior EU official said. The EU wants to see concrete steps from China.

    Failing to agree on a joint statement, however, is a sign of the EU's unsuccessful bid to commit China to give greater access of its markets to European companies, and engage seriously in reforming global trade rules within the World Trade Organisation (WTO).

    The EU hoped to make China address longstanding European complaints, and to commit to concluding an investment agreement that aims to secure better market access and fair treatment for European companies in China by 2020.

    The EU also hopes to achieve an agreement on indications of geographical origins to protect European brands in China by the end of the year.

    An EU official said that the recent foreign investment law adopted in China, does not address all the issues of concern for Europeans, for instance on prohibited sectors, dual regime for foreign and domestic operations, and on forced technological transfer.

    "We agree there has been a lot of promises, it is time for action, not only words. […] We want to make sure we have a modern framework for investment protection in a binding agreement with mechanism to solve disputes," the EU official added.

    https://euobserver.com/foreign/144609

    Why China is cozying up to Europe🤔

    “While the [European] Commission is getting tougher on China, at least for now it does not seem to be aiming for a confrontation with China,” he said.

    But even if the EU doesn’t fully align itself with the increasingly hawkish Trump administration , a shift in China-EU relations seems inevitable.

    “The EU has no interest in cooling its China relationship, but if it does not act now to protect its economy from unfair state-owned enterprise competition in the EU market, then the citizens of Europe might ask for more protection,” Wuttke said.

    “[There is] growing realism in Europe and the end of naivety when it comes to China.”

    https://www.inkstonenews.com/politics/beijing-seeks-friendship-eu-amid-us-china-trade-war/article/3002836

    Exclusive: In China, the Party’s push for influence inside foreign firms stirs fears😲

    BEIJING (Reuters) - Late last month, executives from more than a dozen top European companies in China met in Beijing to discuss their concerns about the growing role of the ruling Communist Party in the local operations of foreign firms, according to three people with knowledge of the discussions.

    https://www.reuters.com/article/us-china-congress-companies/exclusive-in-china-the-partys-push-for-influence-inside-foreign-firms-stirs-fears-idUSKCN1B40JU

    Teamtc321 , 47 minutes ago link

    China got fucked the minute they agreed to invest trillions into US debt securities in exchange for being given unlimited access to sell into the US market. This terrible arrangement set them up to be crushed economically if the US were to close its doors to Chinese exports, and to lose much of what they made from their trade surplus with the US if they ever tried to unload their holdings.

    Their main stock market now is down over 30% since the tariffs went into force last June, and they are closing factories so fast that the price of oil to heat and power those factories has fallen by the same 30+% as the Chinese stock market. And now, were the Chinese to start off loading their US Treasury holdings, they would drive the bond market down about 10-20%, which would be another several hundreds of billions of dollars lost. A clean sweep mop up operation would be done by the Fed and Anointed Banks in a afternoon. Answer this, why is a good soldier to the PLA, HSBC advertising like crazy for deposit's in $ when they have unlimited access to the Yuan? BOOM !!!

    China's future access to U.S. dollars via their exports is the sword hanging above their Chicom heads.

    The Chinese were advised for a long time that they were going to have to make changes in their trade policies if they were to avoid their present troubles. They were told not to hold the US Treasury securities they were forced to buy, and instead sell them off slowly and re-invest the capital into domestic infrastructure projects that would expand the size of the Chinese middle class. And they were told to diversify their export markets, so that they would not be so dependent on the US consumer to buy Chinese products, The Chinese did little on the first initiative, and little on the second as well, although the second is difficult to accomplish since there are not many consumer markets that can buy anywhere near what the US can buy.

    Not a pretty picture. But many saw this day coming. Unfortunately for China, not nearly enough of the decision makers in the Forbidden City did. Xi Jinping played the card to walk away from agreed upon section of the trade deal, he played his hand. Confusis say, you made your bed now sleep in it...............

    China would go from having the largest overall trade surplus in the world to having a trade surplus smaller than Ireland if you take away the U.S. Trade Surplus China Steals……….

    Xi Jinping has now lost Face and the Entire Globe now knows it.

    SickDollar , 1 hour ago link

    I swear our politicians are so dumb, full of Hubris and excellent crooks

    Aggression, Violence, and Threats never ever works

    All you did is awaken the Dragon.

    free corn , 1 hour ago link

    Sure America is leader in Political Technology and has best politicians.

    CashMcCall , 1 hour ago link

    Well that should end the extradition case of Ms Weng. Clearly politically motivated. Her attorney's Steptoe in DC are top drawer. This also means that Huawei may sue Trump for damages.

    CashMcCall , 1 hour ago link

    That's because Steptoe never loses to the DOJ. There are three top firms in DC that are DOJ killers. Steptoe is one of them. Williams & Connolly another. The Ted Stevens Case was the greatest legal slaughter of the DOJ in history. 6 Gov attorney's sanctioned and threatened by the Judge for disbarment. That's the way to kick the Gov ***. All six counts dropped!

    Meng is still in Canada so that is a Canadian Jurisdiction but the Canadian law is express that political motivation is insufficient grounds for extradition. This is evidence of precisely that.

    All this over a charge of fraud... LOL. It doesn't get any weaker than that!

    Savvy , 1 hour ago link

    Canada isn't all that enamored of US trade policy atm. Like the rest of the planet. It's quite possible Canada's courts simply refuse the extradition.

    CashMcCall , 46 minutes ago link

    Trudeau is a wrist licking slime, hope your courts are apolitical.

    scaleindependent , 1 hour ago link

    what would happen to apple and alphabet stock prices if China did the same thing to them, that we did to Huawei?

    CashMcCall , 1 hour ago link

    China will never do that. They are about business and they are not going to harm a customer over politics. Trump does this routinely. He puts sanctions on Venezuela to harm the women and children to soften up the Gov. He has done it with Russia. It is always indirect attacks to get something unrelated. The cowardly conduct of a bully. Hitler did the same sort of things. The siege of Stalingrad for example.

    The damage Trump is doing to Google is incomprehensible. Huawei is one of Google's largest customers. Can you even imaging the implications?

    If you were a manufacturer of smartphones and were licensing an OS from Google and Trump then blocks the license.... How many makers of smartphone do you think will want to be dependent on this kind of lunatic gov? No country should want to deal with the US for anything. Look at Russia, they were buying jet engines for their MC 21 and Trump Gov cuts them off. Now they are making their own engines not buying US made engines. How does that help the US manufacturer? Russia will make their engines and compete with the US makers.

    None of what Trump does makes any sense at all.

    [May 21, 2019] Huawei 'Blacklist' Trump and Commerce Make a Serious Mistake by Editorial Board

    The art of "no deal" in action.
    Notable quotes:
    "... China will only redouble its efforts to produce advanced technologies domestically. ..."
    "... As a negotiating strategy, the decision makes even less sense. U.S. officials claim it had nothing to do with stalled trade talks, but it certainly looks like Trump wants to use Huawei as leverage, just as he did last year with ZTE Corp ..."
    "... Worse, the decision undermines the implicit point of any U.S.-China trade deal: not just to increase commerce but to stabilize relations between the world's two most powerful nations. ..."
    "... targeting Huawei so nakedly will only further marginalize the few moderates in the Chinese leadership and embolden hawks who see conflict as unavoidable ..."
    "... Crushing Huawei, by contrast, simply looks like a strategic miscalculation -- and one with potentially disastrous consequences. ..."
    www.zerohedge.com
    Banning one of China's most high-profile companies from US networks makes sense. Putting it out of business does not.

    In its struggle with China over trade and national security, the US has many legitimate grievances, and a variety of weapons for seeking redress. That doesn't mean it should use all of them.

    The nuclear missile the U.S. just launched at Huawei Technologies Co. Ltd. is a case in point. Last week, the Commerce Department placed Huawei and nearly 70 of its affiliates on an " Entity List ," which means that U.S. suppliers may now need a license to do business with them. Both Huawei's mobile phones and its network equipment rely on American components, including advanced semiconductors. If the ban is applied stringently, it could drive one of China's most high-profile companies -- employing more than 180,000 people -- out of business.

    That would be a serious mistake. The U.S. has long argued that Huawei poses a national-security threat. And there certainly are legitimate reasons to worry that incorporating Huawei gear into America's networks will leave them vulnerable both to spying and, in the event of a conflict, sabotage. But the U.S. is already taking other prudent steps to prevent Huawei equipment from being used domestically. Seeking to put the company out of business as well is both disproportionate and deeply unwise.

    For one thing, it will impose collateral damage. Blameless companies around the world -- including Huawei's American suppliers -- could lose business, face disruptions and incur significant new costs. Allies that have resisted U.S. pressure to shun Huawei's equipment will resent being backed into a corner: Even if President Donald Trump loosens the noose a bit, they can hardly take the chance that restrictions won't be re-imposed later. China will only redouble its efforts to produce advanced technologies domestically.

    As a negotiating strategy, the decision makes even less sense. U.S. officials claim it had nothing to do with stalled trade talks, but it certainly looks like Trump wants to use Huawei as leverage, just as he did last year with ZTE Corp. Trump has already invoked national security far too often in pursuing his scattered trade battles. Doing so here would set another terrible precedent while almost certainly backfiring: It will aggravate the current impasse and give Beijing little incentive to abide by any eventual agreement.

    Worse, the decision undermines the implicit point of any U.S.-China trade deal: not just to increase commerce but to stabilize relations between the world's two most powerful nations. While tensions are inevitable, a healthy trading relationship should in theory restore ballance, reminding both sides of the benefits of cooperation and strengthening constituencies that have reason to prefer peace to war. By contrast, targeting Huawei so nakedly will only further marginalize the few moderates in the Chinese leadership and embolden hawks who see conflict as unavoidable. For ordinary Chinese, it will be hard to avoid the impression that the U.S. is simply trying to limit their economic possibilities.

    Even on its own terms, finally, this gambit is likely to fail. To be effective, an assault on Huawei would need to be embedded in a larger strategy with a clearer endgame in mind. That's nowhere in evidence: Is the aim to cripple China's tech industry? Teach the country its place? Give a boost to non-Chinese suppliers? Provoke a conflict? End one? Without a more focused goal, Trump risks simply alienating U.S. allies, infuriating average Chinese and raising the chances of confrontation, all to no obvious end.

    What the U.S. needs is a larger plan that seeks a healthier coexistence with China. That means building up America's defenses, leveraging its competitive strengths, working with allies to pressure China to conform to global norms, and taking the lead in writing new rules that can constrain its more disruptive behavior. Crushing Huawei, by contrast, simply looks like a strategic miscalculation -- and one with potentially disastrous consequences.

    [May 21, 2019] Huawei banned from Google Android after Trump administration cracks down - The Washington Post

    This looks liek a real trade war...
    May 21, 2019 | www.washingtonpost.com

    With $105 billion in global sales last year, Huawei has a vast web of customers and suppliers on nearly every continent. The company is the world's largest provider of equipment used in 5G telecom networks, and the second largest seller of cellphones. Last week, Huawei said that it spends more than $1 out of every $7 of its annual $70 billion procurement budget buying equipment from U.S. companies.

    Google said it would restrict Huawei's access to future updates of its Android operating software, which powers many of Huawei's phones. Other U.S. manufacturers also began suspending business dealings with the Chinese firm.

    The markets punished many of those suppliers Monday, including Intel, Broadcom and Qualcomm, as well as Micron and semiconductor manufacturer Cypress. Chip makers Qualcomm and Broadcom fell 6 percent. Intel declined nearly 3 percent, and Lumentum Holdings shares fell more than 4 percent after the company said it would stop selling to Huawei.

    The United States said last week it was adding Huawei to a trade blacklist because the company "is engaged in activities that are contrary to U.S. national security or foreign policy interest." That punishment means U.S. firms aren't allowed to sell to Huawei unless they get special approval from the government.

    [ How China's Huawei took the lead over U.S. companies in 5G technology ]

    On Monday evening, the Commerce Department slightly eased the timing of the restrictions, saying it would allow some transactions to continue for 90 days, to facilitate "certain activities necessary to the continued operations of existing networks and to support existing mobile services." The temporary reprieve will allow Huawei to receive U.S. equipment to service existing Huawei mobile phone users and rural broadband networks.

    Kevin Wolf, a former senior Commerce Department and current partner at Akin Gump, called the reprieve "very narrow." "It's not relief for exporters. It really is to prevent unintended operational problems with existing networks," Wolf said.

    The United States views Huawei as a security risk because it believes the company has close ties to the Chinese government, which Huawei has denied. U.S. officials have said Huawei could potentially tap into and monitor sensitive U.S. communications through its network technology.

    Ren Zhengfei, the founder of Huawei, said that the U.S had underestimated his company as he sought to dismiss the impact of the ban.

    "The current practice of U.S. politicians underestimates our strength," Ren said in a group interview with Chinese media Tuesday morning. Huawei had a stockpile of chips and "can't be isolated" from the world, he said.

    The 90-day extension "doesn't mean much" and Huawei is fully prepared for the American actions, Ren said, even appearing to brag about luring workers away from U.S. companies.

    "We are very grateful to the U.S. companies. They have made a lot of contributions to us," he said in the comments, which were shared in real time by state media. "Many of our consultants are from American companies like IBM."

    Earlier, Huawei reacted to Google's decision to stop allowing updates by saying the Chinese company had "made substantial contributions to the development and growth of Android around theworld."

    "As one of Android's key global partners, we have worked closely with their open-source platform to develop an ecosystem that has benefitted both users and the industry," said spokesman Joe Kelly, adding that Huawei would continue to provide security updates and after-sales services to its existingsmartphone and tablet products.

    Google's announcement came at an awkward time for Huawei, which on Tuesday is expected to unveil its Honor 20 series of smartphones in London, and security experts were divided on how quickly and severely the ban could hurt Huawei.

    Some said Huawei is bigger and better prepared for the blockade than its Chinese competitor ZTE was last year when the Trump administration restricted ZTE from doing business with U.S. firms. The U.S. later eased ZTE's punishment.

    [May 21, 2019] Google, Intel Others Cut Ties With Huawei As Trade War Heats Up

    May 21, 2019 | www.zerohedge.com

    Washington announced last week that it would impose new prohibitions on Huawei, including a ban on US companies selling components or services to the telecoms giant. The seriousness of these actions is difficult to understate, as Rosenblatt Securities analyst Ryan Koontz explained. If Huawei is pushed to the brink of collapse, Beijing might label this 'an act of war'.

    "The extreme scenario of Huawei's telecom network unit failing would set China back many years and might even be viewed as an act of war by China," Koontz wrote. "Such a failure would have massive global telecom market implications."

    But bringing a massive global Chinese firm to its knees is one way to demonstrate to Beijing, and the rest of the world, which ignored Washington's warnings about Huawei, the true reach of American economic power. And it's one way to put a timer on talks with Beijing, ensuring that the trade skirmish won't drag on until the height of campaign season.

    American firms weren't the only ones to act. In Europe, German chipmaker Infineon Technologies said it would suspend deliveries to Huawei, at least until it has had a chance to determine the significance of Washington's executive order (though company sources later denied these reports and said shipments to Huawei would continue).

    Since hostilities with the US began, Huawei has been stockpiling components. It now has enough of a buffer supply to keep its business running without interruption for at least three months. Nikkei reported late last week that Huawei had reportedly asked suppliers to help it build up enough stockpiles to last it a year, but it's unlikely that Huawei has accumulated enough buffer stock to last it anywhere near as long.

    If Washington refuses to back down, this three-month window might become the next critical deadline for the trade talks.

    If it wasn't clear before, we now know that President Trump wasn't kidding when he said late last year that Huawei could become 'a bargaining chip' in the trade skirmish. Whether the prosecution of Meng Wanzhou factors into it remains to be seen, but President Trump did tell Fox News over the weekend that he wouldn't allow China to surpass the US on his watch.

    Huawei's odds of finding replacement suppliers are slim, as Koontz explained. Huawei "is heavily dependent on U.S. semiconductor products and would be seriously crippled without supply of key U.S. components."

    It's clear where Beijing stands on this. We wouldn't be surprised to see a 'consumer movement' emerge in China where middle-class consumers ditch foreign phones and proudly proclaim their support for Huawei.

    pic.twitter.com/iAdB3MCJK7

    -- Hu Xijin 胡锡进 (@HuXijin_GT) May 20, 2019

    On Sunday afternoon, President Trump threatened Iran with military intervention via tweet. Yet, analysts blamed the growing pressure on Huawei for the risk-averse trading atmosphere.

    US stocks were on track to open lower. Meanwhile, Huawei's dollar-denominated corporate bonds tumbled again on Monday after one of their biggest declines in recent memory on Friday. The selloff comes as fears of a Huawei bankruptcy are beginning to intensify.

    Beijing has maintained its aggressive posture, with its Ministry of Foreign Affairs warning in response to news of the Google ban that China would do what it needed to do to protect its companies' "legitimate rights", and also hinted at legal actions it might take. Over the weekend, Beijing compared the trade skirmish with its actions in the Korean War, about as clear a sign as any that we're in for a protracted conflict.

    Whatever happens, it looks like the showdown over Huawei has eclipsed the broader trade-war narrative. So much for the Huawei crackdown being a 'separate issue' from the trade talks, like Trump officials had previously insisted.

    Bottom line: If we don't get a deal by the end of June, this trade war is going to really heat up.


    me or you , 2 minutes ago link

    Imaging a phone without Google spyware or Intel backdoors...it's a win win for all of us.

    frankthecrank , 5 minutes ago link

    So, Huawei is dependent upon Western semiconductor manufacturers. But I thought the Chinese were the leaders in innovation? That's all I hear on here and elsewhere. Seems to me that they should have invented and created their own semiconductor industry back in the 1800's when Westerners began to mess with them. One would think that the great and powerful and super duper intelligent Chinese would have discovered and invented it first in the first place. Certainly the Chinese or their pals in the USSR could have done so sometime in the '50s, '60s, '70s, '80s or '90s? No?

    Herdee , 6 minutes ago link

    Christine Lagarde and the IMF team in China:

    http://www.xinhuanet.com/english/2019-04/24/c_138005457.htm

    giovanni_f , 13 minutes ago link

    The US might win this battle but it has already lost the war. It is in a position similar to Ukraine which was the richest and most developed Sovjet republic after the breakup - but which is now one of the biggest shitholes in the entire Galaxy, feasted upon by a bunch of Zionazi oligarchs. Think of the US as an Ukraine on steroids.

    Trump and his diverse actions will hurt Huawei. Maybe even badly. Long term, maybe even short term, the US won't gain anything from it. It is in a position where it can only lose. Not because the potential of the US isn't "terrific" (actually it coud be the most promising country) - but because the US is designed to fail as it is basically a failed state already.

    admin user , 14 minutes ago link

    Alphabet has announced that it will cut off Huawei Mobile's access to most of its Android operating system offerings

    android is open source, anyone can download and modify it

    you just wont get Google Play Store

    What good is a phone call if you're unable to speak?

    cledus , 17 minutes ago link

    The real prob as I see it, Huawei can not be monitored or hacked into by the NSA, CIA and all the other US intelligence agencies.

    They've been shut out and don't like it.

    Spaced Out , 19 minutes ago link

    Lol, there are already better alternatives to android, such as /e/. This dumb move will only hasten the demise of google, etc. Mugs!

    Herdee , 27 minutes ago link

    Chinese news:

    http://www.xinhuanet.com/english/home.htm

    HopefulJoe , 34 minutes ago link

    Google is EVIL, no way they are walking away from an evil company, have they walked away from China also? No, they are giving them code daily...

    To Hell In A Handbasket , 44 minutes ago link

    The beginning of USSA mercantilism being played out. The USSA simply cannot compete and lagging behind in 5G is only the start.

    CheapBastard , 33 minutes ago link

    We have some of the best software engineers in the world...ask Sameer and Raja in our IT department.

    Shockwave , 44 minutes ago link

    Im confused, how would not choosing to do business with Huawei possibly be considered an act of war?

    Especially when China largely keeps their markets closed to the west?

    After speaking to some Chinese immigrrants... according to them, they'll never come to any kind of fair agreement with the west. They're not interested in a level playing field at all. All they care about is making sure the Chinese state gets all the benefits in order to further Chinas power and influence.

    silverwolf888 , 53 minutes ago link

    Great news. Huawei already has completed development of its own OS, no doubt an Android clone. This finally gives us a path off of the Goolag/ Android OS. In 19 months Rabbi Trump will be gone, which is good, but his destroying the Android monopoly may be his biggest achievement.

    yerfej , 45 minutes ago link

    An android clone? No way that would be stealing again. No they will make their own special sauce OS that will electrocute the citizen if they don't adhere to the state directives.

    DelusionsCrowded , 39 minutes ago link

    There are so many other better ways to run a phone interface , I wonder if these two systems have been kept as monopolies so that the Spooks at the NSA and CIA are able to find their way around easily

    [May 20, 2019] Wang also reiterated the principled stand against the "long-arm jurisdiction" imposed by the United States

    May 20, 2019 | www.moonofalabama.org

    psychohistorian , May 19, 2019 10:55:01 PM | 6

    Below is my final Xinhuanet link about China/US relations

    Chinese FM urges US to avoid further damage of ties in phone call with Pompeo

    The take away quote
    "
    Wang also reiterated the principled stand against the "long-arm jurisdiction" imposed by the United States.
    "
    Empire is having its hand slapped back in Venezuela, Iran, Syria, ???

    Where are they going to get their war on?

    I see empire as a war junkie and they are starting to twitch in withdrawals which is dangerous but a necessary stage. Trumps latest tweets show that level of energy.

    The spinning plates of empire are not wowing the crowds like before.....what is plan Z?

    [May 20, 2019] China Has Already Lost the Trade War

    May 20, 2019 | www.theamericanconservative.com

    Indeed, the biggest cost may be imposed on investors, who for years have inflated the economic potential of communist China's state-directed economy. Major public companies in the United States, including Apple, Caterpillar, and Boeing, are among some of the leading exporters to China. Yet exports to China accounted for just 7.2 percent of overall American exports in 2018. According to the U.S. Trade Representative , the top export categories that year were: aircraft ($18 billion), machinery ($14 billion), electrical machinery ($13 billion), optical and medical instruments ($9.8 billion), and vehicles ($9.4 billion).


    grumpy realist May 17, 2019 at 6:55 am

    Hmmm. This sounds suspiciously like the arguments Brexiters have dragged out about the EU. Remember the "German car manufacturers will help us get everything we want because we're such a large market and they can't afford to lose us"?

    People of a country can decide to put up with a heck of a lot of economic pain if they decide they're defending their country.

    Dan Green , says: May 17, 2019 at 7:01 am
    Base issue seems clear. Two large economies with very different models of governing. One a Totalitarian state run economy, and our economy based on greed and consumption, to support GDP. The theory that the world need be interconnected by trade, has run its course. We really don't even need a Nafta re done treaty. All 3 economies have exhausted what works for them, and can simply abandon what doesn't. If a cuntry has something to sell and the buyer country sees a price advantage the deal will go down.
    Kent , says: May 17, 2019 at 7:10 am
    Tariffs do not get passed along into higher consumer prices unless the product has a very high inelasticity in demand.

    Here's a thought experiment: suppose I sell an imported product for $10. The government imposes a 25% tariff, so I decide to up the price to $12.50. Here's your issue: if I could charge $12.50 for the product, why wouldn't I just have charged that in the first place? Charity? No, I didn't charge that because every time I tried, sales collapsed.

    And if you understand retail, especially imports, gross margins are enormous. Sales prices can be 10 times cost of goods. So that $10 product probably just cost $1. And a 25% tariff on $1 is only 25 cents. Top of the line iPhones cost about $180 to make but retail for close to $1000.

    Tariff expenses come out of some combination of negotiated lower prices with vendors, lost jobs as importers seek to cut costs, and lower profits. Consumer prices are the last thing to consider.

    Slugger , says: May 17, 2019 at 9:58 am
    Please excuse my ignorance. We hear about a war on this and a war on that all the time. Now a trade war which we are winning (or not). How will we know that we won? After victory do we buy more stuff from China or less? Will their prices for stuff be higher or lower? I am a financially comfortable retired person who has plenty of stuff that I have accumulated over the years; a trade victory might have a different meaning to a young couple starting a life. Who gets the spoils of victory, me or the youngsters?
    TheSnark , says: May 17, 2019 at 10:10 am
    China has been running much the same economic model as Japan in the 1970's and 1980's, an export-led autarchy heavily dependent on debt financing. When Japan started to open its financial markets in the later 1980's, things started grinding to halt and by the early 1990's stagnation started.

    China is on much the same track, though Xi has been careful not to liberalize the financial markets too much, and has otherwise done a good job of keep growth on track. But it can't last, and if a trade war does not tip China into stagnation, something else will in the not-too-distant future.

    Any downturn will bring the legitimacy of the CCP into question, and the traditional response of dictatorships in that situation is to find a foreign conflict to distract the population. With mutual distrust, and even dislike, growing on both sides, things could get very messy.

    Jon Thaler , says: May 17, 2019 at 11:01 am
    In the 2017/2018 trade year, the US exported $12 billion of soy to China. That's. particularly important for two reasons:

    * China accounts for the majority of US soy exports, so the trade war affects that sector more that the others you mention.

    * The people affected are one of the cores of Trump's base.

    The latter point is particularly significant, because the success or failure of the war will be determined by political stamina, not by economics directly. Who can hold out longer, Xi or Trump, as his political position erodes. One of the "weaknesses" of a democracy is the greater sensitivity to the broader political environment (ie, not just the Politburo). Are you so sure that the US will win this war of attrition?

    Joshua Xanadu , says: May 17, 2019 at 11:20 am
    @Kent – Thank you! Finally someone with actual understanding about retail and the ridiculous profit margins of imported goods, especially from Asia. As someone who worked first-hand at a shoe factory in China, managing the account, I was aghast at how low U.S. companies like Nike or even Wal-Mart drove down the production costs ($6-18 dollars landed), while selling the shoes for $30 – $120 dollars.

    Theoretically all that juiced-up profits from outsourcing should have been reinvested to create new jobs for U.S. workers over the past 20 years. That's what economists and corporate lobbyists will argue. Empirically, however, those profits were reinvested to the stock market for fat quarterly bonuses.

    Leroy Cabana , says: May 17, 2019 at 11:23 am
    The underlying issue with China is their long standing demand to disclose all development info about any product doing trade in China. Take Apple, they butted heads with the FBI and refused to unlock an Iphone that belonged to a killer. Then they enter China and the government there demands all the tec info for phone development and Apple simply hands over their deepest secrets. Its the same for Ford, Cat or any others wanting to do business in China. I for one, can live without any China trade if these have to be the requirements. There is a long list of other cheap labor countries that would welcome our trade without being forced to provide trade secrets.
    Kent , says: May 17, 2019 at 11:37 am
    @FL Transplant

    "So what happens in the next T-bill auction when China doesn't show up and instead sits on the sidelines–does the Treasury end up paying higher interest rates to sell the instruments necessary to finance our federal spending? And, if so, what does an increase in those interest rates do to our economy?"

    Interest rates for treasuries are always set by the Federal Reserve. The secret sauce is the Primary Dealer banks. They are required, by law, to make the market for treasuries. Meaning they have to buy any treasuries that aren't sold. And they do so at the interest rate set by the Fed. And they always, always have all the money they need to do so. The Fed just prints it and adds it to their balances.

    It's the beauty of a fiat currency. The USA cannot be held hostage to foreign financial agents.

    Salt Lick , says: May 17, 2019 at 11:38 am
    This trade war is about regime in change in China, as Bannon has said on many occasions. The Chinese are finally waking up to our true intentions. America can't allow a more successful economic model to exist anymore than they allow socialism in Venezuela.

    The only surprising outcome of the clash will be that American corporations will experience massive collateral damage due to supply chain disruption and being shut out of the largest consumer market in the world in China.

    The U.S. Empire has decided if U.S. corporation can't run ruff shod over the Chinese government like they do here and everywhere else, they cannot be allowed to submit to Chinese government rule in exchange for the benefits of the Chinese market place.

    It's probably the only time in recent history that the defense of market forces resulted in a direct hit on the "free" market itself. Like all front line troops, U.S. corporations will suffer many casualties in the battle ahead. They didn't volunteer for this trade war and they had no idea that this would be a hill that many would die on.

    The paradox of this situation is not lost on them and most are paralyzed by what lies ahead.

    Archie1954 , says: May 17, 2019 at 12:49 pm
    You are conveniently forgetting that much of the Chinese goods subject to the increased tariffs are goods manufactured by American corporations utilizing Chinese labour due to its much reduced costs. Those American companies are going to lose market share and profits because of these new tariffs. They will not be happy!
    workingdad , says: May 17, 2019 at 2:41 pm
    I wonder if they could by commodities? Buy surplus oil would be a logical choice. They could sell their treasuries, use dollars for oil, thereby drive up the price of oil for everyone, including the US.

    Granted that could eventually help the US, but in the short term could be a pain.

    EarlyBird , says: May 17, 2019 at 2:44 pm
    Slugger , I don't think your question is ignorant at all. I think it's very wise. If only we asked the "Why?" and "What does a win look like?" of all these literal and figurative wars, we might get somewhere.

    I do not, ultimately, believe Trump's trade war with China is going to make the US into a manufacturing powerhouse again. Those days have come and gone. It will definitely increase the cost of a lot of junk we buy from China.

    The hope, however, is that it will force China into a position wherein we could demand more fairness in terms of patents and technology theft.

    SteveK9 , says: May 17, 2019 at 3:07 pm
    The time when it was beneficial for China to trade real goods for numbers in a computer was long since past. They keep doing it out of habit. Trump is doing both countries a big favor.
    Liam , says: May 17, 2019 at 3:28 pm
    Historically, it has not been wise to discount China's capacity to overcome disruptions that would vivisect virtually any other civilisational hegemon on this planet. China survived the Mongols, the English, and the Japanese. And itself many many times over.

    We're barely a blink in the eye of China's history. I would not be as sanguine about who "needs" whom more over the long term.

    (Just to be clear: I have more than my share of criticisms of American trade policy of the past couple of generations, including our posture vis-a-vis China.)

    Dakarian , says: May 17, 2019 at 4:33 pm
    "Slugger
    May 17, 2019 at 9:58 am
    Please excuse my ignorance. We hear about a war on this and a war on that all the time. Now a trade war which we are winning (or not). How will we know that we won? After victory do we buy more stuff from China or less? Will their prices for stuff be higher or lower? I am a financially comfortable retired person who has plenty of stuff that I have accumulated over the years; a trade victory might have a different meaning to a young couple starting a life. Who gets the spoils of victory, me or the youngsters?"

    You. Definately you.

    Youngsters need to be able find a job that pays for their basic needs and a path to be able to keep growing or stabilize that lifestyle.

    This war bumps prices higher, but won't bring those jobs back. High skill jobs are already in high demand with few takers so more of those won't help the majority. The rest will either be automated, moved from China to other countries (which is already happening as China wants to move from sweatshops to a consumer middle class economy and places like India and Vietnam are taking up the slack), or abandoned due to a lack of profit margins.

    I'm not saying we should or shouldn't do this with China. They haven't exactly been treating us or our companies well after all. But this is NOT going to benefit the regular American. Low skill, sustainable, reliable work is just Not going to be a thing.

    What will help is encouraging the ability to gain high skills and mobility for those high skill jobs that are in desperate need of workers, aiding low skill workers so that they can afford the things they need and not be 100% exploited, and figure out what to do with the many many middle age and up folks who were trained to be middle class to transition them into one or the other and not hate life while doing so.

    We can go fix or break our trading systems with other countries as we see fit, but we really need to stop thinking it's going to fix things. Same goes for immigration for that matter.

    jack Meof , says: May 17, 2019 at 7:00 pm
    The author shows his ignorance. The Bank of China is a commercial bank. Foreign reserves are held by the People's Bank of China. Different entities. I assume the rest of the article is full of inaccuracies.
    IssacNewton , says: May 17, 2019 at 7:47 pm
    It is hard to know if China has already lost. Their published economic numbers are not very accurate. A key point is that the standard economic models of International Trade are wrong. "Free Trade" can have benefits, but does mandate optimal outcomes. For example, lower cost players can transfer economic production to their soil. There are many equilibrium points (vs. the one of standard economics) in international trade when productivity changes or there are economies of scale. With many of these points it would be better a nation not Trade. The US Trade with China fits this bill. This non-standrd was demonstrated by Baumol and See: https://www.amazon.com/Conflicting to -National-Interests-Robbins-Lectures/dp/0262072092/ref=sr_1_5?s=books&ie=UTF8&qid=1473299717&sr=1-5&keywords=Baumol+Trade We need to follow the actual Terrain of economic results vs. the incorrect map of standard economics.

    Organizational and Technological stage drives over 80% of economic growth (see Solow). The Chinese have latched on to US creativity to drive their economy (plus an investment rate of 45% vs. 20% for the US). In parallel the US went Crony Capitalist and its TFP went from 3% to .4%/year. Can a Crony capitalist US recover its productivity growth and can a State Capitalismt Chinese dictatorship be innovative without the West. The US under Trump is attempting to displace its currrent ruling elites. This will not happen in China. My guess is China has lost at trade and will lose at Economic productivity growth.

    jk , says: May 17, 2019 at 8:43 pm
    Sounds more like a pointless Pyrrhic victory. Tit-for-tat trade wars have many unintended consequences, can easily expand into other sectors, and ultimately consumers and employees will bear the burden.
    david , says: May 17, 2019 at 8:51 pm
    Americans' fear and hatred of China is so great that we are yearning for China's lost regardless of how it may harm Americans.

    Take the latest "emergency order" to put Huawei in the "entity list" to ban it from purchasing American products. If implemented, it will cost American companies $11 billions of sales from Huawei, and lost of thousands of high tech and good quality jobs. If Huawei is destroyed, the 5G market will probably be picked up by Swedish and Finland companies, and the smart phones market by South Korean Samsung, not any US company. But who cares, as long as Huawei is destroyed, right?

    Take a look of all opinion pages in the media and comments in the Internet, if the supply chain is moved from China to Vietnam, then it is a win for Americans, right? Who care whether Vietnamese can produce it as efficiently as Chinese or not, or whether Vietnam is also a communist country?

    This *jihadic* style pursuit to destroy China is also blinding ordinary intelligent Americans of common sense about the relative strengths and weaknesses of both sides. This author, for example, ignores all the possible ways Chinese can hit back if they also decide to go the self-destructive ways or even "nuclear" (figuratively or literally) options. And yes, the options are not restricted to financial tool like US bonds only, e.g.

    1. Stop selling rare earth to American companies – which means we can't even make F-35 fighters. The last congressional study finds that it will take at least 10 years for US to re-open our rare earth mine.

    2. Start making the life of all American companies difficult in China – GM and Ford are selling more cars in China than in US, Apple has its 2nd largest market in China. The growth rate of China for these companies are higher than US.

    3. Stop cooperating with US on geopolitical front, e.g. start helping North Korea to perfect their ICBM, or buying lots of oil from Iran, etc.

    These are just random thoughts I come out from 2 minutes of brainstorming. I am very sure 1.4 billions people can think of many things much more deeply and creative than me. Have the author or any of the people in DC think through all the possibilities before shouting for war? Good luck if you think they do.

    And rest assured when the dusk settles, ordinary Americans will NOT be any penny richer or our life any better.

    This country has a long history of insecurity toward and racism against Asians. Sadly, the current fight proves that this ugly chapter has not close.

    [May 20, 2019] Chinese concept of Face and the current trade dispute by walrus.

    Right now Trump administration clearly wants to slow down China development and Chinese leadership understand that. The game is probably similar to the game the USA played with the USSR -- create economic difficulties to the point when disintegration, or the social upheaval is possible. China level of internal debt denominated in dollars probably dwarf their Treasury holdings (this also is true for Russia). This situation is considered by many commenters a huge weak point and that might be Trump team calculation: in their current situation Chinese's can't afford to lose such a large export market as the USA: many enterprises will simply be bankrupt.
    The US consumers might still feel the pinch, but ultimately Beijing needs the trade surplus more than the USA needs their trade.
    If this is wrong, Trump administration might make already bad situation worse, as if China can switch goods flows and survive more of less intact that might undermine dollar as the reserve currency. They also now will probably completely ignore sanctions against Iran, making them non-essential: a kick in the chin to the Trump and neocons who surround him in WH.
    Looks like we are on the wedge of creation of two hostile to each other neoliberal systems instead of one: one with the center in Washington and the second with the center in Peking.
    It is bad strategy to attack several countries simultaneously (the war on two forints) and that's what Trump is doing: Iran, Russia and China are three major battlefields now. There are also some tensions with EU too.
    The concept of face while somewhat interesting is probably exaggerated and is redundant here. This comments really gats to the bottom of it: " It has always seemed to me that "Face" is the distant inferior cousin of Honor and a much closer sibling to Pride or even Hubris. That is, the Asian concept of Face has everything to do with how you are perceived and almost none with how you "are". Honor, meanwhile, demands a rigorous adherence to a code of conduct and force of will that places less emphasis on perception and more on "being". Westerners (myself included) tend to get those two confused. "
    Notable quotes:
    "... 6: It goes a pretty long way to be aware of some more imaginative things that especially state aligned business can do if you are in China. Things like precision weighing any electronic equipment you take there before and after are just best practice. ..."
    May 20, 2019 | turcopolier.typepad.com
    I don't think the Washington decision makers, as opposed to perhaps career Sinologists in the State Department, quite understand the dynamics of the Trump Administrations relationship with China and the risks America appears to be running. The bit that seems to be missing is a realistic appreciation of "Face".

    A quick search of the internet reveals scholarly definitions of "Face" together with the description of it in socio - cultural terms that in my opinion do not do it justice. Couple that with Western insensitivity, NeoCon hubris and Trumps preference for believing everything is a negotiable transaction and we are set up for a monumental falling out with China that has lethal consequences for America.

    I will give a few examples of Face, you can find plenty more on your own. Did you know it is an insult to request a Chinese to sign a written contract? If he has agreed to the terms and said as much in front of other Chinese then that is enough. "Face" does the rest. Did you know that in certain circumstances "Face" requires you to lie to, or ignore, authorities in support of family and friends? This last, in my opinion, is the reason for the current Chinese attempt at omnipresent surveillance; "we tremble at the power of the Emperor in Peking, but the mountains are high".

    Col. Lang makes the point that the Japanese went to war to dispel the threatened perception that "they weren't the men they thought they were". Well with "Face' in China its more than that, you are your "Face". To damage someones "Face" is to create a lifelong mortal, implacable enemy. There is no way, short of death, to recover once you have given offense. Against that standard Trump, Bolton and Pompeo are playing with fire. "Just kidding" doesn't cut it.

    It may surprise some of you to know that the West was trading with China right through the cold war - in US dollars only. Nixon didn't discover China either. It also may surprise some that China is perfectly capable of making very high quality reasonably priced sophisticated goods, and always has been. The reason that Walmart sells cheap Chinese schlock is because that's what they asked China to supply. As for "stealing intellectual property", don't make me laugh. We all do it and China has plenty of very smart people that create first rate IP of their own. I make the case that China is a sophisticated and capable economy, with its own amour propre, not some third world hole populated by leaders that can be bought or threatened, and Trump risks forgetting this at our peril.

    To this end I note that the trade war is not going to Americas advantage, China has vast holdings of American debt, China buys Iranian oil, judging by reports of Sochi discussions, Russia AND China are likely to support Iran and both Korea and Taiwan are vulnerable. In my opinion President Trump has a very small window left in which to fire Bolton and perhaps Pompeo and embark on a more conciliatory line, before China becomes an irreversible, implacable enemy.

    What says the Committee?


    Procopius said in reply to Harlan Easley ... , 18 May 2019 at 10:43 AM

    So unless we economically surrender to them expect war?
    See, that's the attitude Trump and the Trade Representative display. It is impossible we could find a compromise that would be better for both sides. It is a purely binary zero-sum game. If we do not "win," then we "lose," which means surrendering to an implacable enemy who will destroy us. It's no wonder the majority of the world's people think America is the greatest danger to world peace. This is why Bolton is able to find support throughout the nomenklatura. Most Chinese still hold to Confucian concepts of honor, something the American elites abandoned decades ago as unprofitable.
    jdledell , 18 May 2019 at 10:43 AM
    My son, Jason, is fluent in both Mandarin and Cantonese was headquarered in Hong Kong for years but now works out of Tokyo but spends a great deal of time in China conducting business. He would probably argue that, if anything, Walrus is understating the importance of Face in China. There are numerous rituals associated with interacting with Chinese that must be observed in order for communication and agreement to flow properly.

    I think many in America, maybe even Trump, have an image of China as a backward country full of uneducated dumb people. Nothing could be further from the truth as a large segment of the population is not only eductated but intellectually the equal of Americans.

    As far as handling the trade war between China and the U.S., I think in some ways China has an advantage in it's government directed relationship with business. It allows China to react quickly to adverse conditions, faster and with more cohesiveness than our capitalist system. Watch for China to move it's manufactured products through numerous other countries to avoid some of the impact of tariffs.

    China is also not as responsive to consumer complaints as the U.S. democracy. As soon as Trump's base starts complaining about the higher prices at Walmart etc. Congress and Trump's re-election campaign officials will start to make China tariffs seem intolerable.

    EEngineer , 18 May 2019 at 10:43 AM
    I would think the Chinese see Trump as something to be persevered for a few years regardless of who he surrounds himself with at this point. I wonder if they have a term for "face incapable" as a parallel concept to the Russian "agreement incapable"? As such they probably see his administration as a no more sophisticated than a hornets nest, to be avoided if possible and swatted if necessary.
    ponderer , 16 May 2019 at 11:29 AM
    It has always seemed to me that "Face" is the distant inferior cousin of Honor and a much closer sibling to Pride or even Hubris. That is, the Asian concept of Face has everything to do with how you are perceived and almost none with how you "are". Honor, meanwhile, demands a rigorous adherence to a code of conduct and force of will that places less emphasis on perception and more on "being". Westerners (myself included) tend to get those two confused.

    If the Chinese were bound by the authors concept of Face, China must be a paradise without corruption. Instead of polluted water land and air, wizened elders concerned over their stewardship and the lose of face from an environmental catastrophe, would provide a harmonious balance between man and nature. Instead, its a paradise and a ghetto where passerby's walk nonchalantly around the dieing. Where companies reluctantly provide netting to slow the steady suicide of their workers. They do tend to plan for the long term, and they can certainly hold a grudge I would agree. How far are you willing to bend-knee for someone else's concept of pride though? Tariffs, which have been around since antiquity, seem like a small infraction for all this talk of life-long mortal, implacable enemies. Yesterday I saw a Chinese TV program that roughly translated said Donald Trump was literally in the White House crying over soybean prices. POTUS literally crying over the Chinese governments response to our rising tariffs after decades of unfair trade practices that benefited the Chinese (elites anyway). So you shouldn't think that saving Face is a two way street or will result in a mutually beneficial deal.

    walrus -> ponderer... , 16 May 2019 at 06:13 PM
    Face has nothing to do with Judeo Christian ethics. Corruption and pollution can earn you a bullet behind the ear in China.

    The issue with Face is that duties don't extend much outside the family. That's why they can sell poisoned baby formula, etc.etc.

    It also explains why the CCP is afraid of losing China's Face. They will be blamed.

    blue peacock , 16 May 2019 at 06:13 PM
    Walrus,

    IMO, China has been "an irreversible, implacable enemy" for decades now. It just so happens that our own fifth column in the Party of Davos have aided and abetted this implacable enemy while making sure that we voluntarily disarmed and did not fight back a war that they are fully engaged in. The consequence has been that we are paying for our own destruction. China is more authoritarian & militaristic today than it was three decades ago and there are several people who believe they currently pose an existential threat to the US & the West in general.

    https://www.washingtonpost.com/opinions/steve-bannon-were-in-an-economic-war-with-china-its-futile-to-compromise/2019/05/06/0055af36-7014-11e9-9eb4-0828f5389013_story.html

    While tariffs may not be the best strategy, we have to admire Trump's courage and determination to finally fight back in the face of massive internal opposition from our fifth column. When you look at the sheer scale at which the Chinese are buying think-tanks, academics, media, K-Street lobbyists & political influence it is staggering and only the Israeli influence operation is bigger in depth & breadth. Ever since Bill Clinton gave China Most Favored Nation status and the Party of Davos furthering their own narrow short-term financial interests, we have directly financed and transferred technology to China and dismantled our industrial base. China joined the WTO but has thumbed their noses at every adverse WTO ruling that showed they play not by the rules but are predatory.

    You dismiss the scale of IP theft, forced technology transfer, product dumping, state subsidies and industrial espionage as everyone does it. That's typical of the China apologists in the West.

    I think you over-estimate China's financial strength. There are several macro analysts with excellent long-term analytical track records who believe that China is desperately short USD. This theme that you note that China can crash the UST market is already proven to be false. China in fact sold hundreds of billions of UST in 2014-2016 with no perturbation in the UST market.

    https://www.bloomberg.com/news/articles/2016-06-15/china-dumping-more-than-treasuries-as-u-s-stocks-join-fire-sale

    On the contrary the financial pressure on China is increasing as their debt-fueled malinvestments grow. I'm willing to bet you that we'll see this pressure manifest in a devaluation of the RMB.

    https://www.valuewalk.com/2019/02/kyle-bass-china-paper-tiger/

    I will leave you with a speech from your fellow countryman, John Garnaut. Chilling!!

    https://sinocism.com/p/engineers-of-the-soul-ideology-in

    walrus -> blue peacock... , 16 May 2019 at 06:16 PM
    So the Chinese are playing us at our own game and winning? Boo Hoo. Throwing over the chess pieces is not a useful response.
    blue peacock said in reply to walrus ... , 18 May 2019 at 02:36 AM
    Sure, they've kicked our ass these past couple decades. Now they've got cocky and think they own us. Supply chains can re-orient.

    As a red-blooded American I'd like my home team to seriously up their game and of course beat the Chinese at their own mercantilist game. A good start would be to put the squeeze on their massive USD short position. Eurodollar market is a perfect spot to begin. The Chinese have US$1.3 trillion debt maturing in 12 months. They've either got to redeem or rollover. Devalue & bleed reserves. Or else sell USD assets & lose collateral. Margin call time! Wake-up call time for BRI - if Trump chooses to squeeze at this immediate vulnerability. Trump can also take the next critical step - restrict their access to our capital markets. The SEC can also come down hard on all their fraudulent listings.

    Maybe Australia is losing its best & brightest moving to China. Not here. In fact it is the opposite. Young Chinese techies whoever can get a visa are immigrating here. Wealthy Chinese including top CCP officials are using every mechanism that they can avail to get their capital out. Chinese capital controls are tightening. If they had an open capital account their trillion dollar reserve would vanish overnight as capital flees. You must know that China's domestic security budget is larger than their defense budget. The CCP fear their own people more than anyone else. Why do you think they're amping up their domestic surveillance expenditure?

    I can also give you an anecdotal experience. Newly minted billionaire and founder of Zoom, Eric Yuan spoke to our tech analyst team a year ago. I happened to be in that meeting. He was categorical that if he had been in China and had half the success, CCP would effectively control his company. He said every Chinese techie dreams of moving to America.

    https://www.cnbc.com/2019/04/18/zoom-ipo-bill-gates-speech-inspired-founder-to-move-to-us.html

    Jack Ma, was banded out here in the west as the new breed Chinese tech entrepreneur. A billionaire on the Davos circuit. Did he really own Alibaba or was it the CCP? How come his shareholding was suddenly zeroed out?

    https://www.scmp.com/tech/enterprises/article/2167002/alibabas-jack-ma-giving-ownership-chinese-entities-heres-what-means

    Do you think any smart Chinese really trusts the CCP? Why would they? You talk about "face" & culture and the 3,000 year history of the Han people. What about the history & culture of the Tibetans? Or the culture & traditions of the Uyghurs with over 2 million of them currently undergoing brutal "re-education" in concentration camps in Xinjiang?

    The authoritarian CCP have had a free ride on us for over two decades. It is time to suit up and give them a little taste of their own medicine. I hope Trump retains his resolve.

    Harlan Easley , 16 May 2019 at 11:46 AM
    I don't care one iota about their "Face". Not at the expense of deindustrializing large sections of the American Heartland. Which has already happened. Our trade relationship with China has been a disaster. The only people to benefit are large shareholders.

    As for them holding our debt it's threat is non-existent. Let them sell all of the bonds. China currently owns $1.13 trillion in Treasurys, a fraction of the total $22 trillion in U.S. debt. The Federal Reserve if need be can buy them all up but even that won't be necessary due to insatiable demand for the bonds even at these ridiculous low interest rates.

    In fact their obsession with "Face" indicates a psychopath. Defines as no sense of right and wrong and is generally bolder, more manipulative, and more self-centered than a sociopath. That sums up their dealings with us the last 25 years.

    Only a fool continues to play this game of theirs. Stealing our technology at will, forced 50/50 partnerships, currency manipulation, dumping into our country to destroy industries, etc. etc. etc.

    Plus they are expanding geographically now due to us making them rich. They are 1.3 million homogeneous Han for the most part. Especially compared to our country. I have to say their government has definitely improved the lives of their citizens as a whole and I respect that. But enough of our weak kneed leaders giving away the store.

    I personally am being hurt by the tariffs due to many LVP flooring products I sell are sourced from China. I have no problem taking a hit for the greater good and have been working on sourcing from different locations.

    ISL said in reply to Harlan Easley ... , 16 May 2019 at 11:19 PM
    Harlan Easley,

    Thanks for pointing the finger at China -looking out for their own interests - the bloody bas-ards.

    I guess you believe that had China had remained insular, the US would not have de-industrialized to a different country? As if NAFTA wasn't a great sucking sound. Hmm. Me things the problem lies closer to home - but no finger pointing there.

    Totally impressed with the TrumpTareef - Totally on top of everything.

    Oh wait, the tax advantages that encourage de-industrialization remain. But I guess Trump doesn't understand taxes and how wealthy corporations and people use them to move production overseas and not pay taxes ....

    Meanwhile, global de-dolarization accelerates. At some % the US loses its special status and there will be a reckoning.

    I see a lot of hot air - not new policy: Manufacturing did not come back, US infrastructure is a joke and continues to crumble, workforce participation continues dropping, and hourly median wage remain stagnant. Why? Because it requires actual policies that lessen the profitability of some (very wealthy friends in the circle Trump wants to run).

    Here's my prediction - Trump will fold by summer or sooner.

    guidoamm said in reply to Harlan Easley ... , 18 May 2019 at 04:38 AM
    Apologies for butting-in in an otherwise fascinating conversation... but....

    There is considerable but misplaced talk of "capitalism" being thrown about in some threads, whilst Harlan worries about the deindustrialization of the West, ostensibly, due to China. China has little to do with deindustrialization. A centralized monetary system coupled with electoral politics, can only be sustained through the use of perpetual fiscal deficits.

    In order for the political construct to be able to run perpetual fiscal deficits, national debt must necessarily expand. As debt conforms to the law of diminishing marginal utility however, this is a compounding strategy.

    Thus, in order to compensate for the loss of purchasing power, government borrowing must progressively increase till eventually it goes parabolic. Hence the reason debt in the USA doubled between 2008 and 2016. This is the parabolic phase.

    In order to sustain this strategy, fiscal revenue must ideally expand. In order to increase fiscal revenue however, legislation must be brought to bear. As legislation and fiscality become progressively more restrictive in one country, economic actors migrate to countries where they can achieve an economic advantage.

    As a corollary, as legislation and fiscality become progressively more restrictive, barriers are raised in business and industry. As barriers rise, so does unemployment and/or under employment whilst business dynamism is proportionally stifled.

    In this context therefore, artificially lowering interest rates to ostensibly kick start the economy, actually reinforces the offshoring dynamic to the detriment of SMEs and the benefit of large corporations.

    If China can be blamed for anything therefore, it can only be blamed to have opened the doors wide open to Western corporations to allow them to shift their production technology out of Europe and the USA.

    All the while, the finance industry is laughing all the way to the bank.... their own bank that is.. ..

    g

    Robert L Groves , 16 May 2019 at 01:14 PM
    Excellent analysis by Chas Freeman on US/China relations.
    https://chasfreeman.net/on-hostile-coexistence-with-china/
    robt willmann said in reply to Robert L Groves... , 17 May 2019 at 12:05 PM
    Robert Groves,

    Chas Freeman was president Richard Nixon's senior interpreter for Nixon's visit to China. Here is an interesting description by Freeman of some of that trip--

    https://adst.org/2013/05/the-interpreter-who-said-to-no-to-president-nixon/

    Dave Schuler , 16 May 2019 at 01:31 PM
    Something to which not enough consideration is given is that China has a considerable volume of foreign loans, those are increasing, they are denominated in dollars (particularly since the yuan is not convertible), and must be serviced in dollars. That means that China needs a lot of dollars which it obtains via selling goods to the United States.

    Said another way, China cannot reduce the amount it sells to the U. S. or buy more from the U. S. without a convertible currency or reducing its level of foreign debt.

    Jack said in reply to Dave Schuler ... , 16 May 2019 at 04:28 PM
    Kyle Bass on why China has to sell its US Treasury holdings. Twin deficits.

    https://twitter.com/Jkylebass/status/1129022386228146176

    MP98 , 16 May 2019 at 02:23 PM
    "Did you know it is an insult to request a Chinese to sign a written contract?"

    So, assume that they are dishonest negotiators, as they just showed by walking away from 6 months of negotiations that they "agreed to?"

    Stueeeee , 16 May 2019 at 02:58 PM
    Your commentary exudes the naivety that the Chinese have preyed on for the past 50 years. Their meekish and subservient mannerisms hide a ruthless and immoral inner nature. They would still be a backward country if not for our elite's insatiable greed. What have they produced organically that wasn't ripped off from developed countries? What do they offer cultural other than a social credit system with improved state surveillance techniques? They treat their own people like dogs and they still have dog eating festivals. China offers a way of life that is an antithesis of the West, so it is inevitable that there will be a clash. The question isn't if but when. The longer we delude ourselves into thinking that economics will change China, the more blood will be shed when the reckoning occurs.
    walrus -> Stueeeee... , 16 May 2019 at 06:22 PM
    Denial is not a strategy. For the record, I don't like eating dogs either. but i'm willing to make an exception for pit bulls.
    VietnamVet , 16 May 2019 at 03:33 PM
    Chinese chauvinism puts American exceptionalism to shame. They've been the Celestial Empire thousands of years longer than the upstart Anglo-American Empire. In last 30 years the Western Elite dumped "noblesse oblige" for "get it while you can". China's entry into the WTO directly hallowed out manufacturing in the Mid-West ultimately resulting to Donald Trump's trade war.

    This was a result of CEOs and Wall Street Raiders moving manufacturing to low wage, no environmental regulation, nations to make a quick buck. China was a willing partner in the con in order to modernize.

    China's retail sales are now greater than America's. Since the US declared an economic war, GM will have to drop Buick and Cadillac brands and market their cars in China as Chinese. But "Face" likely will make that ploy unsuccessful.

    Fred -> VietnamVet... , 16 May 2019 at 10:34 PM
    VV,

    " GM will have to drop Buick and Cadillac brands and market their cars in China as Chinese."

    You seem to be misinformed. China has required building those vehicle lines in China for some time now. GM moved all that production there with the intent of exporting from China to other markets in addition to what small portion of the Chinese car market they already have.
    https://www.forbes.com/sites/michaeldunne/2017/05/31/china-ramps-up-exports-via-volvo-buick-cadillac-and-now-bmw/#59830405459e
    https://www.cnbc.com/2018/09/06/cars-made-in-china-at-risk-of-being-pulled-from-us-market-in-trade-war.html

    Joanna said in reply to Fred ... , 17 May 2019 at 06:09 AM
    Look Fred, I agree VV seems a bit confused where to side on the issue or whom to blame beyond Wall Street. Thus good you put him on the right track.

    But China required or GM management found it convenient considering production conditions?

    VietnamVet said in reply to Fred ... , 17 May 2019 at 08:45 PM
    Fred,

    GM sold over 4 million vehicles in China last year, even more than it sold in the North American market. The U.S. only exported 267,000 passenger vehicles to China. Apple sales declined 30% in China. In an economic war Chinese will avoid buying American branded products. They have alternatives. Americans don't have a choice at Walmart except to pay the higher prices due to the tariffs.

    Fred -> VietnamVet... , 18 May 2019 at 09:28 AM
    VV,

    Those GM vehicles were built in China by a JV with majority Chinese ownership. The product line sold at Wal-Mart has plenty of things made in countries other than China. We have a twenty trillion dollar economy with Chinese imports making up 500 billion. We've got plenty of options.

    Jack , 16 May 2019 at 04:01 PM
    China has been emboldened as the west moved their manufacturing base there and transferred their technology. They've been taking the next steps directly influencing our politics.

    https://www.nzherald.co.nz/nz/news/article.cfm

    Huawei while it claims it is an employee owned company is controlled by the CCP as many "private" companies in China. The west would be foolish to not put an end to Chinese subterfuge that undermines their economy and national security.

    https://uk.mobile.reuters.com/article/amp/idUKKCN1SM0VC

    catherine , 16 May 2019 at 04:25 PM
    I say if Face is important, respect their Face. After all written agreements are broken all the time so what difference does it really make.
    Ryan , 16 May 2019 at 04:39 PM
    I don't buy it at all. As others have pointed out China requires access to American markets to 1) make their dollar denominated loan payments and 2) keep foreign manufacturing located in the country. The cost of tariffs to the United States is finding alternative sources in supply chains and higher end cost to consumers. We're insanely rich, we can afford that without issue. The cost of tariffs to China, in the ultimate analysis, is foreign companies moving their manufacturing out of the country, which would utterly devastate them.

    So far as I understand the Trump administration is demanding nothing more than China play by the rules of the game as written. If they're not willing to do so, **** 'em.

    walrus -> Ryan... , 16 May 2019 at 07:10 PM
    What rules? Who wrote them? Respect? Ask Iran. Poppycock.
    Joanna said in reply to Ryan... , 17 May 2019 at 08:11 AM
    We're insanely rich, we can afford that without issue

    That's a curious statement. You too? Insanely, that is.

    turcopolier , 16 May 2019 at 05:23 PM
    Catherine

    A well written contract contains enforceable penalties for non-performance with the money often held in escrow. That's the way I write them. Trump is using the balance of US/China trade to penalize the Chinese for reneging on the verbal and draft agreements they made with us.

    catherine said in reply to turcopolier ... , 16 May 2019 at 09:45 PM
    True. I am not familiar with the agreements so can't discuss it intelligently.
    Just saying it seems hardly anyone lives up to agreements any more regardless of in writing or not.
    And dealing with countries is dealing with the people who represent it ..I do believe you catch more flies with honey than vinegar. You can always swat them later if honey doesn't do the trick.
    fredw , 16 May 2019 at 06:14 PM
    This is a traditional problem deeply embedded in Chinese culture. Westerners in the 1800s concluded that it was impossible to write a binding contract in classical Chinese. There were hopes for Mandarin, but... I was reading about this as a college student studying Chinese in the 1970s and have never ceased running across complaints about it. Chinese contracts are only as good as the will of the contractors and the influence you can bring to bear. When you are dealing with government, a contract is good until the officials get replaced with new faces. Even big players like McDonald's are not exempt.

    "...what was meant as the flagship of McDonald's planned expansion into the People's Republic of China (it already had outlets in Hong Kong and Taiwan) was destined for controversy. In 1994 -- only two years after opening -- a legal battle pitted the transnational corporation against Beijing's government in a land dispute symptomatic of China's no holds barred modernization.

    "In question was McDonald's 20-year lease on the strategically located property at Wangfujing -- a busy central shopping district -- and the city's attempts to shutter the restaurant to make way for a new super sized shopping mall. McDonald's balked at the eminent domain order, which flattened the surrounding neighborhood. In the end the burger joint was the lone building standing amid acres of rubble. The dispute raised serious concerns among foreign investors over the efficacy of business contracts in China at a time when the Communist state was seen as the future of global markets.

    "But in late 1996 McDonald's China president Marvin Whaley announced a reconciliation. "In a spirit of teamwork and partnership, we've developed a plan that will allow our strong expansion in the city to continue."

    Note that it took two years for the "spirit of teamwork and cooperation' to kick in for a multi-billion dollar cooperation who could presumably have just been given another good spot for a hamburger stand. If the officials involved had been willing. Your mileage may vary, but you are unlikely to do better.

    https://timeline.com/china-mcdonalds-food-history-95cd7e2d1fb9

    walrus -> fredw... , 16 May 2019 at 07:07 PM
    Thank you Fredw for an excellent example of how McDonalds came to grips with Face, to everyone's benefit.
    walrus , 16 May 2019 at 06:30 PM
    Chinese will respect a verbal contract - the difficulty is getting them to say the terms in front of other Chinese. Lieing to you is permissible.

    Our business solved the problem by using irrevocable letters of credit. That way we could both blame the banks and not accuse each other of skulduggery. Hence Face was always kept intact.

    walrus , 16 May 2019 at 07:37 PM
    For the record and to preclude pointless ad hominem attacks, the Chinese are intelligent hard working people for whom sophisticated business and finance was a way of life while we were still living in mud huts. They revere education. They do not subscribe to Modern Judeo Christian ethics but a much older Confucian creed. For that reason pleas for China to 'play by the rules" just do not compute.

    China is not some modern, fly by night, Westphalian creation. You are dealing with the Middle Kingdom - 3000 years old and the Chinese, after centuries of oppression now demand respect. The idea that once again the West can dictate to China is offensive to Chinese and, considering their economy, downright delusional.

    China has its problems. Face as a concept does not extend beyond family and immediate friends, so the concept of higher loyalty to a Chinese nation (ie patriotism) is not strong. Neither is respect for national law, nor respect for institutions or companies. This is the source of all commercial crime (eg: fraud, adulterated products pollution).

    The governments reaction to the tendencies of its population include draconian punishments and now attempts at nationwide surveillance.

    The problem Trump fails to recognise is that the CCP and its leaders have Face. Threaten that and China will become an implacable and unbeatable enemy.

    John Merryman -> walrus ... , 16 May 2019 at 10:07 PM
    The underlaying philosophies are in some ways diametrically opposed. We in the West are object and goal oriented, with an ideals based culture, while the East has more of a feedback oriented view, ie. Yin and Yang.

    Even the concept of time is different, as we think of ourselves as individuals, thus moving through our context, the future is in front and the past behind, traveling the events of our lives. While the Eastern view is the past is in front and the future behind, as they see themselves as part of their context and necessarily witness events after they occur, then the situation continues.

    Both are valid in their own context. Though our presumption of moving toward some ideal is flawed. When some is good, more is not always better. Consider efficiency, which is to do more with less. Then the ideal of efficiency would be to do everything with nothing. Those most committed to this view see Armageddon as the door to their ideal state.

    What should be kept in mind about the East is that with Communism and the Party system, then becoming China Inc, to global capitalism, they have adopted essentially Western ideas and tried framing them through their own lens. The reason would be that such an ideals, goal oriented paradigm is very effective in the short and medium term, but creates that much more blowback, in the long term. While China might seem a threat to the current American status quo, the real danger is our own social and economic breakdown. We have been living on the equivalent of a national home loan since Reagan, if not Roosevelt and if the holders of that debt try calling it due, say trading it for remaining public assets, we will be revisiting feudalism.

    The Russian and the Chinese, as well as the Iranians, etc. are really just boogie men, being thrown up to distract us. This Iranian situation seems to have be a total disconnect with reality. Something is brewing, whether planned, or just the wheels really coming off the train.

    Both we and the Chinese seem to be headed to our own versions of Brexit. The Russians went through it with the fall of the Soviet Union.

    Fred -> walrus ... , 16 May 2019 at 11:15 PM
    walrus,

    "...the concept of higher loyalty..." Sounds like the Chinese exclusion act might have been a good idea afterall. How many generations in the US will it take for a Chinese national to actually assimiate and become "American"?

    "...unbeatable enemy." The PRC is not the Middle Kingdom. President Xi is not the subject of Master Po's "Everlasting Wrong" and he is well aware that China is certainly not "unbeatable". These are trade negotiations and right now they need us one hell of a lot more than we need them. Convincing his fellows in the CCP of that is probably going to be harder for him than for Trump to do the same with Congress.

    Keith Harbaugh , 16 May 2019 at 08:33 PM
    Any opinions on this?:
    "Former Trump Senior State Dept. Official Tells Beijing to Wait Until Trump is Removed " ,
    by sundance at CTH , 2019-05-16
    The Twisted Genius , 16 May 2019 at 09:14 PM
    Walrus, I find the most illuminating thing about your informative post is the reaction you elicited. Comment after comment, in my opinion, illustrates some degree of unwillingness or inability to acknowledge and tolerate a culture clearly different from ours. I am reminded of a South Park episode called "Toleration" in which the whole town wrongly assumes toleration of the other requires wholehearted celebration of the other. Nothing could be further from the truth. There's plenty many of us don't like about today's Chinese culture and society, but it's their culture and society. They don't have to conform to our ways anymore than we have to conform to theirs, but we should acknowledge the difference and deal with it.
    Jack said in reply to The Twisted Genius ... , 17 May 2019 at 11:42 AM
    TTG,

    In the name of tolerance of another culture are we going to surrender to their predatory behavior? Are we going to allow the Chinese to continue to "beat us at our own game" as Walrus alludes? Sure the Party of Davos have benefited from the current relationship but why should the US in it's national interest continue to allow an authoritarian state to steal our IP, subsidize their companies to dump products in our market and prevent our companies to sell into their market unless they transfer technology, only to have it stolen?

    That type of predatory behavior is not about cultural difference but taking advantage of a situation that we allowed. Tariffs may not be the best strategy but at least Trump is saying the current arrangement no longer works. It makes no sense to say in order to protect Chinese "face" we should continue this arrangement where we have the short end of the deal. I hope that Trump doesn't back down in the face of Chinese influence operations in the US and his perception of what's best for his reelection. IMO, the Chinese threat is significantly larger than any threat from Russia or Iran, and saying we should walk on eggshells to not offend their cultural sensibilities is frankly ridiculous.

    I believe Walrus over-estimates their strengths. There is a reason why their "best and brightest" continue to immigrate to Silicon Valley in droves. I know some of them personally as I have backed their entrepreneurial ventures. They will be the first to tell you that they have given up a lot in terms of familial connection to immigrate to the US as they don't share nor do they want their kid's futures to be subject to the capriciousness of Xi Jinping's authoritarian vision.

    The Twisted Genius -> Jack... , 18 May 2019 at 11:21 AM
    Jack, why surrender to their predatory behavior? Just stop dealing with them. Stop allowing American nationalists to buy Chinese made goods and stop selling China our goods. Why not make the stuff ourselves or learn to do without? Why are those American farmers growing soybeans for the Chinese. Let them grow stuff for Americans. Sure this approach is even more extreme that the current tariff war, but it will make us immune to Chinese predatory practices, won't it? The isolation of Sakoku as the purest form of American nationalism. As an added benefit of implementing a policy of Sakoku, there would be no more American foreign adventurism.

    I say this tongue in cheek realizing it will never be implemented. But wouldn't this a better implementation of American nationalism than demanding that all other countries simply bend to our demands in all matters?

    Jack said in reply to The Twisted Genius ... , 18 May 2019 at 09:47 PM
    TTG,

    I wholeheartedly agree with you that we should end our overseas interventionism. I've opposed it for a long time from Vietnam to Iraq & Syria. The costs in the trillions of dollars, the destabilization of fragile societies to the unnecessary sacrifices of our soldiers and their families have not provided any meaningful benefit to us.

    As far as China is concerned I believe the situation is more complex. One thing I've noticed in general and exemplified by the comments on this thread is the conflation of the heritage and Confucian values of the Chinese people on the CCP. Let's not be under any illusion. The CCP is unabashedly totalitarian. I've no quarrel with the Chinese people. On the contrary they have my deepest sympathies for having to endure under the boot of the CCP.

    Of course any change in their form of government is for them to effect just as our forefathers did here. The important point that I believe needs to be made is that we provided the finance, the technology and the markets to enable the economic development of an authoritarian regime. An argument can be made that those early decisions to bring in China into the global economic framework was in the belief it would enable them to reform. I was persuaded then by Sir James Goldsmith & Ross Perot and others that the GATT trade deal driven by Wall St would be a disaster for our working class. Neither Bill Clinton nor the Republicans asked the question then what if the CCP doesn't reform and instead intensifies their authoritarianism?

    Of course the big transfer of our industrial base was completely our own doing as our political system is fully captured by the Party of Davos. In retrospect it should be clear that the CCP never intended to relinquish their monopoly on power and would become even more repressive to maintain it. The CCP is not our friend. They are an implacable enemy who are now using their growing economic and military strength to directly interfere and subvert our societies. The scale of their influence operations and the direct use of cash to purchase influence and espionage is something much larger than at the depth of the Cold War with the Soviet Union. It is high time we understand this threat and act. At least Trump in his own limited way gets that something needs to change even if in his mind it is purely transactional. I'd like to highlight a current example where the Trump administration is moving to ban Huawei from our market. Opeds are being furiously written and published in our national media in defense of Huawei, while the company hires the top cybersecurity official in the Obama administration with top secret clearance as their lobbyist. There are no Opeds here or in China that Google, Facebook, and other US companies are banned in China. Why is that? IMO, it's because we accept the authoritarianism of the CCP. The neocons made a lot of noise demonizing Sadam & Assad as brutal dictators, yet they're silent as Xi Jinping has millions of Uighurs in concentration camps. If we don't act to check the CCP now our grandchildren will regret it as they'll have to fight a war.

    Johnb , 16 May 2019 at 11:05 PM
    Quote -"The idea that once again the West can dictate to China is offensive to Chinese and, considering their economy, downright delusional."
    I believe this is the underlying driver to the individual Chinese acceptance of the cost to any conflict, it also links directly to what they see as a Century of Humiliation where China wasn't powerful. The very use of the word Humiliation in any translation directly links into their concept of Face.
    Quote- "China has its problems, Face as a concept does not extend beyond family and immediate friends"

    I believe to extend and change this cultural concept of what constitutes Face is behind the national introduction of Social Credit scores for all citizens and available on line to all citizens. It is in fact intended as a national reputation system whereby an unrelated Chinese can lose Face when interacting with other citizens. China is the elephant in the room in any Western political, defence and economic policy debate.

    Alves , 17 May 2019 at 02:10 AM
    IMHO, the USA holds most of the cards in this negotiation:

    1. The USA trade deficit with China is huge and China needs to sell to the USA, as it will not find other countries to make up for the lost market.

    2. It is not uncommon for supply chains to change. Goods that today are manufactured in China will likely be made in other asian countries which have even lower wages if the trade war really goes for a significant amount of time.

    3. The inflationary and GDP contraction risk of a trade war is not that high, as the imported chinese goods make up only 2,3% of the USA GDP.

    4. The fact that China has lots of USA sovereign debt is not something that can not be solved by the FED. A few economists have already pointed that in the past 5 or 10 years.

    5. China already is an enemy of the USA. Worst case, it will be more active in the hotspots in the World, instead of only spying and hacking the hell out of the USA.

    So, do not panic. The ones that should be panicking are the chinese.

    Anon , 17 May 2019 at 09:11 AM
    China gets our middle class and the west gets cheap socks in return.As our middle class disappears overseas our cheap socks become unaffordable because there are no jobs for our young workers.The only way to get our middle class back is to stop buying cheap socks.or to put the price up on our middle class.any idiot can make cheap socks but middle class is priceless.the backbone of a stable society.Secondly any society that lives beyond its means through over population is doomed and under no circumstances must it be allowed to expand.China's growing affluence will increase competition for resources as it's middle class expands and this will lead to conflict.Cheap socks might end up causing WWIII
    SRW , 17 May 2019 at 09:36 AM
    Interesting article by David P. Goldman, Asia Times, about how to deal with China.

    https://www.asiatimes.com/2019/04/opinion/the-chinese-tortoise-and-the-american-hare/

    jdledell , 17 May 2019 at 06:36 PM
    Just as a reminder - having run International businesses, I just want to clarify that U.S. Businesses are not saints. There is a certain amount of cheating, browbeating and stealing as long as we don't get caught and profits are increasing.

    We might not like the Chinese using our methods but that is the way the cookie crumbles. At this point about two-thirds of Prudential's profits come from overseas subsidiaries and one of the reasons for that success is our ability to mimic what works in their domestic companies and to do it somewhat better and cheaper.

    Since the profits were repatriated to the U.S., I had to deal with a lot of government flack about hurting their domestic companies and their employees.

    Mightypeon , 17 May 2019 at 07:38 PM
    From my own interactions with the Chinese:

    1: Highly sophisticated Culture. They tend to react pretty well if one can show a more then basic degree of understanding of their history.

    2: They greatly prefer nuance. Simple answers imply simple minds.

    3: I have not been in the position to actually have to get formal contracts with them. I can certainly echo however that making a Chinese promise something in front of other Chinese about whose perception he cares is usually sufficient to have a pretty honorable commitment to something, it is often easier said then done.

    4: I initially had some disdain for the Chinese way of not directly letting you know how annoyed they are at any given point (Russians are fairly straightforward in this), but essentially, their point of view is also that if you are incapable of assessing how annoyed they are you are not a valid negotiation partner.

    5: Also, keeping annoyance beneath the radar does not create scenes, and if a scene is created reactions may have to be forced. Vengeance is a thing with the Chinese . My impression is that they can be mollified though, and generally regard vengeance as an expensive luxury item, I also got the impression that you need to go out of your way to seriously become a target of vengeance, just professional disagreements are not a cause for vengeance, especially not if you are a foreigner. They also have a pathway of not having to take vengeance to save their faces by asserting that the offender is insane/feebleminded/crazy and thus beneath vengeance. Its not a position you want to be in though.

    6: It goes a pretty long way to be aware of some more imaginative things that especially state aligned business can do if you are in China. Things like precision weighing any electronic equipment you take there before and after are just best practice.

    [May 20, 2019] On America's Hostile Coexistence with China

    May 18, 2019 | www.zerohedge.com
    Via ChasFreeman.net, Remarks to the Freeman Spogli Institute for International Studies China Program

    Ambassador Chas W. Freeman, Jr. (USFS, Ret.)
    Senior Fellow, Watson Institute for International and Public Affairs, Brown University
    Stanford, California, 3 May 2019

    President Trump's trade war with China has quickly metastasized into every other domain of Sino-American relations. Washington is now trying to dismantle China's interdependence with the American economy, curb its role in global governance, counter its foreign investments, cripple its companies, block its technological advance, punish its many deviations from liberal ideology, contest its borders, map its defenses, and sustain the ability to penetrate those defenses at will.

    The message of hostility to China these efforts send is consistent and apparently comprehensive. Most Chinese believe it reflects an integrated U.S. view or strategy. It does not.

    There is no longer an orderly policy process in Washington to coordinate, moderate, or control policy formulation or implementation. Instead, a populist president has effectively declared open season on China. This permits everyone in his administration to go after China as they wish. Every internationally engaged department and agency – the U.S. Special Trade Representative, the Departments of State, Treasury, Justice, Commerce, Defense, and Homeland Security – is doing its own thing about China. The president has unleashed an undisciplined onslaught. Evidently, he calculates that this will increase pressure on China to capitulate to his protectionist and mercantilist demands. That would give him something to boast about as he seeks reelection in 2020.

    Trump's presidency has been built on lower middle-class fears of displacement by immigrants and outsourcing of jobs to foreigners. His campaign found a footing in the anger of ordinary Americans – especially religious Americans – at the apparent contempt for them and indifference to their welfare of the country's managerial and political elites. For many, the trade imbalance with China and Chinese rip-offs of U.S. technology became the explanations of choice for increasingly unfair income distribution, declining equality of opportunity, the deindustrialization of the job market, and the erosion of optimism in the United States.

    In their views of China, many Americans now appear subconsciously to have combined images of the insidious Dr. Fu Manchu, Japan's unnerving 1980s challenge to U.S. industrial and financial primacy, and a sense of existential threat analogous to the Sinophobia that inspired the Anti-Coolie and Chinese Exclusion Acts.

    Meanwhile, the ineptitude of the American elite revealed by the 2008 financial crisis, the regular eruptions of racial violence and gun massacres in the United States, the persistence of paralyzing political constipation in Washington, and the arrogant unilateralism of "America First" have greatly diminished the appeal of America to the Chinese elite.

    As a result, Sino-American interaction is now long on mutual indignation and very short on empirically validated information to substantiate the passions it evokes. On each side, the other is presumed guilty of a litany of iniquities. There is no process by which either side can achieve exoneration from the other's accusations. Guesstimates, conjectures, a priori reasoning from dubious assumptions, and media-generated hallucinations are reiterated so often that they are taken as facts. The demagoguery of contemporary American populism ensures that in this country clamor about China needs no evidence at all to fuel it. Meanwhile, Chinese nationalism answers American rhetorical kicks in the teeth by swallowing the figurative blood in its mouth and refraining from responding in kind, while sullenly plotting revenge.

    We are now entering not just a post-American but post-Western era. In many ways the contours of the emerging world order are unclear. But one aspect of them is certain: China will play a larger and the U.S. a lesser role than before in global and regional governance. The Trump administration's response to China's increasing wealth and power does not bode well for this future. The pattern of mutual resentment and hostility the two countries are now establishing may turn out to be indelible. If so, the consequences for both and for world prosperity and peace could be deeply unsettling.

    For now, America's relationship with China appears to have become a vector compounded of many contradictory forces and factors, each with its own advocates and constituencies. The resentments of some counter the enthusiasms of others. No one now in government seems to be assessing the overall impact on American interests or wellbeing of an uncoordinated approach to relations with the world's greatest rising power. And few in the United States seem to be considering the possibility that antagonism to China's rise might end up harming the United States and its Asian security partners more than it does China. Or that, in extreme circumstances, it could even lead to a devastating trans-Pacific nuclear exchange.

    Some of the complaints against China from the squirming mass of Sinophobes who have attached themselves to President Trump are entirely justified. The Chinese have been slow to accept the capitalist idea that knowledge is property that can be owned on an exclusive basis. This is, after all, contrary to a millennial Chinese tradition that regards copying as flattery, not a violation of genius. Chinese businessfolk have engaged in the theft of intellectual property rights not just from each other but from foreigners. Others may have done the same in the past, but they were nowhere near as big as China. China's mere size makes its offenses intolerable. Neither the market economy in China nor China's international trade and investment relationships can realize their potential until its disrespect for private property is corrected. The United States and the European Union (EU) are right to insist that the Chinese government fix this problem.

    Many Chinese agree. Not a few quietly welcome foreign pressure to strengthen the enforcement of patents and trademarks, of which they are now large creators, in the Chinese domestic market. Even more hope the trade war will force their government to reinvigorate "reform and opening." Fairer treatment of foreign-invested Chinese companies is not just a reasonable demand but one that serves the interests of the economically dominant but politically disadvantaged private sector in China. Chinese protectionism is an unlatched door against which the United States and others should continue to push.

    But other complaints against China range from the partially warranted to the patently bogus. Some recall Hermann Göring's cynical observation at Nuremberg that: "The people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them they are being attacked and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same way in any country." There is a lot of this sort of manipulative reasoning at play in the deteriorating U.S. security relationship with the Chinese. Social and niche media, which make everything plausible and leave no truth unrefuted, facilitate this. In the Internet miasma of conspiracy theories, false narratives, fabricated reports, fictive "facts," and outright lies, baseless hypotheses about China rapidly become firm convictions and long-discredited myths and rumors find easy resurrection.

    Consider the speed with which a snappy phrase invented by an Indian polemicist – "debt-trap diplomacy" – has become universally accepted as encapsulating an alleged Chinese policy of international politico-economic predation. Yet the only instance of a so-called a "debt trap" ever cited is the port of Hambantota, commissioned by the since-ousted autocratic president of Sri Lanka to glorify his hometown. His successor correctly judged that the port was a white elephant and decided to offload it on the Chinese company that had built it by demanding that the company exchange the debt to it for equity. To recover any portion of its investment, the Chinese company now has to build some sort of economic hinterland for the port. Hambantota is less an example of a "debt trap" than of a stranded asset.

    Then too, China is now routinely accused of iniquities that better describe the present-day United States than the People's Middle Kingdom. Among the most ironic of such accusations is the charge that it is China, not a sociopathic "America First" assault on the international status quo , that is undermining both U.S. global leadership and the multilateral order remarkably wise American statesmen put in place some seven decades ago. But it is the United States, not China, that is ignoring the U.N. Charter, withdrawing from treaties and agreements, attempting to paralyze the World Trade Organization's dispute resolution mechanisms, and substituting bilateral protectionist schemes for multilateral facilitation of international trade based on comparative advantage.

    The WTO was intended as an antidote to mercantilism, also known as "government-managed trade." China has come strongly to support globalization and free trade. These are the primary sources of its rise to prosperity. It is hardly surprising that China has become a strong defender of the trade and investment regime Americans designed and put in place.

    By contrast, the Trump administration is all about mercantilism – boosting national power by minimizing imports and maximizing exports as part of a government effort to manage trade with unilateral tariffs and quotas, while exempting the United States from the rules it insists that others obey.

    I will not go on except to note the absurdity of the thesis that "engagement" failed to transform China's political system and should therefore be abandoned. Those who most vociferously advance this canard are the very people who used to complain that changing China's political order was not the objective of engagement but that it should be. They now condemn engagement because it did not accomplish objectives that they wanted it to have but used to know that it didn't . It is telling that American engagement with other illiberal societies (like Egypt, the Israeli occupation in Palestine, or the Philippines under President Duterte) is not condemned for having failed to change them.

    That said, we should not slight the tremendous impact of America's forty-year opening to China on its socioeconomic development. American engagement with China helped it develop policies that rapidly lifted at least 500 million people out of poverty. It transformed China from an angry, impoverished, and isolated power intent on overthrowing the capitalist world order to an active, increasingly wealthy, and very successful participant in that order. It midwifed the birth of a modernized economy that is now the largest single driver of the world's economic growth and that, until the trade war intervened, was America's fastest growing overseas market. American engagement with China helped reform its educational system to create a scientific, technological, engineering, and mathematical ("STEM") workforce that already accounts for one-fourth of such workers in the global economy. For a while, China was a drag on human progress. It is now an engine accelerating it. That transformation owes a great deal to the breadth and depth of American engagement with it.

    Nor should we underestimate the potential impact of the economic decoupling, political animosity, and military antagonism that U.S. policy is now institutionalizing. Even if the two sides conclude the current trade war, Washington now seems determined to do everything it can to hold China down. It seems appropriate to ask: can the United States succeed in doing this? What are the probable costs and consequences of attempting to do it? If America disengages from China, what influence, if any, will the United States have on its future evolution? What is that evolution likely to look like under conditions of hostile coexistence between the two countries?

    Some likely answers, issue by issue.

    First : the consequences of cutting back Sino-American economic interdependence.

    The supply chains now tying the two economies together were forged by market-regulated comparative advantage. The U.S. attempt to impose government-dictated targets for Chinese purchases of agricultural commodities, semiconductors, and the like represents a political preemption of market forces. By simultaneously walking away from the Paris climate accords, TPP, the Iran nuclear deal, and other treaties and agreements, Washington has shown that it can no longer be trusted to respect the sanctity of contracts. The U.S. government has also demonstrated that it can ignore the economic interests of its farmers and manufacturers and impose politically motivated embargoes on them. The basic lesson Chinese have taken from recent U.S. diplomacy is that no one should rely on either America's word or its industrial and agricultural exports.

    For these reasons, the impending trade "deal" between China and the United States – if there is one – will be at most a truce that invites further struggle. It will be a short-term expedient, not a long-term reinvigoration of the Sino-American trade and investment relationship to American advantage. No future Chinese government will allow China to become substantially dependent on imports or supply chains involving a country as fickle and hostile as Trump's America has proven to be. China will instead develop non-American sources of foodstuffs, natural resources, and manufactures, while pursuing a greater degree of self-reliance. More limited access to the China market for U.S. factories and farmers will depress U.S. growth rates. By trying to reduce U.S. interdependence with China, the Trump administration has inadvertently made the United States the supplier of last resort to what is fast becoming the world's largest consumer market.

    The consequences for American manufacturers of "losing" the China market are worsened by the issue of scale. China's non-service economy already dwarfs that of the United States. Size matters. Chinese companies, based in a domestic market of unparalleled size, have economies of scale that give them major advantages in international competition. American companies producing goods – for example, construction equipment or digital switching gear – have just been put at a serious tariff disadvantage in the China market as China retaliates against U.S. protectionism by reciprocating it. One side effect of the new handicaps U.S. companies now face in the China market is more effective competition from Chinese companies, not just in China but in third country markets too.

    Second : the U.S. effort to block an expanded Chinese role in global governance .

    This is no more likely to succeed than the earlier American campaign to persuade allies and trading partners to boycott the Chinese-sponsored Asian Infrastructure Investment Bank (AIIB). That has isolated the United States, not China. Carping at the Belt and Road initiative and related programs from outside them does nothing to shape them to American advantage. It just deprives American companies of the profits they might gain from participating in them.

    The United States seems to be acting out of nostalgia for the simplicities of a bipolar world order, in which countries could be pressured to stand with either the United States or its then rival. But China is not hampered by a dysfunctional ideology and economic system, as America's Soviet adversary was. What's more, today's China is an integral member of international society, not a Soviet-style outcast. There is now, quite literally, no country willing to accept being forced to make a choice between Beijing and Washington. Instead, all seek to extract whatever benefits they can from relations with both and with other capitals as well, if they have something to offer. The binary choices, diplomatic group-think, and trench warfare of the Cold War have been succeeded by national identity politics and the opportunistic pursuit of political, economic, and military interests wherever they can be served. Past allegiances do not anywhere determine current behavior.

    The sad reality is that the United States, which led the creation of the Bretton Woods institutions that have been at the core of the post-World War II rule-bound international system, now offers these institutions and their members neither funding nor reform. Both are necessary to promote development as balances of supply, demand, wealth, and power shift. The new organizations, like the AIIB and the New Development Bank, that China and others are creating are not predatory intrusions into the domain of American-dominated international finance. They are necessary responses to unmet financial and economic demand. Denouncing them does not alter that reality.

    Other countries do not see these organizations as supplanting pre-existing lending institutions long led by the United States. The new institutions supplement the World Bank Group and regional development banks. They operate under slightly improved versions of the lending rules pioneered by the Bretton Woods legacy establishments. China is a major contributor to the new development banks, but it does not exercise a veto in them as the U.S. does in the IMF and World Bank. The AIIB's staff is multinational (and includes Americans in key positions). The New Development Bank's first president is Indian and its principal lending activity to date has been in South Africa.

    Washington has chosen to boycott anything and everything sponsored by China. So far, the sad but entirely predictable result of this attempt to ostracize and reduce Chinese influence has not curbed China's international clout but magnified it. By absenting itself from the new institutions, the United States is making itself increasingly irrelevant to the overall governance of multilateral development finance.

    Third : the U.S. campaign to block China's international investments, cripple its technology companies, and impede its scientific and technological advance.

    The actions of the Committee on Foreign Investment in the United States (CFIUS) to prevent Chinese investment in American industry and agriculture are well publicized and are becoming ever more frequent. So are official American denunciations of Chinese telecommunications companies like Huawei and ZTE amidst intermittent efforts to shut them down. In an ominous echo of World War I's anti-German, World War II's anti-Japanese, and the Cold War's anti-communist xenophobia, the FBI has begun issuing loud warnings about the menace posed by the large Chinese student presence on American campuses. Washington is adjusting visa policies to discourage such dangerous people from matriculating here. It has also mounted a strident campaign to persuade other countries to reject Chinese investments under the "Belt and Road" initiative.

    In the aggregate, these policies represent a decision by the U.S. political elite to try to hamstring China, rather than to invest in strengthening America's ability to compete with it. There is no reason whatsoever to believe this approach can succeed. China's foreign direct investments have more than doubled over the past three years. Third countries are openly declining to go along with U.S. opposition to intensified economic relations with China. They want the capital, technology, and market openings that Chinese investment provides. U.S. denunciations of their interest in doing business with China are seldom accompanied by credible offers by American companies to match what their Chinese competitors offer. You can't beat something with nothing.

    It's also not clear which country is most likely to be hurt by U.S. government obstruction of collaboration between Chinese and American STEM workers. There is a good chance the greatest damage will be to the United States. A fair number of native-born Americans seem more interested in religious myths, magic, and superheroes than in science. U.S. achievements in STEM owe much to immigration and to the presence of Chinese and other foreign researchers in America's graduate schools. The Trump administration is trying to curtail both.

    China already possesses one-fourth of the world's STEM workforce. It is currently graduating three times as many STEM students annually as the United States. (Ironically, a significant percentage of STEM graduates in the United States are Chinese or other Asian nationals. Around half of those studying computer sciences in the United States are such foreigners.) American loss of contact with scientists in China and a reduced Chinese presence in U.S. research institutions can only retard the further advance of science in the United States.

    China is rapidly increasing its investments in education, basic science, research, and development even as the United States reduces funding for these activities, which are the foundation of technological advance. The pace of innovation in China is visibly accelerating. Cutting Americans off from interaction with their Chinese counterparts while other countries continue risks causing the United States to fall behind not just China but other foreign competitors.

    Finally : the U.S. military is in China's face .

    The U.S. Navy and Air Force patrol China's coasts and test its defenses on a daily basis. U.S. strategy in the event of war with China – for example, over Taiwan – depends on overcoming those defenses so as to be able to strike deep into the Chinese homeland. The United States has just withdrawn from the treaty on intermediate nuclear forces in part to be able to deploy nuclear weapons to the Chinese periphery. In the short term, there is increasing danger of a war by accident, triggered by a mishap in the South China Sea, the Senkaku Archipelago, or by efforts by Taiwanese politicians to push the envelope of mainland tolerance of their island's unsettled political status quo . These threats are driving growth in China's defense budget and its development of capabilities to deny the United States continued military primacy in its adjacent seas.

    In the long term, U.S. efforts to dominate China's periphery invite a Chinese military response on America's periphery like that formerly mounted by the Soviet Union. Moscow actively patrolled both U.S. coasts, stationed missile-launching submarines just off them, supported anti-American regimes in the Western Hemisphere, and relied on its ability to devastate the American homeland with nuclear weapons to deter war with the United States. On what basis does Washington imagine that Beijing cannot and will not eventually reciprocate the threat the U.S. forces surrounding China appear to pose to it?

    Throughout the forty-two years of the Cold War, Americans maintained substantive military-to-military dialogue with their Soviet enemies. Both sides explicitly recognized the need for strategic balance and developed mechanisms for crisis management that could limit the risk of a war and a nuclear exchange between them. But no such dialogue, understandings, or mechanisms to control escalation now exist between the U.S. armed forces and the PLA. In their absence Americans attribute to the PLA all sorts of intentions and plans that are based on mirror-imaging rather than evidence.

    The possibility that mutual misunderstanding will intensify military confrontation and increase the dangers it presents is growing. The chances of this are all the greater because the internal security and counterintelligence apparatuses in China and the United States appear to be engaged in a contest to see which can most thoroughly alienate the citizens of the other country. China is a police state. For Chinese in America, the United States sometimes seems to be on the way to becoming one.

    It's hard to avoid the conclusion that, if Washington stays on its current course, the United States will gain little, while ceding substantial ground to China and significantly increasing risks to its wellbeing, global leadership, and security.

    Economically , China will become less welcoming to American exports. It will pursue import substitution or alternative sourcing for goods and services it has previously sourced in the United States. With impaired access to the world's largest middle class and consumer economy, the United States will be pushed down the value chain. China's ties to other major economies will grow faster than those with America, adversely affecting U.S. growth rates. Any reductions in the U.S. trade deficit with China will be offset by increases in trade deficits with the countries to which current production in China is relocated.

    China's role in global governance will expand as it adds new institutions and funds to the existing array of international organizations and takes a larger part in their management. The Belt and Road initiative will expand China's economic reach to every corner of the Eurasian landmass and adjacent areas. The U.S. role in global rule-making and implementation will continue to recede. China will gradually displace the United States in setting global standards for trade, investment, transport, and the regulation of new technologies.

    Chinese technological innovation will accelerate, but it will no longer advance in collaboration with American researchers and institutions. Instead it will do so indigenously and in cooperation with scientists outside the United States. U.S. universities will no longer attract the most brilliant students and researchers from China. The benefits of new technologies developed without American inputs may be withheld rather than shared with America, even as the leads the United States has long enjoyed in science and technology one-by-one erode and are eclipsed. As cordiality and connections between China and the United States wither, reasons for Chinese to respect the intellectual property of Americans will diminish rather than increase.

    Given the forward deployment of U.S. forces, the Chinese military has the great advantage of a defensive posture and short lines of communication. The PLA is currently focused on countering U.S. power projection in the last tenth or so of the 6,000-mile span of the Pacific Ocean. In time, however, it is likely to seek to match American pressure on its borders with its own direct military pressure on the United States along the lines of what the Soviet armed forces once did.

    The adversarial relationship that now exists between the U.S. armed forces and the PLA already fuels an arms race between them. This will likely expand and accelerate. The PLA is rapidly shrinking the gap between its capabilities and those of the U.S. armed forces. It is developing a nuclear triad to match that of the United States. The good news is that mutual deterrence seems possible. The bad news is that politicians in Taiwan and their fellow travelers in Washington are determinedly testing the policy frameworks and understandings that have, over the past forty years, tempered military confrontation in the Taiwan Strait with dialogue and rapprochement. Some in Taiwan seem to believe that they can count on the United States to intervene if they get themselves in trouble with Chinese across the Strait. The Chinese civil war, suspended but not ended by U.S. unilateral intervention in 1950, seems closer to a resumption than it has been for decades.

    As a final note on politico-military aspects of Sino-American relations, in the United States, security clearances are now routinely withheld from anyone who has spent time in China. This guarantees that few intelligence analysts have the Fingerspitzengefühl – the feeling derived from direct experience – necessary to really understand China or the Chinese. Not to worry. The administration disbelieves the intelligence community. Policy is now made on the basis of ignorance overlaid with media-manufactured fantasies. In these circumstances, some enterprising Americans have taken to combing the dragon dung for nuggets of undigested Chinese malevolence, so they can preen before those in power now eager for such stuff. There is a Chinese expression that nicely describes such pretense: 屎壳螂戴花儿 -- 又臭又美 – "a dung beetle with flowers in its hair still stinks."

    All said, this does not add up to a fruitful approach to dealing with the multiple challenges that arise from China's growing wealth and power. So, what is to be done? 该怎么办?

    Here are a few suggestions .

    First , accept the reality that China is both too big and too embedded in the international system to be dealt with bilaterally. The international system needs to adjust to and accommodate the seismic shifts in the regional and global balances of wealth and power that China's rise is causing. To have any hope of success at adapting to the changes now underway, the United States needs to be backed by a coalition of the reasonable and farsighted. This can't happen if the United States continues to act in contempt of alliances and partnerships. Washington needs to rediscover statecraft based on diplomacy and comity.

    Second , forget government-managed trade and other forms of mercantilism. No one can hope to beat China at such a statist game. The world shouldn't try. Nor should it empower the Chinese government to manage trade at the expense of market forces or China's private sector. Governments can and – in my opinion – should set economic policy objectives, but everyone is better off when markets, not politicians, allocate capital and labor to achieve these.

    Third , instead of pretending that China can be excluded from significant roles in regional and global governance, yield gracefully to its inclusion in both. Instead of attempting to ostracize China, leverage its wealth and power in support of the rule-bound order in which it rose to prosperity, including the WTO.

    Fourth , accept that the United States has as much or more to gain than to lose by remaining open to science, technology, and educational exchanges with China. Be vigilant but moderate. Err on the side of openness and transnational collaboration in progress. Work on China to convince it that the costs of technology theft are ultimately too high for it to be worthwhile.

    Fifth and finally, back away from provocative military actions on the China coast. Trade frequent "freedom of navigation operations" to protest Chinese interpretations of the U.N. Convention on the Law of the Sea for dialogue aimed at reaching common understandings of relevant interests and principles. Ratify the Convention on the Law of the Sea and make use of its dispute resolution mechanisms. As much as possible, call off military confrontation and look for activities, like the protection of commercial shipping, that are common interests. Seek common ground without prejudice to persisting differences.

    In conclusion : both China and the United States need a peaceful international environment to be able to address long-neglected domestic problems. Doing more of what we're now doing threatens to preclude either of us from sustaining the levels of peace, prosperity, and domestic tranquility that a more cooperative relationship would afford. Hostile coexistence between two such great nations injures both and benefits neither. It carries unacceptable risks. Americans and Chinese need to turn from the path we are now on. We can – we must – find a route forward that is better for both of us.

    Thank you.


    MushroomCloud2020 , 7 hours ago link

    The article presents itself as being forward thinking, yet no mention of the robot revolution and how destabilizing it will be for both sides. As it stands today, it seems the economic conflict is between the US and China-perhaps. But when these robots come on line the economic war is going to be between the laborer and the employee world wide.

    The demise of the US economy and manufacturing base in the US is a direct result of cheap labor, so one has a clear picture of what cheap labor will do. Outside of stuff falling from the sky for free, there isn't anything that will be more devastating to the world labor market than a robot enhanced with AI. Sure, products may become cheaper due to reduced labor cost, but if people do not have a job to raise enough income, then how are they going to buy stuff? Clearly, the whole capitalistic system will collapse and then what? What will be our choices? Will we have to shun progress in order to save the current system that has brought us all this wonderful labor saving innovation? Will people choose the hard road over the easy road? It seems to me that things always take the path of least resistance.

    MushroomCloud2020 , 7 hours ago link

    The only advantage China has is cheap labor.The robot revolution will upset the apple cart for both sides. It will be interesting, to say the least, when both sides realize that innovation is both a blessing and a curse.

    Smi1ey , 9 hours ago link

    This is a pretty good article, I agree with a lot of it. The part I don't like is the author's extreme worship of property rights.

    He ignores the commons, things held in common by the people, things like science and culture. For example, Disney's copyright on its films will never expire if Disney can help it. Even an American's personal data is now someone else's private property, probably including their genetic data since even genes can be patented.

    LEEPERMAX , 9 hours ago link

    Fmr Navy Intel Officer:

    Chinese Spy Ministry Operates in Silicon Valley . . . Big Time.

    https://youtu.be/6lLP5zYKr_Q

    [May 19, 2019] Lawrence Wilkerson Warns The US Is Driving Down A Highway To War With China

    Notable quotes:
    "... More broadly, Wilkerson pegs the ramping up of confrontation with China as "all about keeping the [military-industrial] complex alive" that Wilkerson explains "the military was scared to death would disappear as we began to pay the American people back" a peace dividend at the end of the cold war. US government efforts against terrorism, explains Wilkerson, have also been used to ensure the money keeps flowing. ..."
    May 19, 2019 | www.zerohedge.com

    Authored by Adam Dick via The Ron Paul Institute for Peace & Prosperity,

    Former Army Colonel Lawrence Wilkerson, who was chief of staff for Secretary of State Colin Powell in the George W. Bush administration, warns in a new The Real News interview with host Sharmini Peries that the United States government is driving down a "highway to war" with China -- a war for which Wilkerson sees no sound justification.

    The drive toward war is not undertaken in response to a real threat posed by China to the people of America. Instead, argues Wilkerson, the US government is moving toward war for reasons related to money for both the military and the broader military-industrial complex, as well to advance President Donald Trump's domestic political goals.

    Wilkerson, who is a member of the Ron Paul Institute for Peace and Prosperity's Academic Board, elaborates on the US military's money-seeking motivation to advance the new China scare, stating:

    All of this right now, first and foremost, is a budget ploy. They want more money.

    And that's largely because their personnel costs are just eating their lunch. And, second, it's an attempt to develop - and this has something to do with money too of course - another threat, another cold war, another feeding system .

    The military just hooks up like it is hooking up to an intravenous, you know, an IV system and the money just pours out-slush fund money, appropriated money, everything else.

    More broadly, Wilkerson pegs the ramping up of confrontation with China as "all about keeping the [military-industrial] complex alive" that Wilkerson explains "the military was scared to death would disappear as we began to pay the American people back" a peace dividend at the end of the cold war. US government efforts against terrorism, explains Wilkerson, have also been used to ensure the money keeps flowing.

    Watch Wilkerson's complete interview here:

    https://www.youtube.com/embed/42LauiK_rbY

    * * *

    Please donate to the Ron Paul Institute

    [May 19, 2019] Google cuts ties with Huawei following trade blacklisting

    May 19, 2019 | www.rt.com

    Google has reportedly suspended its licences and product-sharing agreements with Chinese communications giant Huawei, as Washington accuses the company of spying for Beijing. The Silicon Valley tech giant has cut its business deals with Huawei that involve the transfer of hardware and software, Reuters and The Verge report. Following the move, Huawei will lose access to Android operating system updates, and its forthcoming smartphones will be shut out of some Google apps, including the Google Play Store and Gmail apps. The Chinese firm however will still have access to the open source version of the Android operating system.

    We have confirmed this is genuine.

    Huawei will only be able to use the public version of Android, and won't get access to proprietary apps and services from Google

    Huawei will have to create their own update mechanism for security patches https://t.co/7eTi4JvWsE

    -- Tom Warren (@tomwarren) May 19, 2019

    Washington repeatedly accused Huawei of installing so-called 'backdoors' into its products on behalf of the Chinese government. The heads of six US intelligence agencies warned American citizens against using Huawei products last year, and the Chinese company's phones were banned from US military bases shortly afterwards.

    [May 19, 2019] China State Run Media Broadcasts Anti-American Movies To Millions Amid Deepening Trade War

    Notable quotes:
    "... All last week, anti-American propaganda flourished across the country, with the slogan "Wanna talk? Let's talk. Wanna fight? Let's do it. Wanna bully us? Dream on!" going viral on Chinese social media platforms. ..."
    May 19, 2019 | www.zerohedge.com

    With the trade war between the US and China suddenly erupting after a 5-month ceasefire, CCTV 6, the movie channel of China's leading state television broadcaster, aired three anti-American movies last week, reported What's On Weibo .

    The three movies are Korean war films: Heroic Sons and Daughters (1964), Battle on Shangganling Mountain (1954), and Surprise Attack (1960), which aired about one week after President Trump raised an existing 10% tariff on $200 billion worth of Chinese goods to 25%.

    All last week, anti-American propaganda flourished across the country, with the slogan "Wanna talk? Let's talk. Wanna fight? Let's do it. Wanna bully us? Dream on!" going viral on Chinese social media platforms.

    ... ... ...

    China's government broadcasting anti-American movies to hundreds of millions of its people shows how officials are starting up the propaganda machines ahead of a potential armed conflict with the US...


    Pioneer.Valley.Man , 24 minutes ago link

    Sounds like the Chinese should just be watching MSNBC or CNN ...

    schroedingersrat , 43 minutes ago link

    The US citizens get fucked by their own establishment for decades instead blame chinese. Cant be dumber than that :)

    gro_dfd , 42 minutes ago link

    Chinese spokesperson Hu Xijin writes: "there's no equal negotiation without fighting." No need for negotiation (or fighting). Assuming Trump imposes the rest of the tariffs, US trade with China will recede to nothing. Inciting anti-American feelings in mainland China just makes the break in relations easier. Goodbye China!

    johnny two shoes , 7 minutes ago link

    + 1

    China has no intention of going to actual war over trade with the U.S. - they have plenty of other potential markets, as is repeatedly alluded to here and elsewhere. This televised propaganda is about manipulating the attitudes of their own disillusioned, controlled populace.

    Smi1ey , 45 minutes ago link

    China State Run Media Broadcasts Anti-American Movies To Millions Amid Deepening Trade War

    Meanwhile, America's Mockingbird Media continues to lie about everything from 911 to Venezuela.

    https://en.wikipedia.org/wiki/Operation_Mockingbird

    Dr Anon , 45 minutes ago link

    So they're broadcasting regular American television? Those shows do a great job demeaning and shitting on average American men while holding up minorities and freaks as capable people. They didn't need to invent any propaganda; just use the same **** *** producers have been feeding us dumb goyim for decades.

    TheRapture , 53 minutes ago link

    ZH is proof, if any more were needed, that all these crudely racist Americans are just not the sharpest tools in the shed.

    Maybe the real cause of all anti-Chinese hate by Americans is rooted in IQ jealousy.

    asadshah , 38 minutes ago link

    Isage master of the The famous paper tiger threat of turning something into glass, empty fuckin threat from a country whose professional army has managed to lose every major conflict in the last 50 years to poorly equipped sometimes barefoot soldiers armed with nothing more that AK -47s.

    please see Korean villagers, Vietnamese villagers, iraqi villagers, afghan villagers and Syrian Villagers.

    and the vaunted Israelis who who only win against ancient armies with ancient gear, but faced with dedicated Hezbollah Lebanese villagers again .....lose.

    Give it up, you are masters of snatching defeat from the jaws of victory... not much else.

    NA X-15 , 47 minutes ago link

    Just to rub it in the PLA trolls faces:

    https://duckduckgo.com/?q=Chinese+factory+dorms+have+anti-suicide+nets&t=h_&ia=images&iax=images

    Tachyon5321 , 57 minutes ago link

    Trump should ban Weibo, Baidu and Sogou apps on Google and Apple phones because they are foreign controlled propaganda

    malek , 54 minutes ago link

    You prefer a diet of purely domestic controlled propaganda instead?

    [May 19, 2019] The Real Risk Of The Trade War

    Notable quotes:
    "... Negotiating with countries is different from the wheeling and dealing world of New York real estate. This should be especially clear with a nation-first politician like Donald Trump. ..."
    "... Where making maximum demands on other parties might work in New York, it's much less likely if one is dealing with proud, independent nations - that should have been the lesson from the North Korea fiasco. ..."
    "... Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. ..."
    May 16, 2019 | seekingalpha.com

    by: Shareholders Unite Shareholders Unite Small-cap, macro, value, momentum Shareholdersunite (11,300 followers) Summary It is difficult to see the Chinese caving to the demands of the Trump government, which seem to involve a wholesale change of China's economic model.

    Either some middle ground is found or we risk a serious escalation with multiple risks to the state of the world economy, with many known and unknown facilities.

    The end state could be a wholesale decoupling of the American and Chinese economies, and while some would applaud such an outcome, it's unlikely to be better than what we've got.

    The Trump administration seems to have the illusion that if you raise the stakes high enough, other countries will cave to US demands. There might also be an element of creating foreign adversary in order to unite the domestic front, we don't know.

    Trade tensions have been taken way too far when the government slapped tariffs on Canadian steel exports because of national security concerns, but in the case of China, there are some legitimate concerns. Mind you, these concerns don't involve:

    This doesn't look particularly mercantilist:

    (Source: Trading Economics )

    Negotiating with countries is different from the wheeling and dealing world of New York real estate. This should be especially clear with a nation-first politician like Donald Trump.

    Where making maximum demands on other parties might work in New York, it's much less likely if one is dealing with proud, independent nations - that should have been the lesson from the North Korea fiasco.

    Just as there is one thing worse than a severe economic recession, which is caving to US pressure for the Iranian ayatollas, the same holds for Chinese politicians in charge of policy.

    It's true that the pain from the escalation in the trade war is probably significantly larger in China compared to the US, but that doesn't make them more likely to be the first to cave, especially considering that what the US administration seems to demand is a wholesale change of China's economic model . That's never going to happen. Since there are no free elections, they can endure the pain for longer, and much fewer people own stocks, so even while the sell-off in China might be worse, it's hitting much fewer people.

    In fact, caving to US demands, or even being seen to be caving, might well be a one-way ticket to political oblivion. Which is why China's leaders called President Trump's bluff. Contrast this with the situation in the US.

    Trade experts like Krugman argue that the short-term economic impact as such on the US economy is fairly moderate, and who are we to disagree? However, a further escalation isn't likely to go by unnoticed, and there is this ephemeral concept called "confidence", of which the stock market might be one of the best indicators:

    The market is already reeling, and this could become uncomfortable pretty soon for a president who prides himself on the rally in the markets.

    The real danger

    The risk is that this becomes a protracted conflict with each party digging in, egged on by heated domestic rhetoric. The longer this lasts, the greater the following risks:

    Sentiment is turning, and at a certain point, this can very well start to affect consumption, investment, and lending decisions in the real world. We're not there yet, but look how the sell-off at the end of last year cowered the Fed into one of the more spectacular retreats in policy. This wasn't because of the market sell-off itself but because of the increasing signs that sentiment could hit the real economy, even if much of the more immediate risks were abroad.

    Moreover, in a highly leveraged financial system, you never know what you're going to find when the investor flows recede. Things can go very fast here. Look how Argentina was able to sell a 100-year bond in 2016, only to be hit by the receding flows pretty soon after.

    Another real risk is a substantial yuan depreciation . It's the most effective way the Chinese can absorb the direct tariff cost on their competitiveness, but it runs the risk of becoming a self-fulfilling prophesy.

    The markets have already twice succumbed to yuan depreciation scares, in 2015 and at the start of 2016, and the PBoC spent $1 trillion of its $4 trillion reserves plus draconian capital controls to stop the rot.

    We're not talking hypotheticals here - guess when that gap-up happened? On the day of the Trump tweets announcing the 25% tariffs:

    A substantial yuan depreciation will risk inserting a major deflationary blow to the world economy as it exports the effects of the US tariffs on China to the rest of the world.

    Given the shaky state of the eurozone, we're not relishing this prospect at all. We have long argued that the eurozone is one downturn away from disintegration, with Italy as its focal point.

    Italy is already in a recession and has a dysfunctional government consisting of a left-wing and right-wing populist party which are constantly bickering. What's more, it has unsustainable debt dynamics and a potential banking doom loop, should the debt dynamics trigger a market selloff, and has no lender of last resort.

    With all the debt and leverage in the world economy, it's a bit like riding a bicycle - you have to keep cycling to stop falling over.

    Decoupling

    While the direct monetary impact of the tariffs is fairly moderate (it's a modest, albeit highly regressive, tax increase), another likely consequence is a further relocation of supply chains and decoupling of the US and Chinese economies.

    We have already read numerous company CCs which described rerouting supplies from China, albeit not usually back to the US, and we're not imagining stuff. From Monday's issue of DigiTimes:

    If 10% tariffs can do that, 25% of tariffs will accelerate this and the next round, where the US levies tariffs on all Chinese imports even more.

    Some within the US administration seems to relish this, as it weakens China economically, but a hard Chinese landing won't pass the US unnoticed, and the end result could very well be two competing economic blocks and a new sort of cold war.

    One of the very first economic measures the Trump government took was to get the US out of the TPP, which not only gave up a lot of leverage over China, but the mostly ASEAN countries who are part of the TPP (without the US) are now firmer in China's orbit as a result, and they will have unenviable choices to make in terms of their future alignment.

    It's also unfortunate that Trump has been waging trade wars on multiple fronts (see here for an overview ), alienating many partners in the process.

    Now might be as good a time as any to remind people of the unpopular thesis that trade isn't a zero-sum game and that both the US and China have greatly benefited from their economic integration the past couple of decades.

    The US got increased exports as well - not as spectacular as the Chinese exports to the US, but this is in part an optical illusion. Much of China's exports to the US contain value added produced elsewhere, even from the US itself:

    94377_BII_COTW_040218_v3_blog

    (Source: BlackRock )

    You see that less than half of the value added of Chinese electronics export to the US is actually produced in China itself. The iPhone is a classic example:

    In the case of the Apple iPhone, this means that China's exports balance accounts for the full $500 iPhone value, when China adds only approximately $15 to $30 of the value to the phone. Most of the iPhone value accretes to Samsung in Korea ($150) and to Apple - the brand owner and engineer. This highlights how the normal accounting of trade flows is inherently distorted under the current trade-deficit estimates.

    (Source: CNBC )

    Yes, the US has lost manufacturing jobs as a result, but it failed to compensate those who lost from trade like other countries have (via massive active labor market policies, for instance in the Nordic countries, where there is little in the way of an industrial waste land as a result).

    The US has also gained. It found willing buyers for its Treasuries, keeping interest rates low, cheap consumer goods, keeping inflation low - which allowed the Fed to keep low interest rates, and which in turn increased economic growth and employment.

    It's not perfect, and we're not blind to China's IP theft and the conditions it places on American companies operating in the country. But China's rise has propelled half a billion people out of poverty and turned them into eager consumers of US agricultural, cultural and high-tech products.

    Conclusion

    While a number of American grievances are right, the Trump administration seems to want a wholesale sellout of China, abandoning its economic model. That's not going to happen, and even less so because they also antagonized potential allies, like ASEAN countries, the EU and Canada.

    There are two choices here: either some middle ground is found or this could spiral out of control, with major economic risks involved and a wholesale decoupling of the Chinese and American economies. Economics 101 argues quite clearly that that world is unlikely to be better than the one we have, despite all the imperfections of the latter.

    Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    [May 19, 2019] Explaining the US China trade war

    Essentially Trump is trying to replace neoliberals with "national neoliberalism"
    Apr 29, 2019 | www.youtube.com

    What if, instead of the U.S. and China battling it out on trade--it was two classes trading cards? We explain the trade war.

    "Trade wars are good and easy to win," President Donald J. Trump famously tweeted. But how would one really impact everyday Americans?

    [May 19, 2019] US pressure on Huawei

    33 out 90 suppliers of Huawei are US companies. If Huawei do not buy from them who will buy them? It's two way street.
    Trump is breaking neoliberalism createing two camps of neoliberal countries hostile to each other. Potential partners for China are Russia, Turkey, Syria, Iraq, Iran, Pakistan and North Korea so this would be a weaker, but still formidable in economic and military capacity block.
    May 16, 2019 | www.youtube.com

    On Wednesday, U.S. President Donald Trump issued an executive order barring U.S. firms from using telecom equipment made by companies accused of being a national security risk; this includes Chinese tech giant Huawei. The U.S. Commerce Department questioned whether Huawei will be able to continue purchasing components from its American suppliers. In response, the Chinese Commerce Ministry said on Thursday

    Philip Yap , 1 day ago

    Huawei will survive with supply chain alternatives and reengineering designs, it will make Huawei stronger with better products. American high tech products and parts suppliers can wait until American companies come up with design to utilise their products, hopefully not long enough to cripple all these high tech parts manufacturers.

    Francoise Loffler , 8 hours ago

    Huawei is an EXCELLENT PHONE MUCH BETTER THAN APLE...I have both and can compare them...

    [May 18, 2019] Trade War US to Pay Heavy Price for Underestimating China Chinese Businessman

    Notable quotes:
    "... US Tariffs Have Nothing to Do With Competition, These are Steps to Contain China ..."
    "... Or do they want to cut off all opportunities for China's future development? In my opinion, the relevant measures that the Americans have been initiating since the very beginning of the trade war to the present day are most likely real steps to contain China rather than some form of sanctions. This is a desire to hinder China's development in various spheres, specifically in trade, economic development, industrial development, science and technology, in the financial sphere and even in the area of human resources in China. They want to hamper our development on all sides. ..."
    "... You might know that we used to have the popular concept of the so-called "hybrid war" but I would not describe the behaviour of Americans using this term. They just want to cut off all of China's development opportunities. They want to limit our ability to thrive as much as possible. ..."
    "... Today I heard you talking about Russia, about the principles of preserving your development and sovereignty, I agree with that. The geopolitical situation is different for everyone, the history is different. There may be differences in how countries approach dealing with issues. ..."
    "... The advantage of the United States is its hegemony in the global financial system. The second advantage is the strong alliance system that was formed after the Second World War and the Cold War. And another one is a still high level of weapons development in the world. ..."
    "... Over the past decades, Americans have repeatedly initiated hostilities, and acute social inequality has flared up inside the country. Today, hegemony in the ideological system is being lost; and some countries and regions' confidence in the USA is being lost. ..."
    May 16, 2019 | sputniknews.com

    ... ... ...

    Dmitry Kiselyov, the general director of Rossiya Segodnya International Information Agency, discussed the recent escalation in the Sino-American trade war with Kong Dan, the former chairman of CITIC Group; Zhang Weiwei, a Chinese professor of international relations at Fudan University and a senior research fellow at the Chunqiu Institute; and Li Shimo, an investor and billionaire, founder and managing director of Chengwei Capital, owner of many US Silicon Valley companies.

    US Tariffs Have Nothing to Do With Competition, These are Steps to Contain China

    Dmitry Kiselyov: What resources does China have?

    Kong Dan: Without a trade war, our view of the United States would be superficial; now we know the other side as well. I, as a representative of business circles, do not really understand the subtleties of what the Americans want. Do they just think that Chinese development is unacceptable for them?

    Or do they want to cut off all opportunities for China's future development? In my opinion, the relevant measures that the Americans have been initiating since the very beginning of the trade war to the present day are most likely real steps to contain China rather than some form of sanctions. This is a desire to hinder China's development in various spheres, specifically in trade, economic development, industrial development, science and technology, in the financial sphere and even in the area of human resources in China. They want to hamper our development on all sides.

    Dmitry Kiselyov: But is it hostile?

    Kong Dan: I would call this approach competition. But competition can be different: hostile, non-hostile

    READ MORE: Strategist: American Producers, Consumers to Pay for US-China Tariff Tit-for-Tat

    China's Two Main Advantages in Trade War With US

    Dmitry Kiselyov: Competition without rules is animosity

    Kong Dan: You might know that we used to have the popular concept of the so-called "hybrid war" but I would not describe the behaviour of Americans using this term. They just want to cut off all of China's development opportunities. They want to limit our ability to thrive as much as possible.

    China May Regulate Energy Imports from US Amid Trade Row Competition has various forms or different aspects. I also have a counter-question for you, how do Russians assess the nature of those sanctions measures that the Americans have implemented against Russia?

    The United States considers us its adversaries. They previously included Russia, China, Iran, and North Korea on their blacklist, a list of terrorist forces. And China is first on the list. Are we hostile to them?

    Today I heard you talking about Russia, about the principles of preserving your development and sovereignty, I agree with that. The geopolitical situation is different for everyone, the history is different. There may be differences in how countries approach dealing with issues.

    I previously worked as the head of the largest state-owned company in China, so, of course, I understand what kind of mission one carries on his/her shoulders. I am willing to make efforts to stimulate the development of the Russian-Chinese partnership as a whole; I think there is still a lot to do in this direction. The US underestimates the potential of President Putin and Russia, China and President Xi Jinping. They will pay a heavy price for it.

    I would like to name two advantages of the trade war for us.

    Why China is Likely to Emerge Victorious in Trump-Driven Trade War

    Dmitry Kiselyov: You said you have confidence that China will emerge victorious in this trade war, what does this victory mean? When will it come?

    Kong Dan: Trump has said many times that he can hit our stock market to destroy it. As for us, we are doing everything well, we are successfully organising work, and we are looking for ways for rapid development in recent years. Our goal of a 100-year-old rebirth of the nation can be achieved -- and that is our victory Of course, we understand that the United States wants to impede our development. If they want to destroy us then I think they will fail. Only in their dreams!

    Zhang Weiwei: I support Mr Kong's view that the Chinese consumer market is the largest in the world! Especially, in the field of innovation. And if one leads the battle with such colossal markets, then the initiators will surely fail .

    READ MORE: US Treasury Chief to Plan for Trade Meeting in China Soon

    'If US Continues to Maintain Hegemony, It Will Suffer Heavy Losses'

    Dmitry Kiselyov: What will then become of the defeated United States?

    Kong Dan: It is very hard to explain all this only in military terms. China neither wants to seize the United States nor does it want to take a dominant position like the United States. We simply do not want the United States to cut off all the opportunities for our country's development.

    Li Shimo: I would like to note that in the course of a trade war, each of the parties has its own strengths and weaknesses. Our advantage is that we have a strong political system. The second one is social cohesion. The third one, as has already been stated, China has quite large domestic markets. The fourth one, China is the world's largest trading country and also the largest trading nation in the history of mankind.

    China to Emerge Victorious From Trade War With US – Foreign Ministry Unlike ours, the American political system has fallen into disarray. American society is split ; the "social contract" has failed. The political and economic elite have gradually lost their credibility and reputation.

    The advantage of the United States is its hegemony in the global financial system. The second advantage is the strong alliance system that was formed after the Second World War and the Cold War. And another one is a still high level of weapons development in the world.

    However, the United States and China have different development goals. China is simply looking for suitable paths to future accelerated development. But the US has a dilemma. Previously, there was a different situation, there was hegemony -- a very important driving force, a very important pillar, the so-called "soft power", and particularly they had ideological dominance. Over the past decades, Americans have repeatedly initiated hostilities, and acute social inequality has flared up inside the country. Today, hegemony in the ideological system is being lost; and some countries and regions' confidence in the USA is being lost.

    © Sputnik / Marina Lisceva Boeing Calls For Limits to US Tariffs Over EU Subsidies

    Therefore, if they now wish to continue to maintain hegemony, they will suffer heavy losses. But if they back down from it -- for instance, Trump wants to abandon ideological dominance -- it will turn into a power struggle in its purest form. This will lead to a loss of ideological advantage in the international arena.

    How to assess the outcome of the battle? I would suggest that you read the 19th National Congress of the Communist Party of China report delivered by President Xi Jinping. In it, he outlined two challenges: the first one -- 2035, the second one -- 2049. These two goals are quite clear and realistic If we can complete these tasks, then the victory will be ours.

    China's Three Future Milestones: 2021, 2035, 2049

    Dmitry Kiselyov: What are these challenges?

    Kong Dan: China has two development goals for the current century. The first is that by 2021 when the CPC will celebrate its 100th anniversary, it will fully and comprehensively build a moderately prosperous society in China. Another goal by 2049, when it will be 100 years since the founding of the PRC, China should reach the level of the most advanced developed countries. Moreover, there is another intermediate task between these two goals of the current century -- by 2035 China has to move into the category of moderately developed countries.

    Zhang Weiwei: China borrowed its methodology and planning practices from the USSR. However, over the past decades, we have brought a lot of innovation into this process. Now it is no longer the old decision-making but strategic and guiding planning. The Americans could see that over the past 40 years China has been fulfilling all its five-year plans ahead of schedule, and that frightened them. If we are talking about how the China-US trade war will end, then personally I would like to quote Americans who say: "if you can't beat them, join them".

    READ MORE: China May Regulate Energy Imports from US Amid Trade Row

    China Presents New Model of Development as Western & Soviet Models Failed

    Dmitry Kiselyov: How many fingers are needed to describe the Chinese model, and what in fact is that, if we are talking about the alternative?

    Zhang Weiwei: The Chinese Model of Development has several features. First, the leading ideology must be based on real facts. "Practice is the sole criterion of truth". As a result, we found that a developing country, such as China, needs to carry out modernisation. Looking at the rest of the world, it becomes clear that the Western model is not successful. The Soviet model also did not prevail. Therefore, Deng Xiaoping said that we need to follow our own path. We did not fall into the trap of "colour revolutions", we were looking for the path we needed based on reality. That is the key thing.

    No US LNG Exports to China in Recent Months as Trade War Reaches Peak - Reports

    I would like to add a little bit. If we talk about reforms in socialist countries, we can name two basic models.

    Reforms according to the Chinese model are characterised by balance, prudence, and sustainability. We have carried out bold economic reforms, built a market economy, and joined the process of globalisation. However, we treat political reforms with caution and prudence; everything should serve economic reforms, and, ultimately, improve people's living standards.

    The American model provides for the concept of political equality "One person, one vote", a multiparty system for governing a country. Strictly speaking, it only started working in 1965. The Chinese model began to take shape in 1978. Their starting points are more than ten years apart. Of course, they can compete with each other but I consider the Chinese model to be more successful and attractive; and I have already been talking about this for 20 years.

    The views and opinions expressed by the speakers and the contributor do not necessarily reflect those of Sputnik.

    [May 18, 2019] China Downplays Chances for Talks, Pledges Economic Defense

    May 18, 2019 | www.bloomberg.com

    China's state media signaled a lack of interest in resuming trade talks with the U.S. under the current threat of higher tariffs, while the government said stimulus will be stepped up to buttress the domestic economy.

    Without new moves that show the U.S. is sincere, it is meaningless for its officials to come to China and have trade talks, according to a commentary by the blog Taoran Notes, which was carried by state-run Xinhua News Agency and the People's Daily, the Communist Party's mouthpiece. The Ministry of Commerce spokesman said Thursday he had no information about any U.S. officials coming to Beijing for further talks.

    U.S. equities fell on concern that talks between the world's two largest economies have stalled. The Shanghai Composite Index also declined. "If the U.S. doesn't make concessions in key issues, there is little point for China to resume talks," said Zhou Xiaoming, a former commerce ministry official and diplomat. "China's stance has become more hard-line and it's in no rush for a deal" because the U.S. approach is extremely repellent and China has no illusions about U.S. sincerity, he said. No Rush for a Deal

    According to Zhou, the commerce ministry spokesman on Thursday effectively ruled out talks in the near term. In comments to the media, ministry spokesman Gao Feng said that China's three major concerns need to be addressed before any deal can be reached, adding that the unilateral escalation of tensions in Washington recently had "seriously hurt" talks.

    The U.S. has been talking about wanting to continue the negotiations, but in the meantime it has been playing "little tricks to disrupt the atmosphere," according to the Taoran commentary on Thursday night, citing Trump's steps this week to curb Chinese telecom giant Huawei Technologies Co.

    "We can't see the U.S. has any substantial sincerity in pushing forward the talks. Rather, it is expanding extreme pressure," the blog wrote. "If the U.S. ignores the will of the Chinese people, then it probably won't get an effective response from the Chinese side," it added.

    The blog reiterated China's three main concerns for a deal are tariff removal, achievable purchase plans and a balanced agreement text, as first revealed by Vice Premier Liu He. They mark the official stance as much as the will of the Chinese public, it wrote.
    "If anyone thinks the Chinese side is just bluffing, that will be the most significant misjudgment" since the Korean War, it said.

    Read: China Vows 'People's War' as Trade Fight Takes Nationalist Turn

    In addition to putting the Taoran commentary on WeChat, the People's Daily newspaper had three defiant articles on the trade war in the physical newspaper Friday.

    A front page commentary from the Communist Party's propaganda department headlined 'No Power Can Stop the Chinese People from Achieving Their Dream' said "the trade war will not cripple China, it will only strengthen us as we endure it," citing the hardships China has overcome from the Opium War to floods to the SARS epidemic in 2002-2003.

    There were two editorials on page three, with one saying "China doesn't intend to change or replace the U.S., and the U.S. can't dictate to China or hold back our development." The other said claims from some officials in the U.S. that they have "rebuilt" China over the past 25 years are "outrageous" and shows their vanity, ignorance and distorted mentalities.

    [May 18, 2019] 'US already spying on public, Huawei threat unproven' Swann

    Trump is a bully and he does not have any methods of diplomacy other then bulling.
    May 16, 2019 | www.youtube.com

    US President Donald Trump declared a national emergency over Huawei, which he has deemed a national security threat. His new executive order makes it more difficult for US companies to do business with the Chinese tech giant. RT America's Manila Chan chats with investigative journalist Ben Swann, who says no evidence exists for the Trump administration's claim. #RTAmerica #InQuestionRT #QuestionMore


    US Of Zion , 2 days ago

    What US bans I will buy. Huawei has profited from Trump's tweets. 😂😂😂

    riva2003 , 2 days ago

    National emergency against one single company? What a promotion for HUAWEI! They must have paid US government a looooot of money! LOOOOOL

    E Walker , 2 days ago (edited)

    U.S. cannot spy via Chinese made technology products. That is the problem. When did competition against American technology get to be a national security threat? It is about creating a monopoly of only certain products in America. I hope American companies fight back. Prices in American stores have already started to rise. Monopolies mean high prices.

    BTV-Channel , 2 days ago div

    In the age of technology...any country who doesn't SPY on other countries or their own citizens is LYING thru their teeth! USA is NO DIFFERENT than CHINA.....they both are rogue nations, competing for the same thing, TECHNOLOGY LEADERSHIP! The problem is....HUAWEI just got the upper hand in 5G technology before the US can compete...so as such, the US threatens other countries with scare tactics until the US can develop and deploy 5G technology to compete with CHINA. It's all about MONEY and BUSINESS.

    OGASI , 2 days ago

    USA has dishonestly gathered more data on it's own civilians than it can access or understand in several lifetimes, they have the gaul to attack others without proof? UNREAL

    [May 18, 2019] Are there any articles on how dependent Apple and Boeing are on Chinese components?

    Boeing and Hollywood are two week stops that China can hit with impunity.
    Notable quotes:
    "... China has outspent the US on R&D since 2009 and now invests three times as much each year. ..."
    "... The issue with these chips highlights just how ridiculous the American position is. The chips referred to are Intel processors they use in servers and qualcomm (arm core) processors in cell phones. Funny thing is, these processors are not even made in the US, and their replacement isn't that much of an issue, not for a company with the resources Huawei possesses. ..."
    "... For government and other high security uses China has options like the MIPs based Loongson but that wouldn't work in the commercial environment so hopelessly devoted to x86 and windows. Probably the best solution would be to make an x86 analog like AMD markets, and it wouldn't take that long to do. ..."
    "... The United States attacked China's largest telecom equipment maker Huawei. If China decides to retaliate, it could target chip giants like Qualcomm and Broadcom, which rely heavily on it for revenue, or tech giant Apple, which depends on them for iPhone manufacturing. ..."
    "... Huawei's competitors Nokia and Ericsson would stand to win from the above ban as the United States and its allies would resort to them for 5G deployment. Nokia's and Ericsson's stocks rose more than 4% and 2% in early trading on May 16. . . here ..."
    "... Chip fab is the only remaining significant technological lead that America retains anymore, but the raw engineering brainpower behind that industry in the US is mostly imported from China anyway. The Chinese have no shortage of brilliant engineers, they just have not really had the need to do without Intel and AMD before. Now they do. ..."
    "... Within a year or so China will be producing chips as good as America's. Another year after that and America will be eclipsed in that industry. No longer will people be looking for "Intel Inside!" stickers on products but rather "Huawei Inside!" . ..."
    "... What doesn't seem to be clear, or else ignored/excused here -- China is today just as globalist as the US and in fact the multinational corporations in control of both countries are inextricably linked, especially in the high tech sector currently under the intense MoA thread microscope. ..."
    "... By our standards exploitation of workers in China is a grim picture , which compares with the grim blue collar conditions in the US, the equal and opposite result of the globalist equation wrt offshoring factory jobs endemic to capitalist production. ..."
    "... MoA China "experts" should study the reality of globalization after removing the rose colored glasses if you wish to be considered analysts instead of merely wishful thinkers/cheerleaders of groupthink delusion. ..."
    May 18, 2019 | www.moonofalabama.org

    S , May 18, 2019 8:47:15 AM | link

    @William Gruff #75: China is already producing world-class ARM chips. HiSilicon 's latest Kirin processors are on par with Qualcomm's Snapdragon and Samsung's Exynos processors. Apple's A-series is ahead of them all, but what does it matter if Apple's rising prices and falling quality are going to kill Apple anyway?

    Schmoe , May 17, 2019 6:45:23 PM | link

    Per Reuters, Huawei spends $11b on US components, and its ability to withstand this hit will vary by segment: "Huawei being unable to manufacture network servers, for example, because they can't get key U.S. components would mean they also stop buying parts from other countries altogether," said an executive at a Huawei chip supplier.

    "They can relatively better manage component sourcing for mobile phones because they have their own component businesses for smartphones. But server and network, it's a different story," the executive said.

    Are there any articles on how dependent Apple and Boeing are on Chinese components? This strategy seems incredibly short-sighted.

    Godfree Roberts , May 17, 2019 7:30:34 PM | link
    China has outspent the US on R&D since 2009 and now invests three times as much each year. That's why it's ahead technologically and scientifically.

    By 2028, if current ratios hold, China will also outspend the US on defense. Won't that be interesting?

    oglalla , May 17, 2019 7:34:09 PM | link
    Remember the "Asian pivot"? Did Huawei and other critical tech companies start making independent chips back then? Or before? When were the tariffs planned? Speculation, anyone?
    Indrid Cold , May 17, 2019 8:15:00 PM | link
    The issue with these chips highlights just how ridiculous the American position is. The chips referred to are Intel processors they use in servers and qualcomm (arm core) processors in cell phones. Funny thing is, these processors are not even made in the US, and their replacement isn't that much of an issue, not for a company with the resources Huawei possesses.

    Huawei already has its own arm based soc's it uses in it's high end phones and they can replace processors in it's low end phones with lesser versions of these.

    The Intel processors will be tougher to do for the commercial market because of software compatibility issues.

    For government and other high security uses China has options like the MIPs based Loongson but that wouldn't work in the commercial environment so hopelessly devoted to x86 and windows. Probably the best solution would be to make an x86 analog like AMD markets, and it wouldn't take that long to do.

    Don Bacon , May 17, 2019 10:59:03 PM | link
    from Market Realist. . .

    The United States attacked China's largest telecom equipment maker Huawei. If China decides to retaliate, it could target chip giants like Qualcomm and Broadcom, which rely heavily on it for revenue, or tech giant Apple, which depends on them for iPhone manufacturing.

    Huawei uses Qualcomm's modems in its high-end smartphones and has been in settlement talks with the chip supplier over a licensing dispute. Tensions between the United States and Huawei could delay this licensing settlement, sending Qualcomm's stock down 4.4% on May 16.

    Huawei's competitors Nokia and Ericsson would stand to win from the above ban as the United States and its allies would resort to them for 5G deployment. Nokia's and Ericsson's stocks rose more than 4% and 2% in early trading on May 16. . . here

    William Gruff , May 18, 2019 8:11:03 AM | link
    "Soon U.S. chip companies will have lost all their sales to the second largest smartphone producer of the world. That loss will not be just temporarily, it will become permanent." --b

    This is a crucial and important development. So long as China is just developing their domestic chip designs as an academic exercise they will forever trail behind the market leaders by at least one technological iteration. Why try so hard with chip designs that will only ever just be used in college degree theses papers and proof of concept models? Real innovation comes from scratching an itch; from fulfilling an actual need. Chip fab is the only remaining significant technological lead that America retains anymore, but the raw engineering brainpower behind that industry in the US is mostly imported from China anyway. The Chinese have no shortage of brilliant engineers, they just have not really had the need to do without Intel and AMD before. Now they do.

    In the short term the transition will be painful for China. The first few iterations of their replacement chip designs will be buggy and not have the features of chips they could have bought for cheaper from the US. They will also have problems ramping up capacity to meet their needs. Typical growing pains, in other words. In the long term, though, this will be seen as the point at which the end started for America's chip tech dominance. Within a year or so China will be producing chips as good as America's. Another year after that and America will be eclipsed in that industry. No longer will people be looking for "Intel Inside!" stickers on products but rather "Huawei Inside!" .

    donkeytale , May 18, 2019 9:57:42 AM | link
    Isnt it clear the US is globalist? Uhhm, well, yes, it's only been clear for the prior 75 years at least. In fact Lenin laid it all out during WWI so one could say it's been clear for 100 years.

    What doesn't seem to be clear, or else ignored/excused here -- China is today just as globalist as the US and in fact the multinational corporations in control of both countries are inextricably linked, especially in the high tech sector currently under the intense MoA thread microscope.

    Why aren't Huawei making making more smartphone chips in production? Because so many Chinese component manufacturers are still heavily invested in churning out product for Apple. These companies employ millions in "relatively high paying" factory jobs and account for a large slice of Chinese export income and stock market capitalization. These corporate oligarchs supported by the Chinese government retain a vested interest in the status quo.

    This is not to minimize Huawei or Chinese growing ability to compete at the design and innovation level as well as production, it is simply rightsizing the perspective to fit the reality. Huawei production is growing worldwide but this doesn't mean Apple or Samsung will evaporate or fall by the wayside and the Chinese need Apple and its markets too . In fact, Huawei is now willing for the first time to sell microchips to third party cell phone producers including Apple. Successful capitalist growth for China depends on increasing production into new products, technologies and markets not replacing current platforms with new. The product cycle will take care of itself in time anyway.

    By our standards exploitation of workers in China is a grim picture , which compares with the grim blue collar conditions in the US, the equal and opposite result of the globalist equation wrt offshoring factory jobs endemic to capitalist production.

    China is still in the industrial growth phase of its capitalist development, although beginning to transition to the higher phase for sure. Of course.

    MoA China "experts" should study the reality of globalization after removing the rose colored glasses if you wish to be considered analysts instead of merely wishful thinkers/cheerleaders of groupthink delusion.

    [May 18, 2019] Trump might get into deeper problem with China that he anticipated: if China assume that US is not desirable partner then can replicate many of key US technological areas and deprive US companies of revenue.

    Trump calculation is probably that neoliberalism in China already corrupted Communist Party enough for US being able to destabilize the country buy depriving it of export revenue. And it is true that influence neoliberal Fifth column in china exists and can compete with Communist Party for power. If Trump timing is correct China will be crushed. If this in incorrect the USA might be crushed. This is a very high stake game as Trump burn bridges way too easily (being reckless and arrogant all his life). Bulling as a negotiating tactics might be OK for New York real estate market is not that good in negotiating with countries such as China.
    Both countries are neoliberal countries but Chinese have more flexibility as remnants of Communist Party control remain in place. But the same remnants are also a bog danger, as China might find itself in the position of the USSR when the US crushed oil price and deprived it of much of its export revenue. In this case Communist Party will be blamed for social disruptions and might lose power due tot he power of Chine Fifth column of nouveau riche like happened in the USSR (opposition was supported by huge cash injections from the USA). I hope they study the USSR experience very carefully and will not repeat Gorbachov mistakes (although it is difficult, as it is very difficult to find a more stupid politician then Gorbachov, unless we assume that he was a traitor). Also the level of nationalism in China is much higher and that might help. In any case this uncharted territory for both China and the USA.
    The Trump administration seems to have the illusion that if you raise the stakes high enough, other countries will cave to US demands. There might also be an element of creating foreign adversary in order to unite the domestic front. If Chinese will hold their position tight despite the pain, Trump might lose the election in 2020 as he will be unable to protect the economy for more then a year and the first signs of reception nullify his changes, as he will be blames for it.
    Notable quotes:
    "... This article titled 'Face' by Walrus over at SST is well worth a read alongside b's piece. https://turcopolier.typepad.com/sic_semper_tyrannis/2019/05/face-by-walrus.html ..."
    "... Both these articles give a very clear picture of what the drunken louts 'Team Trump' are up against in their so called trade war. Very much like a drunken spectator climbing into the ring thinking he can take on a professional boxer. ..."
    "... The US attack on China did not start with Trump. This is what Obama's military "Pivot to Asia" was about, as was the TPP, which explicitly was designed to develop an economic alliance that left China out. Capitalist trade wars are also not new, as are hot wars. They are part of capitalism. ..."
    "... "Intellectual property" is a laughable assertion, an audacious attempt by the US to corner all human advances and claim them as the property of US capitalists, to be only used for their profits. As if! ..."
    "... What an appalling ruling elite in the USA. Blamers and punishers. Never take any responsibility for their murderous acts ..."
    "... The U.S. talks about pressuring China until they give in. China talks about a solution that respects the dignity of each party. ..."
    "... I had the sudden realisation that US politics is essentially monarchist in its nature, for all the complicated legal and constitutional structures that have been built around it over the past 240+ years. US politics and culture are fixated on one individual with extreme powers; the superhero obsession in Hollywood is one symptom of that. ..."
    "... In a way the US now resembles the Ottoman empire during that empire's Sultanate of Women period (late 1500s to mid-1700s) when sultans' power was dominated by their mothers, viziers and sometimes the janissaries who became a hereditary class during that period. ..."
    "... Idolatry is universal. People always gravitate towards Alpha personalities. ..."
    "... In looking into US culture and why it gives rise the type of leadership it has, I think it may be the belief in exceptionalism. Exceptionalism may also carry with it the belief that all other peoples want to be like them and all they (Americans) have to do is free those peoples from the nasty dictators ruling over them. ..."
    "... Patrick Armstrong in one of his articles has said that in his dealings with US officials as Canadian ambassador or diplomat, is that American officials genuinely believed that all they had to do was overthrow the evil dictator and the people would welcome Americans or willingly join the US system. ..."
    "... But, at the same time, on another level, Americans understand that the president is a puppet and must obey orders, or have his brains blown out in bright daylight, in the town square. ..."
    "... We hold both these views simultaneously, hence, as Orwell called it, Doublethink. ..."
    "... The British court said, no patent, no copyright and no monopoly can last longer than 7 years. that was 1787-89, and it explains the for a short time clause in the USA constitution. ..."
    "... I don't think the US sees the world's nations as commanded by their senior politician. Far from it, but to keep the US public locked in a child's mentality, the govt and its MSM present every political event/action/reaction as between personalities. Can't have reason and logic breaking out among the minions can we? ..."
    "... China's "competitive advantages" are too big for a confederation of micro-countries in the Pacific to overcome. ..."
    "... b said;" the U.S. economic system is based on greed and not on the welfare of its citizens." Bingo! Jrabbit @ 52 said;"US foreign policy has been remarkably consistent for over 20 years." Maybe the last 100 yrs.? Demonize countries people and rulers, and take their stuff, but why not? We are, don't ya' know, the exceptional nation, doing gods work. Manifest Destiny, isn't it great? ..."
    "... Smacking down China is a strategic priority for the Deep State. ..."
    "... the neocons in the US believes it is now or never to defend the USA unique position as world power. They believe, that if they don't fight now, they will have lost. I say, they already have. ..."
    "... Trust the UnitedSnake to blame the Chinese for reneging on an agreement ! Fact is, Trump's team Add in last minute conditions that are totally unacceptable to China. Chinese commentators are fuming at the audacity of the demands. 'WTF, Do they think we'r their gawd damned 51st state ?' ..."
    "... Typical UnitedSnake's 'negotiation' tactics, designed to fail ! Thats how Clinton justity his bombing of ex Yugo, by blaming Belgrade for the breakdown of negotiation ,to justify its 78 days of aerial arsons against Yugo. ..."
    May 18, 2019 | www.moonofalabama.org

    jared , May 17, 2019 4:55:50 PM | link

    This article titled 'Face' by Walrus over at SST is well worth a read alongside b's piece. https://turcopolier.typepad.com/sic_semper_tyrannis/2019/05/face-by-walrus.html

    Also this Sputnik Article https://sputniknews.com/analysis/201905161075055767-china-us-trade-war/

    Both these articles give a very clear picture of what the drunken louts 'Team Trump' are up against in their so called trade war. Very much like a drunken spectator climbing into the ring thinking he can take on a professional boxer.

    @ Peter AU 1 | May 17, 2019 4:33:54 PM | 1 5 Trump

    Trump wants improved trade conditions for improved economic climate in the U.S. But there are others in the admin who want something else.

    But still: "backup chips it has independently developed" That's a good one Mr Moon.

    wagelaborer , May 17, 2019 5:05:18 PM | link

    The US attack on China did not start with Trump. This is what Obama's military "Pivot to Asia" was about, as was the TPP, which explicitly was designed to develop an economic alliance that left China out. Capitalist trade wars are also not new, as are hot wars. They are part of capitalism.

    "Intellectual property" is a laughable assertion, an audacious attempt by the US to corner all human advances and claim them as the property of US capitalists, to be only used for their profits. As if!

    https://wagelaborer.blogspot.com/2019/01/intellectual-property-and-war-on-china.html

    uncle tungsten , May 17, 2019 5:12:28 PM | link
    What an appalling ruling elite in the USA. Blamers and punishers. Never take any responsibility for their murderous acts. Rise up people, these are dangerous, stupid leaders and elites.
    dh-mtl , May 17, 2019 5:13:10 PM | link
    B says: Whatever face is at the top is only representing the layers below.

    Yes, this is the case when complex governmental systems are functioning properly. In this case power is distributed throughout the system, based on the role each individual within the system. People must have a collaborative culture for complex systems to function properly.

    People of an authoritarian nature hate complex systems and distributed power, as such systems limit the freedom of action of the authoritarian leader. The corollary to this is that systems must be kept simple to accommodate authoritarian leaders. And simple systems are much less powerful and effective than complex systems.

    My observation is that, in the U.S., authoritarianism is the dominant culture, as opposed to a collaborative culture of the Chinese that is implied by B's comment.

    Indeed we see many signs in these negotiations that the U.S. is operating based on a culture of authoritarianism, whereas China is operating based on a culture of collaboration. Among the signs:

    1. The tendency that B. noted of Americans to assign all power to the leader. (This is not the first time, and in fact it is a common mistake of the U.S. and one of the reasons that their regime change efforts almost never achieve a result that is favorable for the U.S.)
    2. The U.S. talks about winning and losing. China talks equity.
    3. The U.S. talks about pressuring China until they give in. China talks about a solution that respects the dignity of each party.

    The principle behind negotiations for people of a collaborative culture is 'Win-Win or No-Deal'. For Authoritarians, Win-Win is a compromise, and compromise is the equivalent of a loss. My conclusion is that there is only a very low probability that the U.S. and China will successfully negotiate a trade deal. The cultures of the authoritarian Americans and the collaborative Chinese are too divergent. China will only accept Win-Win and the U.S. cannot accept Win-Win.

    Winston2 , May 17, 2019 5:18:30 PM | link
    Classic US empire strategy. Build up a supplier and when they start to be serious a competitor take them down. Asian Tiger crisis,forcing occupied Japan into the Plaza Accord etc. They left it too long with China, way too long. China has not recycled its trade dollars surplus into USTs since 2014. No replacement suppliers like Vietnam or Indonesia etc will do either, no more vendor finance for the US.

    It will have to live within its means, no wonder the neocohens are going insane. We are watching the death of the $ as GRC first hand.

    uncle tungsten , May 17, 2019 5:19:11 PM | link
    @jared | May 17, 2019 4:55:50 PM | 18

    NO jared, Trump is in charge, fully responsible and yet totally irresponsible. He hires and fires, he barks the orders, Trump is not captive. You may desperately wish to believe that but NO, Trump wants it like this and NO dissent.

    This is Henry Kissinger's plan implemented by Trump. A war criminal implementing a sociopath war criminal's plan. Trump is a killer and an oligarchs stooge and he like the rewards.

    See the fabulous Aaron Mate discussion previously linked in the last thread.

    james , May 17, 2019 5:32:57 PM | link
    thanks b... ditto peter au recommendation @16 on the article from walrus on face..
    Jen , May 17, 2019 5:47:54 PM | link
    I'd be curious to know what other MoA barflies think of the US tendency to personalize other countries' governments and political systems and reduce them all to monarchies of one sort or another, and what this says about the American psychology generally. So much of the US slather and accusations against Russia and China and what those nations are supposedly doing look like psychological projection of the US' own sins and malevolent behaviour.

    I was in hospital nearly 20 years ago for a major operation and some of my recuperation there was spent watching a few old "Star Trek: Next Generation" episodes. Watching those shows, I was struck by how much "power" the Star Trek captain Jean-Luc Picard appeared to wield. Every one of his subordinates deferred to his decisions and very few challenged him.

    I know this is an old TV show with scripts that emphasise individual action over collective action and delineating a whole culture on board the Starship fleet (this is a long time before "Game of Thrones") but I had the sudden realisation that US politics is essentially monarchist in its nature, for all the complicated legal and constitutional structures that have been built around it over the past 240+ years. US politics and culture are fixated on one individual with extreme powers; the superhero obsession in Hollywood is one symptom of that.

    In a way the US now resembles the Ottoman empire during that empire's Sultanate of Women period (late 1500s to mid-1700s) when sultans' power was dominated by their mothers, viziers and sometimes the janissaries who became a hereditary class during that period.

    Don Bacon , May 17, 2019 5:55:00 PM | link
    @ dh-mtl 21
    You provided an excellent analysis of two very different kinds of people, westerners and Asians (Chinese). Americans who believe that Chinese are pretty much like them, and respond to people, to pressures and and to situations in the same way, are badly mistaken.

    I would add another: Westerners want instant results and quick profits whereas Chinese take the long view. Heck, they've been around for five thousand years so why not.

    Lochearn , May 17, 2019 5:56:05 PM | link
    I'm glad you raise the issue of increased prices for US consumers, b. I have been looking in vain for a mention of this even in alternative media. Nobody appears to be talking about it.

    If I can go off track for a moment the events surrounding Boeing are highly significant and a parallel to what is happening generally in the US. Here is a something I wrote for naked capitalism but did not send - Yves is too fierce and I don't trust her. A bit like a feminine Colonel what's his name Laing...

    Because of the prestige of Boeing Wall Street left its dimantling until quite late - 1997. GE and Ford had already produced their versions of the 737 Max in the 1960s with the Corvair and the Pinto respectively as finance people started to take over the running of US companies. There is something very sad in watching a once magnificent company reduced by bankers to a shadow of its former self.

    dh , May 17, 2019 5:59:06 PM | link
    There has been a trade imbalance for quite a while but it didn't seem to matter much. The Chinese raised their standard of living, Americans got cheap stuff, surplus dollars went into treasuries to fund the deficit. It all worked pretty well until Trump and MAGA. Somehow he thinks he'll bring the jobs back but no Americans are going to make sneakers and circuit boards for $2 an hour.
    Ian , May 17, 2019 6:21:30 PM | link
    @Jen | May 17, 2019 5:47:54 PM | 25:

    Idolatry is universal. People always gravitate towards Alpha personalities.

    dh | May 17, 2019 5:59:06 PM | 28:

    Trump knows those manufacturing jobs aren't coming back and automation is the future. He's just parroting what his base wants to hear for votes.

    Peter AU 1 , May 17, 2019 6:23:01 PM | link
    Jen 25

    I have just replied to Karlof1 in I think the previous thread and I link into this. In looking into US culture and why it gives rise the type of leadership it has, I think it may be the belief in exceptionalism. Exceptionalism may also carry with it the belief that all other peoples want to be like them and all they (Americans) have to do is free those peoples from the nasty dictators ruling over them.

    Patrick Armstrong in one of his articles has said that in his dealings with US officials as Canadian ambassador or diplomat, is that American officials genuinely believed that all they had to do was overthrow the evil dictator and the people would welcome Americans or willingly join the US system.

    OutOfThinAir , May 17, 2019 6:29:02 PM | link
    All the economic momentum is in Eurasia, centering on China, India, and Russia. China is spearheading this drive and re-assuming its historical status as the richest land in the world. Instead of resisting, Washington should be working with projects like the BRI that help enrich everyone. (Indeed, why doesn't Washington announce a BRI for North/South America, perhaps a Yellow Brick Road? But that's an aside...)

    And concerns about Chinese spying through their companies should be equaled with internal reflection about the practice in the United States. Perhaps it would be wise for both countries to develop and practice international standards that respect human rights in an Everything's Connected world.

    Given how the US and China frequently treat "different" people with disdain, that's a lot to ask. But no country or people is spotless regarding abusing human rights and some wisdom with power would be welcome from both governments.

    wagelaborer , May 17, 2019 6:33:45 PM | link
    Jen @25. Americans are good at Doublethink.

    You point out that our entertainment industry focuses its plots on strong leaders, and Good Guys vs Bad Guys, and we definitely internalize that, especially when our overlords want to demonize another country, and use our entertainment-induced perspective as a shortcut.

    They tell us that the leader of the targeted country is a Bad Guy and we must kill the people in order to save them. And Americans nod and comply. Except for the 5% that prefers peace, and they argue that the leader is not a Bad Guy, so we shouldn't kill the people to save them.
    No American ever thinks to argue international law or basic morality, we just argue about the plot lines.

    But, at the same time, on another level, Americans understand that the president is a puppet and must obey orders, or have his brains blown out in bright daylight, in the town square.

    We hold both these views simultaneously, hence, as Orwell called it, Doublethink.

    snake , May 17, 2019 6:37:51 PM | link
    China has succeeded because it does not honor copyright and patent monopolies. Western civilization is failing because it imposes the feudal monopoly by rule of law system.. The state will make sure a few fat cats are lords and the masses are their slaves.
    ---

    The investment and salary classes have been screwing me since I was born. Now its time for all of us to feel the pain. And create a world that can benefit all of us. https://dedona.wordpress.com/2016/11/10/donald-trump-and-the-politics-of-resentment-john-michael-greer/ so @ 8 <== I agree..

    ---

    It is almost asking the change of China's political system." <= no its not, the struggle today is freedom, human rights and the right to self determination not socialism vs capitalism.. it the struggle today is capitalism vs monopolism.. because monopolism aims to make every single human being alive its slave to a very few monopoly powered corporate giants.. China is a clear example of what can be if the masses are allowed to compete without the shackles of copyrights, patents and other thin air monopolies.

    Some aspects of China's trade behavior can and should be criticized.

    Why? Because of that "intellectual property" stuff? Japan basically built itself from the ground up in the post-war through allowed and unallowed intellectual property theft. Canon and Nikon, for example, essentially fac-similed Leica during that period; after the transition to digital, they erased their theft past, but it doesn't change the objective truth both wouldn't exist without stealing technology from a defeated country (Germany). It did the same with missile reentrance technology it stole from the USSR after the Cold War.

    < Technology is a product of the human mind.. copyright and patents are thefts of the products of the human mind.. and human mind assets do not belong to anyone, to any country.. Instead, copyright and patents (intellectual property) are and should be in the public domain (but the scum that write the laws have created from thin air; rights which do not exist, and given the rights they fabricated to their feudal lords and the corporations owned by such lords. So the lawmaking scum have made it possible for a few (feudal lords) to establish and maintain a monopoly in the good life, over the masses in the world. .. Just as in the in England, France and Switzerland, where only the rich, corrupt politicians, and criminal few hung out and traded copyright and patent monopolies in the coffee houses, (much like stocks and bonds are traded today, monopoly trading was a game between fat cats (today's the fat cats are wall street barons), ..monopolies allow rich and wealth to support their royal life styles at the price of enslaving the masses to poverty. Luckily a court in England, threaten by an angry crowd of the masses, denied the wealthy their perpetual lifetime patents and copyright demands, no longer could the fat cats squeeze ownership of an intellectual creation from its creator, convert it to intangible property, and use the intellectual property to monopolize the world.

    The British court said, no patent, no copyright and no monopoly can last longer than 7 years. that was 1787-89, and it explains the for a short time clause in the USA constitution.

    frances , May 17, 2019 6:42:04 PM | link
    I don't think the US sees the world's nations as commanded by their senior politician. Far from it, but to keep the US public locked in a child's mentality, the govt and its MSM present every political event/action/reaction as between personalities. Can't have reason and logic breaking out among the minions can we?

    As for Trump being in charge, I rather doubt it, no US president has been "in charge" of any thing except possibly what is for lunch since Washington. Too many policies Trump began, such as negotiations with NK, have been trashed by his "teams" who I believe are actually his minders put in place by the Deep State.

    Is Trump a great guy? A NY developer by their very nature is not a great guy. But I do think he wants to be seen as a great president. To do that he has to pull off some deals that will be remembered which is why he wanted the deal with NK, that Pompeo blew up.

    I also think that the govt is preparing for the time when the dollar is no longer the reserve currency. And to do that you need to pull manufacturing back from abroad (from China), seize critical assets (from Venezuela),break any and all treaties that require you to spend money you won't have (making NATO (pay as you go).

    All things the govt is doing, admittedly with the most horrific management team since Taft's. But they are moving on all fronts to circle the wagons of US commerce.

    They know what is coming, some of them may see war as the way to bilk a few more trillions out of the treasury, but I don't think the military will let them. For they know that if they go up against a nation that Russia and China support and botch it, that R&C will go for the throat and that, more so than the currency crash would be the end of the US.

    These moves we see are very serious because the end game is for the continued existence (or death)of the US. And many of these tactical moves are very high risk because they hasten the end of the dollar. I give the dollar five years more, tops. Then it will be just one in a basket of currencies until the yuan makes its way to the top.

    And where that strange UN Agenda 21 fits in this I don't know, its plan for the US is for drastically reduced population (70% loss, from what?)the remaining population in mega cities and truly vast areas of no go set aside for the "environment." It reads like a National Parks program on crack with a side of Hunger Games.

    The next five years are going to be really critical and I personally think the US will only make it by the skin of its teeth.

    Peter AU 1 , May 17, 2019 6:54:13 PM | link
    @ Jen. Another thought. The era in which the current state of America was conceived. British colonies in a war of separation or independence against the British. Europe and Britain at that time mostly ruled by hereditary monarchs nobles and lords ect.

    Americans which I take it at that time would have been mostly British ancestry had done away with hereditary monarchs and so forth. It would have been somewhat exceptional at the time. In the targeting of the leader of a nation as the source of all evil, I wonder if that relates back to doing away with hereditary leadership especially monarch.

    the grand chessboard. checkmate the king.

    Don Bacon , May 17, 2019 6:55:25 PM | link
    President Trump has declared a national emergency due a threat to the US from "the ability of foreign adversaries to create and exploit vulnerabilities in information and communications technology or services, with potentially catastrophic effects, and thereby constitutes an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States," so various actions and prohibitions have been stipulated here .
    Lord H , May 17, 2019 7:07:00 PM | link
    I particularly like this line: "where the propaganda weakens and journalism sneaks in"
    jared , May 17, 2019 7:37:06 PM | link
    UncleT

    I dont mean to make excuses for Trump.
    It all happens on his watch.

    We will have other/better option soon - hopefully not too late.

    Michael Droy , May 17, 2019 8:09:49 PM | link
    I think war reporting rules are in place with China, and Trade war has started. Every month that passes without a crisis is a success for China right now as it over takes US in GDP, tech, and trade links.

    Key issues are bringing Europe in - the Huawei ban extended to Europe is battlefield #1, Northstream (gas link to Russia) is #2.

    First get Europe on board, the US can up things a lot further. If Trump gets this right, he can delay outright defeat by China under well beyond his 8 years are up. (Bush or Obama early on could have won, or could have found a peaceful solution).

    lysias , May 17, 2019 8:15:14 PM | link
    A president doesn't have to obey the orders of the powers that be just because they threaten to kill him otherwise. A brave president would defy them to do their worst. If they went ahead and killed him, he would still have accomplished something important. By exposing the nature of the system, he would have robbed it of its legitimacy and brought a revolution much closer.
    Jackrabbit , May 17, 2019 8:32:10 PM | link
    You've all been trained very well to ignore the class warfare. China's "peaceful rise" was convenient when it enriched the Western elite.

    But when China makes a play for equal footing, the must be smacked down. In each case (rise, smack-down) ordinary people (like yourselves) get f*cked. Kissinger's NWO? It's for the children.... No, not YOUR children. Welcome to the rabbithole.

    bevin , May 17, 2019 8:32:54 PM | link
    vk@13

    Best example of a country stealing foreign inventions and protecting its 'uneconomical' industries with tariffs is the USA. It was notorious that in the C19th American publishers pirated authors and musicians from Europe, particularly of course from Britain where the intellectual properties of Dickens and his contemporaries laid the basis for many an American publishing fortune.

    Among the primary victims were American authors who couldn't compete against stolen imports.

    dltravers , May 17, 2019 8:55:12 PM | link
    I am not so sure the conclusions of the article are correct. Tariffs on Chinese factories will force production to other countries in the area like Vietnam where costs are not going to be much higher than China.

    Granted, the US may be pissed off that Huawei is placing back doors in their systems but I suspect that they are only copying what the US has done for years with US companies like Microsoft.

    My daughter managed 5 factories located in China of a clothing manufacture based in the US some years ago. She said there was constant chaos as the workers were continually on strike. Bad air, dangerous machines, poor wages. few bathrooms, bad water, childcare is chaining you child to a fence for the day, and the like. Her boss flew to China and asked for the cheapest costs possible. They showed him a factory full of little children cranking out production. He left crying his eyes out. He was a cold hearted bastard but even that was too much for him to see.

    I viewed first hand the destruction trade agreements like NAFTA caused to good union wages and benefits in the US. Hell, that is what got Trump elected. It is tough to watch your children go into the same profession and make 50% less in wages and fringes 30 years later.

    Intellectual property and patents? No so sure about that, the views here are new to me. I always supported them but I guess I need to dig deeper on that one.

    In the net I think China is the loser, fewer jobs, higher food costs, their markets are down 30%, ours are peaking and are seen as a safe haven for money. Export numbers for China are dropping as is the trade balance.

    At this point it is not a trade war but a re balancing of markets IMHO. If it was a real trade war things would be far worse. Middle supplier countries will be hurt, US farmers, some markets win some lose. If it was business as usual then it would be business as usual. Trump is stirring the pot and what the endgame is is anyone's guess. Did anyone really believe China would just bend over and accept any demands from the US?

    All that being said China can easily wait it out and hope Trump loses and the policy is reversed which I am sure his policies will be reversed if anyone else gets elected.

    Zachary Smith , May 17, 2019 9:19:41 PM | link
    @ jared 4:47:32 PM #17

    Your link about Boeing is a good one. Today at Naked Capitalism was a story about a possible 'payback' link between Huawei and Boeing. China has the option of causing a great deal of pain to both the US and Boeing in retaliation.

    They could declare the recertified 737-MAX to be unsafe, so much so they're cancelling all orders and forbidding any landings in or overflights of China. If Canada hadn't screwed up so badly, the local Bombardier airplane might have been substituted for the 737. But Canada did goof in a major way.

    Cyril , May 17, 2019 9:24:52 PM | link
    @ponderer | May 17, 2019 4:27:02 PM | 15

    There is no way that the US could subsidize the growth of a larger population base forever.

    China sends vast amounts of manufactured goods to the United States; the US pays for all this with dollars it can effortlessly print. So who is subsidizing whom?

    Cyril , May 17, 2019 9:26:38 PM | link
    A minor thing compared to the trade war, but possibly of interest to sports fans.

    The National Basketball Association (NBA) has been very popular in China, but its profitable Chinese operations may become a casualty of the trade war. Presumably it fears this: the NBA is looking to hire someone who can talk to the Chinese government :

    The National Basketball Association Inc. is hiring its first head of government and public affairs in China as it seeks to protect its most important international market at a time of high tension in the U.S.-China relationship.
    Jackrabbit , May 17, 2019 9:35:47 PM | link
    What I don't like about Chas Freeman's article is his tone-deafness. He has been around government enough to know better. Smacking down China is a strategic priority for the Deep State. But Chas says:
    There is no longer an orderly policy process in Washington to coordinate, moderate, or control policy formulation or implementation. Instead, a populist president has effectively declared open season on China.
    It's a bit disturbing to see people here read Kissinger's 2014 Op-Ed (finally) but say nothing about Chas Freeman's assertion that it's all made up by a "populist" President.

    <> <> <> <> <> <> <>

    If the above hurt your feeling please feel free to retreat to your happy place. We'd all be better off.

    Don Bacon , May 17, 2019 11:06:15 PM | link
    Many trade war articles here
    dltravers , May 17, 2019 11:13:06 PM | link
    Jackrabbit at @ 58

    Not happy, just learned to live with it. I think I get your point. The policy really means little, the underlying issues will never change.
    Been in the rabbit hole for a really long time. If more people jump in maybe things will really start to change.

    vk , May 18, 2019 12:01:02 AM | link
    @ Posted by: dltravers | May 17, 2019 8:55:12 PM | 53
    I am not so sure the conclusions of the article are correct. Tariffs on Chinese factories will force production to other countries in the area like Vietnam where costs are not going to be much higher than China.

    First of all, this is not a new phenomenon: low wages, low technology industries are already being transferred to India and SE-Asia. The Chinese know this and there are innumerous articles on the internet you can find about it.

    But even if this process accelerates, that won't solve the manufacturing problem of the USA: it will continue to be abroad. Besides, China's "competitive advantages" are too big for a confederation of micro-countries in the Pacific to overcome. It has a socialist economy (centrally planified economy, under the hegemony of the working class); it has 1.5 billion people that will only peak in 2030; it is decades ahead in built infrastructure; it has a huge scale economy advantage (e.g. infrastructure projects that are required to reach a certain desired productive level, which are profitable in China, may not be profitable in e.g. Malaysia simply because it is too small); its financial sector is not dominant over production. But then, I repeat: even if the USA nukes China, manufacturing still won't go back to American soil.

    America's problem is a secular fall of its profit rates, not manufacturing capacity: it can import whatever and how much products it needs simply because it can print world money (Dollar system).

    ben , May 18, 2019 12:18:53 AM | link
    b said;" the U.S. economic system is based on greed and not on the welfare of its citizens." Bingo! Jrabbit @ 52 said;"US foreign policy has been remarkably consistent for over 20 years." Maybe the last 100 yrs.? Demonize countries people and rulers, and take their stuff, but why not? We are, don't ya' know, the exceptional nation, doing gods work. Manifest Destiny, isn't it great?
    Zachary Smith , May 18, 2019 1:31:30 AM | link
    I know next to nothing about the "Huawei" business, so a new article about it is something to grab at. Pretty cut and dried, huh? Hauwei is pure evil, and no 'ifs' or 'buts' about it.

    But who is this guy. A couple of quick searches turned up some more of his output.

    'It's now or never': The untold story of the dramatic, Canadian-led rescue of Syria's White Helmets

    How Israel became a defender of the Syrian people

    Just another neocon hack peddling BS, so I'm back to square one.

    Ian , May 18, 2019 4:30:33 AM | link
    dltravers | May 17, 2019 8:55:12 PM | 54:

    China will wait it out until Trump is out of office. The Chinese leadership is pretty smart and had at least three years to prepare for the worst case scenario. Once Chinese industries as a whole follow Huawei's footsteps (i.e. Plan B), there will be no turning back. They'll set off Plan B once they see Trump winning 2020.

    dh | May 18, 2019 12:06:33 AM | 67:

    Ugh...I almost leap for joy until I read the URL.

    padre , May 18, 2019 5:06:23 AM | link
    Are we to asume from "Some aspects of China's trade behavior can and should be criticized" that the United States are shining example of trade (and all other) policies,all others to follow?
    S , May 18, 2019 6:02:26 AM | link
    @Indrid Cold #46:
    For government and other high security uses China has options like the mips based Loongson but that wouldn't work in the commercial environment so hopelessly devoted to x86 and windows. Probably the best solution would be to make an x86 analog like amd markets, and it wouldn't take that long to do.

    Chinese-Taiwanese joint venture Zhaoxin has been making x86 processors since 2013, based on VIA Technologies' x86 license. These processors are manufactured by Taiwanese TSMC, but may switch to Chinese SMIC once it launches its 14nm process later this year.

    William Gruff , May 18, 2019 7:43:24 AM | link
    "Whatever face is at the top is only representing the layers below." --b

    The truth of this is also why so many in America hate Trump so much. He is too perfect a reflection of what America truly stands for. Trump accurately represents America, from America's bloated, over-inflated sense of self-importance and worth to America's pussy-grabbing foreign policy. Trump-hate is really self-hate.

    Delusional American Russiagater Trump Derangement Syndrome victims will protest, but such people are incapable of taking a good hard look at themselves.

    Hmm... "delusional" and "American" are redundant adjectives here. I should be more careful with my writing style.

    snake , May 18, 2019 7:55:24 AM | link
    Mr. Gruff you have it almost correct, Americans and the USA are not one in the same and they never have been.
    I still don't think you guys get it.. The 7 article constitution of the USA apportions the power to rule between two branches and separates the masses from their personal political powers and their human rights. Its result is not a democracy, but a few people rule republic. 100% of the authority to rule (operate and make decisions) is vested in one person (Art. II, rule and decide: President w/VP backup), subject only to the powers distributed to the two bodied legislative structure ( Art. I, pass law and raise money: 450 house+100 senate persons). Critical to understand => one person makes all decisions, and directs the day to day government. Article III thru VII defines the judiciary and clarifies various situations. (525 popularly elected + 2 electoral college appointed <=paid governors) vs. 350,000,000 powerless governed persons entitled only to 3 votes/voter [Senator(1), House members(2)] and allowed one vote/voter for each President(1) and VP(1) <=but both Art. II persons are appointed by the electoral college).

    The USA is about delivering to the ownership of a very few, all of the assets, all of the power, and all of the services once possessed by the many. The demand for all of the possessions of the many, to be delivered to the few, has expanded over time from 13 colony America to earth and now space. No one but the few are entitled to anything and the USA and other governments are there to be sure of it. But how is 'total possession vested in the few' to be maintained? By rule of law!

    But what law would transfer everyone's possessions into the ownership of a few? Ah, the laws of monopoly.. so rule of law, from thin air , generates=> monopoly powers and rights of ownership.. Examples of laws that bear monopoly powers and that transfer ownership rights are copyright laws, patent laws, as they convert monopoly powers that once the many shared (via governments) now belong to the few. The transfer is called privatization. Oil is controlled for the benefit of the private few by ownership laws and right to produce contracts. All in all the function of t he USA has been to make a few very wealthy at the expense of the many.

    The trade issues, sanctions, wars, tariffs, race wars, oil wars, religious wars etc. are about which people are going to be the few. Until the form and function of governments are determined by the masses from the bottom, instead of by the few from the top, nothing will ever change. The masses will suffer or prosper according to which government is the winner.

    therevolutionwas , May 18, 2019 8:08:39 AM | link
    US factories moved to China because the US economy is based on greed?!! US government greed for the company's money maybe. US factories moved to China because it was cheaper to produce products there and then pay the expense to ship them all the way back. The US has one of the highest federal tax rates on earth, and add in high state taxes for an unacceptable situation. US fiat paper money is the base problem.
    Mark2 , May 18, 2019 8:24:01 AM | link
    William Gruff @ 72 & snake 71
    I was just about to say the very same thing ! Delusions of grandeur ! And now major self-harm systems ! But are these degenerates above the law ? They are after all genocidal mass murder's! String um up I say or shall we fry um ?
    Right now the brain dead American public are like something out of -- - - 'The invasion of the body snatchers ' film
    Joanna , May 18, 2019 9:30:24 AM | link
    @58, JackRabitt, Smacking down China is a strategic priority for the Deep State.

    the first time I got some type of glimpse of the average American Mind on China, as it filtered down from "the deep state" to the more fearfully ill-informed quarters of society no doubt, was in the post 9/11 universe. The person or persons pushing the meme, may have been a bit confused by all the conspiracy theories about 9/11 unfolding at the time.

    Anyway, Chinese troops he/she/they asserted readers were close to the Mexican border approaching, advancing swiftly.

    In hindsight, maybe accidentally, although I doubt, Trump combines the elements of that narrative perfectly. And it is not my intention to argue right or wrong here. But apparently down at the border there is this "invasion" on the other hand there's also the Yellow Peril.

    DontBelieveEitherPropaganda , May 18, 2019 9:58:41 AM | link
    Well, the chinese system of power has always been the thoughest to understand for any outsider. It has been this way, but in the last years it seems the so called age of information has lead to erode the curtains of this complex mechanism. At least for those who want to look behind those curtains, and not use them to project their propaganda.. ;)

    And it is a good sign that while Xi tired to establish himself in such a unique position of power like Mao, and openly tried to put himself into the historic succession of the old emperors (like Mao did too), that the will of the people and party still tips the scale of power. It means the chinese confucian tradition and its consequences for a ruler even today still matter. Even though they are anyway lost on someone who is not of Asian origin.

    What to westerners look like a dictator, is of a different nature as one can even imagine with western eyes. Every ruler has to strive for balance, for harmony, which in turns makes hearing of the peoples popular will be a necessity.

    Even though many Chinese say, they like any other people only strive for what they need most ;) (like harmony and compromise). Though many also say, that the chinese will always choose stability and security over freedom. And i guess that is what many from the western world dont get about China, and also about the Putinists. I say let them and every one else have their choice. Just like i say let the US do theirs, and reap what they seeded.

    For those able to read German check out the Books of Peter Scholl-Latour on China. The most telling and authorative books from a journalist who has reported first had for over 60 years, and has always defended and honored his own perspective; While the western so called reporters were trapt in their professional delusion of pro-NATO propaganda, and while the SDS praised the culture revolution as a democratic means, when whole china was terrorized and millions slaugtherd.

    Hard to walk that middle ground, while being attacked from ideological drones from both sides i guess..

    Anyway, the neocons in the US believes it is now or never to defend the USA unique position as world power. They believe, that if they don't fight now, they will have lost. I say, they already have.

    Short of pulling a Hitler on China, meaning a total annihilation of the Chinese people, there is nothing they can do. And even Bolton will have a hard time trying to push through a clear cut genocide ;)

    We will see China rise. Those who feared of this will see that china will not be half as bad as thought, and those who gloirfy china and put them into a good (vs bad US) black-wide scheme will learn of the faults of the Chinese power and its projection (Like its own believe of supremacy, of racism (a reason why china in the cold war was pretty unsuccessful in Africa, where most knew who deeply racist Chinese treated their fellows as workers, guest students,..).

    All in all, what we need is a true and functional global community of nations and people, where goverments truely work together to balance out the stronger world powers. And with the pressure of Chinas rise and its strugle with the US, we may finally have a better chance for this to at least partially succed. I hope.. ;) Or of course it nuclear winter time. We will see.

    daffyDuct , May 18, 2019 10:30:54 AM | link
    vk @ 13

    China now, Japan in the 1980s - it's "deja vu all over again!"

    "AFTER ITS DEFEAT in World War II, Japan was content to take foreign inventions -- the transistor, the laser, the videotape player -- and convert them into products that it could market around the world. Japan acquired much of its base of Western technology, most of it American, perfectly legally through licensing, careful study of scientific papers and patents, and imitation. But when the U.S. wasn't willing to share, some Japanese companies simply copied with little regard for patents and other intellectual property rights that the courts have only recently begun to define in many areas of high technology.

    The U.S., confident of its technical superiority, ''sold out to the Japanese,'' says G. Steven Burrill, head of the high-technology consulting group at Arthur Young, a Big Eight accounting firm. ''We let them share our brain.''

    Now, belatedly awake to the recognition that Japan has been eating their breakfast, lunch, dinner, and bedtime snack, American companies are stirring. IBM vs. Fujitsu over computer software, Honeywell vs. Minolta over automatic focusing, Corning Glass vs. Sumitomo Electric over fiber optics -- these are only the latest, best-publicized complaints that Japan has stolen American technology.

    Even as those legal battles are fought out, the copycat cliche is becoming obsolete. A series of studies financed by the U.S. government since 1984 warn that Japan has caught up with the U.S. or passed it in the development of integrated circuits, fiber optics, computer hardware engineering, and advanced materials like polymers. It is pressing hard in some areas of biotechnology, and lags primarily in computer software.

    Already there are signs that the Japanese, buoyed by their new prowess, have assumed the arrogance of the U.S. along with its technology."

    "A MEASURE of Japan's progress can be found in the number of patent filings in the U.S., Japan's most important export market. ..."

    "THE FACT that Americans now worry about their access to Japanese technology is an acknowledgment of Japan's new scientific competence. When the Japanese were known primarily as copycats, the flow of technology was essentially in one direction. It was also cheap. Aaron Gellman, president of a consulting firm, says that for years U.S. firms licensed technology to the Japanese without asking for a grant-back, the right to use any improvements they made. Says Gellman: ''This was very arrogant and implied that no one could improve on our technology.''"

    "U.S. scientists and companies have failed to take advantage of opportunities to tap Japanese academic research. ''What's wrong here is pure laziness,'' says Martin Anderson, an analyst with the MAC Group, a consulting firm in Cambridge, Massachusetts."

    http://archive.fortune.com/magazines/fortune/fortune_archive/1987/12/21/69996/index.htm

    denk , May 18, 2019 10:39:59 AM | link
    Trust the UnitedSnake to blame the Chinese for reneging on an agreement ! Fact is, Trump's team Add in last minute conditions that are totally unacceptable to China. Chinese commentators are fuming at the audacity of the demands. 'WTF, Do they think we'r their gawd damned 51st state ?'

    Typical UnitedSnake's 'negotiation' tactics, designed to fail ! Thats how Clinton justity his bombing of ex Yugo, by blaming Belgrade for the breakdown of negotiation ,to justify its 78 days of aerial arsons against Yugo.

    denk , May 18, 2019 10:49:38 AM | link
    How the UnitedSnake destroyed Toshiba and took over its crown jewel chip tech,... Toshiba was severely punished for breaking fukus sanction on USSR, by selling state of art milling machine to the Soviets. the unitedsnake slapped a heavy fine, demanded the resignation of Toshiba CEO, imposed a ten years ban on Toshiba products, FORCED the Japs to share their latest chip tech with Merikkans. Toshiba never recovered from that disaster.
    vk , May 18, 2019 10:52:22 AM | link
    Time to discard any illusions about the US ,source: Global Times Published: 2019/5/17 22:49:35
    JOHN CHUCKMAN , May 18, 2019 10:59:52 AM | link
    An excellent summary of many aspects of a serious and deteriorating situation. In the end, China has a lot of brainpower to apply to situations like this.They are used to speaking and writing one of the world's most difficult languages. They are used to playing Go, one of the world's most difficult board games. And their national endowment of analytical skills immensely surpasses that of the United States.

    They are said to have eight times as many students in math and science and engineering in their universities. Xi himself is very bright, having earned degrees in difficult subjects at demanding universities, and he is calm and very forward-thinking. Just consider that magnificent long-term Silk Road Project. When I think of Trump with his constant mock-heroic poses and foot-high signatures on every silly memo and his gang of noisy, pompous thugs in top appointments, I can't help thinking I know how this will turn out in the end.

    vk , May 18, 2019 11:11:09 AM | link
    China's yuan slide risks trolling Trump It's good to remember that would not be the first time. After the first round of tariffs, China devalued the Renminbi and it basically wiped out the tariffs . In fact, it didn't even need to devalue that much: 1 Renminbi is now US$ 0.14 -- just a little over the Government max upwards band of 1:7.
    denk , May 18, 2019 11:24:04 AM | link
    In 2013, the CEO of French hi tech co Alstom was arrested by FBI, while changing flight at New York. His 'crime', breaking MERIKKAN anti corruption
    law by bribing govn officials in INDONESIA ! Such is the LONG arm of merikkan extra territorial jurisdiction, rings a bell ... Ms meng ?

    Just like Toshiba, the French paid a very heavy price. The CEO went to jail, Allstom, the crown jewel of French industry, was FORCED to sell off its core business to its main rival, GE. !

    What did Ian Fleming's fundamental law of probability says.... ONCE IS HAPPENSTENCE, TWIC IS COINCIDENCE...

    Noirette , May 18, 2019 11:39:25 AM | link
    US MegaCos. outsourced and 'globalised' with the blessing, nay encouragement! of the Pol. Class. Cheaper labor and lax environmental rules, in comparison with 'home' (US, W countries, etc.) is a mantra. That is of course good enough, and one can track, say, sh*t-clothes factories transiting from Bangladesh, to China, to Malaysia, to Mexico, etc.

    Other motives, the first is lack of responsibility and involvement which allows domineering and rapacious behavior. Foreign co. implant can just leave, relocate, if whatever. A random /racist term/ exploited worker in the 3rd world is not voting in US elections.

    Deadly industrial pollution is outsourced, and energy use etc. at home while not curtailed or significantly diminished is not as high as one might see under condition of the industries returning home - a sort of 'greener' environment can be touted.

    The PTB simply cannot grasp why some US citizens, who live high on the hog, house, 2 cars, 3 kids, endless dirt cheap consumer goods, etc. produced by 'slaves' abroad, complain. If the 'stuff' was produced at home, it would cost much more, the pay would be going to 'low-level' US labor -- in a more closed economic circuit there would be more 'equality' as things stand today in the US - *not* claiming it's a general rule.

    Trump had some confused? thoughts about turning the present situation around, and relocating industrial - some extractive - manufacturing - jobs back home, say 1960s, with decent pay, to ppl who would then vote for him.

    The stumbling block is that profits to shareholders, oligarchs, chief CEO's, asset trippers, usurers, Mafia types, Banks and other Fin, and Politicians who in the US are highly paid lackeys, etc. is set to diminish, as 'the pie' can no longer be grown much to accomodate all these grifters. Due to energy constraints, disruption of climate change, etc.

    denk , May 18, 2019 11:56:20 AM | link
    Brit and Dutch spooks now concur with Trump the charlatan's claim of Huawei security risk ! Trust the Brits to doublecross the Chinese, after they've been given the huawei source codes to examine and declared it free of bugs. As for the Dutch , they seems to be the goto guys these days, whenever the 5liars need some loyal poodles to corroborate their B.S., cue the M17 'investigation'.

    hehehehe

    [May 17, 2019] It s the clearest sign yet that the basic assumptions of globalization are collapsing

    This is a good overview of Huawai crisis, but the reason for it is deeper. Huaway is just a skirmish in a much larger war for the supremacy in the neoliberal world. At the same time this is a crisis of neoliberlism as social system. Much like the crisis of Bolshevism.
    After 2008 the neoliberal elite lost legitimacy. Nasty jokes about Trump and Obama are just a tip of the iceberg, they just show the level of distrust. In a way they are like anecdotes about Brezhnev during "Stagnation" ("Zastoy" in Russian ) period. Simplifying, Trump is some variation on the theme of of Gorbachov. and a counterrevolution against Trump was similar to the counterrevolution against Gorbachov ("putsch" with the main difference that putsch was instigated by Gorbachov himself and he lost power as the result). While most probably the dirt will be swiped under the carpet, some minor figures might go to jail in the USA as the result as this was clearly attempt of the palace coup by intelligence agencies with the support of Obama administration and Clinton wing of republican partty.
    The level of lies in MSM and level of lies of politicians on the Capital Hill is a clear sign that the social crisis is reached the state "when the elite can't govern as usual, and prols can't live usual". People working in Wall-mart essentially live in a third world country.
    The most telling sign that this stage has come is that the neoliberal elite no longer is able to tell the truth to the population. Russiagate was partially an attempt to cement the cracks in neoliberal facade (loss of the legitimacy of neoliberal elite) by redirecting the anger of population to the external enemy. In this sense neoliberal elite badly long for a war, which would solve their problems, but in the modern world this is too dangerous move. But new local wars (Iran, Venezuela ) are still a possibility, especially because Israel fifth column ( Adelson, Hassid mafia -- Kushner and Co, etc) partially controls Trump and were able to secure the appointments of Bolton and Pompeo.
    BTW attitude to Jews here turned to be much worse (especially in NYC, there are a lot of Hassidic sects). Jews also are very convenient scapegoats and always were.
    The Trump attempt to bully China is based on the understanding that China is a neoliberal state too and as such it should fold in the name of neoliberal globalization, as the USA is the dominant neoliberal power -- kind like the USSR was for Bolshevism. It is funny that China defection to neoliberalism doomed Bolshevism :-)
    As neoliberalism is a flavor of Trotskyism (Trotskyism for the rich :-) it can't be decoupled from the neoliberal globalization ("Financial oligarchy of all countries unite") like Trotskyism can't be decoupled for the idea of the World revolution. If you decouple those two you will get Stalinism.
    The question now is about the control of globalization. Where is the center? In the USA or in China (China is pushing its own version via Belt and Road Initiative -- a China-centered trading network)
    As for China-USA trade war timing is everything. If it is too late the USA will come out of it with bloody nose with the continuation of the Great Recession in the cards. The root case was only patched, but never fixed -- secular stagnation continued past 2010: concentration of wealth at the top undermine consumption of the middle class (lower class does not matter much) and external expansion is limited as there will be no the second USSR collapse and no new markets. As Marxist taught us -- all imperialistic wars are the wars for the redistribution of the markets. I think this might be the case now. .
    If timing for Trump attack is right, China will be crushed and pushed into economic depression.
    I am incompetent in this area but it looks to me that Trump in his usually bulling style overdid it putting too much pressure, and as a result China revolted. Neither China not the USA understand the full consequences of this move, but that does not matter. Chinese reaction suggests that "the Rubicon was crossed" and the real trade war is in th cards. May be some compromise reached, but if the neoliberal world is stilt into two camps: USA-dominated and China-dominated (much weaker, but Russia and possibly India, Pakistan and Iran probably will gravitate to it). Replaying the Cold War on a new level and with much weaker cards in the USA hands.
    Looks like Trump recently understood that he committed a blunder and is trying to back off, but that might be too little too late.
    Notable quotes:
    "... It's the clearest sign yet that the basic assumptions of globalization are collapsing. ..."
    "... the story of the use of SWIFT against Iran, and increasingly it's the story of fights over tech/networks ..."
    May 17, 2019 | threadreaderapp.com

    1. A thread on why Trump decision to put Huawei on the entity list is a very big deal indeed, as @Dimi and others are arguing. ft.com/content/c8d6ca . This is a far bigger step than just excluding Huawei from the US market.

    2. It requires any US company that wants to supply Huawei to first ask the US government for permission. This has obvious implications for Google's Android operating system, Qualcomm chips and a myriad of other suppliers

    3. Dennis Wilder says that this is the "beginning of decoupling" in the telecommunications sector. It's the clearest sign yet that the basic assumptions of globalization are collapsing. As @ANewman_forward and I argue, interdependence is being weaponized Weaponized Interdependence - International Security final pre-edits.pdf Dropbox is a free service that lets you bring your photos, docs, and videos anywhere and share them easily. Never email yourself a file again! https://www.dropbox.com/s/27mnqcxrxwapkit/%20Weaponized%20Interdependence%20-%20International%20Security%20final%20pre-edits.pdf?dl=0 dropbox.com/s/27mnqcxrxwap

    4. The globalization of the 1990s massively transformed the world economy. National economic systems that had previously been separate from each other became densely interpenetrated, and deeply dependent on financial, informational and trade networks that spanned borders.

    5. These networks are structurally embedded. Supply chains have been globalized, in the pursuit of economic efficiencies. It's hard to imagine how the world economy could work without them. But the pursuit of efficiency created strategic vulnerabilities.

    6. Some networks had hub structures meaning that states that could control the hub could control the network. Others relied on crucial components that were single sourced or sourced within an individual country.

    7. The last decade has seen states move increasingly to exploit these vulnerabilities against others or to shore their own vulnerabilities up against outside attackers. That's the story of the use of SWIFT against Iran, and increasingly it's the story of fights over tech/networks

    8. A world of networks built around the pursuit of economic efficiencies is becoming a world where these networks are being exploited (or at risk of being exploited) for strategic advantage. America's Misuse of Its Financial Infrastructure Delirium tilted over into imperial folly, as high officials began to think that they could use America's economic power to re-order the world better to their liking. https://nationalinterest.org/feature/america%E2%80%99s-misuse-its-financial-infrastructure-52707 nationalinterest.org/feature/americ

    9. The Huawei move displays both US fears about vulnerabilities, and US efforts to exploit them. The US is worried that 5G networks could compromise US communications to surveillance.

    10. US is not only moving to push Huawei out of existing markets - but to damage Huawei's core business by potentially preventing it from using core US components (such as Qualcomm chips or Android OS (it remains to be seen exactly which technologies will be listed). Chinese hawks are talking about retaliating through e.g. blocking sales of rare earths again.

    11. This will also reinforce Chinese efforts to build "autonomous and controllable" technology and supply chains outside US control to decrease their vulnerability to future attack.

    12. The old model of globalization is in serious trouble. The networks that tie the world economy together are being exploited for strategic gain. The US move is both a response to fears about its own vulnerabilities, and an effort to exploit China's vulnerabilities in return.

    13. The result will likely be escalation - but we don't know for sure. We still don't have anything that approaches a strategic analysis of this new field of politics and how it works. Historical experience provides no good recent analogies.

    14. During the Cold War, the US dominated parts of the global economy and Comecon were largely disconnected, with the exception of raw commodities such as grain. Now, the economies of US, Europe, China and Russia are deeply intertwined.

    15. If you want to be pessimistic, you can resort to scorpions-in-bottles analogies. If you want to be optimistic, you can point to continued shared interests that states have in avoiding major economic disruptions. The willingness of the US to push this so far and so hard

    16. suggests the skeptics may find their fears justified - but we'll be finding out. Interesting times for international political economy scholars, if frightening times for the international political economy. Finis.

    [May 17, 2019] China Can t Boycott U.S. Movies and Travel by Adam Minter

    Why not? Hollywood those days mostly produced utter junk. It's an easy and lucrative move
    Notable quotes:
    "... The most obvious is the simple fact that the U.S. is much less dependent on its services exports to China than South Korea is. While certain sectors might feel some pain, it's not likely to be strong enough to force the White House to back down. (Indeed, Trump might not mind if liberal Hollywood takes a hit.) ..."
    "... Similarly, many Chinese industries rely fundamentally upon licensed American services. In 2018, foreign films accounted for 38% of China's box office; the most lucrative among them were American. That trend continues: Over the weekend, "Avengers: Endgame" became the third-highest grossing film in Chinese history. ..."
    May 17, 2019 | www.bloomberg.com

    Trying to boycott U.S. entertainment and travel, as Beijing did with South Korea, will only backfire on Chinese companies and consumers.

    By Adam Minter , ‎May‎ ‎17‎, ‎2019‎ ‎8‎:‎00‎ ‎PM Adam Minter is a Bloomberg Opinion columnist. He is the author of "Junkyard Planet: Travels in the Billion-Dollar Trash Trade" and the forthcoming "Secondhand: Travels in the New Global Garage Sale.

    China may want to stand tough against Donald Trump's trade threats. It's going to have a hard time retaliating, though, and not only because it doesn't import enough goods to match the U.S. president tariff-for-tariff.

    One obvious target would be the $58.9 billion in services the U.S. exports to China. These include everything from Hollywood blockbusters to tourism and education. In theory, Beijing could easily enough cut off the flow of American entertainment into China and Chinese students and tourists out of the mainland. Indeed, the nationalist editor-in-chief of the Global Times newspaper has already suggested such a strategy.

    China has some experience with this. After South Korea agreed to deploy a U.S. anti-missile system on its soil in 2016, Chinese television stations were informed that programs involving South Korean stars wouldn't be approved for broadcast, while Chinese venues began canceling appearances by K-pop bands and other South Korean celebrities. On top of restrictions on outbound tourism, the measures helped knock 0.4% off South Korea's expected growth rate in 2017.

    On the other hand, the unofficial boycott didn't persuade Seoul to reverse its decision. And there are many reasons to think a similar strategy directed at the U.S. would be even less effective.

    The most obvious is the simple fact that the U.S. is much less dependent on its services exports to China than South Korea is. While certain sectors might feel some pain, it's not likely to be strong enough to force the White House to back down. (Indeed, Trump might not mind if liberal Hollywood takes a hit.)

    The second reason is more important. Chinese businesses are often as dependent upon U.S. services as American retailers are on their mainland-based supply chains. Restricting Chinese tourism to the U.S., for instance, would damage China's airlines, many of which have been handsomely subsidized in a battle for dominance over hyper-competitive trans-Pacific air routes.

    Similarly, many Chinese industries rely fundamentally upon licensed American services. In 2018, foreign films accounted for 38% of China's box office; the most lucrative among them were American. That trend continues: Over the weekend, "Avengers: Endgame" became the third-highest grossing film in Chinese history.

    Chinese regulators are already worried about slowing box-office revenue . In 2016, they even temporarily lifted quotas on foreign films to help cinema owners. It's unlikely they'd seek to add new burdens now to the struggling industry.

    In recent years, the most high-profile buyers of U.S. entertainment content have been China's celebrated tech champions. In 2015, Tencent Holdings Ltd. agreed to pay the National Basketball Association $500 million (potentially rising to $700 million) for the rights to stream the league's games, highlights and other content in China. It was a smart investment: The NBA is the most popular professional sports league among Chinese viewers. During the 2017 finals, more than 170 million people in China streamed the games live.

    And Tencent isn't the only Chinese tech company leaning upon the NBA to boost user counts. The league has signed more than a dozen media partnerships in China, including a March 2019 agreement with Alibaba Group Holding Ltd. under which the NBA agreed to create content for Alibaba users. (Alibaba Vice Chairman Joseph Tsai owns 49 percent of the Brooklyn Nets NBA franchise.)

    Ultimately, the biggest impediment to any Chinese boycott of U.S. services may be the Chinese public. Though there's no question that Chinese popular opinion is behind Beijing, there's little evidence so far that the trade war has diminished consumer enthusiasm for American movies and vacations. During the key Chinese New Year travel period, the U.S. was the most popular long-haul travel destination for Chinese tourists. Los Angeles reported a 6.9% boost in Chinese visitors last year.

    While some Chinese might just switch to illegal streaming services and pirated downloads if cut off from their favorite American TV shows and movies, trying to bar them from visiting the U.S., sending their kids to university there or seeking medical treatment could quickly provoke a backlash among middle-class citizens. Especially at a time when growth is slowing at home, that's a constituency the government can't afford to alienate.

    Of course, none of this means the Trump Administration should think its services exports are entirely immune. As American culture becomes more globalized, it becomes easier to emulate. China's film industry is getting more polished in spite of censorship. Yao Ming is steadily improving Chinese basketball in spite of China's state meddling in sport. And low-cost airlines give Chinese access to a wide variety of destinations just as compelling as Los Angeles. For now at least, though, China will have a hard time restricting what it can't replace.

    [May 16, 2019] https://www.zerohedge.com/news/2019-05-15/farage-gabbard-lions-great-realignment

    May 16, 2019 | www.zerohedge.com

    Uh, no, Tom, she won't be collecting a lot of voters, well, at least not near enough. Biden has already been "chosen" like Hillary was over Bernie last time. You should know by now Tom, we don't select our candidates, they're chosen for us for our own good. 2 hours ago

    This is going to take a long time. You just can't turn this ship around overnight.

    US Political System:

    United States is neither a Republic and even less Socialistic. US, in the technical literature, is called a Polyarchy (state capitalism). Polyarchy (state capitalism) idea is old, it goes back to James Madison and the foundation of the US Constitution. A Polyarchy is a system in which power resides in the hands of those who Madison called the wealth of the nation. The educated and responsible class of men. The rest of the population is to be fragmented and distracted. They are allowed to participate every couple of years by voting. That's it. The population have little choice among the educated and responsible men they are voting for.

    This is not an accident. America was founded on the principle, explained by the Founding Father that the primary goal of government is to protect the minority of the opulent against the majority. That is how the US Constitution was designed sort of ensuring that there will be a lot of struggle. US is not as the same as it were two centuries ago but that remains the elites ideal.

    Polyarchy (state capitalism) it is a system where small group actually rules on behalf of capital, and majority's decision making is confined to choosing among selective number of elites within tightly controlled elective process. It is a form of consensual domination made possible by the structural domination of the global capital which allowed concentration of political powers.

    A republic is SUBORDINATE to democracy. Polyarchy can't be subordinated to any form of Democracy. 2 hours ago Is the author, to use an English term, daft? Tulsi Gabbard won't get out of the primaries, much less defeat Sanders or Biden. Farage achieved his goal (Brexit), then found out (SHOCK!) that the will of the people doesn't mean anything anymore.

    If Luongo had wanted to talk about the people's uprising, he should've mentioned the Tea Party. 3 hours ago Gabbard appears to have some moral fibre and half a backbone, at least for a politician, regardless of their views, Farage is a slimy charlatan opportunistic populist shill 3 hours ago (Edited) I like Tulsi Gabbard on MIC stuff (and as a surfer in my youth - still dream about that almost endless pipeline at Jeffreys Bay in August), but...

    On everything else?

    She votes along party lines no matter what bollocks legislation the Democrats put in front of Congress. And anyone standing full-square behind Saunders on his socialist/marxist agenda?

    Do me a favour. 1 hour ago (Edited) Farage left because he saw what UKIP was becoming...a zionazi party.

    Also Gabbard is a CFR member. 3 hours ago Gold, Goats and Guns? Certainly not guns under President Gabbard! Here's her idea of "common sense gun control:"

    https://www.votetulsi.com/node/25028

    I'm totally against warmongering, but I have to ask - what good is it to stop foreign warmongering, only to turn around and incite civil war here by further raping the 2nd Amendment? The CFR ties are disturbing as hell, too. And to compare Gabbard to Ron Paul? No, just...no! 3 hours ago Always been a fan of Bernie, but I hope Gabbard becomes president. The world would breathe a huge sigh of relief (before the assassination). 4 hours ago By this time in his 1st term, Obama had started the US Wars in Syria and Libya and has restarted the Iraq War.

    Thus far Trump has ended the War in Syria, pledged not to get us dragged into Libya's civil wars and started a peace process with North Korea.

    Venezuela and Iran look scary. We don't know what Gabbard would actually do when faced with the same events. Obama talked peace too.

    [May 15, 2019] Softer tone in the US vs tougher tone in China

    Plaza accord, Asian Tiger crisis, and now China trade war.
    Notable quotes:
    "... Submitted by Christopher Dembik of SaxoBank ..."
    "... The tone is clearly different in China where the official media, such as CCTV and People's Daily, adopted a tougher stance. ..."
    "... As of yesterday, all the articles and TV reports mention "trade war". This terminology change means a lot and confirms that the negotiations have entered a more dangerous phase. ..."
    May 15, 2019 | www.zerohedge.com

    Submitted by Christopher Dembik of SaxoBank

    Softer tone in the US vs tougher tone in China

    Yesterday evening, senior Trump administration officials tried to appease tensions. US secretary of the Treasury Mnuchin confirmed, without giving much detail, that the US-China trade talks are still ongoing. The tone is clearly different in China where the official media, such as CCTV and People's Daily, adopted a tougher stance. It is interesting to note that in the previous rounds of trade disputes that occurred since Autumn 2018, People's Daily articles mostly used the term "trade friction" instead of "trade war" until now As of yesterday, all the articles and TV reports mention "trade war". This terminology change means a lot and confirms that the negotiations have entered a more dangerous phase.

    In addition, China has tightened its "national security" review for foreign investments, which can be considered as another step in the retaliation process.

    ... ... ...

    Trump's approval rate is still high

    On the US domestic front, President Trump is now seeking $15 billion to bail out farmers in order to mitigate the negative impact of the trade war. Interestingly, more and more Republican Congressmen that were interviewed yesterday on US TV were very vocal against the latest measures decided by the Trump administration. It is, however, unlikely to have any influence on the ongoing process or to push the administration to comprise with Beijing. Trump is looking at polls and the message they send is bright and clear: as of yesterday, 42% of US voters supported Trump's policy (FiveThirtyEight). His electoral base has remained stable, faithful and very broad since he was elected.

    What's next?

    TheRapture , 16 minutes ago link

    "Trump just beat the Chinese massively"

    By three methods we may learn wisdom: First, by reflection, which is noblest; Second, by imitation, which is easiest; and third by experience, which is the bitterest." -- Confucius

    rubiconsolutions , 1 hour ago link

    The US has been the biggest offender in trade wars for decades. The petrodollar conceived by Kissinger and Nixon forced countries to buy oil in USD. How is that not warlike? China and other countries are trying to unhitch themselves from the dollar and who can blame them? The problem is that when they are successful, and they will be, all those dollars will come home to mommy and inflation will run rampant.


    WallHoo , 3 hours ago link

    The country that prints the money will always have the upperhand against the country that works hard and dirty to acquire the said money.

    China is one of the cheapest producers,but that doesnt mean that the US cannot either import or manufacture its own product.

    Case in point im a salesman from greece. I know for a fact that the chinese sell a t-shirt for 2 euros a piece (wholesale) and greek producers for 4 euros a piece. All the t-shirts are sold (retail) for 12-70 euros. So its not about costs but about profit.

    If greece decides tomorow to take back its production from the sick ***** and impose tariffs on them literaly nothing will change.

    Hit the chinese hard with no mercy.

    Deep Snorkeler , 4 hours ago link

    What I Learned From Trump and G. W. Bush

    1. a rich father washes away stupidity, indolence and degenerate living
    2. an ivy league degree is not earned but purchased
    3. moronic speech is a sure sign of genius
    4. Caucasian genetics are in serious decline
    5. criminal behavior can be ethical if packaged correctly
    He–Mene Mox Mox , 4 hours ago link

    Despite all the rhetoric about buying from other places than China, the facts remain, manufacturing is not returning to America. Nor are the jobs coming here to America, nor is the wealth. Conditions in America doesn't favor it. Agriculture was always America's strong suite. But, with the trade wars causing farmers to go bankrupt, you can be assured of losing that too. The question is now, who will feed all you American fat asses, when all your farmers go broke?

    Consumer economies are the economies of third world countries, and that is what America has got. China, with its manufacturing economy, will go on to make investments in other countries, and leave America in the dust.

    CashMcCall , 4 hours ago link

    You have had tariffs for over a year and not one company has returned from Overseas or left China. In fact more US companies have moved manufacturing to China.

    In the USA you have unions, the epa, osha, IRS... and the most litigious tort system and most unreliable employees in the world. You have the most disability claims, the most lawsuits against employers etc. Most absenteeism. Most employee theft. Gender issues, bathroom issues, diversity issues. Your gov continue to pack on the minimum wages eliminating any potential to make products to compete with the world.

    In short the US is dying on the vine. Trump has caused so much bad blood with Asia, that US global businesses will have difficulty penetrating Asian markets which are the only thing that matters for the next 100 years. You Trumptard RACISTS are losers.

    LaugherNYC , 4 hours ago link

    Wrong, wrong and wrong.

    500,000 manufacturing jobs added in Us in last two years.

    Where’d they come from.

    US companies leaving China accelerating - relocating elsewhere in Asia, and bringing back workers to US. Increasing location in US of foreign owned manufacturing plants to avoid trade issues and tariffs.

    The US is not only not dying on the vine, growth ACCELERATED in last several quarters. Can’t hire skilled workers — no one available to take them. My daughter was approached by 3 recruiters to lure her away from her job - she moved for a big pay increase - they upped their offer 20% - and goit the job of her dreams, with all benefits at a major company - and she is an ARTIST!! The huge increase in content production has created a golden age even for liberal arts professions.

    The US ONLY issue is its debt, which it can start to solve by simply retiring debt held by the Fed, and continuing open market purchases and retirements. Monetize while inflation is low and dollar strong. This will likely come with next rate drop (if we get one).

    Chiona living on a MASSIVE consumer/mortgage debt bubble like the US faced in 2007. The tide will wash over their financial industry, as it has begun, and the central government will burn its reserves bailing them out. What goes up...

    China hitting the wall of wage growth where it has become more expensive than its competitors in SE Asia and India.

    The next decade will be a lot more difficult for China. It’s totalitarian state will need to become even more militant and oppressive to survive.

    CashMcCall , 3 hours ago link

    Manufacturing in US under Trump down 6%..

    Every auto made in the world, every mower, every computer, every modem, every LED TV, every telco switch, every smart phone, virtually any product you can think of has Chinese Components or is manufactured in China. China is the largest semiconductor maker in the world. LED lights... CHINA.

    Let it Go , 4 hours ago link

    As we view the global economy we should consider that much of the "free trade" movement is driven by mega companies desire for larger markets and greed. The desire of companies to both develop and control future rules has caused them to lobby individual governments into giving up control and becoming subservient to corporate “efficiency.”

    This is probably not in the best interest of the average citizen as we can see by surging inequality. Those concerned that a trade agreement with low wage nations will not be a great job creator for America have history on their side. The piece below argues that fair trade trumps free trade!

    https://Fair Trade Is Key To Global Economic Stability.html

    RealRussianBot99 , 4 hours ago link

    anybody pointing the finger at China because of IP theft and not doing the same to the USSA is either brainwashed beyond repair, stupid like a piece of wood, a paid troll or any combination of these.

    "accuse the enemy of doing what you secretly do"

    - plenty of people in powerful positions all across history

    sheikurbootie , 4 hours ago link

    Most aren't paying attention to what Trump says.... he said a year ago that China was wanting to make a deal. Trump said, "BUT,they're not ready yet" , meaning that they wanted a small change to the imbalance like Canada and Mexico received.

    China's trade imbalance is seriously astronomical compared to any other country we do business.

    Canada's trade imbalance is $20,000,000,000 per year with US.

    China's trade imbalance is $420,000,000,000 per year with US.

    We have almost the same trade with each $660 B with China and $620 B with Canada.

    Canada is ripping us off. China is not ripping us off, they're ******* us.

    Worst case is we STOP trading with China. Best case they reduce the trade imbalance 90%.

    China is NOT ready yet.

    besnook , 4 hours ago link

    the other side of the coin is a chinese boycott of usa brands means a dollar devaluation in the form of a tanked market. the chinese market means not much. the usa equity/bond market is everything. a falling dollar takes a lot powder out of usa guns.

    Scipio Africanuz , 4 hours ago link

    If winning elections at the expense of the electorate is the main concern of politicians, might that suggest gross immorality amongst the political class?

    On the other hand, if supporting politicians because they mouth soothing platitudes, while yet their policies and actions, defenestrate the quality of life of the electorate, suggests indoctrination, might that not be cause for serious concern?

    Now, it's doubtless that leaders will be required to take unpopular stances sometimes, but ought not those stances be based on cogent analysis of reality, and the elimination or reduction of self contributory inputs?

    All in all, leadership is about courage - to do what's right, and necessary, even if it requires declaring mea culpa. Humility, is often the true indicator of leadership abilities.

    Which reminds us of Alexander, the Great that is, who had to turn back from his expedition in India, when his troops balked at going further. He could have razzmatazzed them no doubt, but he realized they were telling him that exhaustion was prevalent, pushing forward offered no additional gains, and better to return home to sex their wives, teach their sons horsemanship, give their daughters away in marriage, till their farms, chill out, smell the roses, party, and reminisce to their children and grandkids about their adventures..

    Alexander, Great that he is, listened, and with a heavy heart, due to his adventurous nature, signaled the retreat, and homewards it was. That is why they called him Great, not because of his martial prowess which was indeed formidable, but because of his discerning prowess..

    On the other hand, there was Marcus Crassus, who was so avaricious, he went East to war, and got as much gold as his heart desired..molten, and poured down his throat. He died rich, literally filled with gold, cheers...

    Lazane , 4 hours ago link

    Its real simple, if you don't like the cost of doing business in China along with being required by the twisted communist government to turn over your intellectual property as a requirement for doing your manufacturing there, then bring it home to America.

    Not very long ago int he early 1990s I can still recall watching on the cable news programs Chinese rockets launching and blowing up just prior to achieving orbit. The Clintons then were at it full bore trading access to top secret rocket technologies from Loral Space and Technology (Bernie Schwartz) CEO for campaign cash. Clintons transferred Top Secret technologies from State Department to Commerce Department allowing them the access to Sell out America to the Communists. It is why they had to arrange for the liquidation of Commerce Secretary Ron Brown. Remember the video of Bill Clinton laughing and cajoling at the Ron Brown funeral, then when he sees the camera on him, he immediately turns on the bitter tears. These people are the phoniest crooks to ever come to power in America.

    RealRussianBot99 , 4 hours ago link

    lol. you have no idea what you're talking about.

    ever been to China?

    communism? in name only

    lester1 , 5 hours ago link

    Was at Wal Mart yesterday. Surprisingly there isn't any products made in China that I needed to buy. All the food, cleaning supplies, and toiletries are still made in the United States. The clothing section had made in Malaysia, Singapore, India, Mexico. So in reality, other countries can take market share from China. Some of the production will return to United States as well.

    [May 15, 2019] Geopolitical primacy, not maximum prosperity for Americans, might be the president's true objective

    Notable quotes:
    "... The REAL REASON behind the TRADE WAR: Israhell: "I want Iran embargoed and starved to death." China: "I will buy Iran's oil." BAM! Trade War! ..."
    May 15, 2019 | www.zerohedge.com

    The 'play of the day' above comes against a backdrop of markets trying to accentuate the positive in the latest US-China trade war deterioration. Indeed, Moody's has declared a trade deal will still be done and a Bloomberg survey of US economists shows around two thirds think a deal will be signed by year-end, a fifth by 2020, and only 13% don't see a deal for at least five years. Field Marshall, please take these men and women out and have them shot, there's a good chap.

    The rhetoric from China has turned starkly, aggressively nationalist. The Global Times is calling for a "People's War", a 1930's Mao reference to repelling Japanese imperialism; "trade war" now fills Chinese media, having been largely absent for months; and Tuesday's People's Daily mouthpiece posted an image of the Chinese flag with "Talk -- fine! Fight -- we'll be there! Bully us -- delusion!" superimposed on it. US President Trump is also not backing down in a further set of trade-related tweets, again stating tariff revenues will support 'patriot' farmers and adding: "China will be pumping money into their system and probably reducing interest rates, as always, in order to make up for the business they are, and will be, losing. If the Federal Reserve ever did a "match," it would be game over, we win! In any event, China wants a deal!"

    A huge fiscal deficit; trade tariffs; a rapid increase in military expenditure; 'Patriot' farmers; and a political call for lower interest rates for a national struggle. It all sounds very Chinese, doesn't it? But that shouldn't be a surprise. Last year's ' The Rise and Fall and Rise of the Great Powers (and Great Currencies)' argued the historical lessons of the economics of past power struggles are that one must have low borrowing costs, spend a lot on a large military, and be mercantilist if your enemy is. True, one also needs to be economically vibrant, and that isn't assured with mercantilism, militarism and large fiscal deficits. Yet real free trade, pacifism, and austerity is *ruinous* for Great Power . Which is why the EU is not a Great Power but a Great Whinger.

    Some in the markets are starting to get this.

    Regular Bloomberg commentator Noah Smith yesterday published an article --'The Grim Logic Behind Trump's Trade War With China'-- that admits he was wrong to expect a trade deal, that Trump is doubling down, and concludes "There may be a grim sort of logic to this approach If Trump wants to slow China's ascent as a superpower, a trade war might be an effective way to do it. If the harm to the US is modest and the costs for China are severe and lasting, Trump might conclude that the former are acceptable losses. Geopolitical primacy, not maximum prosperity for Americans, might be the president's true objective . if weakening China really is the goal, then this could be just the opening rounds of a long and grinding trade war." That's' what I argued back in November 2017's 'On Your Marx' special reports, which stressed a New Cold War was likely ahead.

    However, many in markets are still acting like a Treasury clerk telling Churchill that Badolf Hissler can offer him a great deal on cut-price bullets, ships, and planes .

    On a related front, we see reports of an alleged Iranian drone attack on Saudi oil pipelines(!); also hear Iran's leader say there will be no war with the US; and Trump has stated reports of 120,000 US troops moving to the region are fake news -- because if he were to send troops it would " a hell of a lot more ." Mixed messages to put it mildly.


    wadalt , 1 minute ago link

    The REAL REASON behind the TRADE WAR: Israhell: "I want Iran embargoed and starved to death." China: "I will buy Iran's oil." BAM! Trade War!

    Artist’s IMPRESSION of Satanyahoo Riding Trump

    PGR88 , 2 minutes ago link

    for 40 years, western liberals and capitalists have had a nebulous idea of China developing, opening and "liberalizing." It hasn't usually occurred in the ways they wanted, but China certainly has become a big market and has moved towards a more open economy and somewhat, more open society overall, while still maintaining a "fascist" structure.

    But we can all agree - that process is done. China's economy, society and politics are what they are. The country is "grown-up." Do not ever expect the communist party to change the tight, top-down structure it has. Do not expect changes to politics, do not expect anyone in China to give up control, and certainly don't expect foreigners to have any say or influence within China. China will always do exactly what benefits China and the CCP.

    Trump is merely being a realist. So accept that, and trade/invest/exchange accordingly.

    SeanInNYC , 2 minutes ago link

    Is it any surprise that a "Noah Smith" of Bloomberg would attribute all the wrong motives and strategy behind President Trump's and America's trade dispute with China's totalitarian regime?

    That he sees the Chinese Communist Party as honest, good faith partners in this scenario?

    There is nothing Trump could ever do to please the internationalist media.

    arby63 , 4 minutes ago link

    I seriously doubt if "weakening" China is Trump's primacy here. Perhaps a by-product but let's finally admit one thing: The US-China trade arrangement is egregious at best. What no one is willing to discuss yet is the fact that this "philosophy" of evening out trade with China will soon take on a life of its own: With the US consumer. We need to bring back a lot of jobs back to the US economy and that's not rocket science. It won't happen overnight but it will indeed happen.

    LaugherNYC , 4 minutes ago link

    What is the point of this piece? To demonstrate the author’s wit and historical knowledge (was that entire little playlet not invented)?

    To maximize American prosperity long term, should the US simply allow China to cheat, manipulate and intimidate its way to the top? China has proven that, unlike the US, its growth is a zero sum game. It adds nothing to the equation of global growth except cheap labor, which subtracts wealth from other nations by taking away their well-paid manufacturing jobs. It contributes almost no raw materials, imports its food and energy, and has stolen most of its technology at enormous cost to Western innovators.

    The US has always provided net inputs to the system of global growth. Natural resources, renewable materials (crops, renewable energy), and the relentless innovation and productivity increases of its workforce. China is an extractor. Thus it needs to expand its borders through exploitative economic imperialist initiatives under their One Belt One Road scam, and their militaristic imperialism in the South China Sea. The US is a machine that puts out far more than it takes in. China is the opposite. If the US directs its economic output away from China’s vast and relentless maw, China’s machine will slow and sputter.

    The real point of the trade war is to end the vacuum of Western and Asian prosperity by China’s greedy and imperialist machine of economic destruction. China knows and implements that its economic growth by definition comes at the cost of others’ prosperity. That the US took 20 years to wake the **** up is astonishing.

    MalteseFalcon , 6 minutes ago link

    You mean all this time the Chinese were nationalists?

    medium giraffe , 6 minutes ago link

    Mutual suicide. Outstanding.

    B-Bond , 7 minutes ago link

    From doves to hawks: why the US’ moderate China watchers are growing skeptical about Beijing😲

    https://www.scmp.com/news/china/diplomacy/article/2177506/doves-hawks-why-moderate-us-china-watchers-are-growing

    from_the_ashes , 8 minutes ago link

    Most news is somewhat depressing these days... But there are moments when the light shines through...

    https://www.thewrap.com/members/2019/05/15/salon-media-announces-5-million-sale-bankruptcy-and-liquidation-threatened-if-deal-fails/

    Learn to code Salon staffers...

    Charlie_Martel , 12 minutes ago link

    The Internationalists are losing. Nationalism is the future.

    [May 15, 2019] Tariffs won't bring back manufacturing jobs...

    The key factor here is that the USA is a neoliberal state which means profits before people and outsourcing to area with lower labor cost. Like leopard can't change its spots, neoliberalism can't change it "free movement of goods and labor" principles, or it stop being neoliberalism.
    No jobs will come back to the USA as financial oligarchy is transnational body that uses the USA military as an enforcer for their gang. It does not care one bit about the common people in the USA.
    May 15, 2019 | www.zerohedge.com

    Originally from: Pepe Escobar Warns Over US-China Tensions The Hardcore Is Yet To Come

    ... ... ...

    Where are our jobs?

    Pause on the sound and fury for necessary precision. Even if the Trump administration slaps 25% tariffs on all Chinese exports to the US, the IMF has projected that would trim just a meager slither – 0.55% – off China's GDP. And America is unlikely to profit, because the extra tariffs won't bring back manufacturing jobs to the US – something that Steve Jobs told Barack Obama eons ago.

    What happens is that global supply chains will be redirected to economies that offer comparative advantages in relation to China, such as Vietnam, Indonesia, Bangladesh, Cambodia and Laos. And this redirection is already happening anyway – including by Chinese companies.

    BRI represents a massive geopolitical and financial investment by China, as well as its partners; over 130 states and territories have signed on. Beijing is using its immense pool of capital to make its own transition towards a consumer-based economy while advancing the necessary pan-Eurasian infrastructure development – with all those ports, high-speed rail, fiber optics, electrical grids expanding to most Global South latitudes.

    The end result, up to 2049 – BRI's time span – will be the advent of an integrated market of no less than 4.5 billion people, by that time with access to a Chinese supply chain of high-tech exports as well as more prosaic consumer goods.

    Anyone who has followed the nuts and bolts of the Chinese miracle launched by Little Helmsman Deng Xiaoping in 1978 knows that Beijing is essentially exporting the mechanism that led China's own 800 million citizens to, in a flash, become members of a global middle class.

    As much as the Trump administration may bet on "maximum pressure" to restrict or even block Chinese access to whole sectors of the US market, what really matters is BRI's advance will be able to generate multiple, extra US markets over the next two decades.

    We don't do 'win-win'

    There are no illusions in the Zhongnanhai, as there are no illusions in Tehran or in the Kremlin. These three top actors of Eurasian integration have exhaustively studied how Washington, in the 1990s, devastated Russia's post-USSR economy (until Putin engineered a recovery) and how Washington has been trying to utterly destroy Iran for four decades.

    Beijing, as well as Moscow and Tehran, know everything there is to know about Hybrid War, which is an American intel concept. They know the ultimate strategic target of Hybrid War, whatever the tactics, is social chaos and regime change.

    The case of Brazil – a BRICS member like China and Russia – was even more sophisticated: a Hybrid War initially crafted by NSA spying evolved into lawfare and regime change via the ballot box. But it ended with mission accomplished – Brazil has been reduced to the lowly status of an American neo-colony.

    Let's remember an ancient mariner, the legendary Chinese Muslim Admiral Zheng He, who for three decades, from 1405 to 1433, led seven expeditions across the seas all the way to Arabia and Eastern Africa, reaching Champa, Borneo, Java, Malacca, Sumatra, Ceylon, Calicut, Hormuz, Aden, Jeddah, Mogadiscio, Mombasa, bringing tons of goods to trade (silk, porcelain, silver, cotton, iron tools, leather utensils).

    That was the original Maritime Silk Road, progressing in parallel to Emperor Yong Le establishing a Pax Sinica in Asia – with no need for colonies and religious proselytism. But then the Ming dynasty retreated – and China was back to its agricultural vocation of looking at itself.

    They won't make the same mistake again. Even knowing that the current hegemon does not do "win-win". Get ready for the real hardcore yet to come.


    Tachyon5321 , 35 minutes ago link

    The Swine fever is sweeping china hog farms and since the start of 2019 200+ millions hogs have been culled. Chinese hog production is down from 2016 high of 700 million to below 420 million by the end of the year. The fever is not under control.

    Soybeans from Ukraine are unloaded at the port in Nantong, in eastern China. Imports of soy used to come from the US, but have slumped since the trade war began. Should point out that the Ukraine soy production matures at a different time of the year than the US soybean. The USA planting season starts in Late april, may and june. Because of the harvest time differences worldwide the USA supplies 80% of the late maturing soybeans needed by October/Nov and December.

    A propaganda story by the Asian Times

    BT , 46 minutes ago link

    Orange Jesus just wants to be re-elected in 2020 and MIGA.

    Son of Captain Nemo , 52 minutes ago link

    Perhaps this is one of the "casualties" ( https://www.rt.com/news/459355-us-austria-embassy-mcdonalds/ ) of economic war given the significance of China and just how important it is to the U.S. in it's purchases of $USD to maintain the illusion of it's reserve currency status and "vigor"...

    Surprised this didn't happen first at the U.S. Embassies in Russia and China?... Obviously Ronald McDonald has turned into a charity of sorts helping out Uncle $am in his ailing "health" these dayz!...

    SUPER SIZE ME!... Cause I'm not lovin it anymore!... I'm needin it!!!!

    joego1 , 52 minutes ago link

    If Americans want to wear shoes they can make them or have a robot make them. Manufacturing can happen in the U.S. **** what Steve Jobs told Oblamy .

    ElBarto , 1 hour ago link

    I've never understood this "jobs aren't coming back" argument. Do you really think that it will stop tariffs? They're happening. Better start preparing.

    ZakuKommander , 1 hour ago link

    Oh, right, tariffs WILL bring back American jobs! Then why didn't the Administration impose them fully in 2017? Why negotiate at all; just impose all the tariffs!?! lol

    Haboob , 1 hour ago link

    Pepe is correct as usual. Even if America tariffs the world the jobs aren't coming back as corporations will be unable to turn profits in such a highly taxed country like America would be. What could happen however is America can form an internal free market again going isolationist with new home grown manufacturing.

    Gonzogal , 41 minutes ago link

    You VERY obviously have ZERO knowledge of Chinas history and its discoveries/inventions etc USED BY THE WEST.

    I suggest that you keep your eyes open for "History Erased-China" on Y Tube. The series shows what would happen in todays world if countries and their contributions to the world did not happen.

    here is a preview: https://youtu.be/b6PJxuheWfk

    [May 14, 2019] Trump desperately needs a trade deal with China as he gears up for his re-election bid in 2020.

    Highly recommended!
    It has become a cliché to quote William Butler Yeats’s poem “The Second Coming,” written almost 100 years ago in the aftermath of World War I. But no one has said it better: “Things fall apart; the centre cannot hold; / Mere anarchy is loosed upon the world . . . And what rough beast, its hour come round at last, / Slouches toward Bethlehem to be born?”
    Donald Trump's decision to raise duties on Chinese goods from ten to 25 percent of additional $200 billion of China exports came into force. It is unclear how this will work and how much the US consumers will pay. Probably half of this raise so from 5% to 10% which might be not very noticeable outside such items as shoes and clothing. The cost of Chinese's shoes already is quite high -- plastic regular $60-30 with discounts on holiday. Leather -- $100-$50 and almost no discounts.
    Trump uses his favorite "bully in the schoolyard" style, a typical the American foreign policy tactic to direct, lawless pressure. First, they accuse partners of violations, to introduce restrictions on this basis (and at the same time to plunge world markets into panic), and then to agree on the resumption of negotiations. But the previous decisions about tariffs were left, of course, in force.
    May 14, 2019 | www.asiatimes.com
    His gambit to conclude a deal with North Korea collapsed in failure in Hanoi in February, and it is a huge blow to his self-styled image of a master dealmaker. Trump also faces a flurry of congressional subpoenas at home from Democrats who now control the House of Representatives. Hence with mounting legal and political troubles, Trump is cornered and desperately needs a conclusion to the prolonged trade war with China, which has netted zero benefits for him.

    The prospect of a trade deal with China remains as elusive as ever, despite Trump's increased tariffs to pressure China to come to the negotiating table with the list of concession that he wants. It is highly unlikely that China will grant Trump the concessions he wants. China remembers clearly the deal that Tokyo concluded with Washington in the 1990s that caused Japan to slip into economic stagnation for many years. That period has now been dubbed Japan's "lost decade."

    China is not dumb and it will not concede to Trump.

    Worse still, the move to increase tariffs took place while Chinese Vice-Premier Liu He was in Washington to negotiate with the Trump administration.

    It is a blunder by Trump and will be perceived by the Chinese as a cheap shot against President Xi Jinping. The tariffs hike came despite Xi's "beautiful letter" to Trump, and it is a massive loss of face for the Chinese leader to see his group of officials return home from Washington with no deal to conclude the trade war.

    Xi could not afford to look weak in front of his people and he knows that millions of Chinese netizens access information about the outside world by using virtual private networks (VPNs) to circumvent the Great Firewall. Many ordinary Chinese know about the trade war's latest developments and should any deal with Trump infringe on China's core interests, it will be political suicide for Xi.

    One of the main reasons the US-China trade talks broke down was that Washington's demands were unpalatable to China. Some of the demands from the US, such as an end to government support for state companies in specific industries and a streamlined approval process for genetically engineered US crops, are a direct challenge to the Communist Party of China's control of the economy.

    Since Xi took office, he has extended the party's reach into every corner of Chinese society, and every businessman in China who aspires to reach the top of the hierarchy knows that they must receive the blessing of the party. It is not surprising that even Jack Ma, who is one of China's most internationally recognizable figures, has been revealed to be a member of the CPC after years of denial.

    Hence in the face of renewed pressure from Trump, Xi and the Chinese government have reached the conclusion that it is better to bear the consequences of increased tariffs than to concede to US demands.

    Xi is in for the long haul and can well afford to ride out the storm. And based on Trump's past negotiations such as his failed bid to pressure House Democrats to fund his wall on the Mexican border, which led to the longest government shutdown in US history, Xi knows that the chances are good that Trump will blink first.

    [May 14, 2019] China tariff dispute threatens to cause economic damage for both countries

    Trump uses his regular bulling style, but for him there are no mechanism out or this deadlock. China can't retaliate dollar to dollar but they can encourage boycott of US goods that are replaceable with Chinese models such as Apple phones
    In any cases there will additional unemployment in China and an additional stress on Chinese economy, which probably two factors the Trump is counted on.
    Notable quotes:
    "... China should ban Boeing products for its compromise on aviation safety. Hit where it hurts with consumer power. ..."
    "... When the 25 percent hits 345 billion dollars of additional untaxed imports Americans will just buy less. After this next round of taxes we will be on the road to bankrupting China and Iran. Europe's turn comes next. ..."
    May 14, 2019 | www.youtube.com

    V Philip , 9 hours ago

    China should ban Boeing products for its compromise on aviation safety. Hit where it hurts with consumer power.

    Luke Li , 1 day ago div

    > 13:41

    "the Chinese won't do us the courtesy of saying hey this is because of your detention of madam Meng" actually this is poorly understood by this professor. it's not a discourtesy, it is the opposite. it is a courtesy to give Canada an opportunity to save face. that is, Canada frees madam Meng and can claim they did so for OTHER reasons than bowing to Chinese pressure. It is a face-saving measure for Canada's benefit. Come on, more cultural understanding is needed.

    hoonsiew yeo , 21 minutes ago

    Western fools have learned one lesson : the CHINESE are NOT SOFT or like the JAPANESE in the 80's.

    The CHINESE have their mightiest WILL to stand against the demonic tyranny of the US - the whole world know US is descending as US itself is struggling like one mad dog for its prestigious status of world domination - refusing to acknowledge the country the nation "in the last days of Rome".

    Mark Fischer , 1 hour ago

    When the 25 percent hits 345 billion dollars of additional untaxed imports Americans will just buy less. After this next round of taxes we will be on the road to bankrupting China and Iran. Europe's turn comes next.

    [May 14, 2019] China Calls For People's War Against The US, Vows To Fight For A New World

    Notable quotes:
    "... "The most important thing is that in the China-US trade war, the US side fights for greed and arrogance ... and morale will break at any point. The Chinese side is fighting back to protect its legitimate interests," the nationalist, state-owned Global Times tabloid wrote . ..."
    "... The Global Times also accused the Trump administration of misleading Americans about the victims of US tariffs. It singled out Larry Kudlow's interview on "Fox News Sunday" in which Trump's top economic advisor said that US consumers would also suffer from the trade war, contradicting Trump's claim that China would foot the bill. ..."
    "... More than just a retaliation to "unprovoked" US aggression, China now sees its response as a crusade against the western style of life. During a prime time broadcast on Monday, CNN reported that the state broadcaster CCTV also aired a statement saying that China would " fight for a new world." ..."
    "... The editorial also hinted that more retaliations are coming, saying that "China has plenty of countermeasures" and telling its readers that "the US tariff moves are very much like spraying bullets. They will cause a lot of self-inflicted harm and are hard to sustain in the long term. China, on the other hand, is going to aim with precision, trying to avoid hurting itself." ..."
    "... The conclusion: "the Chinese side is obviously more realistic while the US is falsifying. This will, to a large extent, influence how the two countries digest the trade war impacts." ..."
    May 14, 2019 | www.zerohedge.com

    China Calls For "People's War" Against The US, Vows To "Fight For A New World"

    by Tyler Durden Tue, 05/14/2019 - 15:50 Twitter Facebook Reddit Email Print While market mood has shifted diametrically from yesterday, with stocks sharply higher on Tuesday following what has widely been interpreted as conciliatory comments from both president Trump and various members of China's ruling elite, one would be hard pressed to find any de-escalation amid the Chinese press commentaries written in the aftermath of the latest escalation in trade war between the US and China.

    In a series of editorials and op-ed articles published Monday and Tuesday, Chinese state media slammed what it labeled the Trump administration's " greed and arrogance ", called for a " people's war " targeting the US " with precision " as China begins a " fight for a new world ."

    "The most important thing is that in the China-US trade war, the US side fights for greed and arrogance ... and morale will break at any point. The Chinese side is fighting back to protect its legitimate interests," the nationalist, state-owned Global Times tabloid wrote .

    Urging indirect boycott of US goods and services, the editorial slammed Trump and suggested a nation-wide uprising against the US aggression: "The trade war in the US is the creation of one person and one administration, but it affects that country's entire population. In China, the entire country and all its people are being threatened. For us, this is a real 'people's war.'" Whether this means a renewed collapse in Chinese iPhone sales remains to be seen - for confirmation, watch for a new guidance cut from Apple in the coming days.

    The Global Times also accused the Trump administration of misleading Americans about the victims of US tariffs. It singled out Larry Kudlow's interview on "Fox News Sunday" in which Trump's top economic advisor said that US consumers would also suffer from the trade war, contradicting Trump's claim that China would foot the bill.

    More than just a retaliation to "unprovoked" US aggression, China now sees its response as a crusade against the western style of life. During a prime time broadcast on Monday, CNN reported that the state broadcaster CCTV also aired a statement saying that China would " fight for a new world."

    "As President Xi Jinping pointed out, the Chinese economy is a sea, not a small pond," anchor Kang Hui said on his 7 p.m. news show. "A rainstorm can destroy a small pond, but it cannot harm the sea. After numerous storms, the sea is still there." Hui concluded echoing a popular refrain, that "China doesn't want to fight, but it is not afraid to fight."

    The Global Times also mocked Trump's suggestion that the tariff hike would "force companies to leave China", stating that "the consumption capabilities and market consumption potential driven by demand are what foreign companies value most when they come to China." As a result, "the White House might as well try to call on American companies such as General Motors, Ford, Apple, McDonald's and Coca-Cola to leave China. Will any of them follow? "

    The editorial also hinted that more retaliations are coming, saying that "China has plenty of countermeasures" and telling its readers that "the US tariff moves are very much like spraying bullets. They will cause a lot of self-inflicted harm and are hard to sustain in the long term. China, on the other hand, is going to aim with precision, trying to avoid hurting itself."

    In an amusing twist, China then accused Trump of spinning and "seeking to beautify the trade war", while Beijing has been "blunt about the difficulties and losses that the trade war will bring to the Chinese economy."

    The conclusion: "the Chinese side is obviously more realistic while the US is falsifying. This will, to a large extent, influence how the two countries digest the trade war impacts."

    Whatever side of the ideological divide one finds themselves, this is hardly the rhetorica that will allow China to reach a quick and painless compromise.



    Agent P , 36 seconds ago link

    But wouldn't boycotting US products lead to a massive drop in Chinese manufacturing? I'm so confused...

    Airstrip1 , 2 minutes ago link

    Right or wrong, the Chinese will fight as one for China. As well, they have allies and resources, but the main thing is they are homogenous and patriotic.

    America is controlled from Jerusalem, who will exit at the first sign of the gravy-train slowing, not to mention *****-hat American snowflakes, a treacherous media and politics. Etc. Beware, Americans, about what you are getting into. You have turned trade negotiations into a war and you will not win this long-term. Just like all the others.

    EHM , 5 minutes ago link

    The communists always know what's best for the "people".

    Powder , 7 minutes ago link

    "Confucius say, he who fishes in other man's well, often catch crabs." - Redd Foxx

    mailll , 7 minutes ago link

    The Giant has awoken. Good job Trump. I guess it was all fake news when you were telling us gullible Americans we were winning. Any other wars you would like to start? Oh yea, Iran and perhaps Venezuela first. Must stick with the Israel First agenda.

    thepsalmon , 8 minutes ago link

    The real issue is intellectual property. If the Chinese can't steal our IP, they got nothing and they know it. Also we should send home all their undergrad and graduate students. Let them learn all this sh## on their own.

    ken , 7 minutes ago link

    Yeah, that's what you said about the Japanese.

    sickofthepunx , 11 minutes ago link

    Trump: "Let's see, what's the absolute stupidest thing I could say in response?"

    I have a feeling we won't be let down.

    Wahooo , 11 minutes ago link

    Send tRump to China.

    lester1 , 11 minutes ago link

    Chicoms tariff food imports from the US? What a bunch of dummies.

    Pernicious Gold Phallusy , 2 minutes ago link

    Who exactly pays tariffs?

    Texman , 13 minutes ago link

    This will not be a good summer to be a westerner in China.

    MoreFreedom , 2 minutes ago link

    China is calling for a war, they've been engaged in for decades via their technology, patent, forced technology transfers, and copyright theft. And we should probably include their subsidies of politically connected firms exporting products, but at least in that case, the Chinese taxpayers are paying for the subsidies.

    GlassHouse101 , 16 minutes ago link

    If China wants a 'new world', they need to put on their big boy pants and DEDOLLARIZE. You can't beat an opponent when you play by the opponent's rigged rules!

    [May 14, 2019] The Grim Logic of Trump s Trade War With China

    The USA can't abolish neoliberalism. And the logic of neoliberalism is to use low cost labor oversees. Which means china.
    Notable quotes:
    "... If Trump wants to slow China's ascent as a superpower, a trade war might be an effective way to do it. If the harm to the U.S. is modest and the costs for China are severe and lasting, Trump might conclude that the former are acceptable losses. Geopolitical primacy, not maximum prosperity for Americans, might be the president's true objective. ..."
    May 14, 2019 | www.bloomberg.com

    Trump is doubling down. He's raising tariffs on $200 billion worth of Chinese imports from 10 percent to 25 percent, and imposing new tariffs on almost all of the remaining $325 billion or so. China today said it would retaliate and starting next month would impose tariffs on $60 billion of U.S. goods. This is the biggest trade war in modern American history.

    ... ... ...

    If Trump wants to slow China's ascent as a superpower, a trade war might be an effective way to do it. If the harm to the U.S. is modest and the costs for China are severe and lasting, Trump might conclude that the former are acceptable losses. Geopolitical primacy, not maximum prosperity for Americans, might be the president's true objective.


    mountaintravelera day ago ,

    Unusually shallow take from Noah. The real reason for the trade war is China's subsidizing SOEs. They subsidize them until the SOEs outcompete all other manufacturers so much that competition dies, and then take over the market. See Moly Corp and rare earths as an example.

    Such dumping is pretty easy to catch, and pretty easy to stop. Perhaps a more focused but more severe tariff structure on things like steel, tires etc would make more sense as an enforcement mechanism.

    Note that the Chinese are willing to give lip service to things that they supposedly agree to, but cannot actually put the mechanisms in place without "losing face". Gimme a break. If Xi hadn't crowed about China's intent for dominance by means of mercantilism, we would still be bending over. Now the only face being lost is his.

    The Chinese will never give up their use of administrative barriers to impede trade internally. But at least they could have said they would. But they couldn't even do that. So again, tariffs are about the only thing they will listen to.

    Epstein's Mother mountaintravelera day ago ,

    The flaw there is that the SOEs may generate a lot of employment in China, but they don't actually generate as much economic growth. And the govt knows this. The support for the SOEs isn't about giving them market share, but to keep them from collapsing precipitously, with all the resulting unemployment. It's China's version of the auto bailout, just on an extended basis. They make up only 25% of China's economy today, down from 50% in 2000.

    Jasper_in_Boston20 hours ago ,

    If Trump wants to slow China's ascent as a superpower, a trade war might be an effective way to do it. If the harm to the U.S. is modest and the costs for China are severe and lasting, Trump might conclude that the former are acceptable losses. Geopolitical primacy, not maximum prosperity for Americans, might be the president's true objective.

    Are we living on the same planet? Coherent, long-term strategic thinking and geopolitical calculus are about as foreign to Trump as marital fidelity.

    mountaintraveler IComment4Fun20 hours ago ,

    Except the Chinese have fewer cards to play. They are in the mother of all bubbles that they desperately want to deflate with a soft landing. And they were well on their way to doing it. Until Xi crowed about it, and basically rubbed the world's nose in his a​ss with the SCS and OBOR, on top of the trade issues.

    That soft landing is now in serious jeopardy. And we all will pay, so I take no satisfaction from China's troubles, now and imminent. But don't blame trump for it happening. It was all those thousand vauted people whose hubris you worship.

    Public opinion is cracking in China as well.

    IComment4Fun mountaintraveler18 hours ago ,

    Whatever China's economic problems are, and why wouldn't a country with such enviable rapid growth into the (soon to be) world's largest economy with the worlds' most internet connected population, have some problems, but they at least seem to study and plan for their future in an intelligent and rational way.

    I don't blame Trump for being a pathological liar and a narcissist, but the spineless Republican Party and "conservatives" who have done nothing to thwart his idiotic behavior. The Chinese have a word for those without a backbone, it translates as "folding chair". My sources tell me a different story about Public Opinion in China.. fwit.. No, they've seen this Trump in action long enough to know he's unreliable as a trading pardner and unbelievable as a leader... He'll fold and the OBOR will proceed more or less as envisioned... Too bad America (trump) has "poisoned" many allies in Asia.

    Tanner Wadea day ago ,

    The sky is falling and it's all Donald Trumps fault!

    The problem is not tariffs or Donald Trump (specifically with China)
    The problems are state sanctioned intellectual property theft and cheating on international trade agreements by the Chinese dictatorship.

    Producers can shift their supply chains away from China to countries that do not view/treat the USA as an adversary and those products will not have tariffs on them. Problem solved. A few years of extra prices from supply-chain resourcing is a very small price to pay to address a dictatorship that seeks to undermine democratic values and human rights.

    DVDemond Tanner Wadea day ago ,

    Your shallow logic is twisted, twinkerbelle.

    Ransomexx Tanner Wadea day ago ,

    If you are looking for cheap labor, the labor you find will be unskilled and without technical resources. It means they must be brought up to today's standards, technically, with your IP. It is the US CEO's that gave away the farm, looking for cheap labor. Apple taught them how to make iPhones, guess what happened? Regardless where they go, US CEO's must give up IP for technical competence.

    profwatson Ransomexxa day ago ,

    The PRC is too expensive. Firms are going to Vietnam and elsewhere.

    Anon2012_201411 hours ago ,

    This time the United States has all the cards. We buy $500 billion per year from them. They only buy $100 billion a year from us. We have 5x leverage. All we have to do is play the hand according to economic game theory.

    If our long run goal is to have a larger economy (and with it all the benefits of being the largest economy, including military security by being able to afford capital ships and planes), we must stop paying China $400 billion extra more than they take from us.

    If China wants to trade, its trade -- $500 billion for $500 billion. If they simply want to use our consumers to build more factory capital we should not allow it. And because of the asymmetry in the balance of trade, we hold all the cards.

    This is Trump's hand to lose by caving in. The optimal move in this game is to raise tariffs and hold until China increases its purchases.

    (And -- tariffs might actually raise S&P 500 earnings long run as additional manufacturing is diverted to old and new U.S. factories -- no one knows and the prognosticator "economists" here have as much empirical evidence as the Austrian School, i.e. they really have no idea other than how they think tariffs ought to cause a recession.)

    clubchampion17 hours ago ,

    There were much better ways to do this. Trump only knows his unilateral tariff way. But it is an improvement over "lead from behind" Obama, who did nothing.

    IComment4Fun clubchampion9 hours ago ,

    Obama's TPP would have organized the largest trade group in history, in asia, to counter China.... Why are you so misinformed?

    Pierre_Rasputin19 hours ago ,

    So it could be this, or it could be that?
    I was wrong before, but now I know....something.
    And you get paid for this?

    mountaintraveler Pierre_Rasputin19 hours ago ,

    The less blind leading us even more blind?

    Brueskiea day ago ,

    The West normalizing relations with China is apt to go down as the biggest blunder in all of human history. China needs to be isolated and cut off at the knees.

    Weather30147 hours ago ,

    Chinese trade policies have always been predatory to the US across Republican and Democrat administrations since Reagan was President. The cost of labor in China is cheap at about $4/hour. Add to that there are few environmental or OSHA-like standards and the pollution is so obvious that at the 2008 Beijing Olympics industry was shut down so that the smog might clear. No US manufacturer without tariff protection can compete with that for unskilled labor. That is a fact. If the US wants to keep some semblance of manufacturing in this country, then tariffs are necessary. And that goes for the countries in the New Nafta and the proposed TPP. The hypocrisy on tariffs is maddening because California's agricultural and Maine and Massachusetts' shoe industry for just a few examples survive only because of the tariffs. Getting tough with China is long overdue, and the political outrage over trying to protect US interests is just Trump Derangement from educated people who should know better.

    sandrala9 hours ago ,

    Buying "made in China" was far too easy, although quality usually suffered (and sometimes dangerously so). Tariffs will force our purchasing agents to look around for better deals...Not a bad idea.

    Alum10 hours ago ,

    We need to stop allowing Chinese Nationals into our STEM programs!

    Look at any graduate program at a top US University's comp sci program, physics, math or any engineering department and you will see that it is heavily filled -- if not dominated -- by Chinese Nationals.

    China has a well organized program to send students to IS STEM programs and US jobs at tech firms and steal the technology.

    emno311 hours ago ,

    I mean...same plan forever?
    That plan is to soak the middle class to make life better for the working class. The theory is mfg will return to the US, because we'll have 9-billion percent tariffs on all imports.

    The net middle-class life goes downhill, the net working-class life goes up.
    then next software and robots will be outlawed.

    The wealthy, of course, stay wealthy.

    robertjberger16 hours ago ,

    Trump is executing Putin's plan to destroy the West from within.

    billsimpson16 hours ago ,

    Washington & Wall Street want to stay top dog as long as possible. If that means most Americans are poorer than they might be, their attitude is, too bad for them. The power base only looks out for itself. That isn't too surprising, since most people are selfish.
    The rise of China would be no big deal if it wasn't a totalitarian state. That makes it extremely dangerous, depending on the wishes of the man at the top. Fortunately, the US is protected from invasion by large oceans, and democratic neighbors with close trade and cultural ties. And then there are all the nukes. No sane person would risk using them first.

    Bobby17 hours ago ,

    I am amazed at the people here commenting on Trump's evil schemes. CHINA IS EVIL, not America. Geesh!

    peacenik18 hours ago ,

    very nice, very nice, how much, how much.

    Historybuff20 hours ago ,

    Good article.

    Mr. Smith writes about the 'why' of trumpy's trade war:

    "It's also possible, of course, that the trade war is a purely populist endeavor, and that maintaining tariffs is simply a way for Trump to look tough. "

    Reality TV show for trumpy... that will hurt millions of Americans... and trumpy and his cronies will never feel it. Just like his business partners that he cheated.

    Nice job, 'trumpy republicans'.
    HB

    Arwa620821 hours ago ,

    You hit the nail right on the head! Good report. Pres Trump main goal is to cripple and contain the rise of China. The trade war is his strategy. As to whether it will succeed or not, only time will tell....The rest of the reasons are just "red herrings" and surprisingly, most Americans felled for it hook line and sinker. But the rest of the world knows all along because US is a hegemonic nation and there are abundant examples of countries that were destroyed by the US for challenging her dominance all over the world. That's why US keep changing the "goal post" from trade deficits to stealing of intellectual property and force technology transfers and now state subsidies. Just as China agrees to US demands, the latter now up the ante and is now insisting that China has to change her laws so that the US can enforce them. Very soon it will be regime change. It will be interesting to see what happen next because to me war is never easy to win. Both sides will suffer and so will the rest of the world. To even think that the US economy is immune to it because it is strong and the numbers are good and it will be able withstand the perfect storm is hubris. Maybe Pres Trump and his neocons can prove history and the Smoot Haley Tariff Act wrong...?

    msdds1a day ago ,

    If you know anything about Narcissists, this is most likely Trumps way of getting you to focus on something other than his deplorable Mueller report, his son DonJr, his huge losses as a business man and his impending Tax returns exposed.

    [May 13, 2019] Markets Tumble As China Unveils Retaliatory Tariffs, May Dump Some Treasuries

    May 13, 2019 | www.zerohedge.com

    After vowing over the weekend to "never surrender to external pressure", Beijing has defied President Trump's demands that it not resort to retaliatory tariffs and announced plans to slap new levies on $60 billion in US goods.

    China's announcement comes after the White House raised tariffs on some $200 billion in Chinese goods to 25% from 10% on Friday (however, the new rates will only apply to goods leaving Chinese ports on or after the date where the new tariffs took effect).

    Here's a breakdown of how China will impose tariffs on 2,493 US goods. The new rates will take effect at the beginning of next month.

    In further bad news for American farmers, China might stop purchasing agricultural products from the US, reduce its orders for Boeing planes and restrict service trade.

    There has also been talk that the PBOC could start dumping Treasurys (which would, in addition to pushing US rates higher, could also have the effect of strengthening the yuan). Though if China is going to dump Treasuries, will they also be dumping US stocks and real estate?

    Hu Xijin 胡锡进 @HuXijin_GT

    China may stop purchasing US agricultural products and energy, reduce Boeing orders and restrict US service trade with China. Many Chinese scholars are discussing the possibility of dumping US Treasuries and how to do it specifically.

    [May 12, 2019] Trump We Are Right Where We Want To Be With China

    May 12, 2019 | www.zerohedge.com

    "It's not China that pays tariffs. It's the American importers, the American companies that pay what in effect is a tax increase and oftentimes passes it on to U.S. consumers," Wallace said.

    As we noted earlier , on Saturday, President Donald Trump said in tweets that it would be wise for China to "act now" to finish a trade deal with the U.S., warning that "far worse" terms would be offered after what he predicted would be his certain re-election in 2020.

    * * *

    And so, as attention turns to China's "countermeasures", Bloomberg notes that while the Communist Party hasn't yet announced what steps it would take, "the commentaries are probably the first part of its response, since state media in China is tightly controlled and the government dictates what can be covered."

    "If they weren't being seriously provoked, the Chinese people would not favor any trade war. However, once the country is strategically coerced, nothing is unbearable for China in order to safeguard its sovereignty and dignity," the Global Times said in the editorial. If the U.S. is to play a roller-coaster-style thriller game, it will bear the consequences."

    In an earlier editorial, the Global Times said the U.S. has made a fundamental misjudgment, that is, believing China is unilaterally benefiting from China-U.S. economic and trade relations."

    "The U.S. has misunderstood the interests of both sides, and seriously underestimated China's endurance," the Global Times warned.

    So to summarize the current state of the talks that on Friday were described as "constructive" helping send the Dow soaring by over 500 points intraday, here is a quick recap courtesy of Mish Shedlock :

    1. Trump demands China put commitments into law.
    2. China replied that "no one should expect China to swallow bitter fruit that harms its core interests".
    3. Trump ordered Lighthizer to begin the process of imposing tariffs on all remaining imports from China This would impact an additional $300 billion worth of goods.
    4. China said it would retaliate.
    5. On Saturday, Trump warned China not to retaliate or it would face worse terms. Trump Tweeted "Love collecting BIG TARIFFS!"
    6. Kudlow said on Sunday he expected retaliatory tariffs to kick in but that it had not happened yet.
    7. China warned Trump on Sunday not to underestimate China's endurance and that China is not afraid to fight.
    8. China posted its own set of demands for further talks including the removal of all extra tariffs.

    As Mish concludes, "This dialog is what's known as "constructive". It's so constructive that further talks between Trump and have been pushed back until the end of June, subject to change of course."

    Meanwhile, as the market's hope for quick resolution fades, keep an eye on Apple and other Chinese consumer-reliant companies, for the market's snap reaction - if Beijing plans to engage in "soft retaliation", it is those corporations that derive much of their revenue from China that will be hit first and hardest. And if there is indeed a shift in sentiment, it will first appear in US equity futures and Chinese stocks, both of which open for trading in just a few hours.


    beemasters , 2 hours ago link

    The idea behind imposing tariffs is to discourage buying, but 10-25% doesn't really make an impact on that front. It only proves that the gubbermint wants to squeeze more out of the little people. Unfortunately, it will backfire (if not already) as shortsighted policies (especially ones that are carried out over Twitter) usually do.

    CashMcCall , 2 hours ago link

    The verdict is not in on that yet. A corporation like Cummins can pay the tariff and deduct it as a business expense same with a importer that is a corporation. LCC now have been destroyed by RINOTAX so they must pass that on to consumers or change to corporations. Bottom line the consumer and or Taxpayer will eat the Tariffs.

    Large multinationals are livid at Trump for this. The GOP is comatose, It has the feeling of a George Bush Subprime moment. The GOP is going to take a big hit for this. Trump is mentally ill and out of control. Congress will have to rescind the section 232 delegation and remove that power from Trump.

    CashMcCall , 2 hours ago link

    The us trades with 102 nations and China has factories and banks in virtually all Asian countries. So there is a logistical fix for this too. And as I have said before HONG KONG has its own treaty with the USA so it is immune to Trump Tariffs. All tariffs are based on shipping origins and destinations so that's a pretty easy fix. Attacking 1 country out of 102, just makes the other 101 countries nervous about the arbitrary and capricious conduct of Trump.

    China as you yourself stated is a heavyweight not some small outfit that can be pushed around by Trump. China is the largest manufacturer in the world. 1000 metric tons of steel etc. Trump is harming US multinationals in China so Trump's days are numbered. Corporations will be hamming republicans tomorrow. Trump is not smart, he's mentally ill and very sick. He had a breakdown when he closed the gov and this is similar in that his mental illness responses are the same paranoia. The threats are similar etc. Same disease different circumstance. And China knows this. They put the hammer down with their three demands. They will not budge.

    China gets a bad rap because they were once very poor. But Gen MacArthur said that if the Chinese Army had not held off the Japanese and fought to the death, the US Marines could not have taken the Japanese islands.

    One other point. Part of the Asian culture is restraint. If China wanted to bust TRUMP hard they would cancel all Boeing Aircraft orders. Mao would have done that. China is now very focused on business and trade and will only retaliate in small measured ways.

    Haboob , 2 hours ago link

    Well said.

    China is not interested in causing conflict as they are too busy winning hearts and minds like America did when it was a fledgling superpower.

    CashMcCall , 1 hour ago link

    America's character went to **** in Vietnam. Then Bush family war criminals got into power. The only thing good about Obama was he distanced America from the Jooz. But along came Trump and his joo daughter and son of a crook in law Kushner and then Trump was antagonizing Iran, Jerusalem with the US embassy and put a US military base in Israel. So Trump is Bibi's houseboy. Then to enforce this Trump appoints bolton, pompeo and Abrams, arms Saudi and signs on for year 17 in Afghanistan. Yet all this is just fine with the TRUMPTARDS as long as they can chant built the wall. Absolutely astonishing how this Orange Tyrant is never held accountable by his Trumptards.

    beemasters , 2 hours ago link

    'Fierce' and 'irrational' pretty much sum up the POTUS' personality. They are spot on.

    CashMcCall , 2 hours ago link

    Trump sounds terrified. His 60 tweets a day are indicative of someone suffering from fear. I have seen this in battle and thats why everyone else gets clear of the yapper. His number is up.

    ElBarto , 3 hours ago link

    I wonder if the Chinese media will show all the factories owned by the communist party cadres chugging along with free money from the government, while millions of workers in privately owned factories are losing their jobs. All Trump wanted was for these government run industries to go private, but the communist party needs to give jobs to friends and relatives. Because if you're not a friend or relative of the communist party, you don't really matter in China.

    HoyeruNew , 2 hours ago link

    what about the factories of Lockheed martin, Boeing, rayteon, churning along along with free money from the US government, while millions of workers in privately owned companeis such as SEARs, Toys R US are losing their jobs?

    there I fixed it for you.

    Haboob , 2 hours ago link

    HAHA well said. America is a fascist country same as China is without the whole stigma of gommunism.

    Haboob , 2 hours ago link

    Correction, Trump wants China to open up their markets to western exploitation which is not happening. If you understand history about China it is mired in exploitation from European powers in the region. I don't blame China for its protectionism and their ambitions to become an independent country.

    ludwigvmises , 3 hours ago link

    The Orange Swine cut taxes for big corporations and multi millionaires and now lets middle class consumers pay the trade war with China. And then orders the Fed to cut rates by 1% to destroy the Dollar. What's next? Value added tax anyone?

    CashMcCall , 3 hours ago link

    China trade and USA small potatoes..


    1 Asia 2,094.4

    2 Europe 696.3

    3 North America 613.1

    4 Latin America 235.9

    5 Africa 178.8

    6 Oceanic and Pacific Islands 133.4

    North American includes the USA and Canada. China exports 438 Billion and imports 180 billion from North America.

    So if you look at it intelligently, US Tariffs have very little leverage but do harm the US supply chain enormously. When China applies retaliatory tariffs to the US and Canada, they can hurt you badly. The US farmer is the prime example.

    But the most important thing to look at is not your silly protectionism but the size of the ASIAN markets. China has been consolidating all of Asia. They have companies and banks in all of those countries and their Asia Trade alone is over 2 trillion annually. Trump screams about applying tariffs to 380 Billion in goods with no comprehension of how much he loses in access to Asia.

    So as Bill O'Neil said, the only thing that matters for the next 100 years is the Asian Consumer. Nothing else matters. Asian growth is exploding.

    The chief export of the USA is aircraft 130 Billion a year. That will change drastically with Boeing. China is building its own narrow body aircraft. Russia is also getting into the narrowbody aircraft space. The US doesn't want to be cultivating enemies in Asia.

    [May 12, 2019] The US-China trade war just got a lot worse. And there's no quick fix for relations by Robyn Dixon and Don Lee

    Many go directly to Washington coffers. But maney will be taken mostly from the US consumers of Chinese goods. Also it is unclear what sanctions China will introduce in return, if any.
    Notable quotes:
    "... But the prolonged trade war — and Friday’s tariff hike — serves as ammunition for hawks on both sides, who see a more confrontational struggle for global dominance unfolding. ..."
    "... In China, there is a growing belief that the U.S. motive in the talks is not to balance trade relations, but to undermine China, slow its rise and hamper its ability to best America in strategic high-tech fields. ..."
    "... Hu Xijin , editor of the Communist Party-owned Global Times , has tweeted in English that China was “fully prepared for an escalated trade war.” He argued there is increased popular support in Beijing for a confrontational approach to the U.S. ..."
    "... “The real intention of the U.S. is to squeeze China’s space in new technologies,” the editorial said. ..."
    "... “Things will continue to slide downward into deeper competitive tensions,” Gill predicted, “including on the economic front because trade is not the problem. The deeper problem … is the question of economic and technological competition. ..."
    "... Chinese President “Xi Jinping is not a forgiving man, so I think we can see that Xi Jinping will take a more robust stance against the U.S. if and when he feels that the Chinese government is able to do so successfully,” Tsang said. ..."
    "... The United States faces a possibility that in decades, China could overtake it as the world’s largest economy. China’s economy is already ranked No. 1 in terms of purchasing parity power, a measure that adjusts GDP to account for price differences in countries. ..."
    May 10, 2019 | www.latimes.com

    ... ... ...

    Even if the two sides can break through the stalemate and strike a deal on trade, the larger message of the week is that U.S.-China relations have changed fundamentally, and there is probably no going back.

    Although their business relations are deeply entwined, the White House and China view themselves as aggressive rivals jostling for global influence and geopolitical power.

    The trade war launched by Trump is just one manifestation of this. Military friction in the South China Sea, a string of espionage scandals, China’s rising military strength and the Trump administration’s battle against Chinese tech giant Huawei are all signs of an ominous chill in relations.

    Although a trade deal seemed at hand in recent weeks, Trump administration officials have accused China of reneging on agreements that had been made over months of negotiations. To pressure Beijing to return to its previous commitments, Washington ratcheted up tariffs on $200 billion in products from China from 10% to 25%. China announced immediately that it would retaliate.

    Some experts said last-minute revisions from China are typical of its negotiating strategy, as with Trump’s mercurial bargaining style.

    If trade negotiators do not reach a deal in coming weeks, the U.S., Chinese and global economies will be hurt, say analysts, who assume both sides will find a way to end the impasse.

    “My baseline scenario is that both leaders still need a deal for political reasons, so we are likely to get one in the next few weeks, but it won't be this week,” said Arthur Kroeber of Gavekal Dragonomics , a financial research firm headquartered in Hong Kong. “The maneuvering right now is mainly end-of-negotiation stuff. But both sides are playing brinkmanship pretty hard so there is material risk (say 20 to 25%) that we don’t get a deal.”

    But the prolonged trade war — and Friday’s tariff hike — serves as ammunition for hawks on both sides, who see a more confrontational struggle for global dominance unfolding.

    In China, there is a growing belief that the U.S. motive in the talks is not to balance trade relations, but to undermine China, slow its rise and hamper its ability to best America in strategic high-tech fields.

    Tariffs already have prompted some U.S. firms in China to shift their supply chains elsewhere. China hawks in the Trump administration believe that applying heavy taxes on imports can be one way to “decouple” from China.

    U.S. legal charges against Huawei executive Meng Wanzhou, and Secretary of State Michael R. Pompeo’s blunt efforts to dissuade European nations from using Huawei in 5G telecom networks by threatening not to share intelligence, have hardened suspicions in China, as have harsh criticisms and rhetoric from other senior officials in the Trump administration.

    “None of the news of the past year or two has been very positive in terms of the geopolitical direction of this relationship. It’s gone from tense to worse, and while the trade relationship seems to get a lot of the headlines, a lot more problematic, even dangerous elements are unfolding in other areas of the relationship particularly around security and military affairs,” said Bates Gill, China expert and professor at Macquarie University in Sydney, Australia.

    “A so-called resolution of the current trade war is not going to remove or resolve the fundamental structural problems in the economic relationship,” he said.

    U.S. business has long favored engagement with China, arguing that external pressure from the United States and others has pushed China to open its economy. More recently, however, that assumption has been called into question by many in the West, giving Trump more political space to go after China on trade and other areas.

    Still, Jacob Parker , vice president of China Operations at the U.S.-China Business Council , warned that if the Trump administration confronts China too aggressively, it could backfire. He said that instead of persuading China to open up more to American companies and ending its insistence that they share their technology in return for market access, aggressive new tariffs could have the opposite effect.

    Parker also warned that Friday’s tariff hike on $200 billion of Chinese imports — and Trump’s threats to slap tariffs on an additional $325 billion in Chinese goods in the near future — has undermined economic reformers in the Chinese system and strengthened the voices of hard-liners.

    “That hardens those voices domestically and reinforces the perspective that the U.S. is trying to contain China,” he said. “If we push the Chinese too far, I think there’s a concern in the business community that we may go beyond what China can accept and that things could start to fall apart. If that happens, I think we can at the least expect that the Chinese economic reform process would come to an end.”

    And in Washington, the lack of a deal would result in “increased tensions between the national security wing of the U.S. administration, who will be happy with this result, and the business-tech community, who are anxious to expand their participation in China and will be pretty mad,” said Kroeber, of the Hong Kong financial research firm.

    Stephen K. Bannon , former chief strategist to Trump, is among a group of hawks who formed the Committee on the Present Danger: China, an organization that sees its role as warning Americans and political and business leaders of the “existential threats” to America posed by China.

    Meanwhile, Hu Xijin , editor of the Communist Party-owned Global Times , has tweeted in English that China was “fully prepared for an escalated trade war.” He argued there is increased popular support in Beijing for a confrontational approach to the U.S.

    “More and more Chinese now tend to believe the current US government is obsessed with comprehensively containing China,” he tweeted Thursday.

    A Global Times editorial Thursday said trade was “only a sideshow” in the confrontation between the U.S. and China and the real issue was the U.S. fear that China would catch up to it in high-tech fields.

    “The real intention of the U.S. is to squeeze China’s space in new technologies,” the editorial said.

    Many analysts, including Australian professor Gill, share the view that relations are in long-term decline.

    “Things will continue to slide downward into deeper competitive tensions,” Gill predicted, “including on the economic front because trade is not the problem. The deeper problem … is the question of economic and technological competition.

    “Ultimately at the bottom of all of this, the problem abides that the two countries don’t trust each other and see each other as long-term strategic competitors.”

    Steve Tsang , director of the SOAS China Institute at the University of London, said regardless of who is president, the U.S. and China will become increasingly competitive in the next two decades.

    Chinese President “Xi Jinping is not a forgiving man, so I think we can see that Xi Jinping will take a more robust stance against the U.S. if and when he feels that the Chinese government is able to do so successfully,” Tsang said.

    As relations decline, both Washington and Beijing are likely to compete to draw countries into their orbit, he predicted.

    He said European countries and the U.K. would drift toward the U.S. “because ultimately this is what we believe in more. You will have a whole bunch of other countries that will drift towards the Chinese because they remain fundamentally authoritarian states.”

    China’s global Belt and Road Initiative — in which it projects its international power through soft loans for infrastructure — would also draw some nations to China, he added.

    Underscoring frictions are U.S. fears that China may overtake it in a range of high-tech fields including space exploration, artificial intelligence, surveillance technology, driverless cars and even military hardware.

    Huawei’s emergence as the global leader in 5G technology — with no American rival — was a shock to U.S. policymakers.

    Parker, of the U.S.-China Business Council, said that although the U.S. and China face a challenging security relationship, it is important to ensure that trade is not affected.

    “I think there’s definitely a competitive dynamic between the U.S. and China, and that will continue into the future. The twist is to ensure that the national security issues don’t get entwined with the businesses’ side.”

    The United States faces a possibility that in decades, China could overtake it as the world’s largest economy. China’s economy is already ranked No. 1 in terms of purchasing parity power, a measure that adjusts GDP to account for price differences in countries.

    “It would be a major milestone. It would send a lot of shock waves and shivers certainly in the United States and much of the rest of the world and I think would be seen as a major turning point, not unlike the United States overtaking the United Kingdom as the world’s largest economy back in the late 19th century,” Gill said. “It would certainly be the end of an era and the beginning of a new one.”

    Trump’s tariff hike on Chinese goods takes effect as the two sides keep talking »


    markmcintyre726 in reply to jim000659

    Trump's misguided tariff/trade war policies are straight out of the 19th century. They are tearing apart relations with our allies and playing straight into Putin's hands. They will cost U.S. consumers and businesses billions in tariff fees and higher prices on goods. They are squeezing American farmers to the breaking point. Nobody wins a trade war.

    [May 12, 2019] Odds Point To A Worst-Case Scenario Shocked Traders Respond To Latest Trade War Twist

    Trump bravado is probably unwarranted. Here the train already left the station: the USA can do a damage to Chine economy only by talking considerable damage to the empire and probably to the status of the dollar as well.
    Notable quotes:
    "... Commenting on this list, the Editor in Chief of the Global Times, Hu Xijin, who has become a real-time translator for Chinese unspoken intentions on twitter, explained that "from perspective of China's politics, there is little room for compromises. They will insist. This political logic won't be changed no matter how much additional tariffs the US will impose." ..."
    "... Trump responded immediately on Twitter when he made it clear on Saturday that the US would not relent, stating that the Chinese may have felt they were "being beaten so badly" in the recent talks that it was better to drag their feet in hopes he would lose the 2020 election and get a better deal from the Democrats. Trump then said that "the only problem is that they know I am going to win (best economy & employment numbers in U.S. history, & much more), and the deal will become far worse for them if it has to be negotiated in my second term. Would be wise for them to act now, but love collecting BIG TARIFFS!" ..."
    May 12, 2019 | www.zerohedge.com

    Following some soothing words from both the US and Chinese sides on Friday that while talks to avert a tariff hikes had failed, they were "constructive" and there was grounds for "cautious optimism" for the future, the standoff between the U.S. and China abruptly escalated over the weekend when China's vice premier Liu He said that China is planning how to retaliate and listed three core concerns that must be addressed, and on which it wouldn't make concessions, ahead of any deal including:

    Commenting on this list, the Editor in Chief of the Global Times, Hu Xijin, who has become a real-time translator for Chinese unspoken intentions on twitter, explained that "from perspective of China's politics, there is little room for compromises. They will insist. This political logic won't be changed no matter how much additional tariffs the US will impose."

    Trump responded immediately on Twitter when he made it clear on Saturday that the US would not relent, stating that the Chinese may have felt they were "being beaten so badly" in the recent talks that it was better to drag their feet in hopes he would lose the 2020 election and get a better deal from the Democrats. Trump then said that "the only problem is that they know I am going to win (best economy & employment numbers in U.S. history, & much more), and the deal will become far worse for them if it has to be negotiated in my second term. Would be wise for them to act now, but love collecting BIG TARIFFS!"

    [May 12, 2019] Why Further U.S.-China Economic War Seems Certain by Alan Tonelson

    May 12, 2019 | nationalinterest.org

    Trade, however, doesn't represent the only U.S.-China economic activity whose profile has lowered recently. For example, since 2016, two-way foreign direct investment (purchases of so-called hard assets, like factories and real estate, as opposed to financial assets, like government bonds) has cratered by fully 70 percent. Most of the drop is due to an 80 percent decrease in Chinese investment in the United States, and the bulk of that decline came in 2018. But American direct investment in China peaked back in 2008, as the recession struck, hasn't come close to recovering since, and is also down slightly since 2012.

    U.S.-China economic flows are still so great that they won't dry up completely. Nor should anyone expect the current unwinding to continue at its current pace. After all, China still boasts advantages in many manufacturing industries (which dominate bilateral trade) sure to sustain sales to American households and businesses. Chief among them are the scale of existing production complexes in China and the efficiencies that result, along with the wide range of cost-reducing subsidies these sectors receive from Beijing. Further, China can't expect to find foreign markets capable of replacing its sales to the United States, and therefore supporting its own ability to grow and maintain the employment levels vital for political stability. Nor will American businesses be able to totally blow off the enormous Chinese market and its own still-impressive growth.

    .... ... ...

    Nonetheless, the days are over when the United States -- or at least its political and business leaders -- saw mushrooming commerce with China as an expressway to greater national prosperity and higher profits, not to mention a powerful contributor to global well-being, security, and stability, and a means of democratizing China itself. With all these hopes dashed, Washington and the American business community will find ample reasons to keep looking for exits.

    Alan Tonelson is the founder of RealityChek, a public policy blog focusing on economics and national security, and the author of The Race to the Bottom.

    R. Arandas an hour ago ,

    I do not necessarily support his course of action...but I feel that sometimes, doing the unexpected and unconventional thing can lead to new doors and new possibilities.

    BigMike 17 hours ago ,

    China's internal debt situation is so precarious that it can ill-afford a trade war with US. China has a trade surplus of $325 billion with the US. This kind of skewed number is totally unacceptable. By reneging on the provisional agreements over IP and other hurdles, China is playing with fire.

    I am not a Trump supporter but I think his policy on China is right on the money. No other US president had the courage to address this issue.

    [May 12, 2019] The U.S.-China trade war just got a lot worse. And there's no quick fix for relations - Los Angeles Times

    May 12, 2019 | www.latimes.com

    javascript:false

    Even if the two sides can break through the stalemate and strike a deal on trade, the larger message of the week is that U.S.-China relations have changed fundamentally, and there is probably no going back. Although their business relations are deeply entwined, the White House and China view themselves as aggressive rivals jostling for global influence and geopolitical power. The trade war launched by Trump is just one manifestation of this. Military friction in the South China Sea, a string of espionage scandals, China's rising military strength and the Trump administration's battle against Chinese tech giant Huawei are all signs of an ominous chill in relations. Although a trade deal seemed at hand in recent weeks, Trump administration officials have accused China of reneging on agreements that had been made over months of negotiations. To pressure Beijing to return to its previous commitments, Washington ratcheted up tariffs on $200 billion in products from China from 10% to 25%. China announced immediately that it would retaliate. Some experts said last-minute revisions from China are typical of its negotiating strategy, as with Trump's mercurial bargaining style. If trade negotiators do not reach a deal in coming weeks, the U.S., Chinese and global economies will be hurt, say analysts, who assume both sides will find a way to end the impasse. "My baseline scenario is that both leaders still need a deal for political reasons, so we are likely to get one in the next few weeks, but it won't be this week," said Arthur Kroeber of Gavekal Dragonomics , a financial research firm headquartered in Hong Kong. "The maneuvering right now is mainly end-of-negotiation stuff. But both sides are playing brinkmanship pretty hard so there is material risk (say 20 to 25%) that we don't get a deal." But the prolonged trade war -- and Friday's tariff hike -- serves as ammunition for hawks on both sides, who see a more confrontational struggle for global dominance unfolding. In China, there is a growing belief that the U.S. motive in the talks is not to balance trade relations, but to undermine China, slow its rise and hamper its ability to best America in strategic high-tech fields. Tariffs already have prompted some U.S. firms in China to shift their supply chains elsewhere. China hawks in the Trump administration believe that applying heavy taxes on imports can be one way to "decouple" from China. U.S. legal charges against Huawei executive Meng Wanzhou, and Secretary of State Michael R. Pompeo's blunt efforts to dissuade European nations from using Huawei in 5G telecom networks by threatening not to share intelligence, have hardened suspicions in China, as have harsh criticisms and rhetoric from other senior officials in the Trump administration. "None of the news of the past year or two has been very positive in terms of the geopolitical direction of this relationship. It's gone from tense to worse, and while the trade relationship seems to get a lot of the headlines, a lot more problematic, even dangerous elements are unfolding in other areas of the relationship particularly around security and military affairs," said Bates Gill, China expert and professor at Macquarie University in Sydney, Australia. Advertisement "A so-called resolution of the current trade war is not going to remove or resolve the fundamental structural problems in the economic relationship," he said. U.S. business has long favored engagement with China, arguing that external pressure from the United States and others has pushed China to open its economy. More recently, however, that assumption has been called into question by many in the West, giving Trump more political space to go after China on trade and other areas. Still, Jacob Parker , vice president of China Operations at the U.S.-China Business Council , warned that if the Trump administration confronts China too aggressively, it could backfire. He said that instead of persuading China to open up more to American companies and ending its insistence that they share their technology in return for market access, aggressive new tariffs could have the opposite effect. Parker also warned that Friday's tariff hike on $200 billion of Chinese imports -- and Trump's threats to slap tariffs on an additional $325 billion in Chinese goods in the near future -- has undermined economic reformers in the Chinese system and strengthened the voices of hard-liners. "That hardens those voices domestically and reinforces the perspective that the U.S. is trying to contain China," he said. "If we push the Chinese too far, I think there's a concern in the business community that we may go beyond what China can accept and that things could start to fall apart. If that happens, I think we can at the least expect that the Chinese economic reform process would come to an end." And in Washington, the lack of a deal would result in "increased tensions between the national security wing of the U.S. administration, who will be happy with this result, and the business-tech community, who are anxious to expand their participation in China and will be pretty mad," said Kroeber, of the Hong Kong financial research firm. Advertisement

    Stephen K. Bannon , former chief strategist to Trump, is among a group of hawks who formed the Committee on the Present Danger: China, an organization that sees its role as warning Americans and political and business leaders of the "existential threats" to America posed by China. Meanwhile, Hu Xijin , editor of the Communist Party-owned Global Times , has tweeted in English that China was "fully prepared for an escalated trade war." He argued there is increased popular support in Beijing for a confrontational approach to the U.S. "More and more Chinese now tend to believe the current US government is obsessed with comprehensively containing China," he tweeted Thursday. A Global Times editorial Thursday said trade was "only a sideshow" in the confrontation between the U.S. and China and the real issue was the U.S. fear that China would catch up to it in high-tech fields. "The real intention of the U.S. is to squeeze China's space in new technologies," the editorial said. Many analysts, including Australian professor Gill, share the view that relations are in long-term decline. "Things will continue to slide downward into deeper competitive tensions," Gill predicted, "including on the economic front because trade is not the problem. The deeper problem is the question of economic and technological competition. "Ultimately at the bottom of all of this, the problem abides that the two countries don't trust each other and see each other as long-term strategic competitors." Steve Tsang , director of the SOAS China Institute at the University of London, said regardless of who is president, the U.S. and China will become increasingly competitive in the next two decades. Chinese President "Xi Jinping is not a forgiving man, so I think we can see that Xi Jinping will take a more robust stance against the U.S. if and when he feels that the Chinese government is able to do so successfully," Tsang said. As relations decline, both Washington and Beijing are likely to compete to draw countries into their orbit, he predicted. He said European countries and the U.K. would drift toward the U.S. "because ultimately this is what we believe in more. You will have a whole bunch of other countries that will drift towards the Chinese because they remain fundamentally authoritarian states." China's global Belt and Road Initiative -- in which it projects its international power through soft loans for infrastructure -- would also draw some nations to China, he added. Underscoring frictions are U.S. fears that China may overtake it in a range of high-tech fields including space exploration, artificial intelligence, surveillance technology, driverless cars and even military hardware. Huawei's emergence as the global leader in 5G technology -- with no American rival -- was a shock to U.S. policymakers. Parker, of the U.S.-China Business Council, said that although the U.S. and China face a challenging security relationship, it is important to ensure that trade is not affected. "I think there's definitely a competitive dynamic between the U.S. and China, and that will continue into the future. The twist is to ensure that the national security issues don't get entwined with the businesses' side." The United States faces a possibility that in decades, China could overtake it as the world's largest economy. China's economy is already ranked No. 1 in terms of purchasing parity power, a measure that adjusts GDP to account for price differences in countries. "It would be a major milestone. It would send a lot of shock waves and shivers certainly in the United States and much of the rest of the world and I think would be seen as a major turning point, not unlike the United States overtaking the United Kingdom as the world's largest economy back in the late 19th century," Gill said. "It would certainly be the end of an era and the beginning of a new one." Trump's tariff hike on Chinese goods takes effect as the two sides keep talking "

    [May 11, 2019] China tariffs could add $2,500 to average car price, says expert

    [Video]
    Notable quotes:
    "... And if we don't protect manufacturing jobs in the US the whole damned car will be made in China and there won't be decent paying jobs here manufacturing them. ..."
    "... I have worked with Chinese auto parts suppliers. They run from OK to horrible. ..."
    "... In reality, the tariffs are 'cash in the bank' for the U.S. Treasury. If nothing else, tariffs will allow our politicians to spend more each year - perhaps we might even get to the point that our nation avoids 'deficit spending' for at least one year. ..."
    May 11, 2019 | finance.yahoo.com

    John Murphy of Bank of America joins CNBC's "Closing Bell" to discuss the impact of new tariffs on the auto industry.


    William 23 hours ago

    And if we don't protect manufacturing jobs in the US the whole damned car will be made in China and there won't be decent paying jobs here manufacturing them.

    c craig f 21 hours ago

    Cars that do not use Chinese parts will sell better and the world it will keep turning

    P Park Slope 23 hours ago

    Great. I'll keep my old one. Thanks for the savings.

    BobBob, yesterday

    I have worked with Chinese auto parts suppliers. They run from OK to horrible. I'd never buy from them - maybe as a LAST option to avoid going belly up. The problem then becomes losing repeat customers due to quality and reliability problems....

    GeorgeGeorge, 10 hours ago

    Do not understand how the anti-Trump politicians and the media can be against these tariffs. In reality, the tariffs are 'cash in the bank' for the U.S. Treasury. If nothing else, tariffs will allow our politicians to spend more each year - perhaps we might even get to the point that our nation avoids 'deficit spending' for at least one year.

    [May 11, 2019] China Lists The Three Conditions To Agree To Trade Deal

    May 11, 2019 | www.zerohedge.com

    In an unusual move, the Chinese delegation has come clean to the domestic press about Beijing's remaining trade-deal related demands, exposing steep divides that could make it a final deal impossible for Trump, who has repeatedly said he will only accept a "great" deal.

    Unsurprisingly, Liu He, the leading Chinese trade negotiator, confirmed what Beijing has intimated time and time again :

    That without the complete removal of all trade-war related tariffs, Beijing will not remorse a deal.

    The other two demands were related to American commitments to buy Chinese goods , something that could also pose a problem.

    In a wide-ranging interview with Chinese media after talks in Washington ended Friday, Vice Premier Liu He said that in order to reach an agreement the U.S. must remove all extra tariffs, set targets for Chinese purchases of goods in line with real demand and ensure that the text of the deal is "balanced" to ensure the "dignity" of both nations.

    [May 11, 2019] China Names Its Trade-Deal Price as Trump Sets New Deadline

    May 11, 2019 | www.bloomberg.com

    China for the first time made clear what it wants to see from the U.S. in talks to end their trade war, laying bare the deep differences that still exist between the two sides.

    In a wide-ranging interview with Chinese media after talks in Washington ended Friday, Vice Premier Liu He said that in order to reach an agreement the U.S. must remove all extra tariffs, set targets for Chinese purchases of goods in line with real demand and ensure that the text of the deal is "balanced" to ensure the "dignity" of both nations.

    Liu's three conditions underscore the work still to be done if an accord is to be reached between the world's two largest economies. President Donald Trump's own negotiators told China it has a month to seal a deal or face tariffs on all its exports to the U.S.

    That threat was made during talks Friday in Washington, hours after Trump upped the ante by imposing a second round of punitive duties on $200 billion in Chinese goods. China vowed retaliation, but hadn't announced any details as of Saturday evening in Beijing.

    U.S. Trade Representative Robert Lighthizer said the administration would on Monday release details of its plans for tariffs on an additional $300 billion in imports from China, setting the process in motion for Trump to deliver on the threat to hammer all Chinese trade.

    U.S. officials insist they have been working on a deal that would bring an end to what they portray as China's rampant theft of American intellectual property and rein in the industrial subsidies that have fueled the rapid ascent of Chinese corporate giants.

    Trump's move to raise tariffs on Friday came after China backed away from prior commitments to enshrine changes promised at the negotiating table in Chinese law, according to U.S. officials. During his meetings in Washington this week Liu said China was ready to commit to pushing reforms via State Council directives but again balked at changing any laws, according to one person familiar with the discussions.

    In his interview Liu said both sides agreed to keep talking despite what he called "some temporary resistance and distractions,'' and to hold future meetings in Beijing. He dismissed the idea that talks had broken down. "It's normal to have hiccups during the negotiations. It's inevitable."

    Liu also struck a note of defiance. "For the interest of the people of China, the people of U.S. and the the people of the whole world, we will deal with this rationally," the vice premier said. "But China is not afraid, nor are the Chinese people," adding that "China needs a cooperative agreement with equality and dignity."

    'Candid and Constructive'

    In a series of tweets that cheered markets, Trump declared Friday that the talks with China had been candid and constructive. "The relationship between President Xi and myself remains a very strong one, and conversations into the future will continue," he said. Further talks are possible, but there's no immediate plan for the next round, according to a person familiar with the negotiations.

    Liu's comments, however, revealed yet another new fault line: a U.S. push for bigger Chinese purchases to level the trade imbalance than had originally been agreed.

    To Be Tariffed...Maybe

    Top 10 U.S. imports from China which haven't been tariffed in current dispute

    https://www.bloomberg.com/toaster/v2/charts/a4cbca7583de4d4b8f0a03d81cca277e.html?brand=politics&webTheme=politics&web=true&hideTitles=true

    Source: U.S. International Trade Commission

    <style> .chart-js { display: none; } </style> <img src="https://assets.bwbx.io/images/users/iqjWHBFdfxIU/ia8Px00T7e.8/v0/-1x-1.png">

    According to Liu, Trump and Chinese President Xi Jinping agreed "on a number" when they met in Argentina last December to hammer out the truce that set off months of negotiations. That "is a very serious issue and can't be changed easily."

    Read more about China's offer to end the imbalance in trade with U.S.

    The amount of purchases by China should be "in line with reality," according to a commentary by state news agency Xinhua on Saturday. China also sees the removal of all the extra tariffs that have been imposed since last year as a precondition to a deal, whereas U.S. negotiators see retention of some duties as a key mechanism to enforce a deal.

    The lack of progress left major question-marks hanging over the search for a deal on trade -- just one source of tensions in a growing geopolitical rivalry that's already shifting supply chains and testing established economic and security alliances.

    Trump, who is seeking re-election on the back of a booming U.S. economy, on Friday sought to justify his decision to hike tariffs as well as to convince businesses and financial markets that he wasn't walking away from a deal.

    No Rush "There is absolutely no need to rush," the U.S. president said. In another tweet, Trump proposed a vast new plan to use income from tariffs to buy up the crops of American farmers who've watched their exports to China collapse, and send them to poor countries as aid.

    The presidential good humor hid what people familiar with the discussions say has been an increasingly gloomy mood around the negotiations in recent days.

    Before a rebound late Friday, U.S. equity markets had posted their worst week of the year, as the trade truce that had been in place for months was shattered by the new U.S. tariffs. The S&P 500 recovered from earlier losses Friday, ending the day 0.4% higher.

    Election Year

    This week's tariff move is likely to have significant short-term consequences for retailers and other U.S. businesses reliant on imports from China. But extending it to all trade would increase the economic and political stakes even further for Trump and American businesses.

    Such a step would see price increases on smartphones, laptops and other consumer goods -- the kind that Trump's advisers have been eager to avoid, out of concern for the domestic fallout. It would likely provoke further retaliation , and some economists are predicting it could even tip the U.S. economy into recession just as Trump faces re-election in 2020.

    'Gets Harder'

    This week's talks have also amplified the differences that remain between the two governments as they navigate their own domestic politics as well as a growing international rivalry.

    Liu's interview underlined the need for any agreement not to be seen as undermining Chinese sovereignty -- as the U.S. demand to change domestic laws surely would be.

    The text "must be balanced" for the dignity of a country, Liu said, repeating China and the U.S. are "trying to meet halfway" despite different views on some crucial issues.

    Securing a trade deal is likely to get harder from here unless outside factors, such as an economic downturn , force a compromise, according to Ely Ratner, a China expert who served in the administration of President Barack Obama and is now director of studies at the Center for a New American Security think-tank.

    "The question is can the Chinese come back and offer enough such that Trump can sell it?'' he said. "It is going to be hard for them to do that in the face of Trump escalating. I think it gets harder as this thing goes on, and it gets harder politically for Trump.''

    -- With assistance by Jennifer Jacobs, Ye Xie, Andrew Mayeda, Jim Jia, Natalie Lung, Saleha Mohsin, and Jenny Leonard

    [May 07, 2019] Bannon We're In An Economic War With China. It's Futile To Compromise by Stephen K. Bannon

    Bannon is really weak. this is the logic of neoliberal that raised China: cheap labor attracts multinationals like honey attracts flies.
    May 06, 2019 | www.zerohedge.com
    Written by Stephen K. Bannon via the Washington Post

    Stephen K. Bannon served as chief strategist for President Trump from January 2017 to August 2017.

    Getting tough with China to bring manufacturing jobs back to the United States was the linchpin of President Trump's electoral march through the Rust Belt during his 2016 victory. Today, the goal of the radical cadre running China -- the Chinese Communist Party (CCP) -- is to be the global hegemonic power. The president's threatened tariffs on Sunday demonstrate the severity of this threat. But as Washington and Beijing wrap up months of negotiations on a trade deal this month, whatever emerges won't be a trade deal. It will be a temporary truce in a years-long economic and strategic war with China.

    These are six "understandings" that highlight why it is futile to compromise with this regime.

    The first understanding : The CCP has been waging economic war against industrial democracies ever since China joined the World Trade Organization (WTO) in 2001, and now China has emerged as the greatest economic and national security threat the United States has ever faced.

    As a framework for the current trade talks, China must agree to end forced technology transfers; intellectual property theft; cyberintrusions into business networks; currency manipulation; high tariff and nontariff barriers; and unfair subsidies to state-owned enterprises. However, if the CCP agrees to the United States' demands in an enforceable manner, it would amount to a legal and regulatory dismantling of Chinese state capitalism.

    The second understanding : The trade deal under negotiation this month is not a deal between two similar systems seeking closer ties, as its cheerleaders on Wall Street and in the media and academia argue. Rather, this is a fundamental clash between two radically different economic models.

    The best U.S. result is a detailed document in which China renounces its predatory, confiscatory and mercantilist practices while providing ample means to monitor and promptly enforce the agreement.

    The best CCP result is to get the tariffs lifted by filing reams of paper with false, unenforceable promises that will allow it to run out the clock on the Trump administration and hope for a less antagonistic Democratic alternative.

    The third understanding : Chinese state capitalism is highly profitable for its owners -- the members of the CCP. Stagnant state-owned enterprises gain a competitive edge through massive government subsidies and the cost savings won by stealing the intellectual property, technology and innovations of foreigners.

    If China halted such grand theft, its enterprises would be rapidly outcompeted by the Germans, South Koreans, Japanese and especially the United States.

    This fact explains much about internal Chinese politics today. President Xi Jinping faces a palace sharply divided between reformers led by chief trade negotiator Liu He and a swarm of hawks who have profited and gained power from the status quo. Within China itself, it is both gallows humor and even money as to whether Liu He will be celebrated as the next Deng Xiaoping or end up in a Chinese gulag.

    The fourth understanding : Trump advisers inside and outside the White House are playing on the president's well-earned pride in a rising stock market and a fear he might lose the Farm Belt to try to box him into a weak deal. But it is a decidedly false narrative that any failure to reach a deal will lead to a market meltdown and economic implosion.

    In fact, there is no better argument for Trump keeping his bold tariffs on China than the latest report that the U.S. economy grew at an annualized rate of 3.2 percent in the first quarter .

    Anything less than a great deal will subject the president to relentless criticism from the Charles E. Schumer and Bernie Sanders wings of the Democratic Party. In addition, Sens. Marco Rubio (R-Fla.) and Ted Cruz (R-Tex.) might use it to get to the right of Trump on China -- potentially setting up a later primary challenge. For these reasons, the president's best political option is not to surrender, but rather, to double down on the tariffs -- they have been highly effective in pressuring the Chinese without harming the U.S. economy.

    The fifth understanding : Even the toughest agreement needs effective monitoring, which is difficult even with accommodating partners and perhaps impossible with China. The danger is for the president to sign what appears to be a reasonable deal and find out several years later that the United States was hoodwinked.

    The United States failed to adequately monitor China's entry into the WTO in 2001. Instead of access to a billion Chinese consumers, the United States lost more than 5 million manufacturing jobs since 2000.

    The sixth understanding : The world now bears witness to a rapidly militarizing totalitarian state imprisoning millions in work camps; persecuting Uighurs, Christians and Buddhists; and spying on, and enslaving, its own population.

    This is history in real time; and the world is a house divided -- half slave, half free. Trump and Xi are facing off to tip the scales in one direction or the other. One way leads to the benefits of freedom, democracy and free-market capitalism. The other leads to a totalitarian and mercantilist power run on state capitalism with Chinese characteristics.

    The United States' fight is not with the Chinese people but with the CCP. The Chinese people are the first and continuous victims of this barbarous regime.

    The central issues that must be faced are China's intentions on the world stage and what those ambitions mean for U.S. prosperity. With our country at a crossroads, it is more important than ever that Trump follow his instincts and not soften his stance against the greatest existential threat ever faced by the United States.


    TheRapture , 7 minutes ago link

    I expected better from Bannon . . .

    1. China must agree to end forced technology transfers; intellectual property theft; cyberintrusions into business networks; currency manipulation; high tariff and nontariff barriers; and unfair subsidies to state-owned enterprises.

    In the good 'ol USA, we refer to this as "corporate welfare", direct federal subsidies (eg farm subsidies), MIC and government 'no-bid defense' contract, oil depletion allowance, tax credits and other tax incentives such as accelerated depreciation, dividend tax, Advanced Technology Program, federal land giveways, local & state land & tax "incentive" giveways, carried interest, welfare and food stamp costs paid to employees of companies like Walmart and McDonalds (because employee wages for full time employment fall below poverty level), the clunker auto subsidy program to bail out US auto companies, the mortgage interest deduction, and more. The cherry on top is, of course, the trillions of dollars in TARP and QE given to giant banks to bail out Wall Street.

    For all the hot air, it appears that reciprocity is not really what Steve has in mind.

    2. The best U.S. result is a detailed document in which China renounces its predatory, confiscatory and mercantilist practices while providing ample means to monitor and promptly enforce the agreement.

    Steve? Steve?? Are you aware that the U.S. is currently trying to economically strangle countries all over the world with economic sanctions? Venezuela. Cuba. Syria. Iran. Russia.North Korea. Lebanon. Yemen. And if economic sanctions don't work, we bomb them. Iraq. Afghanistan. Libya. Syria.

    3. by stealing the intellectual property, technology and innovations of foreigners.

    Libya's gold "disappeared". As did much of Iraq's gold. And the Bank of England, citing U.S. sanctions as its legal fig leaf, confiscated $1.2 billion of Venezuelan gold. As to stealing technology, no one does it better than Uncle Same: Vault 7 and Stuxnet are prime examples of US spying on foreign technology companies.

    4. But it is a decidedly false narrative that any failure to reach a deal will lead to a market meltdown and economic implosion.

    I dunno. I'm hearing a lot of very unhappy muttering in the rural Midwest, where I live. I think we're facing the very real possibility of a large-scale Trumpian economic disaster, due to his trade war, negative trending macoeconomic indicators, the unbelievable Trumpian debt (the biggest debt in the history of the galaxy, putting Obama and Bush Jr., and even WWII debt to shame), and the looming loss of the dollar's world reserve currency status. Toss in a global recession, to boot. This feels like "implosion" to me.

    5. Instead of access to a billion Chinese consumers, the United States lost more than 5 million manufacturing jobs since 2000.

    Typical capitalist hypocrisy. We demand free markets for other people. Never for ourselves. Many American companies have been doing fine selling to "a billion Chinese consumers". The problem is, Americans participating in the free market often choose Chinese goods.

    Not only are you full of hot air, Steve-- you and Bolton and the rest of Trump's Israel-first neocon apologists are effectively destroying our economy and our country. When the very likely "implosion" does occur, watch the rats (hate to use that metaphor, since the lowest mangy flea-bitten rat is better than any neocon) scurry for the exits, blaming everyone but themselves.

    Who is Steve Bannon going to blame? Ocasio-Cortez, who else?

    Let it Go , 7 minutes ago link

    Understanding the core nature of China is important to comprehend the lack of flexibility ingrained in their system. This comes in the ideology that directs its actions. China is still very much a communist country, and the Chinese Communist Party (CCP) controls everything. While it may appear both State-owned and private firms operate within China's economic system. This is mostly an illusion following economic reforms in the 1980s.

    In reality, the communist system does not allow for true private ownership and views all "tech innovation" as essential to its national interests. Thus, private and state-owned Chinese firms act in the interest of the Chinese regime when it comes to foreign investments in the high-tech sectors. Below is the second part of a part-two series which explores why China is on a one-track path and blind to other options going forward. This is a recipe for conflict.

    http://China's Unflexible Path Forward.html

    flashmansbroker , 24 minutes ago link

    What pisses me off is the fact that pretty much every western company has decided to manufacture in China.

    My Mrs bought me a coat today. A nice snazzy Italian brand. Then looking at the label it says made in China. So it's not an Italian coat at all. It's a Chinese coat with Italian branding.

    Burberry do the same thing. They can basically charge whatever they want for coats, and as a consumer you buy into that British heritage . Low and behold their stuff is made in China.

    Perhaps we should slap the tariffs (I'm not a fan of tariffs BTW,) on the western companies that continue to outsource to China .

    Really ***** me off.

    Giant Meteor , 4 minutes ago link

    The ceding of national interests, without the wilful, knowing consent of both political parties, and citizens believing they could simply vote their way out of this or that brand of swamp, could never have been accomplished ..

    The story of the scorpion, and the frog, crossing the river ..

    After much pleading by the scorpion, the frog did give the scorpion a lift to safely cross the river, and after being bitten during the crossing, frog crys out "but you promised you would not bite me!!"

    Scorpion replys, " you knew what i was when you picked me up .. "

    The story of the American body politic, on steroids the last 40 -50 years ..

    Justin Case , 2 minutes ago link

    That is exactly what happened. The murican and other corporations moved to the larger consumer markets for their products, Asia. China has moar than 3 times the population of murica. Labour is plenty, wages are low, no benefits or overtime. 12 hour days or moar is the norm there. It's not China that people should be blaming for the transition to manufacture there. The corporations are all about profits. They care less about you and yoar family or jobs for you. The corporations are making money like never before. GM sells 3 times as many cars in China than in murica. It costs money to ship over seas, cheaper to move manufacturing to where the demand is.

    China also has a growing middle class that will be big consumers of goods, whereas murica has a decling middle class and retiring baby boomers. Murica is in decay. Neglected infrastructure, dying cities, NY, Baltimore, Seattle, Detroit, Chicago, SanFran, farms are over producing and need social welfare from tax payers, high consumer debts, low consumption of goods. Car manufacturers will be back at the Fed window for free tax payers money to avert total bankruptcy. We've seen this play before and here we are again.

    Murica is bankrupt. This is why the banks around the world are buying gold reserves. All currencies eventually become worthless paper for fire starting or heating in winter. There is no currency that ever exceeded 100 yrs. as money. Gold has been money for thousands of years.

    Economies work best when currencies are stable in value. Once we know what the goal is, we then look for a way to achieve it and the best way has always been to base a currency on gold. Nobody has found a better way, even in the form of a proposal and nobody has ever needed to find a better way, because gold has always worked very well.

    Herdee , 43 minutes ago link

    The fight is actually with America's own politicians and corporations. They sold out America long ago. The Chinese trade differently. They don't have to bomb. It's really too bad what American democracy stands for today around the world. Nobody wants anything to do with it and gradually they're dumping it.

    Justin Case , 24 minutes ago link

    British and Roman empires were not much different towards the end of their rein. They become complacent and arrogant towards other countries. Eventually they run out of friends, then start woars to rape and pillage gold, silver and resources. An attempt to sustain the costs of maintaining their exuberant life style and military around the globe. Rome at first started debasing their gold and silver money. Once trading partners realized their coins were not pure, they called the empire a fraud and didn't want to trade with the crooks. Woar ensued.

    besnook , 53 minutes ago link

    what a dumbass. bannon represents the wacko christian wing of the zionazi party.

    usa oligarchy greed did this to the american people. the chinese happily cooperated likely wondering how they were being screwed because the usa policy was so stupid. the usa made the mistake of thinking the chinese would roll over like the japanese and koreans did, once the spice started flowing.

    the chinese don't have to give anything because the usa screwed itself so badly they need china to keep producing crap for the usa because there is no competitive alternative either by other countries to fill the gap and certainly not with a built from scratch usa manufacturing sector. the usa is so stupid it has foreign countries make critical military tech parts to maximize profit for mic.

    does bannon really think the chinese people won't riot if they are unhappy with .gov? does he remember tianemen square? it's american people who won't do anything about .gov and the oligarchs screwing them.

    according to bannon it is okay for the usa to kill millions of muslims and christians in the mid east for jewland and the zionazis but wrong for china to control their influence in china?

    bannon's calling is a homeless alchy. he fits the part with lunatic rants and his appearance.

    dcmbuffy , 52 minutes ago link

    "a corporation masuerading as a country."

    Baron von Bud , 1 hour ago link

    The problem here isn't the WTO, it's the WTC. Bannon says China entered the WTO in 2001 and have been criminals ever since. Also in 2001 the Neocons started their insane wars after blowing up the WTC and have been criminals ever since. Eighteen years of pissing away cash and not minding the store - and these lunatics are back in the White House. Anybody hoping for a happy ending with China is just as nuts.

    jutah , 1 hour ago link

    You fat ******* zio-slob/slut troll. It may have been a good idea if it were just about trade and you are willing to actually seek a mutually beneficial compromise, but when you are also poking them militarily it changes the dynamics of the successful negotiations and cooperation. Who wants to do a deal with someone who continually sends warships up and down your coastline in engaging in provactive actions

    52821740 , 1 hour ago link

    Its not their coastline. It's the Phillipines and International waters. Don't believe the Chinese lies. Btw I'm no fan of Bannon.

    He–Mene Mox Mox , 1 hour ago link

    Bannon has got some screws loose in the head. Getting tough with China isn't going to bring manufacturing jobs back to the United States for ten reasons:

    1. Those jobs have nowhere in the U.S. to come home to. Most of the factories have been shut down and demolished years ago.

    2. American workers have been out of the loop for so long, that they are basically unskilled and untrained at this point...... all 95.5 million of them!

    3. The fight isn't against China, as it is against corporate America. Corporate America doesn't want to pay the higher wages or benefits here. That is why they went hunting for the cheap labor in China in the first place. It's not China's fault!

    4. America's entire tax system stinks and its predatory. There is nothing that is going to make those businesses in China go to America , particularly when China is offering those same companies tax incentives to stay.

    5. China's transportation infrastructure is far better than America's. America's road system is now a full 40 years behind China's, and America's rail system is 75 years behind China's. Air transportation is about the same as the U.S., but China has the better airports for handling large number of passengers and freight. Maritime shipping is first rate all the way, the U.S. can't hardly touch them in moving freight overseas.

    6. The United States routinely blocks the World Trade Organization's appointments of judges who could rule on tariffs, because the U.S. wants to load the dice in their favor at the WTO. Companies are often used as captive hostages by the U.S.,. Not the case with China.

    7. The U.S. has a notoriety for not honoring any treaty it signs. The WTO has cited the U.S. as undisciplined, and the decision of whether to comply with international legal obligations varies depending on which domestic political actors are engaged in the policy process. Some American institutions are more likely to supply compliance than others. Why would any company want to come to America without any assurances in governing trade rules or a hostile political environment that turns on a dime?

    8. China is the ideal place for emerging markets. It has access to lots of different manufacturing for emerging businesses, something the U.S. lacks these days.

    9. China has economic free zones, like Shanghai, Hong Kong, Macau, etc.,. The U.S. has nothing to compare.

    10. China's main priority has been shifted from expansion to stability. By stability, what is implied is demand that is internal, rather than external, and that requires a focus on the consumer. This could represent an opportunity for businesses that invest in the opportunity to sell goods in the country. As it stands now, there is really no reason for a company in China to come to the U.S., because every American is maxed out on credit and doesn't have the money to buy anything. Why set up a business in the U.S. when the U.S. economy is in imminent danger of collapsing over night, and becoming a casualty???

    B-Bond , 1 hour ago link

    All Things Being Equal Come Friday? 🤔

    Tariff rate, applied, weighted mean, all products (%)

    China 3.8 MCGA🧢 🖕 😜 🖕

    United States 1.7 MA-- 😲

    https://data.worldbank.org/indicator/TM.TAX.MRCH.WM.AR.ZS?locations=US

    -- ALIEN -- , 1 hour ago link

    "...two radically different economic models..."

    Untrue.

    China and the USA both are Command Economies being controlled by a group of Oligarchs.

    TotalMachineFail , 1 hour ago link

    This is another false (fraudulent non-existent choice) being presented by the global so called but no longer existent elite. U.S. vs China. It doesn't make any difference whether it is the corporations presenting the false choice or the so called deep state. Either way it has no truth and therefore no value.

    As I've provided extensive facts and evidence as details on both sides all governments are full of traitors. Traitors both foreign, domestic and international. Any future global attempt at government will never consist of any of these two places or any other since all others continue to fail in their own right to take the appropriate actions in their own governments or against those that are attempting to implement wholly criminal operations internationally.

    not dead yet , 1 hour ago link

    Very little of the Chinese technology was stolen by them. It was freely given by US universities getting big bucks to fill seats and US corporations looking to boost executives pay and perks, plus offloading the headaches they were getting paid big bucks to solve, by offshoring to China. As evidenced by the recent tax cut for corporations and the funds they brought back from overseas bringing back or creating jobs in the US is a pipe dream. Your CEO's thought it was more important to feather their nests, and in many cases putting their company into hock, to buy back their stock. Raises or funds for R&D? Fuggeddaboutit. With China in the cross hairs the captains of industry are sailing to other shitholes for their stuff rather than the US. Don't blame the Chinese for the "best and brightest" selling the US down the drain to enrich themselves. One of the many reasons the US is circling drain due to self inflicted hurt is the whole country from top to bottom wants **** and they want it now no matter what it takes whether it be power, riches, or both.

    JBL , 1 hour ago link

    "Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gains."

    -Thomas Jefferson

    B-Bond , 1 hour ago link

    MD Anderson ousts 3 scientists over concerns about Chinese conflicts of interest😲

    MD Anderson Cancer Center is ousting three scientists in connection with concerns China is trying to steal U.S. scientific research

    https://www.houstonchronicle.com/news/houston-texas/houston/article/MD-Anderson-fires-3-scientists-over-concerns-13780570.php#photo-17253782

    [May 06, 2019] US Tariffs on China Trump Threat Leaves Beijing Stalling

    May 06, 2019 | www.bloomberg.com

    Trump continued tweeting on the trade situation Monday. "The United States has been losing, for many years, 600 to 800 Billion Dollars a year on Trade. With China we lose 500 Billion Dollars. Sorry, we're not going to be doing that anymore!" he wrote.

    "Risks of a full blown trade war are escalating," Chua Hak Bin, a senior economist at Maybank Kim Eng Research Pte. in Singapore, said before the ministry's announcement. "Trump's threat may backfire as China will not want to negotiate with a gun pointing at their heads."

    ... ... ...

    China was considering delaying a U.S. trip this week by a trade delegation led by Vice Premier Liu He after Trump's tariff threat, according to people familiar with the matter. Liu and about 100 other officials had been scheduled to arrive Wednesday for what was shaping up to be the final round of negotiations.

    The two sides have been locked in intense negotiations since last year for an agreement to address U.S. concerns over China's trade surplus, alleged theft of intellectual property and forced technology transfers. Trump and Xi agreed to a tariff truce on Dec. 1 to allow senior officials time to negotiate.

    ... ... ...

    White House economic adviser Larry Kudlow said on Fox News that the president was "issuing a warning." While "great progress" has been made in the talks, structural and enforcement issues remained, he said.

    ... ... ...

    Trump imposed duties of 25 percent on an initial $50 billion of Chinese goods last year and then 10 percent on an additional $200 billion in products in September. Those duties were set to rise to 25 percent on Jan. 1 and then again on March 1, but Trump delayed that as talks continued. China has imposed tariffs on $110 billion of U.S. exports in retaliation and repeatedly warned it would counter tariffs with actions of its own.

    That means there's a risk China would counter any extension of U.S. levies, though the smaller size of its imports may constrain its ability to do so.

    "China isn't likely to make concessions that the U.S. want with a big stick hanging over its head," said Zhou Xiaoming, a former Ministry of Commerce official and diplomat. "If the tariffs that Trump threatens are implemented on Friday, China has to respond."

    [May 06, 2019] Trade Deal Dead Trump Says 10% China Tariff Rising To 25% On Friday, Another $325BN In Goods To Be Taxed

    May 06, 2019 | www.zerohedge.com

    So much for months and months of constant leaks, headlines, tweets, and press reports that US-China trade talks are going great, and are imminent amid an ocean of "optimism" (meant solely to sucker in amateurs into the most obvious bull headfake since 1987).

    Just after noon on Sunday, President Trump tweeted that 10% tariffs paid by China on $200 billion in goods will rise to 25% on Friday, and that - contrary to what he himself and his chief economist, Larry Kudlow has said for months, talks on a trade deal have been going too slowly.

    And, just to underscore his point, Trump also threatened to impose 25% tariffs on an additional $325 billion of Chinese goods "shortly."

    With the tariff rate on numerous goods originally set at 10% and set to more than double in 2019, Trump postponed that decision after China and the US agreed to sit down for trade talks; following Trump's tweet it is now confirmed that trade talks have hit an impasse and that escalation will be needed to break the stalemate.

    It was as recently as Friday that Vice President Mike Pence told CNBC that Trump remained hopeful that he could strike a deal with China (at the same time as he was urging for a rate cut from the Fed).

    Curiously, on Wednesday, the White House - clearly hoping to sucker in even more naive bulls to buy stocks at all time highs - said the latest round of talks had moved Beijing and Washington closer to an agreement. Press secretary Sarah Sanders said, "Discussions remain focused toward making substantial progress on important structural issues and re-balancing the US-China trade relationship."

    In recent weeks there were multiple reports that China and U.S. were close to a trade deal, and an agreement could come as soon as Friday. Major sticking points the U.S. and China have been intellectual property theft and forced technology transfers. There has also been disagreement as to whether tariffs be removed or remain in place as an enforcement mechanism.

    While it was not clear why Trump has decided to escalate his tariff policy, the most obvious explanation is that for a White House, which has been obsessed with pushing the S&P to record levels, this was the last lever it had at its disposal. And now that the S&P is back at all time highs, the lies can end, if only for the time being.


    smacker , 1 minute ago link

    The article is misleading. My understanding is that the importer country pays import tariffs, not the exporter country.

    So these 10% tariffs, soon to be 25% will jack up US end-user prices and are inflationary.

    SeaMonkeys , 3 minutes ago link

    An article Zero Hedge ran yesterday is my best guess at understanding Trump vs. China. Keeping the hegemony of the dollar is paramount to U.S. empire.

    https://www.zerohedge.com/news/2019-05-03/americas-global-financial-war-strategy-escalating

    slyder wood , 7 minutes ago link

    Meanwhile, crickets about the border/invasion situation, even here on ZH articles. From an off-duty, decompressing senior border patrol guy I happened to meet - El Paso alone has had over half a million "migrants" come thru seeking "asylum". They are releasing about 2000 a week into the US, leasing buildings, including a Las Cruces high school for the weekend to stage them. he said unusual number of Cubans, maybe from VZ. Lots of sickness/disease, he personally saw flesh-eating infections, dying AIDS patients, children accompanied by unknown males. Already 90% who had court hearings were no-shows. They've found cutoff ankle monitors at airports.Their hands are tied by archaic laws and a (((congress))) unwilling to do **** about it. The **** governor of NM, Lujan-Grisham ****-blocking any effort to stem the tide. But articles about giant meteors, James Woods, Russia-gate, China, etc, etc ad nauseum.

    Sorry for the hi-jack. The globalists have mobilized their armies. Chinese **** I can live without, except SKS in a pinch. Might need it when the in country migrant hordes are given the sign and LE and mil stand down.

    BTW< he said two more caravans are forming, one of about 30000.

    mailll , 7 minutes ago link

    Interesting to see how the stock market futures will react. If they dive, we can just blame someone else. If it does good, we can give all the credit to Trump. And if we don't, Trump will surely give himself credit for it and gloat.

    me or you , 6 minutes ago link

    remember US market runs on fake news and rumors...all fake economies are like that.

    Neochrome , 7 minutes ago link

    Let's see how much will yuan depreciate come tomorrow, making whatever the **** US exports to China even more expensive.

    https://www.bloomberg.com/opinion/articles/2018-12-04/trump-s-embrace-of-tariffs-hurts-u-s-consumers-more-than-china

    When the U.S. taxes another country's goods, it puts downward pressure on that country's currency. When China's yuan falls against the U.S. dollar, it makes Chinese goods cheaper, canceling out some of the effect of the tariff. The yuan was at about 16 cents to the dollar earlier this year, but as Trump imposed tariffs on Chinese goods and ramped up his trade-war rhetoric, it fell to roughly 14 cents -- a decline of more than 12 percent:

    iSage , 4 minutes ago link

    what, no mention of the tariffs and taxes other countries post on us? imagine that...

    VWAndy , 13 minutes ago link

    Steel tariffs would be a good move for the USA. Its a national security issue.

    mailll , 17 minutes ago link

    Trump tweeted that 10% tariffs paid by China on $200 billion in goods will rise to 25% on Friday

    Paid for by China? More ********. Paid for by the American consumer who buys from China.

    Cyrus the Great lost yet another battle. Oh wait, Cyrus was only good for Israel, that's right.

    [Apr 28, 2019] If China does not cut Iran oil purchases to zero, the Trump administration may have to make a decision on blocking Chinese banks from the U.S. financial system

    Apr 28, 2019 | www.moonofalabama.org

    jayc , Apr 28, 2019 5:20:22 PM | link

    In a few days we may be witnessing a massive game of "chicken" between the world's two largest economies:

    "If China does not cut Iran oil purchases to zero, the Trump administration may have to make a decision on blocking Chinese banks from the U.S. financial system. That could have unintended consequences for finance and business between the world's two biggest economies, already in negotiations over trade disagreements.

    "It could," one official conceded about the potential for unintended consequences, "but that's why China's decision is easy, it's not a difficult decision for them mathematically. They do business with the U.S. which is critical, they do business with Iran which is not critical."
    https://www.reuters.com/article/us-usa-iran-sanctions/no-wind-down-for-china-on-stopping-its-iran-oil-buys-trump-officials-idUSKCN1S2238

    The unnamed "senior official" consulted for this article is remarkably confident the Chinese will blink on this matter, based on a what seems a limited understanding of what constitutes their base interest. In previous times, foreign policy initiatives always featured internal deliberation with advocates from all sides of an issue, so a complete range of option and consequence could be anticipated. Such process seems to have been abandoned.

    [Apr 24, 2019] We've Endured Years of Bragging From Trump -- What Would an American Trade 'Victory' Look Like

    Apr 24, 2019 | www.nakedcapitalism.com

    The granting of a "permanent normal trading relationship" (PNTR) and then the subsequent accession to the World Trade Organization (WTO) in 2001 have been a boon for China, but the persistence of ongoing American trade deficits have led many, including the current president, to judge the United States a loser in ongoing trade negotiations with Beijing. It's not a totally irrational judgment: China's WTO accession hasn't been great for U.S. manufacturers .

    Part of the problem stems from the extraordinary fact that Washington has seldom deployed a negotiator who is actually well-versed in trade issues. Since the days of the Clinton administration, it has been the U.S. Treasury Secretary, as opposed to the country's chief trade representative, who has consistently directed trade negotiations, with the resultant (and eminently predictable) impact that financial interests have superseded those of any other economic sector. That pattern was briefly disrupted when President George W. Bush appointed Alcoa's CEO, Paul O'Neill, to head the Treasury, and then CSX president John W. Snow, but ultimately the " Wall Street uber alles " mentality again prevailed with the appointment of Hank Paulson (to be followed by Tim Geithner, Jack Lew, and now Steve Mnuchin -- all of whom have finance-centric backgrounds).

    For all of the supposed financial sophistication of America's Wall Street-based Treasury Secretaries, it is indeed ironic that China has consistently been able to play them for fools with the implied threat of its so-called "nuclear option," a highly flawed narrative that alleges that as a final resort, Beijing would dump its huge stockpile of U.S. Treasuries, thereby driving up U.S. rates, and creating a catastrophic depression for the U.S. economy. That so-called threat to the bond market is the traditional reason why successive Treasury Secretaries have been hesitant to resort to the blunt trauma force of trade sanctions or tariffs when it came to negotiating with Beijing. They were also comforted by the idea that as it modernized, China would increasingly abide by traditional norms of free trade doctrine against all available evidence that shows that it has not played by the same rules.

    Let's leave aside the internal incoherence of the nuclear option: China exiting dollar-denominated assets could well create downward pressure on the external value of the free-floating currency. But that would enhance U.S. export competitiveness, assuming, of course, that America has anything left to export, an unfortunate legacy of the Treasury's malign neglect of U.S. manufacturing. It's also operationally wrong (see here for further detail), and mistakenly assumes (against all historical evidence to the contrary) that Beijing would pursue an economic policy that is the functional equivalent of cutting its own nose to spite its face, as Paul Krugman, among others, notes.

    Even if Paulson, Geithner, Lew, Mnuchin, etc., didn't truly believe in the "nuclear option," they have been happy to tamp down the possibility of a trade war in order to keep the capital markets stable. Each trade "deal" has therefore largely sustained the status quo, the price for which sees Beijing usually offering up a few well-timed purchases of soybeans or Boeing aircraft (although the latter will be more problematic in light of the 737 fiasco). But China's policy makers have never been forced to deal with the economic consequences of their country's mercantilism, which has resulted in the steady erosion of America's Rust Belt, as the U.S. economy gave back the considerable employment gains it achieved during the 1990s, via a historic contraction in manufacturing employment .

    Things have changed markedly since Trump seized the "China trade" portfolio from the Treasury's Steve Mnuchin, and placed it under the control of Robert Lighthizer, the current trade representative. Unusually for a member of the Trump administration, Lighthizer actually knows his brief. He has had literally decades of experience in trade issues, dating from his days as a deputy U.S. trade representative in 1983 (when Japan was widely perceived as the main trade threat), to his current role as America's chief trade negotiator. As Trump's U.S. Trade Representative (USTR), he has provided policy flesh and bones to the president's robustly unilateral approach in trade.

    If anything, Lighthizer's trade hawkishness has become even more pronounced over the years, as he has shifted his attention away from Japan to China. In his 2010 congressional testimony , he argued that U.S. policy makers gravely underestimated the threat posed to American manufacturing by virtue of China's entry into the WTO, marshaling an array of evidence to cast doubt on the idea that its entry had brought any significant economic benefits to U.S. workers and businesses. He also highlighted the mercantilist nature of Beijing's state capitalism and noted that the country's administrative complexity likely precluded it embracing WTO rules, even if wanted to do so (which he doubted):

    "As part of China's system, specific large companies receive government patronage in the form of credit, contracts, and subsidies. The Chinese government, in turn, sees these 'national champions' as a means of competing with foreign rivals and encourages their dominant role in the domestic economy and in export markets

    {[S]cholars have questioned whether -- given its lack of institutional capacity and the complexity of its constitutional, administrative, and legal system -- China is even capable of complying with its WTO obligations.

    No doubt in thrall to the prevailing free-trade ideology, Washington's "policy passivity" made it loath to use available tools such as the WTO's "421" special safeguards to counter the resultant trade shock. In that same testimony, Lighthizer also signaled that he was uninterested in the niceties of WTO style multilateralism, more inclined to the use of " aggressive unilateralism " via executive orders, diplomatic pressure, and most importantly, the use of Section 232 of the 1962 Trade Expansion Act to levy tariffs on various products, premised on the notion that the targeted country (in today's case, China) represented a national security threat.

    Most significant from the Lighthizer perspective is an explicit rejection of the idea that China needs to do more than just buy more U.S. goods before the two countries strike a permanent trade deal, which in any case is highly problematic if the end objective is to bring the bilateral trade balance between the two countries to zero.

    You can understand why. For one thing, the math doesn't add up: even if China were to raise its agricultural purchases by $30 billion, as it has reportedly pledged to do , this is pretty small beer in the context of a $300 billion bilateral trade deficit. As the economist Brad Setser highlights :

    "The scope for explosive growth in soybeans is actually fairly limited, as the pre-tariff base for soybeans [the number one or two largest U.S. export to China] was quite high -- the United States was supplying $12 billion of China's almost $40 billion in oil seed imports. A huge tilt away from Brazil might cause U.S. beans exports to double, but getting much more than that would be difficult (there is a natural seasonality to soybean trade that favors alternating supply from the Southern and Northern Hemispheres).

    "The real growth would need to come in sectors where China doesn't buy much now. Corn. Rice. Perhaps pork and beef Getting really big numbers there though would risk pushing up U.S. prices, and getting China to abandon its goal of self-sufficiency in basic grains."

    So U.S. farm prices would be pushed up, which would hurt U.S. domestic consumers, even as it cosmetically dresses up America's trade position vis a vis China.

    Setser adds:

    "China has signaled it is willing to let foreign firms take majority stakes in a few more sectors, and has reiterated its belief that technology transfer isn't a legal requirement for entry into the Chinese market. There are likely to be settlements on some long-standing disputes as well -- the rating agencies have gotten approval to enter the Chinese market; Visa, American Express and Mastercard likely will finally get approval too ( Mastercard through a joint venture not everything changes); and some tariffs introduced as retaliation in the past may get dropped."

    But how does the entry into China of consumer credit card companies or the ratings agencies help Americans? Ironically, this looks precisely like the kind of sop to finance that Trump said he would eschew. However, because of corporate/Wall Street pressure, the Trump agenda pivoted a few months ago from selective decoupling and protection of American strategic industries to opening up China for U.S. investment and pushing China to treat American companies doing business in China more equally. That is why leading U.S. companies have become friendlier and increasingly less critical of the president's trade policy, even as the economic commentariat has continued to blast him.

    Trump himself needs to understand that a third to a half of 'trade' is really transnational production with inputs from suppliers coordinated by mostly third-party manufacturers in Asia (notably in semiconductors). The purpose of modern mercantilism (particularly as it is practiced in China today) is not just to sell more finished goods but to try to monopolize the high value added rungs of supply chains. It is unclear that targeting China's bilateral trade surplus with the United States will ultimately disrupt these entrenched supply chains. It almost certainly won't bring semiconductor manufacturing back to America's shores.

    In the end, therefore, pushing China's leadership to make structural changes to open up China to American companies is probably an illusion. Beijing is unlikely to rip up the model that has seen it create national champions that can now compete successfully with America's biggest corporations. It may make token promises to curtail cybertheft, or the subsidies that the administration complains create an uneven playing field for American companies. But, as noted above, even Lighthizer himself has cast doubt that Beijing could enforce those promises, given the administrative complexity of its system of governance. In his eagerness to claim a win, therefore, Trump ironically might end up settling for the usual Faustian bargain: more large Chinese purchases, selective decoupling of supply chains (as American companies rethink their reliance on China ), and increased domestic protection for certain sectors (such as 5G) on national security grounds, Lighthizer's considerable efforts notwithstanding. We may have reached the peak as far as this particular tariff war goes, but the longer-term trade tensions will almost certainly persist well beyond this hollow 'victory,' which Mr. "Art of the Deal" will no doubt claim for himself when the negotiations do officially end.

    The Rev Kev , April 23, 2019 at 4:18 am

    Excellent assessment of the situation here. I suppose another factor for Trump is the fact that as the US 2020 elections drew ever nearer, he will want some sort of win – any sort of win – to take to the American people to show that he was tough on China and got a better deal. His opponents will disagree with the deal. Hell, probably most economists will disagree but Trump will only care what his supporters think as they are the ones that will re-elect him.
    But of course the interests of people like Robert Lighthizer may come into play here as he may not care what Trump wants. He is the sort of person that might just blow up negotiations in order to be tough on China to get it to buckle. I have seen this movie before. Let me quote from a Salon article here-

    "In the summer of 1941, before leaving for Placentia Bay, U.S. President Franklin D. Roosevelt had ordered a freeze on Japanese assets. That measure required the Japanese to seek and obtain licenses to export and pay for each shipment of goods from the United States, including oil. This move was most distressing to the Japanese because they were dependent on the United States for most of their crude oil and refined petroleum products. However, Roosevelt did not want to trigger a war with Japan. His intention was to keep the oil flowing by continuing to grant licenses. Roosevelt had a noose around Japan's neck, but he chose not to tighten it. He was not ready to cut off its oil lifeline for fear that such a move would be regarded as tantamount to an act of war.
    That summer, while Roosevelt, his trusted adviser Harry Hopkins and U.S. Undersecretary of State Sumner Welles were attending the shipboard conference off Newfoundland and Secretary of State Cordell Hull was on vacation at the Greenbrier in West Virginia, the authority to grant licenses to export and pay for oil and other goods was in the hands of a three-person interagency committee. It was dominated by Assistant Secretary of State Dean Acheson, whom one historian described as the "quintessential opportunist of U.S. foreign policy in 1941."
    Acheson favored a "bullet-proof freeze" on oil shipments to Japan, claiming it would not provoke war because "no rational Japanese could believe that an attack on us could result in anything but disaster for his country." With breathtaking confidence in his own judgment, and ignoring the objections of others in the State Department, Acheson refused to grant licenses to Japan to pay for goods in dollars. That effectively ended Japan's ability to ship oil and all other goods from the United States.
    Acheson's actions cut off all American trade with Japan. When Roosevelt returned, he decided not to overturn the "state of affairs" initiated by Acheson, apparently because he feared he would otherwise be regarded as an appeaser. Once Roosevelt perpetuated Acheson's trade embargo, the planners in Japan's imperial military headquarters knew that oil to fuel their fleet, as well as rubber, rice and other vital reserves, would soon run out."

    And we all know what happened next. So I would not be surprised if Robert Lighthizer could very well be the re-encarnation of Dean Acheson and given half a chance, would seek to put China under the gun if he thought that he would get away with it.

    Marshall Auerback , April 23, 2019 at 4:45 pm

    Rev Kev
    I hope you are right. LIghthizer is actually one of the few beacons of hope in the Trump Administration. But I fear he'll drink the Trump Kool-Aid and basically settle for less than half a loaf. That's a fascinating historical precedent you have cited. Thank you for bringing it to my attention.

    Albert , April 24, 2019 at 12:03 pm

    Very interesting article. In the mean time Japans aim was land conquest. They raped, murdered, and pillaged their neighbors so WWII USA/Japan was not avoidable to say the least. They worshipped an emperor and thought they were superior ideologically and militarily. One could argue that they should have addressed the Japan issue years earlier.
    Trump has taken on 20+ years of terrible trade deals and is now stepping up to change it. He should be applauded! Instead, everyone in the peanut gallery (news media) takes pot shots at him. We are dealing with a "COMMUNIST" country here which says it all. We now have a business man running the USA thank God. To make changes will take time!

    skippy , April 23, 2019 at 5:23 am

    Everything Donald Trump Is an Expert In, According to Him

    Summation: https://www.youtube.com/watch?v=5GqJna9hpTE

    Sound of the Suburbs , April 23, 2019 at 7:52 am

    The US dreamed of an open, globalised world.

    China became a superpower and the US went into decline.

    Whoops!

    What do we do now?

    Sound of the Suburbs , April 23, 2019 at 7:55 am

    Why not just blow your economy up like the US and UK in 2008?

    They have seen their Minsky Moment coming unlike the clueless Americans and British.

    The PBoC know where to look to see these things unlike the FED and BoE.

    The private debt-to-GDP ratio.

    https://cdn.opendemocracy.net/neweconomics/wp-content/uploads/sites/5/2017/04/Screen-Shot-2017-04-21-at-13.52.41.png

    https://cdn.opendemocracy.net/neweconomics/wp-content/uploads/sites/5/2017/04/Screen-Shot-2017-04-21-at-13.53.09.png

    The West's "black swan" is a Chinese Minsky Moment.

    John B , April 23, 2019 at 8:11 am

    Darn. When I read the headline, I hoped the article would explain what a victory in U.S. trade policy with China would look like -- that is, what kind of trade relationship would "rectify lingering structural problems that have devastated U.S. manufacturing (with genuine enforcement provisions)." That's a tough question to answer! But all this article describes is why Trump's policy won't achieve that result. Every policy tried so far has not achieved that result, so it's not really surprising that this one won't either. In fact, the article seems to suggest that China cannot play by reasonable trade rules. So what is victory? Seriously, we need an answer to that one.

    Monty , April 23, 2019 at 9:43 am

    How can State Capitalism have caused that 'quantum leap' for China when everyone told us Central Planning does not work?

    If it does work, maybe the US should try it in a way other than the PPT, Fed bailouts, ag subsidies, military industrial complex, mortgage subsidies, sanctions on rivals, military action on rivals, etc they already do.

    d , April 23, 2019 at 1:10 pm

    And how do the free marketers square that with their support of globalization?

    JEHR , April 23, 2019 at 10:32 am

    As I understand it, US manufacturing left the US for other countries because of the lower cost of labour and the lower cost of doing business in foreign countries. What would bring manufacturing back from foreign countries? Maybe when the cost of doing business in the US (i.e., wages and salaries of the working class) are lower than those in foreign countries. Maybe a labour contigent made up entirely of robots would bring back manufacturing to the US.

    d , April 23, 2019 at 1:08 pm

    While lower wage costs helped drive it, now they the ever rising cost of shipping their wares. Course they have seen the Chinese boycotts work so well, they may think they will have a US version to deal with, as so many dislike ok, hate globalization, that any that smacks of it has a PR problem. Course its likely we will see a repeat of NKoroea too

    d , April 23, 2019 at 1:15 pm

    While labor cost was a driver, it didn't go down cause executive labor cost went up.plus there was a lot more travel costs too

    Irrational , April 23, 2019 at 2:21 pm

    different budget line probably, so can still be presented as cost-saving also factor in the use of consultants before/during/after off-shoring – but again different budget line!

    jonst , April 23, 2019 at 10:47 am

    I'm not sure at all what others think a "victory' would look like, but to me it would be anything that finally raises the profile our (Western Nations) reliance (addiction?) on supply chains emanating from CHina that impact, negatively, our National Security. If we could even BEGIN to discuss this dilema I'd be satisfied. And it appears we are beginning to question the dependence.

    rc , April 23, 2019 at 1:33 pm

    China has been at war with the United States for decades. It is an all domain, unrestricted war. The Chinese do not play by any rules but their own. They have used the West's strengths of an open political and market system against North American and European industrialized democracies.

    A win against China means re-industrializing the United States across all manufacturing industries. Tariffs and regulations are the most efficient means to effect this result.

    Negotiating is a fool's errand. China will not live up to its obligations under the agreement anyway.

    Perhaps, readers should ask themselves if China is beginning to resemble the Third Reich. Dictatorship, concentration camps, military buildup, territorial expansion, religious persecution, military aggression, economic warfare, racist ideology If so, then we should determine what steps the West and its allies in the East should take to ensure its survival and prosperity.

    John k , April 23, 2019 at 3:23 pm

    Probably we need tariffs to protect against the wage race to the bottom. Not at all clear trumps 25% threat is high enough.
    But spending big on overdue infra would employ lots of blue collars, some at union wages not in competition w foreign labor, and focusing on higher unemployment regions first avoids inflation.
    Regarding changes in Chinese gov us has been warmonger for decades, assassinates foreign leaders etc China so far not nearly as aggressive.

    Susan the other` , April 23, 2019 at 3:31 pm

    Our corporations which benefit from unlimited credit via our very own Military Industrial Capitalism are no different from China's SOEs. China is protecting essential industries, so are we. We have tried to force austerity on the rest of our economy – but China does not. Why is that? And because we have succeeded in establishing the world's most unequal society, we should be proud of our success. Mindless and shameful as it has been. China doesn't think it would be politically beneficial to do that to 1.5 billion Chinese. They will find their own way. Why should they now shoot themselves in the foot just because we did? For them to bend to our demand that they stop being so mercantilist means they would have to impose austerity on their people to some degree. It's an appropriate point for a showdown. And I can't imagine we will win unless we are willing to continue our own ridiculous social "structure" which is undemocratic and tyrannical. We're looking at a political revolution because everyone is fed up. China is not. Who's right? We can only brag that we have the "liberal" high ground because we haven't faced facts yet.

    ptb , April 23, 2019 at 9:37 pm

    The latest Iran sanctions salvo, the claim that "waivers" for China and others will be eliminated, is another complication. It will be perceived, with good reason, as deliberately interfering with world trade under false pretenses. An aggressive follow-up and this could be an effective way for team Trump to get out of whatever agreements they made in negotiations so far. More drama

    Lynne , April 24, 2019 at 8:56 am

    The potential increases in pork shipped to China mentioned will not mean much. China owns a huge US pork producer

    [Apr 24, 2019] To me if feels like the US and China are two pilots locked in a kamikaze plane together

    Apr 24, 2019 | www.moonofalabama.org

    Schmoe , Apr 24, 2019 9:41:07 PM | link

    @71 karlof1

    I would not say advantage US; for example China needs US semiconductors. To me if feels like the US and China are two pilots locked in a kamikaze plane together; both nations are floating on a sea of debt and IMO prone to massive downside risk during a recession (eg, US corporate balance sheets are in very poor shape due to debt used to fund stock buybacks). The US has the reserve currency, but China has sane leadership and doesn't have to carry around other countries. Interesting times.

    @ William Gruff
    "Planned economies cannot have overproduction problems like market economies do" I don't agree with that; look at China's empty cities (overproduction of everything in that city). The recent book China's Great Wall of Debt went through China's massive overproduction of certain items (do they really need that much cement?). The book's thesis is that China builds what it knows how to build, whether it needs it or not.

    [Apr 22, 2019] Data Tells: China's BRI promotes global trade

    Apr 22, 2019 | economistsview.typepad.com

    anne , April 19, 2019 at 04:12 PM

    https://news.cgtn.com/news/3d3d774e7949544d34457a6333566d54/index.html

    April 19, 2019

    Data Tells: China's BRI promotes global trade
    By Zhang Xinyuan

    As a development strategy proposed by China that focuses on connectivity and cooperation on a trans‐continental scale, the Belt and Road Initiative (BRI) has significantly boosted global trade and investment in recent years.

    With a wave of trade protectionism sweeping across the world in recent years, causing global economic turmoil, China still adheres to economic openness, actively pushing toward economic globalization, and striving to build a more convenient and liberal environment for international trade and investment.

    BRI is one of the most important tools for China to achieve that goal. About 125 countries and 29 international organizations have signed cooperation agreements with China on jointly building the Belt and Road, according to data published in March on China's official Belt and Road website.

    The total trade volume of goods between China and countries along the Belt and Road exceeded six trillion U.S. dollars from 2013 to 2018, according to a Ministry of Commerce (MOFCOM) statement on Thursday.

    The average annual growth rate of trade between China and countries along the Belt and Road hit four percent during the 2013-2018 period, higher than the growth rate of China's foreign trade during the same period, accounting for 27.4 percent of China's total trade in goods, according to MOFCOM.

    According to the Belt and Road Big Data Annual Report of 2018 from the State Information Center, BRI in 2017 connected 71 countries around the world, spanning across Asia, Europe, and Eastern Africa, and in total the BRI countries' foreign trade reached 9.3 trillion U.S. dollars in 2017, 27.8 percent of the total world trade volume.

    Among the BRI countries, South Korea ranks first in terms of foreign trade volume, reaching over one trillion U.S. dollars in 2017, Singapore and India follows with 697 billion U.S. dollars and 617 billion U.S. dollars, respectively, the report showed.

    In terms of trade commodities, the top import and export commodities among BRI economies fall in the same categories, including electronic machinery, sound recorder and reproducers, and televisions, followed by nuclear reactors, boilers, and other heavy machinery, based on the report.

    Private enterprises in China have played a major role in trade with BRI economies. In 2017, China's private enterprises trade with BRI countries reached 619 billion U.S. dollars, representing 43 percent of the total trade volume between China and BRI countries. Foreign companies grabbed 36.6 percent of the trade pie, while state-owned enterprises got 19.4 percent of the market share.

    BRI has greatly prompted the development of private economies in China and further opened its market to foreign companies.

    ilsm -> anne... , April 19, 2019 at 04:33 PM
    As Jimmy Carter observed....the US spread death and destruction investing in war and spending on war to the tune of trillions, China is investing in the future.
    anne -> ilsm... , April 19, 2019 at 05:58 PM
    https://twitter.com/christineahn/status/1118125703008940034

    Christine Ahn‏ @christineahn

    Carter to Trump: While China has some 18k miles of high-speed rail, the US has wasted $3 trillion on military spending. "It's more than you can imagine. China has not wasted a single penny on war, and that's why they're ahead of us. In almost every way."

    5:15 AM - 16 Apr 2019 from Honolulu, HI

    Fred C. Dobbs said in reply to anne... , April 20, 2019 at 05:58 AM
    (That may depend on how one defines 'waste'.)

    China Defense Spending
    Set to Rise 7.5% as Xi Builds Up Military
    https://www.bloomberg.com/news/articles/2019-03-05/china-s-military-spending-slows-as-economy-cools via @Bloomberg - March 4

    China set a defense budget growth target of 7.5 percent in 2019, slower than last year but still enough to fulfill President Xi Jinping's plans to build a world-class military.

    Authorities made the announcement on Tuesday in a statement released ahead of the National People's Congress, the annual gathering of China's legislature in Beijing. In 2018, before the trade war started to affect China's economy, officials predicted an increase of 8.1 percent to 1.11 trillion yuan ($164 billion). ...


    [Apr 22, 2019] The starting point is a collapse in US China trade, which falls by 25 30 percent in the short term and somewhere between 30 percent and 70 percent over the long term, depending on the model and the direction of trade.

    Apr 22, 2019 | economistsview.typepad.com

    anne , April 19, 2019 at 12:38 PM

    https://conversableeconomist.blogspot.com/2019/04/when-us-market-access-is-no-longer.html

    April 18, 2019

    When US Market Access is No Longer a Trump Card

    When the US economy was a larger share of the world economy, then access to the US market meant more. For example, World Bank statistics say that the US economy was 40% of the entire world economy in 1960, but is now about 24%. The main source of growth in the world economy for the foreseeable future will be in emerging markets.

    For a sense of the shift, consider this figure from the most recent World Economic Outlook report, published by the IMF (April 2019). The lines in the figure show the trade flows between countries that are at least 1% of total world GDP. The size of the dots for each country is proportionate to the country's GDP.

    In 1995, you can see international trade revolving around the United States, with another hub of trade happening in Europe and a third hub focused around Japan. Trade between the US and China shows up on the figure, but China did not have trade flows greater than 1% of world GDP with any country other than the US.

    The picture is rather different in 2015. The US remains an international hub for trade. Germany remains a hub as well, although fewer of its trade flows now exceed 1% of world GDP. And China has clearly become a hub of central importance in Asia.

    [Graph]

    The patterns of trade have also shifted toward greater use of global value chains--that is, intermediate products that are shipped across national borders at least once, and often multiple times, before they become final products. Here's the overall pattern since 1995 of falling tariffs and rising participation in global value chains for the world economy as a whole.

    [Graph]

    Several decades ago, emerging markets around the world worried about having access to selling in US and European markets, and this market access could be used by the US and European nations as a bargaining chip in economic treaties and more broadly in international relations. Looking ahead, US production is now more tied into global value chains, and the long-term growth of US manufacturing is going to rely more heavily on sales to markets outside the United States.

    For example, if one is concerned about the future of the US car industry, the US now produces about 7% of the world's cars in 2015, and about 22% of the world's trucks. The future growth of car consumption is going to be primarily outside the US economy. For the health and long-term growth of the US car business, the possibility of unfair imports into the US economy matters a lot less than the access of US car producers to selling in the rest of the world economy.

    The interconnectedness of global value chains means that General Motors already produces more cars in China than it does in the United States. In fact, sales of US multinationals now producing in China are already twice as high as exports from the US to China. Again, the long-term health of many US manufacturers is going to be based on their ability to participate in international value chains and in overseas production.

    Although what caught my eye in this World Economic Outlook report was the shifting patterns of world trade, the main emphases of the chapter are on other themes that will come as no surprise to faithful readers of this blog. One main theme is that shifts in bilateral and overall trade deficits are the result of macroeconomic factors, not the outcome of trade negotiations, a theme I've harped on here.

    The IMF report also offers calculations that higher tariffs between the US and China will cause economic losses for both sides. From the IMF report:

    "The starting point is a collapse in US–China trade, which falls by 25–30 percent in the short term and somewhere between 30 percent and 70 percent over the long term, depending on the model and the direction of trade. The decrease in external demand leads to a decline in total exports and in GDP in both countries. Annual real GDP losses range from –0.3 percent to –0.6 percent for the United States and from –0.5 percent to –1.5 percent for China ... Finally, although the US–China bilateral trade deficit is reduced, there is no economically significant change in each country's multilateral trade balance."

    Some advocates of higher tariffs take comfort in noting that the estimated losses to China's economy are bigger than the losses to the US economy. Yes, but it's losses all around! As the 21st century economy evolves, the most important issues for US producers are going to involve their ability to compete in unfettered ways in the increasingly important markets outside the US.

    -- Timothy Taylor

    [Mar 21, 2019] Look who's ready to fight Trump's trade war now

    Mar 09, 2019 | socialistworker.org

    Is Donald Trump starting to look like a softie on the trade conflict with China compared to sections of the U.S. business and political elite? Dorian Bon explains the background.

    WHEN DONALD Trump launched his trade war on China last spring, he had to drag the U.S. political and business establishment along with him.

    Most elected officials in both parties and a large majority of corporate execs cringed at the thought of a protracted trade war that would disturb the ordinary flow of profits and investments between the world's two largest economies.

    Now, as Trump and his team seek a negotiated settlement with Chinese President Xi Jinping, Trump finds himself in the opposite position -- facing bipartisan pressures not to back down or compromise in any U.S.-China trade deal.

    Even Trump's own trade negotiator Bob Lighthizer -- who helped bend Japanese auto companies to the will of the Reagan administration in the mid-1980s -- has grown frustrated with the president , wanting him to take a harder line on Chinese telecom giant Huawei and keep the threat of further tariff increases on the table.

    Donald Trump and Xi Jinping meet during the 2018 G20 Summit in Buenos Aires
    Donald Trump and Xi Jinping meet during the 2018 G20 Summit in Buenos Aires

    The context for this strange turnabout is the new common sense across the political spectrum: the idea that China poses a threat to U.S. jobs, security and technological dominance.

    Trump's advisers fully expect the eventual Democratic nominee in 2020 to try to outflank him to the right on China and the defense of U.S. manufacturing. And the political competition over anti-Chinese toughness could very well throw a wrench into the continuing bilateral negotiations with China.

    Even big American capital -- which, outside of the steel industry, has been almost universally opposed to Trump's tariffs -- is warming to the administration's more aggressive stance toward China.

    Most U.S. CEOs are still hostile to the use of tariffs as an economic weapon, especially against their North American and European trading partners. But they also have serious concerns about the rapid development of Chinese high-tech manufacturing, the transfer -- by contract and by coercion -- of U.S. technologies to Chinese firms, and investment restrictions for U.S. companies in China.

    Somewhat to their surprise, Corporate America sees Trump forcing Xi's hand on these issues more effectively than Barack Obama or George W. Bush before him.

    Josh Bolten, president of the Business Roundtable -- an association of the U.S.'s largest companies, collectively worth $8 trillion and employing 15 million workers -- put it this way during a recent interview with Washington trade experts Scott Miller and Bill Reinsch on their podcast The Trade Guys :

    The CEOs of the Business Roundtable have found themselves in agreement...with the Trump administration on most of the objectives of the very aggressive posture that the administration has taken with respect to China.

    As both of you also know, that is an evolution...of the business community's position. The Roundtable doesn't speak for the whole business community, but I think there has been an evolution throughout the business community on this. And that is that the posture of waiting for democratic, market-oriented capitalism gravity to have its effect on the Chinese has proven not to be a viable approach.

    Bolten went on to lament the defeat of the Trans-Pacific Partnership (TPP) -- a major Obama-era economic agreement that Trump opposed on the campaign trail and terminated once he took office -- as a missed opportunity to contain China's rise and secure crucial markets where U.S. and Chinese companies are in direct competition.

    Bolten and most of the U.S. ruling class see -- somewhat in contrast to Trump -- the strengthening of a multilateral alliance of Western and pro-Western countries as the best strategy to counter the threat of a growing Chinese rival.

    But Bolten is unambiguous and Trump-sounding about the goal of the strategy. "All of our interests are actually consistent with each other in confronting the threat that an economically hegemonic China poses for the entire world," he explained.


    HEARING A leading representative of the American corporate elite talk about the threat of Chinese economic hegemony on "the entire world" is alarming to say the least -- and demonstrates that Trump doesn't have a monopoly on anti-China discourse by any stretch of the imagination.

    That isn't to underplay the serious disagreements over strategy between the Trump administration and most of the U.S. business world.

    Many corporate leaders are concerned about the fact that Trump is simultaneously in tense trade negotiations with the European Union and brandishing the threat of tariffs on car imports (primarily impacting Germany and Japan), a move which virtually every single American auto-company angrily opposes.

    And they appear to be signing on only half-heartedly to Trump's renegotiated NAFTA, now dubbed the U.S.-Mexico-Canada Agreement -- which contains some attractive updates on digital trade (mostly lifted from the TPP, ironically enough), but is broadly seen as a step backwards for corporate profits and preferable only to a collapse of NAFTA altogether.

    These raise question for U.S. corporate rulers: If Trump is so concerned with the Chinese threat, why doesn't he focus his fire in that direction, instead of toward allies?

    This will be the line of attack against Trump from much of the political and corporate establishment, including those who are Democrats or support them, moving forward into the new election cycle.

    To Trump and his team, however, trade disputes and negotiations with Canada, Mexico, the European Union, Japan and China are all so many elements of a larger plan to keep as much of global industry as possible within the continental U.S.

    For the largest American companies -- which have positioned themselves at the technological peak of a globalized network of supply chains, markets and investments -- Trump's economic nationalism poses an opportunity to challenge China, but new problems in relation to the rest of the world.

    The biggest CEOs and industry lobbies are still figuring out a response.


    THE REVERBERATIONS of the U.S.-China trade war have been felt across the corporate world, perhaps nowhere more starkly than in telecommunications.

    As geopolitical tensions between the U.S. and China have deepened, telecom companies and state governments have been preparing for the highly anticipated rollout of 5G cellular networks. 5G, or fifth generation, technology is expected to speed up data flows (and increase data volumes) across cell phone and other digital communication systems.

    Many analysts predict the degree of change brought on by 5G will be similar to that of the 3G and 4G evolutions, which underpinned the smartphone boom. This time around, however, most eyes are trained on what the new networks will mean for digitized and computerized manufacturing, commerce and transportation more broadly.

    For the leadership of both main U.S. political parties, the excitement around 5G has been muted by hostility toward the world's largest telecom equipment supplier (and second largest cell phone seller), the Chinese corporation Huawei.

    With $7.55 billion in profits in 2017 and the most cost-competitive telecom equipment in the world, Huawei has been widely predicted to be one of the main beneficiaries of the 5G expansion.

    But Congress has been on an offensive against the company since 2012 , and the Trump administration has escalated the attacks.

    Trump has gone on a global campaign with broad bipartisan support to persuade allied states to ban Huawei entirely from their domestic markets. He has also planned to issue an executive order to bar the company from the U.S. economy as well, though he seems to have now turned this threat into a bargaining chip in his dealmaking with Xi and China.

    The justification for bans is that Huawei could use its access to the cellular networks it builds overseas to spy on foreign governments. The extraordinary hypocrisy of this claim coming from the main surveillance power in world history has not been lost on most people following the debate.

    Meanwhile, Trump instructed the Canadian government to arrest and extradite Huawei's Chief Financial Officer Meng Wanzhou, daughter of Huawei founder and President Ren Zhengfei, during a routine visit to Vancouver. The charges against Wanzhou stemmed from alleged violations of U.S. sanctions on Iran. Wanzhou's extradition hearing began this week and could drag on for months.

    Wanzhou's arrest could also be used as a bargaining chip by Trump, though most of Trump's staff is reticent to bring a separate legal proceeding into a trade agreement for fear of discrediting the courts.


    PART OF what is so striking about the case of Huawei and 5G is how it flatly contradicts the whole logic of the current neoliberal world order of free markets and free trade.

    According to the propaganda, under neoliberalism, any buyer should be allowed to make their purchases from any company that offers the best products for the lowest prices. For many buyers, including national governments, that company is clearly Huawei.

    Now, however, the U.S. state is attempting to restrict the field and eliminate the Chinese option from the market. In other words, what we're witnessing in this crucial sector of the global economy is an open attempt by the world's most powerful state to create trade blocs in telecommunications that shut out one of China's most prominent companies.

    While both Republicans and Democrats in Congress are rallying behind the attacks on Huawei, the response from the U.S. and European information technology industries has been much more conflicted.

    The main lobby for telecom and technology companies in the U.S., the Information Technology Industry Council, has been clamoring for Trump to strike a deal with Xi and drop the tariffs. Chuck Robbins, CEO of the largest American telecom equipment maker, Cisco Systems, insists Trump's tariffs and sanctions are unnecessary.

    "We don't need anything else to beat these guys or to beat any of our competition in the marketplace," Robbins said in February . Huawei competitors Ericsson and Nokia -- multinational companies based in Sweden and Finland, respectively -- have claimed that they're ready to supply Europe's 5G infrastructures in the event of a Huawei ban, indicating they may have some sympathy with Trump's efforts.


    AS OF now, the Trump administration's campaign to block Huawei from the world's markets has had mixed results. Both British and German intelligence agencies are leaning toward accepting Huawei as a legitimate business partner, as is the French Senate .

    In the Czech Republic, a conflict has emerged pitting President Miloš Zeman, who wants to strengthen ties with China, and the Czech cybersecurity agency, which has labeled Huawei a threat to national security. Debates on the same topic are also underway in Italy and Canada .

    Australia's Foreign Minister Marise Payne, staking out the most extreme anti-Huawei position, has fully embraced Trump's ban and vowed to maintain it, even if Trump himself backs away from his current position. New Zealand's Prime Minister Jacinda Ardern, on other the hand, rejected the idea of a blanket ban .

    Crucially, Narendra Modi's right-wing government in India has so far opposed the idea of banning Huawei .

    Despite ongoing China-India tensions, the offer of cheap telecommunications equipment to expand India's cellular infrastructure seems too attractive for Modi and his business allies to decline. The fact that the Trump administration is simultaneously weighing raising tariffs and restrictions on Indian products is certainly not helping to convince Modi to further antagonize Beijing.

    However unsuccessful the Trump White House has been in forcing the hand of other states, the president and congressional leaders are well aware of the economic leverage they have against key Chinese companies.

    Last year, the Trump administration brought China's second telecom corporation, ZTE, to the brink of collapse when he issued a temporary ban on trade between the company and American suppliers. ZTE is totally dependent on U.S. imports of advanced communications equipment and might have been destroyed if Trump had not chosen to lift the ban before entering negotiations with Xi.

    Similar bans by the Trump administration have nearly brought down the Chinese state-owned chipmaking company Fujian Jinhua, which has announced it will have to cease production altogether in March if it cannot buy more imports of crucial American equipment.


    WITH ALL of these variables at play, the next year in the U.S.-China economic relationship is impossible to predict.

    The financial costs of unraveling one of the largest state-to-state commercial relationships in modern history may prove too high for either side to escalate the 2018-19 trade conflict any further, especially as the global economy passes the high point of the business cycle and heads toward another likely recession .

    The two heads of state plan to meet at the end of March, possibly at Trump's Mar-a-Lago resort in Florida, to sign a trade agreement.

    For Trump to sell the deal to an increasingly hawkish Congress, he will have to demonstrate "progress" on the goals he articulated at the outset of the trade war: more Chinese purchases of American products, stronger intellectual property safeguards for U.S. corporations and less state subsidies for Chinese companies. It remains to be seen whether Trump will decide to incorporate a compromise on Huawei into the deal.

    Whatever the outcome of this round of negotiations -- and it is still possible that they could fall apart -- what is unfolding today is undoubtedly just the first act in a long and tempestuous drama.

    China is clearly a growing geopolitical rival to the U.S., and Chinese corporations are quickly developing the capacity to compete with their U.S. counterparts on a global scale in the most advanced areas of high-tech manufacturing.

    This means that many more economic confrontations between the two states are inevitable. And as politicians on both sides of the aisle have made abundantly clear, Trump will not be the last president to stoke tensions with China.

    Then there is the question of how the perspectives of the largest American businesses will change as this conflict develops.

    Josh Bolten, the Business Roundtable president, claims that the CEOs he represents have been through an "evolution" in their views that brings them closer to Trump's "aggressive posture" toward China. Yet at the same time, there continues to be near-universal opposition to tariffs and trade wars within these elite strata.

    So what kind of "aggressive posture" do these leading American capitalists hope to adopt? With more money and power concentrated in their hands than any other ruling class in the world, the stance that these elites take toward U.S.-China relations will be very important.

    If the American 1 Percent drifts any further toward the rising economic nationalism articulated by their political representatives in Washington, future flare-ups between the two countries may be a great deal worse.

    [Mar 04, 2019] US does not have "plan B". Trump just betting on enough pressure will force China to surrender, like Japan did in the 80s.

    Notable quotes:
    "... Face it. Mass production of consumer electronics in the USA is almost non-existent. An entire important industry has been lost forever based on wage arbitrage. But even if there were not a 10:1 wage disparity, the skill level and work ethic of Americans is pathetic compared to the diligent Asian worker bees. Reality is a cruel mistress ..."
    "... Russia just passed up the U.S. in grain exports. Their economy in real terms grows year on year. Russia has more natural wealth available to exploit than USA that includes lands rich in minerals, timber, water, etc. ..."
    "... With regards to traitorous fifth column atlantacists and oligarchy, Russia's shock therapy (induced by the Harvard Boys) in the 90's helped Russian's figure out who the real enemy is. Putin has marginalized most of these ((Oligarchs)), and they longer are allowed to influence politics. Many have also been stripped of their ill gotten gains, for example the Rothschild gambit to grab Yukos and to own Russia was thwarted. Dollar debts were paid off, etc. ..."
    "... The Western European based US economy is fast draining out (along with people of Western European descent) and the days of US world manufacturing leadership (1950's) are a distant memory. ..."
    "... Maybe the takeaway from US/Chinese history is that the US needs its own Maoist style Cultural Revolution. Nothing short of US Maoism is needed to root out every aspect of the current rotten system and get a fresh start from zero. ..."
    Mar 04, 2019 | www.unz.com

    jacques sheete says: February 18, 2019 at 4:05 pm GMT 100 Words A superb and apparently too little appreciated point,

    War, in this model, begins when the first shots are fired.

    Well, think again in this new era of growing great-power struggle and competition.

    It all war, all the time and another point to remember is that there is always a war between the .001% and the rest of us.

    Another thing is that we proles, peasants and peons should give some serious thought to having the "elite" fight their own battles, on their "own" (though mostly stolen) shekels for once. Read More Agree: foolisholdman Reply Agree/Disagree/Etc. More... This Commenter Display All Comments


    Agent76 , says: February 18, 2019 at 4:08 pm GMT

    Feb 15, 2019 Next Phase, Xi & Trump, Coordinate The Transition

    US industrial production plunges, this doesn't mean that manufacturing jobs are not coming back to the US this means the [CB] is deteriorating quickly as Trump brings back manufacturing.

    Feb 16, 2019 Pentagon Warns of Chinese Space Lasers | China News Headlines

    A new Pentagon report says #China and Russia have developed #laser weapons to target US satellites. Need a Space Force?

    SteveK9 , says: February 18, 2019 at 4:09 pm GMT
    Michael Klare believes in Russia-gate. Anyone that foolish is not worth reading.
    The Scalpel , says: Website February 18, 2019 at 4:13 pm GMT

    governing elites have developed other means of warfare -- economic, technological, and covert -- to achieve such strategic objectives. Viewed this way, the United States is already in close to full combat mode with respect to China.

    Looked at this way, there are countless wars all the time as well as a huge gray area that is debatable. I think there is merit in defining war as actual kinetic weapons firing in both directions. Even then, there are gray areas, but at least they are minimized

    Yee , says: February 18, 2019 at 4:15 pm GMT
    Erebus,

    "The time and investment required to rebuild/replace supply chains in a JIT world means much of what's left of America's real economy would disappear within weeks.

    American trade negotiators are apparently oblivious to this. I find that very weird."

    Of course they're not oblivious, as you can see everytime the stock market goes down, some US official came out to say a deal/talk is on the way. Both the negotiators and the market know.

    They're just betting on enough pressure will force China to surrender, like Japan did in the 80s.

    nsa , says: February 18, 2019 at 4:18 pm GMT
    @Erebus In the distant past there were at least 1000 PC Board manufacturers in the US .now there are only 2 or 3. Most US PCB houses are actually a middleman with an iphone fronting for one of the many Chinese PCB factories. You supply the Gerber Files and the payment, of course, and your finished PC Boards come back by air the next day.

    Now here is the kicker: our US PC Board supplier is located in Illinois and owned by you guessed it Hindus. Half the staff are also Hindus. In general, the Chinese PCBs are of higher quality than the Hindu .er US PCBs.

    Face it. Mass production of consumer electronics in the USA is almost non-existent. An entire important industry has been lost forever based on wage arbitrage. But even if there were not a 10:1 wage disparity, the skill level and work ethic of Americans is pathetic compared to the diligent Asian worker bees. Reality is a cruel mistress

    MEFOBILLS , says: February 18, 2019 at 4:26 pm GMT
    @jeff stryker Reality much?

    Russia just passed up the U.S. in grain exports. Their economy in real terms grows year on year. Russia has more natural wealth available to exploit than USA that includes lands rich in minerals, timber, water, etc.

    With regards to traitorous fifth column atlantacists and oligarchy, Russia's shock therapy (induced by the Harvard Boys) in the 90's helped Russian's figure out who the real enemy is. Putin has marginalized most of these ((Oligarchs)), and they longer are allowed to influence politics. Many have also been stripped of their ill gotten gains, for example the Rothschild gambit to grab Yukos and to own Russia was thwarted. Dollar debts were paid off, etc.

    Russia could go further in their symphony of church and state, and copy Justinian (Byzyantine empire) and prevent our (((friends))) from teaching in schools,bein control of money, or in government.

    With regards to China, they would be not be anywhere near where they are today if the West had not actively transferred their patrimony in the form of transplanted industry and knowledge.

    China is only temporarily dependent on export of goods via their Eastern seaboard, but as soon as belt and road opens up, she will pivot further toward Eurasia. If the U.S. factories withdrew from China tomorrow, China already has our "knowledge" and will find markets in Eurasia and raw materials in Africa, etc.

    People need to stop whistling past the graveyard.

    The atalantacist strategy has run its course, internal development of U.S. and linking up with belt and road would be in America's best future interests. But, to do that requires first acknowledging that money's true nature is law, and not private bank credit. Further, the U.S. is being used as whore of Babylon, where her money is "Federal Reserve Notes" and are international in character. The U.S is not sovereign. Deep state globalism does not recognize national boundaries, or sovereignty.

    The Scalpel , says: Website February 18, 2019 at 4:32 pm GMT
    @Alfa158 Alternatively, one could examine a nations ability to rapidly expand their economy to meet wartime needs. In this scenario, other factors such as access to raw materials come into play. In this perspective, the equations would change dramatically.
    Digital Samizdat , says: February 18, 2019 at 4:32 pm GMT
    @MEFOBILLS To make a long story short, China is run by the Chinese, while the US today is run by (((globalist parasites))).
    The Scalpel , says: Website February 18, 2019 at 4:42 pm GMT
    @Wally

    And to think some take this fraud, Klare, seriously.

    He writes for Tomdispatch. Need I say more?

    jacques sheete , says: February 18, 2019 at 4:57 pm GMT
    @The Scalpel

    I think there is merit in defining war as actual kinetic weapons firing

    Why limit it to that? I'd say there's plenty of merit in the author's definition especially since it would tend to shed some lights on the origins of major conflicts.

    AriusArmenian , says: February 18, 2019 at 5:14 pm GMT
    That US elites that are split on who to go after first compromised by going after both Russia and China at the same time is a definition of insanity. The US doesn't have a chance in hell of subduing or defeating the Russia/China alliance. The US is already checkmated. The more it goes after some big win the worse will be its defeat.

    So the question (for me) is not which side will win, the question is the scenario of the decline of the US Empire. Someone here mentioned the EU turning East. At some point the EU will decide that staying a US vassal is suicide and it will turn East. When that happens then the virus of US insanity will turn inwards into itself.

    The US has recently focused on South America by installing several fascist regimes and is now trying to get Venezuela. But the US backed regimes are laying the groundwork for the next wave of revolution soon to come. Wherever I look the US is its own worst enemy. The big question is how much suffering before it ends.

    The Scalpel , says: Website February 18, 2019 at 5:43 pm GMT
    @jacques sheete The author's definition makes the term a purely rhetorical one tantamount to an angry child saying "this means war!" to another angry child, or "The War on Drugs" or "The Battle of the Sexes" etc.

    Admittedly, this is all semantics, so have it your way if you want, as it is not worth the time of further debate. As for me, I prefer to have terms as precise as possible.

    DB Cooper , says: February 18, 2019 at 5:52 pm GMT
    @nsa I didn't know Indians are into the PCB industry. Do the customers aware that they are just middlemen getting their goods from China?

    Anyway here is a behind the scene look at one of the PCB manufacturers in China. Pretty interesting stuff.

    Cratylus , says: February 18, 2019 at 5:56 pm GMT
    Klare discovers the US crusade against China – 8 years after the Obama/Hillary "pivot" to East Asia sending 2/3 of the US Navy there and putting together the TPP to excluded China. As usual he is right on top of things.

    And he begins with this gem: " "The media and many politicians continue to focus on U.S.-Russian relations, in large part because of revelations of Moscow's meddling in the 2016 American presidential election and the ongoing Mueller investigation." Huh? Does he mean the $4700 in Google ads or the $50,000 in Facebook ads traced to some alleged Russian sources? A Russiagater from the start.
    I remember some years ago before the shale revolution Klare was warning us about "peak oil." I think we were supposed to have run out of it by now.

    Klare is a hack who cycles things that any conscious person reading the newspapers would have known long ago.

    P.s. He says that Apple is the number one cell phone. No longer. He should improve his Google search skills or his set of assumptions which have turned him into a Russiagater.

    Huawei now sells more cell phones worldwide than Apple ( https://gearburn.com/2018/08/huawei-smartphone-sales-2018/ ). And Huawei does this even though it is effectively excluded from the US market (You cannot find it in stores) whereas Apple has unfettered access to the enormous Chinese market. You find Huawei everywhere – from Italy to Tanzania. How would Apple fare if China stopped purchases of its products? Not so well I am afraid.

    Anon [424] Disclaimer , says: February 18, 2019 at 6:24 pm GMT
    Usa is at war against everyone , from China to Latinamerica , from Europe to India , from the islamic world to Africa . Usa is even at war against its own citizens , at least against its best citizens .
    peterAUS , says: February 18, 2019 at 6:30 pm GMT
    @Counterinsurgency You are onto something here.

    I don't think it's simple "Eastern" vs "Western" Europeans; my take is Protestants vs Catholics vs Orthodox. In that order. The biggest difference is between Protestant and Orthodox. Catholics are, sort of, in the middle. Or, in practical terms, don't see much difference between Austrians and Slovenes. That's for Europe.

    As for China, definitely agree.

    wayfarer , says: February 18, 2019 at 6:55 pm GMT
    China's "Petro-Yuan": The End of the U.S. Dollar Hegemony?
    WorkingClass , says: February 18, 2019 at 7:09 pm GMT
    When we speak of the culture war or the war on drugs or the war between the sexes or a trade war we are misusing the word war.

    War with China means exactly shooting and bombing and killing Chinese and American people. Expanding the meaning of the word only makes it meaningless.

    We are NOT already at war with China.

    jacques sheete , says: February 18, 2019 at 7:57 pm GMT
    @The Scalpel

    Admittedly, this is all semantics, so have it your way if you want, as it is not worth the time of further debate. As for me, I prefer to have terms as precise as possible.

    I agree on all four points.

    However, if you didn't want a debate, or at least a response, then why did you bother bringing it up? (That's a rhetorical question, since I neither expect nor really care what the response would be; now I'm asking myself why I bothered !!!)

    jacques sheete , says: February 18, 2019 at 8:00 pm GMT
    @DESERT FOX

    Russia under Putin is an exporter of non GMO grains where as the U.S. exports GMO grains thatt the Chinese do not want as these GMO grains are a destuctive to humans and animals.

    I hope that's true. To Hell with that GMO crap!!! Anyone using it for farming ought to be forced to drink glyphosate straight for breakfast.

    AnonFromTN , says: February 18, 2019 at 8:02 pm GMT
    As far as the war with China goes, we ain't seen nothing yet. It won't be pretty, especially considering that the US is starting it with severe self-inflicted wounds.
    Cratylus , says: February 18, 2019 at 8:19 pm GMT
    Yes, and the ads were often absurd – one somehow featuring Yosemite Sam and gun rights and another for a dildo, I believe. Great for click bait maybe but not real winners for a campaign.

    As the incomparable Jimmy Dore says on his show, which should be required watching for everyone, if the Russians can swing an election with such modest resources against maybe $1-2 billion spent by the Donald and the Hillary together, then every candidate for offices high and low should run not walk with $54,700 in hand to secure a cheap and easy victory from the Russobots.

    Commentator Mike , says: February 18, 2019 at 8:41 pm GMT
    @DESERT FOX Actually China has approved import of some US GMOs

    https://www.cnbc.com/2019/01/08/reuters-america-factbox-china-approves-new-gmo-soybean-corn-and-canola-traits.html

    Cyrano , says: February 18, 2019 at 8:41 pm GMT
    I don't think China stands the chance. As we all know diversity is strength and China is mono-cultured rather than the obviously superior multi. So China will continue to decline, while US goes from strength to strength thanks to its brilliant, brilliant multicultural philosophy.

    China was dumb enough to try real socialism, while obviously the fake one is the way to go. You convince your domestic population of your humanitarian credentials – via the phony socialism, plus you don't have to share a cent with them. How clever is that? Phony socialism is the way to go – it eliminates the need for the real one.

    James Wood , says: February 18, 2019 at 8:49 pm GMT
    At some point one must consider that this is all a fraud. In Washington Ocasio-Cortez and the Democrats are proposing to eviscerate the US economy with their Green New Deal. While here we find Washington launching a long term struggle for economic, political, and military superiority over China.

    As was once said in another context by an individual remembered in history, "What is truth?" A question which either revealed his own puzzlement or was simply a rhetorical dismissal of the question altogether. Likely both at the same time. One can be simply bemused by the turn of events.

    Is all this activity simply a song and dance to entertain, terrify, confuse, and amuse the public while the real ordering of the world takes place behind closed doors? Put Ocasio-Cortez together with the Pentagon and we have apparently a commitment by the US to force the entire world to immolate itself. No state shall be superior to the US and the US shall be a third world hellhole. Cui bono?

    AnonFromTN , says: February 18, 2019 at 9:04 pm GMT
    @joe webb Russia and China are certainly not natural allies. However, deranged international banditry of the US (called foreign policy in the DC bubble) literally forced them to ally against a common threat: dying demented Empire.

    As you call Chinese "Chinks", I suggest you stop using everything made in China, including your clothes, footwear, tools, the light bulbs in your house, etc. Then, using your likely made in China computer and certainly made in China mouse, come back and tell us how great your life has become. Or you can stick to your principles of not using China-made stuff, write a message on a piece of paper (warning: make sure that neither the paper nor the pen is made in China), put it into a bottle, and throw it in the ocean. Be patient, and in a few centuries you might get an answer.

    Anonymous [375] Disclaimer , says: February 18, 2019 at 9:34 pm GMT
    @joe webb Russia is currently trying to get China to ally against the West:

    " Russia to China: Together we can rule the world "

    https://www.politico.eu/blogs/the-coming-wars/2019/02/russia-china-alliance-rule-the-world/

    In the halls of the Kremlin these days, it's all about China -- and whether or not Moscow can convince Beijing to form an alliance against the West.

    Russia's obsession with a potential alliance with China was already obvious at the Valdai Discussion Club, an annual gathering of Russia's biggest foreign policy minds, in 2017.

    At their next meeting, late last year, the idea seemed to move from the speculative to something Russia wants to realize. And soon

    Seen from Moscow, there is no resistance left to a new alliance led by China. And now that Washington has imposed tariffs on Chinese exports, Russia hopes China will finally understand that its problem is Washington, not Moscow.

    In the past, the possibility of an alliance between the two countries had been hampered by China's reluctance to jeopardize its relations with the U.S. But now that it has already become a target, perhaps it will grow bolder. Every speaker at Valdai tried to push China in that direction.

    Anon [332] Disclaimer , says: February 18, 2019 at 9:45 pm GMT
    @Sean Pollution in China is good for the environment:

    https://www.npr.org/2018/12/05/673821051/carbon-dioxide-emissions-are-up-again-what-now-climate

    Another hurdle, reported in the journal Nature this week, is that China is cleaning up its air pollution. That sounds great for pollution-weary Chinese citizens. But climatologists point out that some of that air pollution had actually been cooling the atmosphere, by blocking out solar radiation. Ironically, less air pollution from China could mean more warming for the Earth.

    tamo , says: February 19, 2019 at 2:53 am GMT
    @AnonFromTN Frankly, I really don't give a damn about what you say. But do not use racial slurs FIRST. I use racial slurs ONLY in RESPONSE to the comments that contain them, in retaliation. If you don't use racial slurs, I wouldn't either.
    nsa , says: February 19, 2019 at 3:02 am GMT
    @DB Cooper DB,
    Thanks for the PCB mfg video. Asian roboticized surface mount assembly plants are even more impressive. At one time supplied specialized instrumentation to the FN factory in South Carolina where the 50 cal machine guns are made, and received a tour. Crude by Asian standards, but efficient in its own way. Base price on a 50 LMG at the time was $5k without any of the extras: tripod, flash suppressor, water cooling, advanced night vision sights, etc. Base price would be $10k by now. The US Guv does not allow this kind of production to go offshore .but apparently cares not a jot about the production of consumer electronics, a massive and growing worldwide market.

    Have read the Chinese shops assemble $1000 I-pods for as little as $5 each including parts sourcing, making domestic production here impractical. Surprisingly, the Germans manage to produce high end electronics and their manufacturing labor rates are even higher than North America. Says something about the skill and diligence level of the US workforce ..where just passing a drug test and not having felonies or bad credit is a major achievement.

    @Anonymous Yes, it is quite off putting, even though most of the article is quite sound. Possibly Klare was obliged to add this bit of nonsense in order to get it published in TomDispatch but who knows.
    Erebus , says: February 19, 2019 at 1:39 pm GMT
    @nsa A good friend supplies hi-end PCBs to EU & RU electronics mfrs, particularly in DE. Judging by the numbers I hear, hi-end electronics is still very much alive in Europe while it's all but dead in NA.

    It's a capital intensive business, and raw labour cost is a minor component in the total cost of doing business. NA has put so many socio-political obstructions & regulatory costs in the way that even at min wage it makes no business sense to locate there. I doubt it would make sense even with free labour.

    As Steve Jobs told Obama point blank, "Those jobs aren't coming back". NA's manufacturing ecosystem (rather than mere infrastructure), which includes social-cultural aspects as well as physical plant has been disappeared, and only dire necessity will build a new one. I explicitly avoid the word "rebuild", as that train left the station years ago. NA still "assembles" stuff, but it doesn't manufacture except on a small, niche scale.

    Manufacturing is a difficult and very demanding business. 21st C manufacturing is not simply an extension of the 20th's. It's a radically different hybrid of logistics, design & production engineering, "smart" plant, and financial mgmt.

    Not for the faint of heart. Much easier to flip burgers/houses/stocks/used cars/derivatives/credit swaps/ until there's nothing left to flip.

    peter mcloughlin , says: February 19, 2019 at 1:55 pm GMT
    Where a war begins – or ends – can be hard to define. Michael Klare is right, 'War' and 'peace' are not 'polar opposites'. We often look at wars in chronological abstraction: the First World War started on the 28th July 1914. Or did it only become a global war one week later when Great Britain declared war on Germany? The causes can be of long duration. The decline of the Ottoman Empire, for which the other Great Powers were positioning themselves to benefit, might have begun as far back as 1683 when the Turks were defeated at the Battle of Vienna. It ultimately led to the events of 1914.

    Great power rivalry has always led to wars; in the last hundred years world wars. Graham Allison wrote that the US can 'avoid catastrophic war with China while protecting and advancing American national interests' if it follows the lessons of the Cold War. History shows that wars are caused by the clash of interests, that's always at some else's expense. When core interests collide there is no alternative to war – however destructive.
    https://www.ghostsofhistory.wordpress.com/

    Jason Liu , says: February 19, 2019 at 2:45 pm GMT
    The trade war is meh.

    The real conflict is a cultural/ideological war in which liberal democracy tries to apply its system worldwide under the delusion that egalitarianism, freedom, your definition of rights, is universal.

    China will never accept this. Russia is already fighting back. Nor does any developing country look like they will ever truly embrace western values. It's gonna be SWPLs + WEIRDs vs The Rest of Humanity.

    The new Cold War will last much longer than any trade issue and conflict over values will always be the underlying motivation, until the west either ends its universalist crusade, or abolishes liberal democracy within its own borders.

    raywood , says: February 19, 2019 at 2:53 pm GMT
    I would be more sympathetic with Klare's fear of cold war with China if he could just assure me that Chinese writers are equally able to voice concern with their own government's side of the equation.
    peterAUS , says: February 19, 2019 at 5:42 pm GMT
    @peter mcloughlin

    Great power rivalry has always led to wars ..

    History shows that wars are caused by the clash of interests, that's always at some else's expense. When core interests collide there is no alternative to war – however destructive.

    Pretty much, BUT, with one little difference re "some else's expense" now. M.A.D. scenario.

    Even limited exchange of thermonuclear M.I.R.V.s could affect everyone (even if somebody can define that "limited" in the first place).

    My take: we haven't developed, as species, along our capability for destruction.
    Cheerful thought, I know.

    denk , says: February 19, 2019 at 6:07 pm GMT
    Pepe Escobar says: 'US elites remain incapable of understanding China'

    That's B.S., Pepe should've known better . They dont 'misunderstand', they'r simply lying thru their teeth.

    The following are all bald faced lies, Classic bandits crying robbery.

    Lawmaker: Chinese navy seeks to encircle US homeland
    [bravo, This one really takes the cake !]

    US Accuses China Of Preparing For World War III

    US accuses China of trying to militarise and dominates space

    USN have to patrol the SCS to protect FON for international shipping..

    tip of an iceberg

    Those who uttered such nonsense aint insane, stupid or cuz they 'misunderstand' [sic] China.
    They know we know they'r telling bald faced lies
    but that doesnt stop them lying with straight face .

    This is the classic def of psychopaths: people who'r utterly amoral, no sense of right or wrong, there's no such word as embarrassment in their vocab.

    Is it sheer coincidence that all the 5lies have been ruled by such breeds ?
    Ask Ian Fleming's fundamental law of prob .

    but why couldnt they produce one decent leader
    in all of three hundred years.
    5lies have more than their fair share of psychopaths no doubt, but surely not everybody is like joe web and co., I know this for a fact. ?

    Trouble is .

    Washington DC is a veritable cesspool that
    no decent man would want to dip his foot into it.
    They might as well put it in the job requirement,
    'Only psychopaths need apply '
    Thats why in the DC cesspool, only the society's dregs rise up to the top.

    A case of garbage in, garbage out .

    A vicious circle that cant be fixed, except to be broken.

    Китайский дурак , says: February 20, 2019 at 12:56 am GMT
    1) People from China PRC has as a people on the whole become quite disgusting. But please exclude ppl from Hong Kong, Taiwan, Tibetans, Uyghurs etc. I confirm that PRC China people by and large are now locusts of the world. I am one of them by birth. how did it happen? Deep question for philosophers. It wasn't like this 60 years ago. some poisonous element entered the veins of the collective, infected at least 70 percent. I worry for Russia due to its inflated self confidence when dealing with PRC. Lake Baikal deal was almost sealed before it got shelved. Still, using racial curses don't hurt anyone but yourself. All the big internet advocates for Russia such as Orlov and Saker and Karlin don'tunderstand The Danger of China PRC. If you understand then you have a responsibility to keep yourself décent and respectable.

    2) USA aside from its liberals and Zionist Jews etc. Has become a slowly stewing big asylum for psychologically infantile and demented big babies. How did it happen again is a big philosophical myth to me. Western Europe is sinking primarily because they came to resemble the US. especially French and Brits and Spanish.

    3) Russia is ruled by a few individuals with brains and maybe a bit of conscience but the elite ruling class behave in such a way that one would conclude that they share the China PRC virus, just not as advanced. Your basic Russian people are in a state of abject degradation dejection, not changed all that much since 1990s. Only slightly ahead of the Ukrainians. If one cares about Russia then shove aside 19th century naive romanticism and face reality.

    4) A sustained and massive war by USA against China maybe the only miniscule chance Greek/Christian civilization can be saved. Otherwise descend of history into thousand year dark age. The latter is more likely due to advanced stage of brain dead disease gripping the entire West.

    jeff stryker , says: February 20, 2019 at 1:19 am GMT
    @tamo TAMO

    If you have observed cities like Detroit or Greater Los Angeles than you know that "white flight" as oppose to sycophancy is the end result of black or Hispanic populations reaching a certain level. Whites leave and the US then has another internal third world like Detroit or East LA.

    It is a game of musical chairs where the white move into remote hinterlands, which develop into suburbs or exurbs, then of course as these become population centers the blacks and Hispanics enter them and the whites flee again.

    What you will see is white flight from the US with the wealthiest whites simply moving to other developed countries. The 1% would move to New Zealand or Tasmania.

    jeff stryker , says: February 20, 2019 at 1:54 am GMT
    @Joe Wong JOE

    The best way for the US to win a war over China is not to outsource their labor there.

    There is no way the US could win a conventional war with China. It cannot even win a conventional war in Afghanistan.

    China managed to fight off-if not defeat-the US in Korea and Vietnam.

    atlantis_dweller , says: February 20, 2019 at 1:54 am GMT
    The handicap for the USA in the confrontation is twofold its élite are in conflict (and afraid, and contemptuous of) at least half of their own populace.
    Plus, all the resources of all kinds directed to enterprises in the Middle East, subtracted thusly from other enterprises.

    Furthermore, there is the occasional bullying of Europe, and the continuous bullying of Russia, yet more resource drains.
    The USA spreads itself too thin, perhaps.

    Joe Wong , says: February 20, 2019 at 1:54 am GMT
    @peterAUS Chinese are neither for money nor for ethnic power, Chinese is for 5 principles of peaceful coexistence, treating all nations large and small as equal with respect.

    Chinese believes we are now living in a rapidly changing world Peace, development, cooperation and mutual benefit have become the trend of our times. To keep up with the times, we cannot have ourselves physically living in the 21st century, but with a mindset belonging to the past stalled in the oldays of colonialism, and constrained by the zero-sum Cold War mentality.

    Chinese is determined to help the world to achieve harmony, peace and prosperity thru the win-win approaches.

    atlantis_dweller , says: February 20, 2019 at 2:16 am GMT
    @Китайский дурак 2) The riddle reads simply: democracy, multiracialism, economic welfare (no-limit printing of currency made possible by uncontested military "overmatch").
    jeff stryker , says: February 20, 2019 at 2:20 am GMT
    @Joe Wong JOE

    I lived in the Philippines and would chalk that up to fairly typical of a country run by China since it is effectively controlled by a syndicate of Fujian family cartels.

    This is on the horizon in Africa. Probably.

    In the West, Chinese were held in check by Jews and WASPS and to some degree by Malaysians. I see Africa becoming like the Philippines once Chinese can become citizens there, however.

    Joe Wong , says: February 20, 2019 at 2:55 am GMT
    @Biff The Romans create a desert and call it peace; British Empire imitated Roman Empire, USA is born out of British Empire; so only the White People particular the Anglo-Saxon is not ready for peace or salvation. But rest of the world has been waiting for peace or salvation for a long long time.
    peterAUS , says: February 20, 2019 at 2:56 am GMT
    @Joe Wong

    Chinese are neither for money nor for ethnic power, Chinese is for 5 principles of peaceful coexistence, treating all nations large and small as equal with respect.

    Peace, development, cooperation and mutual benefit have become the trend of our times.

    Chinese is determined to help the world to achieve harmony, peace and prosperity thru the win-win approaches.

    Three options here:
    Preferably,you are just pulling our legs. Not bad attempt, actually. Got me for a second.

    Most likely, you are simply working. Sloppy and crude but, well, "you get what you pay for". 50 Cent Army. Retired but needing money. Sucks, a?

    Crazy and the least probable, you really believe in all that. Ah, well

    Joe Wong , says: February 20, 2019 at 3:28 am GMT
    @jeff stryker Obviously you are brain washed by the 'god-fearing' morally defunct evil 'Anglo-Saxon', blaming every of your own failure on the Chinese just like what the Americans and their Five-Eyes partners are doing right now.

    The Filippino, the Malay and all the SE Asia locals have the guns not the Chinese, if the Chinese do not hand over their hard earned money they will use what their ex-colonial masters taught them since Vasco da Gama discovered the East Indies, masscared the Chinese and took it all. The Dutch, Spanish, English, Japanese and the American all have done it before in order to colonized the East Indies.

    Before WWII, the American is just one of the Western imperialists ravaged and wreaked havoc of Asia with barbaric wars, illicit drugs like Opium, slavery, stealing, robbing, looting, plundering, murdering, torturing, exploiting, polluting, culture genocide, 'pious' fanaticism, unmatchable greed and extreme brutality. In fact it is hard to tell the difference between the American and the unrepentant war criminal Japanese who is more lethal and barbaric to Asians until the Pearl Harbour incident.

    For over seventy years the US has dominated Asia, ravaging the continent with two major wars in Korea and Indo-China with millions of casualties, and multiple counter-insurgency interventions in Indonesia, Thailand, Malaysia, the Philippines, Timor, Myanmar, Pakistan and Afghanistan. The strategic goal has been to expand its military and political power, exploit the economies and resources and encircle China.

    USA is 10,000 miles away on the other side of the Pacific. USA is not an Asian nation, and American is an alien to Asia. American is a toxin and a plague to Asian, They have done enough damage to Asian already, they are not wanted, not invited and not loved in Asia, go home Yankee.

    Joe Wong , says: February 20, 2019 at 3:50 am GMT
    @peterAUS You should know the White man has some fallacies built into their culture, such as they believe that the White man's words must be taken as given truth, only the White man can invent and the White man can succeed, and the Whte man's culture is the final form of civilization.

    The West (Europeans and their offshoots like the American, Aussie, etc.) is where is now, because of those hundreds of millions of people all over the world who were robbed and murdered, those who become victims of their very madness of colonialism and orientalism, of the crusades and the slave and Opium trades. Cathedrals and palaces, museums and theatres, train stations – all had been constructed on horrid foundations of bones and blood, and amalgamated by tears.

    The West squandered all the wealth they obtained thru stealing, looting and murdering hundreds of millions of people all over the world in the scrabbling of a dog-eat-dog play rough over the monopoly to plunder the rest of the world through two World Wars, one on the edge of Armageddon, and on the verge of another Armageddon. It proves the West is incapable of bringing peace and prosperity to the mankind because of their flawed culture, civilization and religion. The chaos and suffering of the world in the last few hundreds of years under the dominance the West proves they are a failure.

    Human beings deserve better, we need to depart from the chaotic and harmful world order and path established by the moronic West. China proposed a new way of life, a win-win approach for the well-being of mankind like Belt-Road-Initiative to build and trade the world into peace, harmony and prosperity. The West should not be the obstacle for achieving such refreshing winner for all initiative. The West should embrace the new approach proposed by China because the West will benefit from it. I call upon you, let go the old, obsolete, failed and detrimental believe passed onto you by your colonialist forebears please, welcome the new era.

    Miro23 , says: February 20, 2019 at 4:16 am GMT
    @Erebus

    As Steve Jobs told Obama point blank, "Those jobs aren't coming back". NA's manufacturing ecosystem (rather than mere infrastructure), which includes social-cultural aspects as well as physical plant has been disappeared, and only dire necessity will build a new one. I explicitly avoid the word "rebuild", as that train left the station years ago. NA still "assembles" stuff, but it doesn't manufacture except on a small, niche scale.

    Manufacturing is a difficult and very demanding business. 21st C manufacturing is not simply an extension of the 20th's. It's a radically different hybrid of logistics, design & production engineering, "smart" plant, and financial mgmt.

    Not for the faint of heart. Much easier to flip burgers/houses/stocks/used cars/derivatives/credit swaps/ until there's nothing left to flip.

    All true, leaving the question of what happens to North America before it reaches the African street market economy (low tech, low investment, low trust, basic products, vibrant and over each morning).

    The Western European based US economy is fast draining out (along with people of Western European descent) and the days of US world manufacturing leadership (1950's) are a distant memory.

    Maybe the takeaway from US/Chinese history is that the US needs its own Maoist style Cultural Revolution. Nothing short of US Maoism is needed to root out every aspect of the current rotten system and get a fresh start from zero.

    Don't ask what happens to US nuclear weapons.

    jeff stryker , says: February 20, 2019 at 4:32 am GMT
    @Joe Wong JOE

    If Chinese took over the world it would look like the Philippines.

    Shabu labs everywhere? Corrupt politicians blowing away homeless squatters when some Chinese guy wanted to build a shopping center or Chinese arsonists setting squats on fire? Dictators living off wages Chinese don't want to pay exploited peasants?

    No thanks, the whites don't want Chinese family cartels running our economies. We can see the harm you have done in Burma, Philippines etc.

    Китайский дурак , says: February 20, 2019 at 5:07 am GMT
    @jeff stryker This Joe Wong is obviously a WuMao (professional trolls paid by Beijing to parrot their government's pathological propaganda). Any mainland Chinese who can read will confirm this fact. It is not worth your time to deal with folks like him.
    jeff stryker , says: February 20, 2019 at 5:38 am GMT
    @Китайский дурак Maybe, but my posts are intended for those that think a Chinese-run planet would be a better New World Order.

    Visit the Philippines.

    Australians all wrapped up in America should pay close attention.

    Китайский дурак , says: February 20, 2019 at 6:08 am GMT
    @jeff stryker Australians, Philippines, Singaporeans, Vietnamese, Taiwanese, Russians, Italians, Japanese,Mongolians, Koreans, New Zealanders, a tiny anguished minority of mainland Chinese themselves, everyone has gotten the mail, everyone has seen them on the streets, everyone understood -- what a Beijing lorded world shall be like, coffee beans in the morning. Americans are last in getting the news. Americans can be dim witted. Too many Nobel winning economists and globalist bankers in America. And China is the gift of these white people to the world.
    joe webb , says: February 20, 2019 at 6:25 am GMT
    @peterAUS thanks and if you are a young man, congrats for your rationality. I am old, but probably have ten or 20 years left, if not all those years real fit.

    The young guys need to not fuc themselves up with regard to earning a living .keep your mouth shut , sort of, and your name protected.

    I hope a new generation of "White Nationalists" come along sans Hitlerism. Stay rational, with just the facts M'am if you don't recall that line it was Dragnet and Detective Jack Webb I think .you are young, Congrats.

    Stick to the facts, keep your ego under control, keep a smile on your face .. Buddhist wisdom to spread a little love around and it is essential for snaring a woman.

    The Facts are with us. The Future is with us, including hard times, civil war, and so on. The Sentimental Lie (Joseph Conrad) of race equality cannot stand for long.

    Joe Webb

    NoseytheDuke , says: February 20, 2019 at 6:26 am GMT
    @jeff stryker Australian people nowadays are far less wrapped up in America than at any time that I can remember but Australian politicians are just as bought and paid for as are those in the US.

    Australians generally are much more well travelled than most Americans and have been to various places both in Asia and Europe, especially the UK. Despite having seen the longer term results of "diversity" with their own eyes they overwhelmingly seem to think that things will somehow work out differently in Australia. To even suggest that mass immigration from the third world is a ticking time-bomb is to be branded a racist of the very worst kind.

    Yee , says: February 20, 2019 at 12:11 pm GMT
    jeff stryker,

    "The best way for the US to win a war over China is not to outsource their labor there."

    Too bad you don't get to decide what "the best way for the US" is, no matter how many times you vote America has owners, and the owners aren't the average Americans.

    PS. Philippines is just the poor-man version of USA. Does the American capitalist class have many concerns for their working class? The money class are all the same.

    Your rant about Chinese of SE Asia is also quite similar with that of American Whites for the Jews, or South African Blacks for the Whites, just only on economic side, not politics.

    People aren't much different everywhere

    Nzn , says: February 20, 2019 at 2:44 pm GMT
    Filipinos are nothing but semi retarded 85 IQ trying hard Americans, the vast majority who are too stupid to copy the better parts of US high culture, and so ape and cargo cult the trashiest and lowest of the low parts of US culture, or maybe low IQ Austronesians are just prone to overall trashiness unless they are regulated by a somewhat draconian conservative culture like Muslim Malays are.
    Joe Wong , says: February 20, 2019 at 4:47 pm GMT
    @Китайский дурак Perhaps some Russians like you are willing to live under the Anglo-Saxon's dominance, submitted to Anglo-Saxon's zero-sum, beggar-thy-neighbour, negative energy infested cult culture, and try to talk like them and walk like them, but not everybody is like those feeble Russians. Other people has their long history, culture and identity to protect. Please do not smear other people's integrity because you are lack of it.
    denk , says: February 20, 2019 at 5:48 pm GMT
    @denk

    Self-Defense, Civilizational Defense ,

    Exhibit A

    General William R. Looney III

    If they turn on their radars we're going to blow up their goddamn SAMs [surface-to- air missiles]. They know we own their country. We own their airspace We dictate the way they live and talk. And that's what's great about America right now . It's a good thing, especially when there's a lot of oil out there we need.

    Comments about the bombing of Iraq in the late 1990s, which he directed. Interview Washington Post (August 30, 1999); quoted in Rogue State, William Blum, Common Courage Press, 2005, p. 159.

    William Blum,
    RIP
    Somebody should do an autopsy on him !

    TT , says: February 26, 2019 at 12:48 pm GMT
    @denk

    In korea, a UN coaliton force , bristling with bombers, jet fighters, complete air superiority.no less. Tanks, artilleries, carbines, couldnt subdue the PLA fighting with ww1 vintage rifles.

    There is never any UN coalition force in Korea war. Its a illegal US led aggression, known as Unified/United Command, in violating of UNSC charter. US deceived UN by using 'United Command' in its letterhead when communicating. And then go ahead to lie shamelessly using UN name.

    https://www.globalresearch.ca/the-role-of-the-un-in-the-unending-korean-war-united-nations-command-as-camouflage/5350876

    By acting before the Security Council could act, the US was in violation of Article 2(7) of the UN Charter which requires a Security Council action under Chapter VII before there is any armed intervention into the internal affairs of another nation unless the arms are used in self-defense. (See Article 51 of the UN Charter. The US armed intervention in Korea was clearly not an act of self defense for the US.) Also the actions of the UN have come to be referred to as the actions of the "United Nations Command"(UNC), but this designation is not to be found in the June and July 1950 Security Council resolutions authorizing participation in the Korean War. (3) What is the significance of the US using the UN in these ways?

    The current US military command in South Korea claims to wear three hats: Command of US troops in South Korea, Combined Forces Command (US and South Korean troops), and "United Nations Command" with responsibilities with respect to the Armistice. The United Nations, however, has no role in the oversight or decision making processes of the "United Nations Command". The US Government is in control of the "United Nations Command". The use by the US of the designation "United Nations Command", however, creates and perpetuates the misconception that the UN is in control of the actions and decisions taken by the US under the "United Nations Command".

    The Democratic People's Republic of Korea (more commonly referred to as North Korea) has called for disbanding the "United Nations Command"(UN Command). At a press conference held at the United Nations on June 21, 2013, the North Korean Ambassador to the UN, Ambassador Sin Son Ho argued that the actions of the US Government using the designation "United Nations Command" are not under any form of control by the United Nations. (4) Since the UN has no role in the decision making process of what the US does under the title of the "United Nations Command", North Korea contends the US should cease its claim that it is acting as the "United Nations Command".

    TT , says: February 26, 2019 at 1:41 pm GMT
    @Sean

    Anyway, there is hardly a tree left in China and since 2006, China has been the world's largest emitter of CO2 annually and though they pay lip service they accept no binding target for reduction; quite the opposite.

    Pls has slight decency to check before spewing nonsense.

    According to Nasa, China has planted & expanded forest the size of Amazon, contributing 1/4 of global greenery effort.

    Its now working on massive irrigation projects in Tibet & Xinjiang, including dams that will overshadow 3Gorges. These will convert arid Xinjiang into another green agriculture pasture & food basket providing economic to it landlocked natives.

    China's effort to roll back desertification is also very impressive, converting thousands of hectares deserts into green forest using proprietary planting method.

    It has built world most hydropower stations & dams in China, and help built in Asia, Africa with grants & subsidized loan. Forefront in reusable energy, EV, solar.

    And China is the staunchest supporter of CO2 emission control with solid actions, when US write off Kyoto treaty in Paris as hoax.

    TT , says: February 26, 2019 at 4:03 pm GMT
    @jeff stryker Jeff,

    what's about Spore that have 75% majority Chinese mainly come from Fujian too, HK, Taiwan!? Do they fare well & very safe, or a shithole filled with drugs & crimes that you projected to be?

    And then compare with Chinese minority countries:
    Msia with 25% Chinese contributing 70% economy, Indonesia 3% Chinese contributing 70% economy.
    Thailand, Myanmar, Laos, Cambodia, Philippines, .

    It seems that the more Chinese % a country has, the more its prosperous & safe, vice versa. So Chinese is in fact the main economic & safety contributing factor, instead of the other way round you painted.

    If Chinese are indeed as evil as you make out to be, then China will be worst than India, dysfunctional like Philippines, completely crimes & drugs infested like Mexico. Yet China today is biggest growing economy in real ppp, and world safest country well surpassing nearly all whites countries. No?

    Vietnam tried to purge Chinese ethics under Ho Chih Min anti-China policy, ended paralyzed its entire economy until Chinese were brought back to help. Today its still the Chinese ethics controlling its majority economy & ruling elites.

    Indonesia Prez Suharto slaughtered million of Chinese ethics under Yanks CIA instigation to coup pro-China Prez Sukarno, and their economy suffered. Suharto later brought back Chinese to run 70% of economy, while his cronies suck off remaining.

    Malaysia Mahatir had forthright admonished his disgruntled Malays complaining about 20% Chinese controlling 70% economy. He famously said Malays race by inheritance is lazy and bad in economic, screwing up every gov granted projects & handouts. So let the skillful Chinese take care of all business, and Malays can tax on them to make Malaysia prosperous. All subsequent leaders follow that policy, and the result is continuous economy growth.

    Myanmar purged Chinese after independent, immediately encountered dysfunction economy. Today its still relying on Chinese ethic to support the main economy behind.

    Thailand, Cambodia, Laos didn't purge Chinese ethics, and Chinese are similarly their main economy contributors.

    There is one common observation in all these countries, where ever Chinese live, they are mostly law obedient, work diligently and eventually established in businesses contributing to most prosperity.

    Whereas in majority Catholics Philippines, are literally controlled by Vatican appointed bishops, who forbid contraceptive & divorce, directly causing its explosive population, leading to grave poverty & crimes. These bishops are also colluding with corrupted politicians to dictate election outcome using their churh influence.

    When pro-China Prez Duerte declared war on drugs with China help is achieving good result, these West-appointed bishops are leading their followers in full force to oppose, all in syn with West govs 'human rights'. Dont that smell fishy?

    So will Philippines be better off without Chinese? Im not sure, just like whites, some Chinese are also ruthless crimals. But your sweeping statements & allegation certainly is fundamentally flawed.

    But CIA has been plotting anti-Chinese ethic riots in Asean for a long time as part of China containment plan. Previously Denk posted one article on this.

    jeff stryker , says: February 27, 2019 at 1:41 am GMT
    @TT Your description of Malaysians as lazy and stupid is why Indonesians kill ethnic Chinese and not some CIA plot. That's the thinking right there that motivates Malays to dislike ethnic Chinese.

    China did not help Duterte. China makes the drugs there or in Taiwan. Duterte pleaded with them to stop sending shabu to the Philippines but China does not care and so Filipinos continue to stagger around like zombies in their squats.

    Philippines has the additional post-colonial curse of Mestizo half-breed Spanish landowning and political class of "Hacienderos" while Malaysians are unified under Islam. Since these Spanish-blooded elite are part-white, some of the blame for the problems in the Philippines can be attributed to whites.

    As for CIA containment plans, you'll probably say that the reason Singapore immigration allowed so many Indians in was because the US government wanted to import a competitive ethnic group to prevent Chinese in Singapore from controlling all of Southeast Asia.

    Anon [117] Disclaimer , says: February 27, 2019 at 6:08 am GMT
    "An emboldened China could someday match or even exceed U.S. power on a global scale, an outcome American elites are determined to prevent at any cost."

    They will fail. The United States, like Carthage, is doomed to lose its struggle for dominance; too many things are running against it. Not only does China have the far larger population, but consider the following factors that run in their favor:

    1. Like the US, China has a highly advanced and productive agriculture industry, making them all but immune to nation-killing food blockades.

    2. China has an average IQ that may approach Japan's before it levels out; Japan is insanely outsized in terms of competitiveness, mainly due to its intelligent, group-oriented population, so imagine how much stronger China could be.

    3. China is geographically situated in the heart of the world's economic engine, Asia. This puts China in prime position to break out from US dominance and, potentially, even surround the Americans by making their trading partners their vassals.

    4. The US is located far away and in a fairly unimportant region of the world. It will be difficult for the US to get reinforcements to the Asian theater in the advent of a conflict. American allies know this, so they will be predisposed to making peace with the Chinese as the power balance continues to shift in China's favor.

    5. Universalist dogma outsourced to American satellites Australia and New Zealand will eventually make both countries Chinese vassals. Sometime in this century both countries will have majority Asian populations due to immigration. Polls have repeatedly shown that Asian immigrants have positive feelings towards the Chinese, despite the propaganda efforts of the Americans. Take a look at what the Israel Lobby has accomplished and imagine what a future China Lobby in those countries will do. Also, there is virtually no way to stop this from eventually happening as this diversity dogma is spouted by the US at the highest level and is now deeply ingrained in its future Chinese satellites. Before the end of the century, the Chinese will have naval bases in both countries and the US will have none.

    6. China is free from the social-trust killing, national ethos-sapping political divisiveness seen in the US – no feminism, no attacks on its majority Han population. America, on the other hand, is beset with hundreds of hate hoaxes targeted at its most important demographic, white males – the group that disproportionately dies in its wars, invents its best technology, and exports the best elements of its culture. If there is a military conflict between China and the United States ten years hence, expect the critical white male demographic to sit it out.

    7. The Chinese are deeply patriotic and nationalistic. The US has experienced an unprecedented decline in patriotism according to polls; that trend will continue. Therefore, there is little appetite in the US for confrontation. This as a hungry China chomps at the bit to show everyone who "the real ruler of the world is", a concept I sometimes see floated on their social media.

    8. The US is rapidly losing cultural influence due to a diminished Hollywood. The last several American tent poll films, for instance, have crashed in Asia. Meanwhile movies like Alita: Battle Angel (adapted from a Japanese anime) have done well in that market while doing not so well in the US (and coming under immense fire from SJW gatekeepers for portraying a female as something other than a weirdo). This means that tastes are diverging between the two markets, a trend the Chinese can exploit in the future due to shared tastes across the region and American inability to make anything other than low-quality superhero movies.

    Hollywood is also now pretty much incapable of making the kinds of movies Asians (and Europeans) used to see – science fiction, fantasy, and action/adventure movies – due to rampant anti-white male hate and an industry focused on other demographics. Gone are the movies like Robocop, Aliens, Jurassic Park, Die Hard, The Terminator, The Lord of The Rings, and the Matrix. Gone because the white guys who made them are aging out of the industry (or changing genders) and now all Hollywood wants to make are infantile superhero movies for the Idiocracy demographic.

    And did you see the Oscars this year? What an embarrassment. They actually nominated Black Panther for Best Picture. I can't imagine anyone in Asia cares. They couldn't even get a host.

    9. The Chinese are primed to dominate influential cultural industries like video games in a way that the Americans cannot due to checklist diversity requirements and the many anti-male gatekeepers within the industry.

    The video game industry is now three times the size of Hollywood and much more influential than Hollywood for the youth. When technology and budgets are not a limiting factor, politically-incorrect nations like Japan dominate over large American corporations like Microsoft. The American video game industry, led by Microsoft, has effectively zero influence in Asian nations due to American corporate greed, developer laziness, checklist diversity, feminism, and a short-sighted strategy of broadly targeting low quality material to low quality people (stupid FPS games).

    Microsoft has been crushed so badly by the Japanese that they are now putting their software on the Nintendo Switch; they simply cannot compete on any level. Meanwhile, Chinese cultural influencers grow in power. They await only a maturation in Chinese taste and a forward-thinking export policy but it will come. China's Tencent already owns a significant stake in Epic Games, a streaming platform that will compete with America's Steam for dominance of the huge online market.

    One day, China will dominate their inferior American competition just as the Japanese and Koreans have done. This bodes very badly for the US in the future, especially when you stop to consider that all movies may be CGI in the future. The Chinese market is still immature, but when it does mature, it will dominate – games, movies, music everything.

    10. Divisive rhetoric promoted by the American elite and aimed at white European-Americans – an effort to suppress white group solidarity – will eventually drive a wedge between Europe and America that the Chinese, through their Russian ally, can exploit. You already see a bit of this in Germany's refusal to cancel their gas pipeline (Nordstream 2, if I recall), and Italy's defiance of the Empire over Venezuela. When racist American politicians like Kamala Harris begin stealing money from European Americans and handing it to blacks through reparations schemes, expect the Europeans to start thinking twice about their relationship with this country.

    After Trump loses in 2020, European elites will celebrate but not for long. Over the following decade, both the far left (for economic reasons) and the far right (for ethnic reasons) may unite against the United States. That will be made all the easier once the United States is no longer able to elect a competent European as president. Europe isn't going to want to be ruled over by someone of a different ethnic group that hates their own.

    11. China is unified in a way the US never can be again. China is 90% Han Chinese. The US gets more diverse and divided by the day. Therefore, the Chinese public is more resilient to conflict with rivals.

    12. China's political model is far superior to their American counterpart. The Americans, for instance, elect incompetent leaders through national popularity contests; said leaders then rule only for favored interests. China, on the other hand, is run by smart people for the benefit of all Chinese – the nation-state.

    13. China's economic model is far superior to the corrupt, inefficient American corporate model. Whereas China is a meritocracy not beset with crippling diversity requirements and feminism. Tellingly, whenever the two models have gone head-to-head, such as in Africa, the Chinese have won by a large margin. I see nothing that will change that in the future as that would require a wholesale rethinking in the US of their basic philosophies, both on the left and the right and that is impossible at this point.

    The US is a proposition nation, so dogma lies at the heart of civic life. The Chinese, in contrast, are free to pick and chose from the best of each ideology and apply it where warranted because they are a blood and soil nation – group interest comes first, not allegiance to dogma. Everyone in the US is an extremist of some sort – socialist, corporatist, environmentalist, etc. That's no way to run a government.

    14. The US will soon lose the moral high ground. As the US devolves into a police state, as it continues kicking dissidents off the internet and silencing whistle blowers (and attacking nations like Iran and Venezuela), nations around the world will cease to see a difference between the US and China. At that point, they my either go independent (perhaps in alliance with India or Russia) or openly start to flirt with a Chinese alliance. After all, what does it matter if both states are authoritarian? At least the Chinese don't have a history of invading their competition.

    15. The divided American public may not support more military spending over social service spending; this likelihood will only increase in the future due to demographic changes. They see that China has a competent single-payer medical program and will want the same for themselves, not pay for missiles and guns for other people.

    16. The US cannot pursue relationships with vital nations like Russia due its anti-male and anti-European dogma, now infused into society at the highest levels. It will take decades to erase that and by then it will be too late.

    Anon [117] Disclaimer , says: February 27, 2019 at 6:11 am GMT
    "Someone here mentioned the EU turning East. At some point the EU will decide that staying a US vassal is suicide and it will turn East. When that happens then the virus of US insanity will turn inwards into itself."

    True. One day someone like Kamala Harris or Stacey Abrams will be president. Will Europe want to be ruled by non-Europeans who hate Europeans, want to tear down their monuments, and steal their money for reparations payments?

    "The USA has lost strategic air superiority, as well as strategic brain power. I wonder how the USA would look after a week of retaliatory aerospace strikes?"

    Like New Orleans after Katrina – a breakdown in the social order as all the diverse groups start fighting each other and shooting at rescue efforts because they're morons and thieves.

    "Open the USA borders wide open and encourage 1 billion South Aemricans, Africans, SE Asians and South Asians into the USA is the fastest and easiest way to close the human resource gap between the USA and China."

    How exactly is an efficient democracy supposed to work in that instance? Seems like dysfunction, low social trust, and corruption would reign. Besides, the Chinese population will still be far more intelligent overall, so no gap will be closed. The US should have focused on immigration from Europe and increasing its white birth rate back in the 1970s. They'd be in a far stronger position now if they had done that then.

    TT , says: February 27, 2019 at 11:53 am GMT
    @Anon Which West European nations willing to move to dysfunctional disUnited States filled with crimes & unemployment en masse?

    May be some poor cousins of East European. But they will soon find US is worst than their country, no good jobs, homeless without affordable accommodation, crime infested, their whites is actually marginalized by diversification, LGBT conflict with their WASP value. Most will want go back soon.

    So its left with only choice of finest selection of 1.3B poor Indians, Latino, South Americans, Africans & ME refugees willing to go anywhere just to get out of their countries shithole.

    When they arrived, hundreds of millions whites, Chinese & Asians will flee like been no tomorrow.

    Here it go, United States of Asshole is founded. Pls handover all nukes to UNSC before implementing lest been exchange for food or use for heating in winter.

    TT , says: February 27, 2019 at 1:15 pm GMT
    @jeff stryker Its Malaysia PM Mahatir who said Malays are inheritingly lazy. Im just quoting.

    Do educate yourself about CIA & Muslim politicians instigated riots against ethnic Chinese before writing off in ignorant.

    Spore was shielded from all these info distorted with West msm propaganda. I had only learned about these details from Indonesian Chinese friends whose family had suffered these trauma. After some readings, also Indonesia under current Chinese ethnic President Jokowi, did all these CIA-Muslims Generals collision genocides been publicized. How about you, where you got yours?

    https://www.wsws.org/en/articles/1998/02/indo-f14.html

    https://sweetandsoursocialism.wordpress.com/2013/02/18/cias-role-in-indonesias-anti-chinese-genocide-hidden-harmonies-blog/amp/

    China did not help Duterte. China makes the drugs there or in Taiwan. Duterte pleaded with them to stop sending shabu to the Philippines but China does not care and so Filipinos continue to stagger around like zombies in their squats.

    Why did you say China didn't help Prez Duerte in drugs war, your Chinese philippino mistress told you? Pls cite your evidence.

    Its widely publicized in our msm, West msm that China gov working with Philippines police to track & dry up many drugs supply, even donated rehab centers as part of long term solution. So you mean all these West msm are lying to help China.

    In your word, these shabu are make & sold by China gov? Or they are part of global drug syndicates that operated in every countries including all West?

    As for CIA containment plans, you'll probably say that the reason Singapore immigration allowed so many Indians in was because the US government wanted to import a competitive ethnic group to prevent Chinese in Singapore from controlling all of Southeast Asia.

    Let these unequal US FTA & India CECA speak itself. These were shoved into our PM LEE ass to screw SG, allowing unlimited Indians of all kinds & their families to live & work in SG, with their mostly internationally unrecognized qualifications mandatory to be accepted.

    Also both US & India nationals enjoy tax free in property investment, while Sporeans & all foreigners subjected to 3% + 7% + 7% tax regimes, literally giving them a 10~17% profits upfront.

    https://thehearttruths.com/2013/11/11/this-is-why-singaporeans-will-not-be-protected-in-our-jobs-by-the-government/amp/

    Indians as " competitive " ethnic group to suppress SG Chinese, you are joking or seriously think Indians IQ80 & its education is superior to Sg Chinese IQ107 that rank consistently Top in SAT, PISA & Olympiad?

    These are the dredge of India, violent drunkard, not those US get. Numerous are caught with fake certificates when they simply could not even do the most basic task, near illiterate. A documentary show was make to investigate how widespread & complex is it in India, even there are someone stationed to pick up call as reference to certify everything. These including medical MD cert, aka fake Indian Drs that India Health Ministry condemn openly been so rampant up to 80% of India Drs(that was posted in one of Unz old discussion 2yrs ago)

    https://gocertify.in/articles/certification-verification-rogue-it-credentials-rampant-in-india/

    TT , says: February 27, 2019 at 1:47 pm GMT
    @Erebus If both US & China go on full trade war 100% tariff, to the brim of stop trading, who do you think can last longer?

    As you said, in mere wks, US will be paralyzed with every shelves empty & factories shut down. Emergency declared with imports from other sources with much chaos. Frustrated, nation wide civil riots may ensue with states like California, Texas, demanding independent.

    Whereas for China its life as usual with some restructuring, since it can live without yanks useless financial services, msm & few chips easily replaced by EU/Jp or live without. Airbus will be happy to replace Boeing.

    China total export to US is ~$500B, 50% are imported components, so $350B damage is passed back to US $250B(total US export to China) & global suppliers $100B.

    That make China actual impact only $150B, $4T reserved, it can theoretically offset the trade loss for >20yrs, while continue to expand its domestic consumption, BRI & global trade to fuel growth.

    But the world will be in chaos to get double impact of a totally collapsed US $21T GDP & China import cut. With all economies stunt, global financial mkt burst, consumption all dive, US allies turning to China for leadership & trade, a WW3 look imminent as yank is left with only one product – weapons!

    But not to worry, it should be very short one in yelling, as no yanks want to die with empty belly, nor there are $ to pump vessels & bombers or resources to prepare long war. Military is quickly paralyzed with desertion, & split between seperated states. There go 51 disUnited states of America.

    So China is indeed discussing with yanks from great strength. But with farsight, they prefer to settle yanks brinkmanship in Chinese humble & peaceful way.

    I hope China can drag on until US can no longer conceal its pain with fake data, screamming out loudly for truce to sign China dictates trade agreement. China need to teach yank a painful lesson to humble it once & for all, including a WTO style unequal treaty that yank shoved down china throat.

    jeff stryker , says: February 27, 2019 at 3:35 pm GMT
    @TT TT

    For all the refugees the US creates in the Mideast, it doesn't except many of them. Most Iraqi and Afghani refugees have no hope of entering the US; European countries that protested the war in Iraq end up absorbing the human cost.

    jeff stryker , says: February 27, 2019 at 3:42 pm GMT
    @TT An Indian-Malay should know.

    As for the CIA cooperating with Muslims in anti-Chinese anything, I am skeptical. My feeling about Indonesia is that a 3% minority owning everything and displaying contempt for the natives as lazy savages is enough fuel ethnic hatred and Chinese backing of Suharto didn't help things.

    Indians don't represent job competition for Singapore, they are simply a basic menace to your society. And it is possible that the US government, not wanting to see Singapore become a vassal state of China, wanted your country's population to become more well, diversified.

    Patricus , says: February 27, 2019 at 4:50 pm GMT
    @Joe Wong The "dominance" of Anglo-Saxons is overstated. They are a pretty small minority in the US. They still dominate Britain, maybe.
    Erebus , says: February 27, 2019 at 7:59 pm GMT
    @TT

    If both US & China go on full trade war 100% tariff, to the brim of stop trading, who do you think can last longer?

    China would take a hit, but not greater than the whole world could be expected to take. Probably quite a bit less.

    There's little doubt in my mind that China is in a much stronger position to both survive and to be in a position to take advantage of the world's eventual recovery. As you note

    $4T reserved, it can theoretically offset the trade loss for >20yrs

    It also has the world's widest and deepest industrial infrastructure.

    It's not only the $4T and the infrastructure. China also has a lot of gold within its domestic system, which it can mobilize to make purchases from the the rest of the world's staggered economies. Approx 20kT, by some quite carefully done estimates. Mobilizing that gold, of course, is where things get tricky. The world would be awash with useless dollars and how all that liability gets unwound would cause a lot of Central Bankers and their govts a lot of sleepless nights.

    Anon [409] Disclaimer , says: February 27, 2019 at 9:17 pm GMT
    "Which West European nations willing to move to dysfunctional disUnited States filled with crimes & unemployment en masse?"

    Quite a number of Europeans would have moved to the US circa 1965 – 1990 with the countries then demographics, which was the point being made in the comment. The US is a huge country with lots of space. In 1980, virtually all Eastern Europeans would have been better off in almost any place in the US over where they were. The US Ruling Class had the chance but cast it aside for lesser and more divisive groups so they could win elections and stiff their workers. Even the US now is a mostly a better place to live than virtually any place in Eastern Europe, and quite a number of places in overcrowded Western Europe – now filled with Muslim invaders, rising crime, higher unemployment than the US, and yearly riots.

    TT , says: February 27, 2019 at 10:25 pm GMT
    @Erebus One TV celebrity went on crusade to expose Monsanto GMO toxicity impact in food chain few yrs ago.

    He visited US & collected clinical evidences of GMO cancer causing from several US professors, publicized them online. These force China gov to investigate, and their clinical test too revealed mice & animals fed with GMO have huge tumors growing all over shortly.

    China agriculture minister was investigated, found to hold lucrative high pay job in Monsanto taking bribery, and blanket approved all untested Monsanto GMO seeds, grains & weed killer. Even those used as domestic animals feed but banned for wild animals in US were introduced into food chain. Some also passed off as non GMO to plant in vast land not approved for GMO.

    About 30% of China food chain & vast agriculture lands contaminated, no longer productive. That agri minister got arrested. No sure what China gov is doing about it. But Prez Xi is hailing organic food. Tibets & Xinjiang have mega irrigation projects on going now, might be to open up new agri lands to offset.

    TT , says: February 27, 2019 at 10:50 pm GMT
    @jeff stryker Tonnes of evidences on CIA-Muslim generals instigated riots & massacre since 1965. You choose to see otherwise.

    A trove of recently released declassified documents confirms that Washington's role in the country's 1965 massacre was part of a bigger Cold War strategy.
    https://www.theatlantic.com/amp/article/543534/

    https://www.globalresearch.ca/still-uninvestigated-after-50-years-did-the-u-s-help-incite-the-1965-indonesia-massacre/5467309/amp

    https://www.globalresearch.ca/trumps-indonesian-allies-in-bed-with-isis-backed-fpi-militia-they-seek-to-oust-elected-president-jokowi/5588694/amp

    I couldn't find one article published in one unz comment by Denk?, where West msm interviewing Indonesia biggest opposition party. Their chiefs had audacity to brag how they will instigate another massive anti-Chinese riots to win next election.

    The jews are much more vicious & open in controlling US, but you won't see CIA staged riots & protest against their jewish masters Aipac.

    Thailand Chinese ethnic are holding most economy too, but their politicians elites been Chinese don't instigate riot against own ethnic to meddle election.

    TT , says: February 27, 2019 at 11:07 pm GMT
    @jeff stryker

    US government, not wanting to see Singapore become a vassal state of China, wanted your country's population to become more well, diversified.

    Its not diversification, its complete indianized with Weapon of Mass Migration, by jews controlled US to push back China influence. As China refused to let jews control them!!! Its also happening for Sri Lanka, Nepal, Bhutan, Mauritius now.

    Its Top to bottom all indians now in SG, 9% Indians with India new migrants controlling 75% Chinese & 15% Malays. Since when Indians have turn so great well surpass all Chinese capability, over a short span of 10yrs since Obama's new balance in Asia Pacific started. Its a regime change, silent coup.

    Starting from Indian Prez, Indian DPM(a ex-criminal for leaking state secret data, he was highly touted as best future PM to test voter response, but a Chinese PM candidate was eventually selected for coming election as voters brainwashing not yet complete), national DBS bank CEO chairman Indian. Central bank MAS chief Indian. Law, Home Affair, Foreign Minister all Indians. High court judges flooded Indians. Chief judge Indian. Top senior counsels(equivalent to Queen Councils) many Indians. MPs also new india migrants. MSM journalist & writers flooded Indians.

    Some are India newly arrived Indians of no credential. Yet no msm reporting on that. Its near complete regime change in stealth.

    Patricus , says: February 28, 2019 at 2:00 am GMT
    @Erebus In addition to the herbicide and insecticide resistance some plants are modified to withstand prolonged dry conditions, or to produce more of certain proteins or vitamins, or to increase yields.

    The corn or maize we now have started from an indigenous plant in Central and South America. Twenty plants would produce a tablespoon of grain. The native corn plant can still be found. Over thousands of years these were bred for increased size and yields but probably for other reasons as well like drought resistance. That's genetic modification over many generations.

    In this country the Food and Drug Admin. and Dept. of Agriculture have studied the genetically modified plants extensively. Not that government agencies always get it right but it would be interesting to see a real life example of these plants actually harming people, or animals and insects. Sometimes the fear of Frankenfoods is related to a fear of lower cost imports and a sop for the local farmers.

    Having an interest in horticulture I produced greenhouse bedding plants for the most part. One significant expense was pesticides. We took great pains to carefully watch the crops. If the aphids, or other creatures, showed up we would strive to isolate the affected plants and only treat the ones with aphids and some that were nearby. Lots of hours with a bright light and magnifying glass. We didn't proactively apply these because of the expense. Sometimes an entire greenhouse required several treatments and there goes much of the profit. On the other hand refusing to use pesticides leads to total crop failures. Nobody applies pesticides if there are no pests. Without pesticides the world population would be much smaller and the remaining living people would know about famines.

    jeff stryker , says: February 28, 2019 at 2:58 am GMT
    @Anon ANON

    In terms of space, most Europeans would immigrate to US cities. Chicago was popular with Slavs, for instance. And of course Silicone Valley. Very few immigrants move to rural wide-open areas. There is nothing to do there and Norwegians in 1990 were no longer homesteading on the North Dakota plains.

    By 1990, few Irish wanted to immigrated to Boston or Italians to New Jersey. Europe was actually safer and more prosperous when I was young than the US.

    Europeans prior to 1965 were attracted to the US middle-class standard of living and that has shrunken precipitously.

    The refugee crisis in Europe is relatively recent. As for unemployment, indeed this is bad. But the social safety net is slightly better and there is less poverty overall in Western Europe.

    anon [267] Disclaimer , says: February 28, 2019 at 5:47 am GMT
    "Very few immigrants move to rural wide-open areas."

    Sure, if you're talking Nevada or New Mexico desert. But there are areas considered "rural" in the US that have relatively mid-sized cities nonetheless. Oklahoma City has a population roughly equal to the population of Latvia's capital, for example. And I'm sure that Eastern Europeans could have been coaxed to leave Europe for the US had America pursued a deal with the Soviets – white South Africans, too. Certainly, this could have been done with success post Soviet breakup. Some Western Europeans could also have been coaxed, perhaps a few million, with the right financial incentives. Along with substantial efforts to increase the native European birthrate and targeted, gender-imbalanced ~skills-based immigration* from emerging market, high IQ countries, US demographics would be in a far better place today. The country would be less divided and more rational on a global stage (and probably friends with Russia, too).

    *In other words, purposely encourage 2 to 1 female immigration from places like Korea and China back when they were both poor and filled with people ready to emigrate and compliment that with an equal but reversed ratio elsewhere (Vietnam, Laos). This forces interbreeding and prevents formation of divisive ethnic communities, while also having the benefit of harming your competitor's demographics down the road. Actor Keanu Reeves is something like 1/8th Japanese. But most people just think he's a white guy.

    If that kind of policy had been adopted in 1965, along with my plan above (and a few other things not mentioned), things would be better for the US now. The US would be overwhelmingly white with a small admixture of smart Asian while leaving descendants who look European; the kind of internecine racial strife we see now could have been avoided. However, that kind of plan requires a competent, and rational, near-authoritarian to be in charge. As Fred Reed has pointed out, that kind of plan is not capable in Western countries that choose their leaders via popularity contest with a birthright citizenship voting base.

    Erebus , says: February 28, 2019 at 3:45 pm GMT
    @Patricus

    That's genetic modification over many generations.

    One wonders how many fish genes made their way into corn over those generations, and how they got in there.

    it would be interesting to see a real life example of these plants actually harming people, or animals and insects.

    Pesticides of increasing toxicity are surely not good for insects. As for harming people, I doubt we'd see any more harm than the fructose and aspartame etc, or the growth hormones and rampant anti-biotic use in husbandry that those agencies approved have caused. Of course, genetics is much more complex, and so who knows what will turn up in humans a few generations from now.

    Without pesticides the world population would be much smaller and the remaining living people would know about famines.

    I'm of the firm opinion that a smaller population would be a very, very good thing, and we'll be seeing famines soon enough anyway, but on a scale that will dwarf all other famines.

    Patricus , says: February 28, 2019 at 7:23 pm GMT
    "Pesticides of increasing toxicity are surely not good for insects. As for harming people, I doubt we'd see any more harm than the fructose and aspartame etc, or the growth hormones and rampant anti-biotic use in husbandry that those agencies approved have caused. Of course, genetics is much more complex, and so who knows what will turn up in humans a few generations from now.'

    The pests who feed on domesticated crops lived in nature before people were around. When they stumble upon thousands of acres of corn or wheat they rapidly reproduce to exploit the windfall. The pesticides will hopefully kill or drive off many of these insects but their total number would probably be higher than in a pre-human environment. There is a balance of power.

    Utilizing the "precautionary principle" one could say any technical advance might have some unanticipated detrimental effect in the near or distant future. Therefore let's stop all new technology. For now we have the methods of physical science to guide us. These aren't perfect but it's the best we have and more sensible than the precautionary principle, also called the paralysis principle.

    "..a smaller population would be a very, very good thing, and we'll be seeing famines soon enough anyway, but on a scale that will dwarf all other famines.".

    I'm hoping my family and I (and you) are not among the culled billions. Death by starvation is not a pleasant way to go, so I've heard.

    Erebus , says: March 1, 2019 at 1:28 am GMT
    @Patricus

    their total number would probably be higher than in a pre-human environment. There is a balance of power.

    Probably? Pre-human? Yours is the disingenuity of a pesticide salesman.
    The insect world is in a massive die off, losing of ~75% its flying population over 3 decades, as attested by countless studies. The studies tell us what we already know. 40 yrs ago, a 2 hr drive in the countryside at night meant 30 min spent scraping insects off your windshield and headlights. Every lonely streetlight in the middle of nowhere had a cloud around it. Screens to protect the radiator, or even the entire front of the car were sold by every automotive shop and gas station. Seen one lately?

    Utilizing the "precautionary principle" one could say any technical advance might have some unanticipated detrimental effect in the near or distant future.

    One could say it, and one would often be right for doing so. As the complexity of the technological advance increases, so do its effects. Who considered 50 years ago that pesticide use would devastate the insect world? Who knows with any level of certainty what the effect of that will be on the ecosystem we live in? What we know is it ain't gonna likely to be good, and may be devastating. They're now found in mother's milk with potential effects we lack the tools and brain power to comprehend, never mind predict.

    When it comes to playing with complex, chaotic systems that support our life on the planet, humans are like a monkey with a hand-grenade. To borrow a phrase "If the planet's ecosystem was simple enough to understand, we'd be too simple to understand it. " Our myopia & hubris will kill us, if our stupidity and belligerence doesn't do it first.

    Patricus , says: March 2, 2019 at 11:14 pm GMT
    The insect "die off" is an interesting occurrence. Puerto Rico lost a large percentage of insects while at the same time they decreased pesticide use by 80%. This die off is observed in a limited number of regions of the world. It isn't known exactly what caused the drop in insect population. Some say pesticides, others say climate change (the theory that explains all things), are killing the bugs.

    Pesticides have been overused in the past but there have been impressive improvements in the technology which reduces the amounts required. There are herbicides and pesticides designed with chemical half lives. These kill the weeds or pests then break down into harmless components and in 10-14 days can no longer be detected in the field. Unfortunately for some any improvements will require some kind of technology.

    We are all going to die eventually, hopefully later rather than sooner.

    [Mar 04, 2019] War With China by Michael T. Klare

    Mar 04, 2019 | www.unz.com

    In his highly acclaimed 2017 book, Destined for War , Harvard professor Graham Allison assessed the likelihood that the United States and China would one day find themselves at war. Comparing the U.S.-Chinese relationship to great-power rivalries all the way back to the Peloponnesian War of the fifth century BC, he concluded that the future risk of a conflagration was substantial. Like much current analysis of U.S.-Chinese relations, however, he missed a crucial point: for all intents and purposes, the United States and China are already at war with one another. Even if their present slow-burn conflict may not produce the immediate devastation of a conventional hot war, its long-term consequences could prove no less dire.

    To suggest this means reassessing our understanding of what constitutes war. From Allison's perspective (and that of so many others in Washington and elsewhere), "peace" and "war" stand as polar opposites. One day, our soldiers are in their garrisons being trained and cleaning their weapons; the next, they are called into action and sent onto a battlefield. War, in this model, begins when the first shots are fired.

    Well, think again in this new era of growing great-power struggle and competition. Today, war means so much more than military combat and can take place even as the leaders of the warring powers meet to negotiate and share dry-aged steak and whipped potatoes (as Donald Trump and Xi Jinping did at Mar-a-Lago in 2017). That is exactly where we are when it comes to Sino-American relations. Consider it war by another name, or perhaps, to bring back a long-retired term, a burning new version of a cold war.

    Even before Donald Trump entered the Oval Office, the U.S. military and other branches of government were already gearing up for a long-term quasi-war, involving both growing economic and diplomatic pressure on China and a buildup of military forces along that country's periphery. Since his arrival, such initiatives have escalated into Cold War-style combat by another name, with his administration committed to defeating China in a struggle for global economic, technological, and military supremacy.

    This includes the president's much-publicized "trade war" with China, aimed at hobbling that country's future growth; a techno-war designed to prevent it from overtaking the U.S. in key breakthrough areas of technology; a diplomatic war intended to isolate Beijing and frustrate its grandiose plans for global outreach; a cyber war (largely hidden from public scrutiny); and a range of military measures as well. This may not be war in the traditional sense of the term, but for leaders on both sides, it has the feel of one.

    Why China?

    The media and many politicians continue to focus on U.S.-Russian relations, in large part because of revelations of Moscow's meddling in the 2016 American presidential election and the ongoing Mueller investigation. Behind the scenes, however, most senior military and foreign policy officials in Washington view China, not Russia, as the country's principal adversary. In eastern Ukraine, the Balkans, Syria, cyberspace, and in the area of nuclear weaponry, Russia does indeed pose a variety of threats to Washington's goals and desires. Still, as an economically hobbled petro-state, it lacks the kind of might that would allow it to truly challenge this country's status as the world's dominant power. China is another story altogether. With its vast economy, growing technological prowess, intercontinental "Belt and Road" infrastructure project, and rapidly modernizing military, an emboldened China could someday match or even exceed U.S. power on a global scale, an outcome American elites are determined to prevent at any cost.

    Washington's fears of a rising China were on full display in January with the release of the 2019 Worldwide Threat Assessment of the U.S. Intelligence Community, a synthesis of the views of the Central Intelligence Agency and other members of that "community." Its conclusion: "We assess that China's leaders will try to extend the country's global economic, political, and military reach while using China's military capabilities and overseas infrastructure and energy investments under the Belt and Road Initiative to diminish U.S. influence."

    To counter such efforts, every branch of government is now expected to mobilize its capabilities to bolster American -- and diminish Chinese -- power. In Pentagon documents, this stance is summed up by the term "overmatch," which translates as the eternal preservation of American global superiority vis-à-vis China (and all other potential rivals). "The United States must retain overmatch," the administration's National Security Strategy insists, and preserve a "combination of capabilities in sufficient scale to prevent enemy success," while continuing to "shape the international environment to protect our interests."

    In other words, there can never be parity between the two countries. The only acceptable status for China is as a distinctly lesser power. To ensure such an outcome, administration officials insist, the U.S. must take action on a daily basis to contain or impede its rise.

    In previous epochs, as Allison makes clear in his book, this equation -- a prevailing power seeking to retain its dominant status and a rising power seeking to overcome its subordinate one -- has almost always resulted in conventional conflict. In today's world, however, where great-power armed combat could possibly end in a nuclear exchange and mutual annihilation, direct military conflict is a distinctly unappealing option for all parties. Instead, governing elites have developed other means of warfare -- economic, technological, and covert -- to achieve such strategic objectives. Viewed this way, the United States is already in close to full combat mode with respect to China.

    Trade War

    When it comes to the economy, the language betrays the reality all too clearly. The Trump administration's economic struggle with China is regularly described, openly and without qualification, as a "war." And there's no doubt that senior White House officials, beginning with the president and his chief trade representative, Robert Lighthizer , see it just that way: as a means of pulverizing the Chinese economy and so curtailing that country's ability to compete with the United States in all other measures of power.

    Ostensibly, the aim of President Trump's May 2018 decision to impose $60 billion in tariffs on Chinese imports ( increased in September to $200 billion) was to rectify a trade imbalance between the two countries, while protecting the American economy against what is described as China's malign behavior. Its trade practices "plainly constitute a grave threat to the long-term health and prosperity of the United States economy," as the president put it when announcing the second round of tariffs.

    An examination of the demands submitted to Chinese negotiators by the U.S. trade delegation last May suggests, however, that Washington's primary intent hasn't been to rectify that trade imbalance but to impede China's economic growth. Among the stipulations Beijing must acquiesce to before receiving tariff relief, according to leaked documents from U.S. negotiators that were spread on Chinese social media:

    halting all government subsidies to advanced manufacturing industries in its Made in China 2025 program, an endeavor that covers 10 key economic sectors, including aircraft manufacturing, electric cars, robotics, computer microchips, and artificial intelligence; accepting American restrictions on investments in sensitive technologies without retaliating; opening up its service and agricultural sectors -- areas where Chinese firms have an inherent advantage -- to full American competition.

    In fact, this should be considered a straightforward declaration of economic war. Acquiescing to such demands would mean accepting a permanent subordinate status vis-à-vis the United States in hopes of continuing a profitable trade relationship with this country. "The list reads like the terms for a surrender rather than a basis for negotiation," was the way Eswar Prasad, an economics professor at Cornell University, accurately described these developments.

    Technological Warfare

    As suggested by America's trade demands, Washington's intent is not only to hobble China's economy today and tomorrow but for decades to come. This has led to an intense, far-ranging campaign to deprive it of access to advanced technologies and to cripple its leading technology firms.

    Chinese leaders have long realized that, for their country to achieve economic and military parity with the United States, they must master the cutting-edge technologies that will dominate the twenty-first-century global economy, including artificial intelligence (AI), fifth-generation (5G) telecommunications, electric vehicles, and nanotechnology. Not surprisingly then, the government has invested in a major way in science and technology education, subsidized research in pathbreaking fields, and helped launch promising startups, among other such endeavors -- all in the very fashion that the Internet and other American computer and aerospace innovations were originally financed and encouraged by the Department of Defense.

    Chinese companies have also demanded technology transfers when investing in or forging industrial partnerships with foreign firms, a common practice in international development. India, to cite a recent example of this phenomenon, expects that significant technology transfers from American firms will be one outcome of its agreed-upon purchases of advanced American weaponry.

    In addition, Chinese firms have been accused of stealing American technology through cybertheft, provoking widespread outrage in this country. Realistically speaking, it's difficult for outside observers to determine to what degree China's recent technological advances are the product of commonplace and legitimate investments in science and technology and to what degree they're due to cyberespionage. Given Beijing's massive investment in science, technology, engineering, and mathematics education at the graduate and post-graduate level, however, it's safe to assume that most of that country's advances are the result of domestic efforts.

    Certainly, given what's publicly known about Chinese cybertheft activities, it's reasonable for American officials to apply pressure on Beijing to curb the practice. However, the Trump administration's drive to blunt that country's technological progress is also aimed at perfectly legitimate activities. For example, the White House seeks to ban Beijing's government subsidies for progress on artificial intelligence at the same time that the Department of Defense is pouring billions of dollars into AI research at home. The administration is also acting to block the Chinese acquisition of U.S. technology firms and of exports of advanced components and know-how.

    In an example of this technology war that's made the headlines lately, Washington has been actively seeking to sabotage the efforts of Huawei , one of China's most prominent telecom firms, to gain leadership in the global deployment of 5G wireless communications. Such wireless systems are important in part because they will transmit colossal amounts of electronic data at far faster rates than now conceivable, facilitating the introduction of self-driving cars, widespread roboticization, and the universal application of AI.

    Second only to Apple as the world's supplier of smartphones and a major producer of telecommunications equipment, Huawei has sought to take the lead in the race for 5G adaptation around the world. Fearing that this might give China an enormous advantage in the coming decades, the Trump administration has tried to prevent that. In what is widely described as a " tech Cold War ," it has put enormous pressure on both its Asian and European allies to bar the company from conducting business in their countries, even as it sought the arrest in Canada of Huawei's chief financial officer, Meng Wanzhou, and her extradition to the U.S. on charges of tricking American banks into aiding Iranian firms (in violation of Washington's sanctions on that country). Other attacks on Huawei are in the works, including a potential ban on the sales of its products in this country. Such moves are regularly described as focused on boosting the security of both the United States and its allies by preventing the Chinese government from using Huawei's telecom networks to steal military secrets. The real reason -- barely disguised -- is simply to block China from gaining technological parity with the United States.

    Cyberwarfare

    There would be much to write on this subject, if only it weren't still hidden in the shadows of the growing conflict between the two countries. Not surprisingly, however, little information is available on U.S.-Chinese cyberwarfare. All that can be said with confidence is that an intense war is now being waged between the two countries in cyberspace. American officials accuse China of engaging in a broad-based cyber-assault on this country, involving both outright cyberespionage to obtain military as well as corporate secrets and widespread political meddling. "What the Russians are doing pales in comparison to what China is doing," said Vice President Mike Pence last October in a speech at the Hudson Institute, though -- typically on the subject -- he provided not a shred of evidence for his claim.

    Not disclosed is what this country is doing to combat China in cyberspace. All that can be known from available information is that this is a two-sided war in which the U.S. is conducting its own assaults. "­The United States will impose swift and costly consequences on foreign governments, criminals, and other actors who undertake significant malicious cyber activities," the 2017 National Security Strategy affirmed. What form these "consequences" have taken has yet to be revealed, but there's little doubt that America's cyber warriors have been active in this domain.

    Diplomatic and Military Coercion

    Completing the picture of America's ongoing war with China are the fierce pressures being exerted on the diplomatic and military fronts to frustrate Beijing's geopolitical ambitions. To advance those aspirations, China'sleadership is relying heavily on a much-touted Belt and Road Initiative , a trillion-dollar plan to help fund and encourage the construction of a vast new network of road, rail, port, and pipeline infrastructure across Eurasia and into the Middle East and Africa. By financing -- and, in many cases, actually building -- such infrastructure, Beijing hopes to bind the economies of a host of far-flung nations ever closer to its own, while increasing its political influence across the Eurasian mainland and Africa. As Beijing's leadership sees it, at least in terms of orienting the planet's future economics, its role would be similar to that of the Marshall Plan that cemented U.S. influence in Europe after World War II.

    And given exactly that possibility, Washington has begun to actively seek to undermine the Belt and Road wherever it can -- discouraging allies from participating, while stirring up unease in countries like Malaysia and Ugandaover the enormous debts to China they may end up with and the heavy-handed manner in which that country's firms often carry out such overseas construction projects. (For example, they typically bring in Chinese laborers to do most of the work, rather than hiring and training locals.)

    "China uses bribes, opaque agreements, and the strategic use of debt to hold states in Africa captive to Beijing's wishes and demands," National Security Advisor John Bolton claimed in a December speech on U.S. policy on that continent. "Its investment ventures are riddled with corruption," he added, "and do not meet the same environmental or ethical standards as U.S. developmental programs." Bolton promised that the Trump administration would provide a superior alternative for African nations seeking development funds, but -- and this is something of a pattern as well -- no such assistance has yet materialized.

    In addition to diplomatic pushback, the administration has undertaken a series of initiatives intended to isolate China militarily and limit its strategic options. In South Asia, for example, Washington has abandoned its past position of maintaining rough parity in its relations with India and Pakistan. In recent years, it's swung sharply towards a strategic alliance with New Dehli, attempting to enlist it fully in America's efforts to contain China and, presumably, in the process punishing Pakistan for its increasingly enthusiastic role in the Belt and Road Initiative.

    In the Western Pacific, the U.S. has stepped up its naval patrols and forged new basing arrangements with local powers -- all with the aim of confining the Chinese military to areas close to the mainland. In response, Beijing has sought to escape the grip of American power by establishing miniature bases on Chinese-claimed islands in the South China Sea (or even constructing artificial islands to house bases there) -- moves widely condemned by the hawks in Washington.

    To demonstrate its ire at the effrontery of Beijing in the Pacific ( once known as an "American lake"), the White House has ordered an increased pace of so-called freedom-of-navigation operations (FRONOPs). Navy warships regularly sail within shooting range of those very island bases, suggesting a U.S. willingness to employ military force to resist future Chinese moves in the region (and also creating situations in which a misstep could lead to a military incident that could lead well, anywhere).

    In Washington, the warnings about Chinese military encroachment in the region are already reaching a fever pitch. For instance, Admiral Philip Davidson, commander of U.S. forces in the Pacific, described the situation there in recent congressional testimony this way: "In short, China is now capable of controlling the South China Sea in all scenarios short of war with the United States."

    A Long War of Attrition

    As Admiral Davidson suggests, one possible outcome of the ongoing cold war with China could be armed conflict of the traditional sort. Such an encounter, in turn, could escalate to the nuclear level, resulting in mutual annihilation. A war involving only "conventional" forces would itself undoubtedly be devastating and lead to widespread suffering, not to mention the collapse of the global economy.

    Even if a shooting war doesn't erupt, however, a long-term geopolitical war of attrition between the U.S. and China will, in the end, have debilitating and possibly catastrophic consequences for both sides. Take the trade war, for example. If that's not resolved soon in a positive manner, continuing high U.S. tariffs on Chinese imports will severely curb Chinese economic growth and so weaken the world economy as a whole, punishing every nation on Earth, including this one. High tariffs will also increase costs for American consumers and endanger the prosperity and survival of many firms that rely on Chinese raw materials and components.

    This new brand of war will also ensure that already sky-high defense expenditures will continue to rise, diverting funds from vital needs like education, health, infrastructure, and the environment. Meanwhile, preparations for a future war with China have already become the number one priority at the Pentagon, crowding out all other considerations. "While we're focused on ongoing operations," acting Secretary of Defense Patrick Shanahan reportedly told his senior staff on his first day in office this January, "remember China, China, China."

    Perhaps the greatest victim of this ongoing conflict will be planet Earth itself and all the creatures, humans included, who inhabit it. As the world's top two emitters of climate-altering greenhouse gases, the U.S. and China must work together to halt global warming or all of us are doomed to a hellish future. With a war under way, even a non-shooting one, the chance for such collaboration is essentially zero. The only way to save civilization is for the U.S. and China to declare peace and focus together on human salvation.

    Michael T. Klare, a TomDispatch regular , is the five-college professor emeritus of peace and world security studies at Hampshire College and a senior visiting fellow at the Arms Control Association. His most recent book is The Race for What's Left . His next book, All Hell Breaking Loose: Climate Change, Global Chaos, and American National Security , will be published in 2019.

    [Mar 04, 2019] As far as "economic" war, China has been fighting one for decades. It's called competing and trying to do the best to improve your people's lot.

    Mar 04, 2019 | www.unz.com

    Godfree Roberts , says: February 18, 2019 at 3:41 am GMT

    A recent Asia Society conference asked how we should compete with China. https://asiasociety.org/northern-california/made-china-2025-policy-behind-rhetoric

    The genuinely expert panelists could not articulate America's demands beyond the familiar 'level playing field' that America created by shackling China with uniquely humiliating conditions before admitting it to the WTO.

    Today, China generates 20% of global GDP (the US 15%), its imports and exports are in balance, its currency fairly valued, its economy one third larger and growing three times faster than America's and it produces essential technology that America needs and cannot provide.

    It is almost impossible to imagine a war scenario that the US could win, short of China invading America.

    Alfa158 , says: February 18, 2019 at 5:31 am GMT
    Excellent article Mister Klare, but would like to raise a few quibbles.

    1) As far as "economic" war, China has been fighting one for decades. It's called competing and trying to do the best to improve your people's lot. The US is finally starting to fight back but some of it's measures are inappropriate and/or ineffective.

    2) As far as the US trying to confine the Chinese military to its own region, I really haven't seen that the Chinese military is particularly interested in operation outside their own region anyway. It seems to be focused on protecting China and its own neighborhood and interests, and the Chinese aren't stupid enough to bleed away their wealth and blood in distant misadventures.

    3) I'd gotten the impression from the Deep State's rhetoric that they are much hotter on fighting a shooting war with Russia than with China. In an extended struggle, as long as it doesn't go nuclear, US chances are much better against a Russia whose economy is only a fraction of China's.

    MEFOBILLS , says: February 18, 2019 at 6:06 am GMT
    Keynes says this, "All trade is only barter." The Wall Street/China Gambit is key to understanding today. Clinton signed MFN trade status with China, screwing over NAFTA. Those Zenith TV's that were supposed to be made in Mexico became Chinese made electronics.

    Balanced trade was also thrown out the window, as Wall Street was in on the gambit. Trade in goods was unbalanced, and America supplied dollars to China to make up the difference. China then recycled those mercantile won dollars back to the U.S. to buy Tbills, helping keep interest rates low, and acting as a prime variable in forming U.S. housing bubble. Returning dollars then spun out into the American economy, so American's could buy more Chinese goods from transplanted American factories.

    The wall street China gambit turned mainstreet American's into Zeros, while wall street became heroes.

    Any discussion of China current economic status cannot overlook the role of Wall Street exporting of jobs, to then get wage arbitrage. Immigrating third world people into America is also a function of this "finance capitalism" as it wants wage arbitrage from third world labor as well.

    Finance Capitalism in turn is part of Zion and Atlantacism. International credit "banking" will send its finance capital anywhere in the world to get the lowest price. In the case of China, overhang of communist labor in the mid 90's was available to make things, and then export Chinese made goods back to U.S. (at the China price.)

    China still uses Atlantic doctrine, where raw materials come in by ship, and finished goods with increment of production value add leave by ship. (Value add is key element to making any economy thrive. Just extracting raw materials turns a country into Africa, witness the attempt at turning Russia into an extraction economy in the 90's.)

    Note difference in American policy in the 90's: Russia was to become extraction, and China was to become value add. As Tucker Carlson says, America is run by a ship of fools.

    For China, "Eurasia" beckons, and raw materials can be had from China's interior and via overland routes. This then is a pivot away from London/Zion Atlantacism (finance capital) and toward industrial capitalism.

    In other words, both U.S. and the West have hoisted themselves on their own petard. People that wax poetic about China's gains overlook this important mechanism of "gifting" of our patrimony to China. It is very easy to copy or be a fast follower, it is beyond difficult to invent and create.
    Wall Street and greed gave away our patrimony, which was hard won over the ages in order to make wage arbitrage today, and gave away the future.

    China uses state banks, and also forgives debts lodged in their state banks. This is actually one of the secret methods used to rope-a-dope on the west. The Chinese economy is not debt laden, and what public debts there are, are lodged in a State Bank, where they can be jubileed or ignored.

    The U.S. and the West had better take a long hard look at finance capital method, which uses only "price signals" to make economic decisions, as pricing is main vector from which jobs were exported, and which China cleverly used to climb up its industrial curve. Sovereign money/Industrial Capitalism IS the American System of Peshine Smith and Henry Clay. Atlantacism/Zionism/Finance Capital is not American – the parasite jumped to the U.S. from London.

    China is wisely in control of its money power via its state banks and is pivoting away from Atlantacism now that it has served its purpose. The belt and road routes are mostly overland, with some coastal sea routes, and there isn't a thing sea power (((atlantacists))) can do about it.

    China has played the game well, but don't overlook the gifting of Western patrimony caused by a false neo-liberal finance capital economic ideology, which blinds Western adherents.

    Anonymous [392] Disclaimer , says: February 18, 2019 at 6:09 am GMT
    @joe webb Yeah, so America can topple China and go after Russia immediately afterwards? I don't think the Russians are so stupid.

    There is only 1 way Russia survives the 21st century without being broken up and ruined, and that is allying itself with China. The same is true for China.

    The only way China can survive intact is to ally itself with Russia.

    Pretty simple stuff I am sure each country understands.

    Erebus , says: February 18, 2019 at 6:15 am GMT

    China generates 20% of global GDP (the US 15%)

    On a PPP basis, of course.

    China's real economy, of course dwarfs that of the US'.

    The author touches on a nuclear trade option China holds over the US that I see little mention of elsewhere. High tariffs are one thing, but a closure of trade in components and raw materials would do far more than

    endanger the prosperity and survival of many firms that rely on Chinese raw materials and components.

    Should China block exports of everything other than finished goods to the US, almost every US factory would close due to lack of parts and materials. The time and investment required to rebuild/replace supply chains in a JIT world means much of what's left of America's real economy would disappear within weeks.

    What then?

    Unlike Russia, the US is highly vulnerable to targeted sanctions. American trade negotiators are apparently oblivious to this. I find that very weird.

    Wally , says: February 18, 2019 at 6:36 am GMT
    author Klare said: "The media and many politicians continue to focus on U.S.-Russian relations, in large part because of revelations of Moscow's meddling in the 2016 American presidential election and the ongoing Mueller investigation."

    – What "revelations"? "What meddling"?

    – He tipped his hand right off the bat. Klare is just another run of the mill Communist with a case of the Trump Derangement Syndrome, complete with Communism's favorite scam, 'global warming'.

    Klare said: "Ostensibly, the aim of President Trump's May 2018 decision to impose $60 billion in tariffs on Chinese imports (increased in September to $200 billion) was to rectify a trade imbalance between the two countries "

    – No, the aim is to encourage China to removes it vastly more & extreme tariffs on US goods & services.

    Klare said: " continuing high U.S. tariffs on Chinese imports will severely curb Chinese economic growth and so weaken the world economy as a whole, punishing every nation on Earth, including this one. High tariffs will also increase costs for American consumers and endanger the prosperity and survival of many firms that rely on Chinese raw materials and components."

    – Nonsense, all China needs to do is remove it's many times over more severe tariffs.

    – If the US's lesser tariffs on Chinese goods / services 'hurt the US', then why don't China's massive tariffs on US goods / services hurt China?

    And to think some take this fraud, Klare, seriously.

    Biff , says: February 18, 2019 at 7:17 am GMT
    It was all a really great, intriguing article, but then it morphed into a dreamworld at the end.

    The only way to save civilization is for the U.S. and China to declare peace and focus together on human salvation.

    Humans aren't ready for peace or salvation, and anybody that has promoted such a thing is readily shot dead – Gandhi, John Lennon, MLK, Jesus.

    "Love thy neighbor" "Give peace a chance"

    "Fuck you! Bam!"

    Humans are not ready.

    Anonymous [370] Disclaimer , says: February 18, 2019 at 7:24 am GMT

    The media and many politicians continue to focus on U.S.-Russian relations, in large part because of revelations of Moscow's meddling in the 2016 American presidential election and the ongoing Mueller investigation.

    Eh? What revelations?

    Cyrano , says: February 18, 2019 at 7:39 am GMT
    It's not the economy stupid. According to many "experts" on this site, since the US economy and military expenditures are 10 times bigger than Russia's, it seems "logical" to those experts that the US army is 10 times better. I would argue that not only is not 10 times better, it's not even equal to Russia's army. Again, according to the same types of "experts" Russia's economy is the size of Italy. Why don't then someone break the good news to Italy and encourage them to go to war with Russia? Since their economies are equal – it seems that Italy stands a fair chance of beating Russia, thus eliminating the need of the 10 times superior army to fight them. The moronity on this site, man – it's unbelievable.
    tamo , says: February 18, 2019 at 7:49 am GMT
    @joe webb You sound like a failed proctologist in the crumbling Honkiedom.
    Franklin Ryckaert , says: February 18, 2019 at 8:40 am GMT
    China is not suffering from massive degeneration as the US is. Instead of trying to prevent China from becoming a leading nation of the world, why could the US not accept China's coming prominence and concentrate on strengthening its own population ? Unlike the US, China is not interested in "ruling the world", it is only interested in expanding its economy. For the rest, it is dedicated to stability and cooperation. No threat to the world at all, except for some compulsive hegemonists in the Pentagon.
    HiHo , says: February 18, 2019 at 11:05 am GMT
    This article is pure propaganda and as such is based upon lies, misconceptions and pure fantasy.
    If there already is a war it is all in the minds of Anericans, and they have already lost that war because America needs allies and can only create enemies amongst people that were its friends.
    Europe will join with Russia as soon as it can get away from the US bully. That means 550million Europeans will join 160 million Russians. 710 million people with Russian technology and Chinese investment (China already runs Btitain's North Sea gas), will produce an economic power that will humiliate the USA at every turn.
    All of South America wants to break with the US, the entire Orient hates the US. America is actually doing to Africa what the US accuses Russia and China of doing.
    If there really is a war between the US and China then the US has already lost it. The rest of the world wants only one thing: the absolute collapse of the entire US. Everyone hates the US. No one will ever support you US dictators and bullies 100%.
    You stab everyone in the back sooner or later and your only interest is supporting the fascist and racist Israel that is genociding the true Semites, the Palestinians.

    I'm amazed Fred Unz publishes this sort of trash. It is unadulterated lies, brainless stupidity and total hog wash. Pure drivel.

    Counterinsurgency , says: February 18, 2019 at 11:19 am GMT
    The obvious:

    It might be a bit harder than that.

    It is often said that, had the Western and Eastern Europeans formed a coalition rather than fight WW I, they would still be dominant.
    And if I had wings, I could fly to the moon.
    The Eastern Europeans had never accepted the Western Enlightenment (still haven't), and to have done so would have destabilized their family structure -- the deep structure of their society -- exactly as it has finally destabilized ours, today. The nature of authority and organization in Eastern Europe differed considerably from that of Western Europe. Their forms of organization were different enough to make integration impossible, and perhaps to make formation of a coalition impossible.

    China's organizational forms, family structure, and and social assumptions in general differ even more from the present day form of the Western Enlightenment than did those of East Europe c.a. AD 1900.

    It's at times like these we get to test the assumption that reason and fear of death can lead to agreement on a modus vivendi.

    Counterinsurgency

    mikemikev , says: February 18, 2019 at 11:53 am GMT
    @Alfa158

    In an extended struggle, as long as it doesn't go nuclear, US chances are much better against a Russia whose economy is only a fraction of China's.

    I wonder how their economy would look after a week of strategic bombing.

    Shaun , says: February 18, 2019 at 1:28 pm GMT
    @Biff I forget, who shot Jesus?
    Ilyana_Rozumova , says: February 18, 2019 at 1:36 pm GMT
    China is now PAC-man of the world.
    DESERT FOX , says: February 18, 2019 at 1:42 pm GMT
    I will never believe the Zionist controlled U.S. will go to war with China as long as one U.S. company remains in China and damn near all the major U.S. companies are in business in China, this is a ploy for the zionist controlled MIC to loot the America taxpayer!
    JC , says: February 18, 2019 at 2:18 pm GMT
    I didnt read the article but I dont think china needs the US for anything they are well on their way to be the dominant world power the US and ist zionist occupied government are losers the zionists want never ending wars which stupid USA has done,,china and all the rest will eventually dump the rothchild banking system and form its own which will in all likely hood benefit more than the zionist one does
    WHAT , says: February 18, 2019 at 2:20 pm GMT
    @HiHo Ron probably has a quota to fill. Reed gets his scribbles in by the same token, I bet.
    WHAT , says: February 18, 2019 at 2:22 pm GMT
    @mikemikev >m-muh bombers

    It will be fine, chinese know where to buy AA complexes that actually work.

    onebornfree , says: Website February 18, 2019 at 2:36 pm GMT
    No mention of an ideological battle, and no wonder, as "the Chinks" et al have apparently already won that one, as evidenced by the fact that the last US general election was merely yet another idiotic, meaningless [ yet highly entertaining], cat fight over blue socialism versus red socialism.

    The US vs China trade war is just another power/domination battle scam between two competing, wholly criminal orgs, both totally against anything ever resembling truly free trade ..nothing more.

    And so it goes .

    The "America Is Not A Socialist Country" Scam :
    http://onebornfree-mythbusters.blogspot.com/2019/02/onebornfrees-special-scam-alerts-no-87.html [bottom of page]

    Regards, onebornfree

    Rich , says: February 18, 2019 at 2:37 pm GMT
    "The US and China must work together to halt global warming or all of us are doomed to a hellish future." Really? If this doesn't prove this guy is a lefty shill, nothing does. Even the clowns raking in grants and trying to impoverish everyone with higher taxes have seen the light and have been saying "climate change" lately. Many scientists are now arguing that we may be headed into a new cooling period rather than a "hellish" warming period that brought us so much prosperity. This "global warming" religion with its hockey stick icons and polar bear mythology is worse than the Heaven's Gate religion.
    ThreeCranes , says: February 18, 2019 at 2:53 pm GMT
    @HiHo

    "The rest of the world wants only one thing: the absolute collapse of the entire US. Everyone hates the US. No one will ever support you US dictators and bullies 100%.
    You stab everyone in the back sooner or later and your only interest is supporting the fascist and racist Israel that is genociding the true Semites, the Palestinians."

    Well yes. As history has shown, occupation and rule by Jahweh's Chosen People tends to bring this fate down upon the host country.

    Ned Ludlam , says: February 18, 2019 at 2:59 pm GMT
    Oh, for Pete's sake:
    1. It will always be China+Russia vs. the US. The EU, site of WWIII, will just soil itself.
    2. The Debt Bubble US economy will collapse. At some point. Changes every calculation.
    3. The US will devolve into a state of civil war. Of some sort. Paralyze the place.

    Momentum is with China and Russia. The US is sliding into history's toilet.

    Just give it a few more years. And the whole world sees and knows it. The whole world can get along very well without the US. And would very much like that to be.

    therevolutionwas , says: February 18, 2019 at 3:09 pm GMT
    Global warming my azz! But the rest of it rings pretty true. If nukes arn't used, Russia and China will win this war simply because they have the gold now and the US has spread its fiat petro dollar all over the world which will come back big time to bite them. That is if China and Russia are smart enough to go on a gold exchange standard.
    MEFOBILLS , says: February 18, 2019 at 3:11 pm GMT
    @Cyrano

    since the US economy and military expenditures are 10 times bigger than Russia's, it seems "logical" to those experts that the US army is 10 times better. I would argue that not only is not 10 times better, it's not even equal to Russia's army.

    I would argue the same.

    Russia is a land power. This means using a land army and area denial. Russia does not need to power project with a blue water Navy and she does not follow Atlantacist doctrine.

    Atlantacist doctrine got its start when our (((friends))) evolved the method during the Levantine Greek City State period, where our tribal friends would be stationed in various entrepot cities ringing the Mediterranean. They would use their tribal connections to Launder pirated goods, and to push their "international" usurious money type, which in those days was silver. Simultaneously they were taking rents on their secret East/West mechanism, whereby exchange rates between gold and silver were exploited. Gold was plentiful in India and Silver more plentiful in the West, so the Caravan's took arbitrage on exchange rates as silver drained east and gold drained west.

    The U.S. inherited Atlanticist method after WW2. The U.S. is not an island economy like England – it does not need to go around the world beating up others to then extract raw materials. The U.S. is actually more like Russia in that U.S. can afford to have economic autarky and be independent. The U.S. does not need to power project with a blue water navy, despite the false narrative (((inheritance))) passed down to us, especially after WW2. Nobody likes being punked with false narrative.

    U.S. military expenditures are so heavy because of this tendency of finance capital to search the world for gains, and this means posting overseas military bases, which in turn are expensive to operate. Russia only has a "close in" defensive posture of area denial. This is far less expensive than power projecting.

    Also, GDP figures are misleading. In the U.S. if housing prices go up it reflects in GDP growth, when in reality – the house didn't improve. GDP figures are lies. If finance takes 50% cut of the economy, they are only pushing finance paper back and forth at each other this is not the real economy, but it shows up in GDP because finance paper is an "asset".

    Russia's economy is much larger than their GDP, probably it is closer to Germany's in real terms. Real terms = real economy = the making of goods and services.

    China is not America's natural ally, Russia is. Atlantacist doctrine sold America's patrimony to China for cheap, and then the ((international)) will just jump to another host.

    America has been parasitized by false doctrine and the output is thus that of an infected brain – an output that is crazy. Finance plutocracy typically will not let go willingly, but has to be removed forcefully.

    jeff stryker , says: February 18, 2019 at 3:22 pm GMT
    Russia is a country of vodka drunks and Dubai prostitutes run by a syndicate of Israel oligarchs and ex-KGB who kill their journalists in foreign countries.

    China is dependent on outsourcing and if the US factories were to withdraw tomorrow the Chinese economy would take a huge hit.

    NoseytheDuke , says: February 18, 2019 at 3:27 pm GMT
    @Erebus The US is vulnerable in so many other ways too, see how fast the store shelves empty just on the news of an approaching big storm. Panic buying is rife and some people keep minimal food available at home. I know people who have to stop at an ATM to get $20. All kinds of vital distribution of food, water, power, fuel and more seems to pass through a myriad of often vulnerable bottle-necks real or virtual. Easy targets for low cost, low tech sabotage teams I'd think.

    I'm inclined to think also that this threatening hysteria possibly is a deep state psy-op designed to prime Americans prior to the enactment of some sort of "democracy" modifications.

    Sean , says: February 18, 2019 at 3:28 pm GMT
    America is the most powerful country solely because it has the most powerful economy in the world, and that was in no small measure due to America's abundance of arable land, navigable waterways, natural resources ect ect. . In a few decades China has rocketed close to US level and is in a global hegemon trajectory solely on the quality and size of its population . There is not much doubt about the outcome of any competition between China and the West, especially as much of the profits of the ruling class in the West has come from offshoring and investment in China and their economy of scale production suppressing labour's power in the West. The Chinese and their Western collaborators will just wait Trump out. Trump is a populist not a creature of the Deap State alarmed at China's rise. The leading strategists of America's foreign policy establishment still don't realise what they are dealing with in China.

    Perhaps the greatest victim of this ongoing conflict will be planet Earth itself and all the creatures, humans included, who inhabit it. As the world's top two emitters of climate-altering greenhouse gases, the U.S. and China must work together to halt global warming or all of us are doomed to a hellish future.

    Better to reign in hell. Anyway, there is hardly a tree left in China and since 2006, China has been the world's largest emitter of CO2 annually and though they pay lip service they accept no binding target for reduction; quite the opposite.

    Even if their present slow-burn conflict may not produce the immediate devastation of a conventional hot war, its long-term consequences could prove no less dire.

    The manufacturing should be done in the most advanced regions of Earth ie the West, because that is where the technology and will exists to protect the environment. China is trying to churn out cheaper goods and does not care what damage they do in cutting environmental corners.

    https://en.wikipedia.org/wiki/Climate_change_in_China
    China still supports the "common but differentiated responsibilities" principle, which holds that since China is still developing, its abilities and capacities to reduce emissions are comparatively lower than developed countries'. Therefore, its emissions should not be required to decrease over time, but rather should be encouraged to increase less over time until industrialization is farther along and reductions are feasible

    In other words the global environment is going to continue to be ripped apart like a car in a wrecking yard by China. "Industrialization is farther along" is obviously Chinese speak for "when China is able to dominate the world with enormous productive capacity and we do not even have to pay lip service any more".

    In today's world, however, where great-power armed combat could possibly end in a nuclear exchange and mutual annihilation, direct military conflict is a distinctly unappealing option for all parties. Instead, governing elites have developed other means of warfare -- economic, technological, and covert -- to achieve such strategic objectives. Viewed this way, the United States is already in close to full combat mode with respect to China.

    No, the appeal of a real war will increase precipitously for any clear loser in the economic competition who has a rapidly declining military advantage (especially in thermonuclear first strike capacity due to proximity fuses and sub location tech), and we all know who that is going to be. A shooting war will come, and the sooner it comes the better for the whole world. Reassuring Russia that it will not be subjected to the same treatment by the West at some point in the future will be the main problem inhibiting the coming military take down (and nuking if necessary) of China.

    NoseytheDuke , says: February 18, 2019 at 3:30 pm GMT
    @Shaun Eric Clapton, surely. Or was it Eric Idle? I forget. Who was it?
    Reuben Kaspate , says: February 18, 2019 at 3:32 pm GMT
    As to bringing in Hindoos and Pakis into to the America-China conflict with a singular example of the demand for defense related technology transfer by the former

    India is a mediocrity but Pakistan is a nightmare for all concerned, given that after imbibing religious mumbo jumbo from moronic Arabs, with which havocs were created in Afghanistan via neoconnish America, now they are fellating uncircumcised Chinese for crumbs the ungodly Chinese will play the idiotic Pakis like a fiddle to the detriment of the West!

    [Mar 02, 2019] US Said to Ready Final China Trade Deal as Hawks Urge Caution

    Mar 02, 2019 | www.bloomberg.com

    Bloomberg

    Negotiations with Beijing to address structural economic reforms are taking place on a track that's separate from the talks about the quantity of American products the Chinese may agree to buy to reduce the U.S. trade deficit, one of the people briefed on the matter said.

    The Chinese have offered to ramp up purchases of American goods by $1.2 trillion over six years, according to the person. It's still unclear how Beijing would follow through on those purchases if retaliatory tariffs remained in place and other trading barriers aren't removed, the person added. China bought $130 billion in U.S. goods in 2017, according to U.S. figures.

    After several rounds of face-to-face meetings between U.S. and Chinese officials since last year, the sides are now in regular contact via phone and video-conference to hammer out the details of a deal, according to the person.

    The U.S. Trade Representative's office said Thursday it will publish a notice in the Federal Register delaying the increase of tariffs on Chinese imports until further notice. Trump had previously planned to raise tariffs on March 1, but on Sunday dropped the threat amid progress at the negotiating table.

    [Feb 17, 2019] Beware of well dressed ladies who smell of Chanel #5

    Well meaning idiot is the most dangerous type of idiots, if he is the king, who is still in power...
    This use of "beautiful ladies" is the trick that centuries old... Children can also be used this way, especially girls...
    Feb 17, 2019 | turcopolier.typepad.com

    Persuading the king ...

    I watched Trump's Rose Garden session in which he announced that he would sign the appropriation bill and also declare a national emergency under the National Emergencies Act. IMO he will win whatever court challenges are made because his authority to do this is clear in "black letter" law and the opposition will have to base their plaints on a judgment as to whether or not there is an emergency. IMO there is nothing in the constitution or law that makes the judgment or the courts competent to overrule his judgment in this case. If they don't like the National Emergencies Law, let the Congress repeal it.

    On the other hand, Trump also told the world that because of a personal appeal by a woman from Idlib Province in Syria who came to see him in the Oval Office, he called Putin and argued him into calling off the preparations for a massive Russo/Syrian/Iranian offensive that would IMO have recovered Idlib for the SAG.

    I am recalling here roughly what he said.

    The lady's argument was that she believed that the millions who lived in the province would be killed or maimed in the process and all the towns destroyed. Her parents lived in the province. And, after all, she said, there are only 45,000 jihadis in the province. I was not in the room, but would be willing to bet that she was; well spoken, well dressed, and reasonably attractive. Trump was persuaded and Idlib remains a cancer in the side of the Syrian state, the Russians, having listened to Trump, attempted to create a de-militarized zone around Idlib Province within which the jihadis have consolidated power.

    Some years ago I was asked to speak at a two or three day discussion of the Middle East at Mississippi State University. This is a big school. Attendance was in the thousands. On the program with me (or I with him) was, then TV personality, (later governor of Ohio) John Kasich. At a pre-conference dinner, Kasich sought to dominate the table talk and me (his principal competition) at this conference. There were numerous senior faculty present at table. Kasich sought to belittle whatever knowledge I might have of the MENA region and of the peoples and cultures there. In particular he said that I did not understand Islam at all because I said that the jihadis were among the various forms of Islam, a religion which I foolishly claimed had no central authority structure and in which the "true Islam" was not to be known except in the consensus (ijma') of various groups of Muslims.

    Having heard him out, I explained to him my background and experience. He grew more and more sober, clearly unused to opposition. I asked him what the basis was for his opinion that the various jihadis were not real Muslims at all.

    He told us that a number of beauteous Muslim ladies had been brought to see him. He said they were well spoken, well dressed (some in French couture clothing) and that they smelled good. This last was said after I asked him about it having run into this phenomenon before.

    These ladies were all at pains to explain to him that the jihadis were outside Islam because they did not accept the ijma' of the scholars of whatever "school" (mathab) of Sunni Sharia these ladies adhered to.

    The lesson - Beware of well dressed ladies who smell of Chanel #5. pl


    PeterVE , 5 hours ago

    Are you suggesting that President Trump could be influenced by an attractive, well spoken woman with an exotic accent? Maybe the Iranian Mullahs need to change their UN representative to get off Trump's s#*! list.
    Barbara Ann , 3 hours ago
    Great anecdote Colonel, interesting that Kasich's first instinct was to see you as "competition" in such a setting. I don't suppose you told him that, despite your evident ignorance, you were known by the name of a famous warrior poet in several ME countries - or inquired as to his own sobriquet as in these places? My guess is the women folk of Idlib province are not in the habit of frequenting the Oval Office, it would be interesting to know who arranged her visit.

    Machiavelli does not seem to have commented on the specific matter of wariness of beauteous messengers. However, I'd expect his advice on such matters would echo your own, in the importance of evaluating a message independently of its perfume.

    Pat Lang Mod -> Barbara Ann , 2 hours ago
    That is very good. Antar thanks you. An Iraqi general once asked me how I came to be called that. He said, "you are not Black." I said that was true but that I lived with a woman whose sobriquet was Abla and after so much war my heart was black enough. He said that was true of them as well.
    Pat Lang Mod -> Pat Lang , 19 minutes ago
    Actually Abla and I were named by a Palestinian Arabic teacher who wanted his class to have working names that began with 'ain. He was from Bethlehem and owned a night club in San Francisco where he was occupied while not teaching Arabic at DLI in Monterey. The name stuck. He was killed in Kuwait by the Kuwaiti resistance who said he was a collaborator with the Iraqis. He was a marvelous 'oud player.
    Keith Harbaugh , an hour ago
    On the other side of the coin, I recall reading how HRC, when she was SecState, was convinced by well-spoken, well-dressed Westernized and Western-educated men from Libya and Syria that if only the U.S. would overthrow the "brutal tyrants" then ruling those nations, that then democracy and freedom would reign in those lands.
    In particular, she was lobbied by one such Westernized Libyan just before she persuaded BHO to intervene in Libya, leading to the subsequent chaos.
    BTW, for a reminder of who else pushed BHO to intervene in Libya,
    see "Fight of the Valkyries" by Maureen Dowd, 2011-03-23.
    Is calling such women stupid about things that matter sexist?
    Thinking about how popular the values of Westernized people from the Islamic world are back in their native lands, there is the illustrative example of Benazir Bhutto .

    Also BTW, the URL for this post currently is: https://turcopolier.typepad...
    "my-entry"? Is this right?

    The Beaver , 2 hours ago
    Colonel

    Here is that lady:

    https://www.cnn.com/videos/...

    She is with SAMS thus in cahoots with White Helmets

    https://www.buckscountycour...

    and their reactions about Douma

    https://www.sams-usa.net/pr...

    Pat Lang Mod -> The Beaver , 2 hours ago
    She qualifies.
    DontBelieveEitherPropaganda , 3 hours ago
    While not having the time nor energy at the moment to read much (even more post much), this statement from DJT just stunned me. And i am not easily stunned.
    Some ppl including me thought of this possibility, to be precise that Ivanka and Jared fed him: You got to save those inocent people there! And he took the bait.

    But then again i didnt truely want to believe that this is how the goverment of the biggest world power works. With all those gazillions of analysts, SIGINT HUMINT etc. at hand, briefings and what not..

    Even more comically and tragic is, that he might just told the truth, and this is truly what happend.

    IMHO this is how the neocons influence him: By presenting selective "information", and just like the MSM he falls for it. Be it his family or patriachic instincts or what ever the psychologic motivation:

    He admitted that he was influenced by the same MSM methods he claims to fight, and in turn protecting the biggest gathering of international Jihahist in this century against their sure defeat.

    MAGA = Make AlQaida Great Again! ;)

    AFAIK this is how DJT stopped the funding of the FSA, when he was shown the video of the child the Zenki Jihadists beheaded. So it is not a single decision, but the M.O. of his style of decision making.

    Under all that narcissistic, egomanic and sociopathic behaviour seems to be a human being, a quite emotional too. Too bad it seems to care more for single female Jihadists propagandists than for his campaign promise of fighting Jihadists..

    Maybe Assads wife should make a undercover visit to DJT? ;)

    EDIT: Typos

    Pat Lang Mod -> DontBelieveEitherPropaganda , an hour ago
    The problem with him is his abysmal ignorance of anything outside the world of business. This makes him vulnerable to nonsense like this.
    Pat Lang Mod -> DontBelieveEitherPropaganda , 2 hours ago
    What is with the "EDIT:Typos" thingy? We are all plain folk here. Basma Asad? A beautiful, well spoken creature. There is a certain strain of blond Syrian upper class woman who will just knock your socks off. This what Italians call "the thunderbolt." I went to visit one in the Maryland suburbs of DC. A relative asked me to go. She was that type. After she decided I wasn't going to do whatever it was she thought I would want to do she took me out to the garage where there were several big cats; tiger, leopard, puma, etc. in cages. I asked her why. She just shrugged and went back in the house.
    mourjou , 3 hours ago
    The woman concerned.
    Dr Rim Al-Bezem is the president of the eastern chapter of the Syrian-American Medical Society (SAMS), an organization that provides training, medical equipment and medicine for a country decimated by the war.


    From memory, SAMS only ever worked in the rebel-held areas .
    And again from memory, she has been economical with the truth, by ignoring the doctors in west Aleppo and inflating the number of people in Aleppo. Yet again from memory, I think it never reached much above 2 million, 1.5 million in the west and 0.5 million in the east.

    "Many of the doctors have left the country because they, too, have families. In Aleppo alone, there are 35 doctors left to treat the population of 5 million people," she said.

    .

    David Solomon , 3 hours ago
    Colonel, I really enjoyed this piece. It may not have been intentional on your part, but it brought some joy to my day.

    Regards,

    David

    [Feb 09, 2019] No trade deal can dictate our relationship with China

    Feb 09, 2019 | economistsview.typepad.com

    anne , February 06, 2019 at 01:32 PM

    https://www.washingtonpost.com/opinions/no-trade-deal-can-dictate-our-relationship-with-china/2019/02/04/ff5ea754-28c4-11e9-8eef-0d74f4bf0295_story.html

    February 4, 2019

    No trade deal can dictate our relationship with China
    By Lawrence H. Summers - Washington Post

    As the United States and China continue to joust over trade and technology, the U.S. policy debate contrasts two views of the primary problem.

    A first view expressed often in President Trump's tweets locates the key issue in the bilateral trade deficit that the United States chronically runs with China. On this theory of the problem, a solution is relatively easy: The Chinese could rearrange their imports of soybeans, fossil fuels and other products so more of them come from the United States, while countries now supplying China could export instead to nations now importing from the United States. This is what the Chinese keep offering since it means almost no real change in their economy. Neither levels of employment, output or total trade deficits and surpluses are likely to change much in either the United States or China.

    A second view, held by more serious alarmists about the U.S.-China relationship, such as U.S. Trade Representative Robert E. Lighthizer, emphasizes problematic Chinese practices in key technological sectors. These range from theft of U.S. technologies to requirements that U.S. firms wishing to do business in China -- chiefly in the development of key technologies, such as artificial intelligence -- must form joint ventures with Chinese firms, especially those with connections to the Chinese government.

    Such technological alarmists in and out of the administration hold that we can wall off U.S. technologies with sufficiently aggressive policies so China cannot steal them, or that we can pressure China to the point where it will give up government efforts at industrial leadership. Neither of these prospects is realistic.

    In many ways, U.S. concerns over China and technology parallel concerns over the Soviet Union in the post-Sputnik missile gap period just before President John F. Kennedy's election in 1960. Or over Japan in the late 1980s and early 1990s, when it was often joked that "the Cold War is over and Japan won."

    When atomic weapons were our most sensitive military secret, their creation required extensive sophisticated infrastructure. Yet the United States and Russia essentially had no normal interchange, so we were able to maintain a lead of three or four years with respect to both fission and fusion weapons.

    Technology for artificial intelligence in development today, however, can be operated on widely available equipment. And there are hundreds of thousands of Chinese citizens studying in the United States or working for U.S. companies that develop such technology. Keeping U.S. knowledge out of Chinese hands for substantial lengths of time is impracticable short of a massive breaking of economic ties.

    Nor is it likely for the Chinese government to halt its support of technology development. How would the United States react if other countries demanded that we close down DARPA, the Defense Department's advanced research agency, because it represented unfair competition? Or if trading partners argued that U.S. support for private clean-energy companies, such as the subsidies provided by the Obama administration, was an unfair trade practice? Much of our current information technology and communications infrastructure comes directly or indirectly out of Bell Labs, which was financed out of the profits of a government-regulated and -protected monopoly. Would the United States have responded constructively to demands from other countries to dismantle the Bell system?

    A focus on resisting the Chinese economic threat will likely not only be ineffective but may also be counterproductive if it diverts private and public energy from more productive pursuits. I remember well from the early Clinton administration that the great symbol of efforts to constrain unfair Japanese practices was Kodak's case against Fuji, the Japanese photographic film company that attracted massive attention from Kodak's senior management and U.S. policymakers. Perhaps if Kodak had instead focused on the digital photography ideas its scientists had developed, it would still be a significant company.

    Where we can mobilize international support, we should, of course, push China to live up to its trade obligations and seek to modify rules in the World Trade Organization where they do not cover problematic practices. But in reality, our competitive success over the next generation will depend much more on what happens in our economy and society than at any international negotiating table.

    Will our national investment in applied scientific research continue to languish to the point where even the most brilliant young scientists cannot get their first research grants until they are in their 40s? Will public officials who surely know better continue to allow creationism to be taught as serious science in U.S. public schools in a century with so much progress in life sciences? Will public policy concern itself with the strength and competitiveness of U.S. information technology companies as well as with their marketing practices? Will a national effort be made to improve the dismal performance of U.S. students at every level in international comparisons of mathematical and scientific achievement?

    These questions and others like them, much more than any trade negotiation, will determine how the United States competes over the next generation. The Russian and the Japanese challenges pushed us forward as a nation in very constructive ways. So can the Chinese challenge if we seize the opportunity it represents.


    Lawrence Summers is a professor at and past president of Harvard University.

    [Jan 29, 2019] US steps up offensive against China with more "hacking charges" by Mike Head

    Notable quotes:
    "... Washington Post ..."
    "... Sections of the Chinese regime responded belligerently to the accusations. An editorial in the state-owned Global Times ..."
    "... The editorial asked: "Assuming China is so powerful that it has stolen technological information for over a decade that is supposedly worth over a trillion in intellectual property, as the US has indicated, then how is it that China still lags behind the US in so many fields, from chips to electric vehicles, and even aviation engines?" ..."
    Dec 21, 2018 | www.wsws.org

    Further escalating its economic and strategic offensive to block China from ever challenging its post-World War II hegemony, the US government yesterday unveiled its fifth set of economic espionage charges against Chinese individuals since September.

    As part of an internationally-coordinated operation, the US Justice Department on Thursday published indictments of two Chinese men who had allegedly accessed confidential commercial data from US government agencies and corporate computers in 12 countries for more than a decade.

    The announcement represents a major intensification of the US ruling class's confrontation against China, amid a constant build-up of unsubstantiated allegations against Beijing by both the Republican and Democrat wings of Washington's political establishment.

    Via salacious allegations of "hacking" on a "vast scale," every effort is being made by the ruling elite and its media mouthpieces to whip up anti-China hysteria.

    The indictment's release was clearly politically timed. It was accompanied by a global campaign by the US and its allies, accusing the Chinese government of an illegal cyber theft operation to damage their economies and supplant the US as the world's "leading superpower."

    US Secretary of State Mike Pompeo and Homeland Security Secretary Kirstjen Nielsen immediately issued a statement accusing China of directing "a very real threat to the economic competitiveness of companies in the United States and around the globe."

    Within hours, US allies around the world put out matching statements, joined by declarations of confected alarm by their own cyber-warfare and hacking agencies.

    The Washington Post called it "an unprecedented mass effort to call out China for its alleged malign acts." The coordination "represents a growing consensus that Beijing is flouting international norms in its bid to become the world's predominant economic and technological power."

    The Australian government, the closest ally of the US in the Indo-Pacific region, was in the forefront. Foreign Affairs Minister Marise Payne and Home Affairs Minister Peter Dutton explicitly accused the Chinese government and its Ministry of State Security (MSS) of being responsible for "a global campaign of cyber-enabled commercial intellectual property theft."

    Geoffrey Berman, the US attorney for the Southern District of New York, called the Chinese cyber campaign "shocking and outrageous." Such pronouncements, quickly emblazoned in media headlines around the world, destroy any possibility of anything resembling a fair trial if the two men, named as Zhu Hua and Zhang Shilong, are ever detained by US agencies and brought before a court.

    The charges themselves are vaguely defined. Federal prosecutors in Manhattan accused the men of conspiracy to commit computer intrusions, wire fraud and aggravated identity theft. Zhu and Zhang acted "in association with" the MSS, as part of a hacking squad supposedly named "APT1o" or "Stone Panda," the indictment said.

    FBI Director Christopher Wray called a news conference to issue another inflammatory statement against China. Pointing to the real motivations behind the indictments, he declared: "China's goal, simply put, is to replace the US as the world's leading superpower, and they're using illegal methods to get there."

    Coming from the head of the US internal intelligence agency, this further indicates the kinds of discussions and planning underway within the highest echelons of the US political and military-intelligence apparatus to prepare the country, ideologically and militarily, for war against China.

    Washington is determined to block President Xi Jinping's "Made in China 2025" program that aims to ensure China is globally competitive in hi-tech sectors such as robotics and chip manufacture, as well as Beijing's massive infrastructure plans, known as the Belt and Road Initiative, to link China with Europe across Eurasia.

    The US ruling class regards these Chinese ambitions as existential threats because, if successful, they would undermine the strategic position of US imperialism globally, and the economic dominance of key American corporations.

    Yesterday's announcement seemed timed to fuel tensions between Washington and Beijing, after the unprecedented December 1 arrest of Meng Wanzhou, the chief financial officer of Chinese telecommunications giant Huawei, in Canada at the request of the US.

    Last weekend, US Vice President Mike Pence again accused China of "intellectual property theft." These provocations came just weeks after the US and Chinese administrations agreed to talks aimed at resolving the tariff and trade war launched by US President Donald Trump.

    The Trump administration is demanding structural changes to China's state-led economic model, greater Chinese purchases of American farm and industrial products and a halt to "coercive" joint-venture licensing terms. These demands would severely undermine the "Made in China 2025" program.

    Since September, US authorities have brought forward five sets of espionage allegations. In late October, the Justice Department unsealed charges against 10 alleged Chinese spies accused of conspiring to steal sensitive commercial secrets from US and European companies.

    Earlier in October, the US government disclosed another unprecedented operation, designed to produce a show trial in America. It revealed that a Chinese citizen, accused of being an intelligence official, had been arrested in Belgium and extradited on charges of conspiring to commit "economic espionage" and steal trade secrets.

    The extradition was announced days after the Pentagon released a 146-page document, titled "Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States," which made clear Washington is preparing for a total war effort against both China and Russia.

    Trump, Pence and Wray then all declared China to be the greatest threat to America's economic and military security. Trump accused China of interfering in the US mid-term elections in a bid to remove him from office. In a speech, Pence said Beijing was directing "its bureaucrats and businesses to obtain American intellectual property -- the foundation of our economic leadership -- by any means necessary."

    Whatever the truth of the spying allegations against Chinese citizens -- and that cannot be assumed -- any such operations would hardly compare with the massive global intrigue, hacking, regime-change and military operations directed by the US agencies, including the National Security Agency (NSA) and its "Five Eyes" partners.

    These have been exposed thoroughly by NSA whistleblower Edward Snowden and WikiLeaks founder Julian Assange. Leaked documents published by WikiLeaks revealed that the CIA has developed "more than a thousand hacking systems, trojans, viruses and other 'weaponized' malware," allowing it to seize control of devices, including Apple iPhones, Google's Android operating system, devices running Microsoft Windows, smart TVs and possibly the control of cars and trucks.

    In an attempt to broaden its offensive against China, the US government said that along with the US and its Five Eyes partners, such as Britain, Canada and Australia, the countries targeted by the alleged Chinese plot included France, Germany, Japan, Sweden and Switzerland.

    Chinese hackers allegedly penetrated managed services providers (MSPs) that provide cybersecurity and information technology services to government agencies and major firms. Finance, telecommunications, consumer electronics and medical companies were among those said to be targeted, along with military and US National Aeronautics and Space Administration laboratories.

    Sections of the Chinese regime responded belligerently to the accusations. An editorial in the state-owned Global Times branded them "hysterical" and a warning sign of a "comprehensive" US attack on China.

    The editorial asked: "Assuming China is so powerful that it has stolen technological information for over a decade that is supposedly worth over a trillion in intellectual property, as the US has indicated, then how is it that China still lags behind the US in so many fields, from chips to electric vehicles, and even aviation engines?"

    The Global Times declared that "instead of adhering to a low-profile strategy, China must face these provocations and do more to safeguard national interests."

    The promotion of Chinese economic and militarist nationalism by a mouthpiece of the Beijing regime is just as reactionary as the nationalist xenophobia being stoked by the ruling elite of American imperialism and its allies. The answer to the evermore open danger of war is a unified struggle by the international working class to end the outmoded capitalist profit system and nation-state divisions and establish a socialist society.

    Ron Ruggieri13 hours ago

    ANY rational person would think : a nation like USA TODAY which can name a different ENEMY every other week is clearly SICK, led by sociopaths. China ? Russia, Iran, North Korea ? Venezuela ? ( all fail to live up to the high moral standards of " OUR democracy " ?)
    How are any of these countries a greater threat to YOU than the local Democratic or Republican party hacks ?
    If YOU think that so many people hate you , would it not make sense to ask if there is perhaps something wrong with YOU ?
    Lidiya17 hours ago
    Imperialism means wars, as usual, Lenin was right in his polemics against Kautsky.

    [Jan 14, 2019] The neoliberal European Union is dead, but it does not know it yet

    Jan 14, 2019 | www.amazon.com

    At this point, deja vu mind-set returns to teach a powerful lesson. Having once witnessed a major historical reversal, one knows that historical determinism isan illusion -- opium for people on the edge of a nervous breakdown.

    Machiavelli insisted that surrender is a bad idea because we never know what surprises fortune may have in store for us. In Machiavelli's view, there are "good times" and "bad times" in politics, and the good ruler is not one who can fend off the "bad times" so much, as one who has accumulated enough goodwill among citizens to help him ride out those bad times.

    The argument of this short book is that European Union is going through a really bad time today, torn apart by numerous crises that damage confidence in the future of the project among citizens across the continent. So the disintegration of the union is one of the most likely outcomes.

    [Jan 12, 2019] These US companies employ the most H-1B visa holders

    Jan 12, 2019 | finance.yahoo.com

    One of the most sought-after visa programs in the U.S., the H-1B, could see some significant changes in 2019, according to President Trump , including a potential path to citizenship for recipients of the non-immigrant visa.

    The H-1B visa program allows U.S. employers to hire graduate-level workers in specialty occupations, like IT, finance, accounting, architecture, engineering, science and medicine. Any job that requires workers to have at least a bachelor's degree falls under the H-1B for specialty occupations.

    Each year, the U.S. Citizenship and Immigration Services (USCIS) allots about 85,000 of the H-1B visas -- 65,000 for applicants with a bachelor's degree or equivalent, and 20,000 for those with a master's degree or higher.

    As of April 2017, when Trump signed an executive order -- "Buy American and Hire American" -- it's become more difficult for U.S. companies to hire people via H-1B. It directs the Department of Homeland Security to only grant the visas to the "most-skilled or highest-paid beneficiaries."

    Here's a look at the American companies (and industries) that benefited the most from the program in 2017.

    Cognizant: The IT services business had a whopping 3,194 H-1B initial petitions approved in 2017, the most of any U.S. company by almost 600.

    Amazon: In 2017, the e-commerce behemoth hired 2,515 employees via the H-1B visa program, according to data compiled by the National Foundation for American Policy . That was about a 78 percent increase from 2016, or 1,099 more employees.

    Microsoft: Microsoft hired 1,479 workers through H-1B in 2017, the second most of U.S. companies -- an increase in 334 employees from the year prior, or close to 29 percent.

    IBM: In 2017, IBM employed about 1,231 workers through the H-1B visa program.

    Intel: The California-based company employed 1,230 workers through H-1B in 2017, 200 more workers -- or a 19 percent increase -- compared to 2016.

    Google: The search engine giant had 1,213 H-1B initial petitions approved for fiscal year 2017, a 31 percent increase of about 289 from 2016.

    [Jan 12, 2019] If China Is Suffering So Much Because of Trump's Trade War, Why Is Its Surplus Up So Much? by Dean Baker

    Jan 12, 2019 | economistsview.typepad.com

    anne , January 07, 2019 at 02:34 PM

    http://cepr.net/blogs/beat-the-press/if-china-is-suffering-so-much-because-of-trump-s-trade-war-why-is-its-surplus-up-so-much

    January 4, 2019

    If China Is Suffering So Much Because of Trump's Trade War, Why Is Its Surplus Up So Much?
    By Dean Baker

    Donald Trump has made his tariffs against China and other countries a big part of his agenda as president. He even went so far as to dub himself "Tariff Man" on Twitter.

    The media have been quick to assume that Tariff Man is accomplishing his goals, especially with regard to China. It is standard for news articles, like this one, to assert that China's economy is suffering in large part because of Trump's tariffs.

    In fact, through the first ten months of 2018 China's trade surplus * with the United States on trade in goods has been $344.5 billion. This is up 11.5 percent from its surplus in the same months last year.

    The tariffs surely are having some effect, and China's surplus would almost certainly be larger if they were not in place. But it is difficult to believe that China's $13.5 trillion dollar economy (measured at exchange rate values) could be hurt all that much by somewhat slower growth in its trade surplus with the United States. (For arithmetic fans, the surplus is equal to 2.5 percent of China's GDP. We are talking about slower growth in this surplus.)

    It is worth noting that we will not be getting new trade data until the government shutdown is over since the Census Bureau is one of the government agencies without funding for fiscal year 2019.

    * https://www.census.gov/foreign-trade/balance/c5700.html

    Fred C. Dobbs said in reply to anne... , January 07, 2019 at 09:07 PM
    'If China Is Suffering So Much Because of Trump's Trade War, Why Is Its Surplus Up So Much?'

    Merchants outside of China stockpiling
    Chinese-made goods (ahead of, or maybe
    despite tariffs.)

    It seems we've read of American firms
    doing exactly that. They are probably
    not alone.

    anne -> Fred C. Dobbs... , January 08, 2019 at 09:23 AM
    'If China Is Suffering So Much Because of Trump's Trade War, Why Is Its Surplus Up So Much?'

    Merchants outside of China stockpiling
    Chinese-made goods (ahead of, or maybe
    despite tariffs.)

    It seems we've read of American firms
    doing exactly that. They are probably
    not alone.

    [ There has been no evident stockpiling of inventory by American firms:

    https://fred.stlouisfed.org/graph/?g=mBet

    January 30, 2018

    Inventories to Sales Ratio, 2007-2018 ]

    Fred C. Dobbs said in reply to anne... , January 08, 2019 at 09:56 AM
    I posted an NYT piece the other day
    that described an automobile-headlight
    manufacturer in Michigan who was struggling
    to get LED bulbs from China, where they were
    usually in plentiful supply, So, he was just
    *trying* to stockpile some inventory.

    (Too expensive to make in the US, he said.)

    anne -> Fred C. Dobbs... , January 08, 2019 at 11:27 AM
    https://www.nytimes.com/2019/01/06/business/trump-tariffs-trade-war.html

    January 6, 2019

    Trump Has Promised to Bring Jobs Back. His Tariffs Threaten to Send Them Away.
    By Peter S. Goodman

    For EBW Electronics, the biggest hit has come through increased costs for components, including transistors, resistors and capacitors. Across the breadth of the factory, workers in blue lab coats slot these nibs of metal into circuit boards and then attach LED lights, most of these items imported from China.

    These components are produced at enormous scale in China. Even with tariffs on Chinese imports, American factories have no incentive to make them, because profit margins are tiny, and the costs are vast.

    "Nobody in this country wants to make these things," said Mr. Steeby, the EBW president, echoing a contention heard widely here.

    The company has filed for exemptions from the tariffs, but has yet to hear back from the federal government. And EBW has encountered stiff resistance in passing on the extra costs to its customers, though it is obliged to continue delivering lights to major auto manufacturers at agreed-upon prices, or pay fines for interfering with production.

    "We're the monkey in the middle," said Mr. LeBlanc, the EBW chairman.

    If Mr. Trump follows through on threats to raise tariffs to 25 percent, EBW and its 230 employees could face dire circumstances.

    "At 25 percent, we are not making money," Mr. Steeby said. "There's a threat that you cease to exist, or there's a threat that jobs move to Mexico."

    In an era of anxiety over global competition, EBW has engaged Chinese suppliers to produce a crucial commodity -- American paychecks. Now, Mr. Trump's tariffs have put jobs at risk.

    "There's no intelligence to the way this is being done," Mr. Steeby said. "The tariffs are designed to hurt China, but they are being paid by American companies."

    Mr. Bill said in reply to anne... , January 09, 2019 at 04:31 PM
    Of course, the Mr. Steeby, President of EBW Electronics, is without question, honest and trustworthy. Like a boy scout, he would never lie. What he said should be taken as the gospel truth, not a grain of salt.

    Even when he lies.

    Mr. Bill said in reply to Mr. Bill... , January 09, 2019 at 04:33 PM
    Which, most likely, is always.
    anne -> Fred C. Dobbs... , January 08, 2019 at 11:31 AM
    I posted an NYT piece the other day
    that described an automobile-headlight
    manufacturer in Michigan who was struggling
    to get LED bulbs from China, where they were
    usually in plentiful supply, So, he was just
    *trying* to stockpile some inventory.

    [ There is no indication the company is stockpiling LED bulbs, and there is no indication there is stockpiling as yet through the economy. ]

    Fred C. Dobbs said in reply to anne... , January 08, 2019 at 12:44 PM
    Hmmm. Substitute 'obtain'
    for 'stockpile' then.
    anne -> Fred C. Dobbs... , January 08, 2019 at 12:55 PM
    Substitute 'obtain'
    for 'stockpile' then.

    [ No, the matter is important, and I am correct and do not care to be baited.

    This is no data showing that American companies are stockpiling. American companies have long operated with minimal inventory and a change would be dramatic. ]

    anne -> anne... , January 08, 2019 at 02:36 PM
    https://fred.stlouisfed.org/graph/?g=luZC

    January 30, 2018

    United States Goods Imports from and Exports to China Mainland & Hong Kong, 2007-2018


    ttps://fred.stlouisfed.org/graph/?g=luZD

    January 30, 2018

    United States Goods Imports from and Exports to China Mainland & Hong Kong, 2007-2018

    (Indexed to 2007)

    anne -> anne... , January 08, 2019 at 02:36 PM
    Correcting link:

    https://fred.stlouisfed.org/graph/?g=luZD

    January 30, 2018

    United States Goods Imports from and Exports to China Mainland & Hong Kong, 2007-2018

    (Indexed to 2007)

    [Jan 11, 2019] Blowback from the neoliberal policy is coming

    Highly recommended!
    Seeing Tucker Leaders show no obligation to American voters suggest that the collapse of neoliberalism is coming...
    Notable quotes:
    "... Excessive financialization is the Achilles' heel of neoliberalism. It inevitably distorts everything, blows the asset bubble, which then pops. With each pop, the level of political support of neoliberalism shrinks. Hillary defeat would have been impossible without 2008 events. ..."
    Jan 11, 2019 | www.nakedcapitalism.com

    bruce wilder, January 11, 2019 at 2:17 pm

    Barkley insists on a left-right split for his analysis of political parties and their attachment to vague policy tendencies and that insistence makes a mess of the central issue: why the rise of right-wing populism in a "successful" economy?

    Naomi Klein's book is about how and why centrist neoliberals got control of policy. The rise of right-wing populism is often supposed (see Mark Blyth) to be about the dissatisfaction bred by the long-term shortcomings of or blowback from neoliberal policy.

    Barkley Rosser treats neoliberal policy as implicitly successful and, therefore, the reaction from the populist right appears mysterious, something to investigate. His thesis regarding neoliberal success in Poland is predicated on policy being less severe, less "shocky".

    In his left-right division of Polish politics, the centrist neoliberals -- in the 21st century, Civic Platform -- seem to disappear into the background even though I think they are still the second largest Party in Parliament, though some seem to think they will sink in elections this year.

    Electoral participation is another factor that receives little attention in this analysis. Politics is shaped in part by the people who do NOT show up. And, in Poland that has sometimes been a lot of people, indeed.

    Finally, there's the matter of the neoliberal straitjacket -- the flip-side of the shock in the one-two punch of "there's no alternative". What the policy options for a Party representing the interests of the angry and dissatisfied? If you make policy impossible for a party of the left, of course that breeds parties of the right. duh.

    Likbez,

    Bruce,

    Blowback from the neoliberal policy is coming. I would consider the current situation in the USA as the starting point of this "slow-motion collapse of the neoliberal garbage truck against the wall." Neoliberalism like Bolshevism in 1945 has no future, only the past. That does not mean that it will not limp forward in zombie (and pretty bloodthirsty ) stage for another 50 years. But it is doomed, notwithstanding recently staged revenge in countries like Ukraine, Argentina, and Brazil.

    Excessive financialization is the Achilles' heel of neoliberalism. It inevitably distorts everything, blows the asset bubble, which then pops. With each pop, the level of political support of neoliberalism shrinks. Hillary defeat would have been impossible without 2008 events.

    At least half of Americans now hate soft neoliberals of Democratic Party (Clinton wing of Bought by Wall Street technocrats), as well as hard neoliberal of Republican Party, which created the " crisis of confidence" toward governing neoliberal elite in countries like the USA, GB, and France. And that probably why the intelligence agencies became the prominent political players and staged the color revolution against Trump (aka Russiagate ) in the USA.

    The situation with the support of neoliberalism now is very different than in 1994 when Bill Clinton came to power. Of course, as Otto von Bismarck once quipped "God has a special providence for fools, drunkards, and the United States of America." and another turn of the technological spiral might well save the USA. But the danger of never-ending secular stagnation is substantial and growing. This fact was admitted even by such dyed- in-the-wool neoliberals as Summers.

    This illusion that advances in statistics gave neoliberal access to such fine-grained and timely economic data, that now it is possible to regulate economy indirectly, by strictly monetary means is pure religious hubris. Milton Friedman would now be laughed out the room if he tried to repeat his monetarist junk science now. Actually he himself discarded his monetarist illusions before he died.

    We probably need to the return of strong direct investments in the economy by the state and nationalization of some assets, if we want to survive and compete with China. Australian politicians are already openly discussing this, we still are lagging because of "walking dead" neoliberals in Congress like Pelosi, Schumer, and company.

    But we have another huge problem, which Australia and other countries (other than GB) do not have: neoliberalism in the USA is the state religion which completely displaced Christianity (and is hostile to Christianity), so it might be that the lemming will go off the cliff. I hope not.

    The only thing that still keeps neoliberalism from being thrown out to the garbage bin of history is that it is unclear what would the alternative. And that means that like in 1920th far-right nationalism and fascism have a fighting chance against decadent neoliberal oligarchy.

    Previously financial oligarchy was in many minds associated with Jewish bankers. Now people are more educated and probably can hang from the lampposts Anglo-Saxon and bankers of other nationalities as well ;-)

    I think that in some countries neoliberal oligarchs might soon feel very uncomfortable, much like Soros in Hungary.

    As far as I understood the level of animosity and suppressed anger toward financial oligarchy and their stooges including some professors in economics departments of the major universities might soon be approaching the level which existed in the Weimar Republic. And as Lenin noted, " the ideas could become a material force if they got mass support." This is true about anger as well.

    [Dec 27, 2018] Trump Considering Order To Ban Purchases Of Huawei, ZTE Equipment

    Dec 27, 2018 | www.zerohedge.com

    After the US government elicited outrage from the Chinese due to its attempts to convince its allies to bar the use of equipment made by telecoms supplier Huawei, President Trump is apparently weighing whether to take another dramatic antagonistic step that could further complicate trade negotiations less than two weeks before a US delegation is slated to head to Beijing.

    According to Reuters , the White House is reportedly considering an executive order that would ban US companies from using equipment made by Huawei and ZTE, claiming that both companies work "at the behest of the US government" and that their equipment could be used to spy on US citizens. The order would invoke the International Emergency Economic Powers Act to order the Department of Commerce to prohibit the purchase of equipment from telecoms manufacturers that could threaten national security. Though it wouldn't explicitly name Huawei or ZTE, the ban would arise from Commerce's interpretation. The IEEA allows the president the authority to regulate commerce in the face of a national emergency. Back in August, Congress passed and Trump signed a bill banning the use of ZTE and Huawei equipment by the US government and government contractors. The executive order has reportedly been under consideration for eight months, since around the time that the US nearly blocked US companies from selling parts to ZTE, which sparked a mini-diplomatic crisis, which ended with a deal allowing ZTE to survive, but pay a large fine.

    The feud between the US and Huawei has obviously been escalating in recent months as the US has embarked on an "extraordinary influence campaign" to convince its allies to ban equipment made by both companies, and the arrest of Huawei CFO Meng Wanzhou in Canada has also blossomed into a diplomatic crisis of sorts.

    But the real reason issuing a ban on both companies' equipment is seen as a priority is because Huawei's lead in the race to build 5G technology is making its products more appealing to global telecoms providers. Rural telecoms providers in the US - those with fewer than 100,000 subscribers - are particularly reliant on equipment made by both companies. They've expressed concerns that a ban would require them to rip out and scrap their equipment at an immense cost.

    Rural operators in the United States are among the biggest customers of Huawei and ZTE, and fear the executive order would also require them to rip out existing Chinese-made equipment without compensation. Industry officials are divided on whether the administration could legally compel operators to do that.

    While the big U.S. wireless companies have cut ties with Huawei in particular, small rural carriers have relied on Huawei and ZTE switches and other equipment because they tend to be less expensive.

    The company is so central to small carriers that William Levy, vice president for sales of Huawei Tech USA, is on the board of directors of the Rural Wireless Association.

    The RWA represents carriers with fewer than 100,000 subscribers. It estimates that 25 percent of its members had Huawei or ZTE equipment in their networks, it said in a filing to the Federal Communications Commission earlier this month.

    As Sputnik pointed out, the news of the possible ban followed questions from Defense Secretary Gavin Williamson, who expressed serious concerns over the involvement of Huawei in Britain's 5G network, suggesting that Beijing sometimes acted "in a malign way." But even if it loses access to the US market, Huawei's global expansion and its leadership in the 5G space are expected to continue to bolster profits and growth. Currently, Huawei sells equipment in 170 countries.

    According to a statement from the company's rotating chairman, the company's full-year sales are expected to increase 21% to $108.5 billion this year. The company has signed 26 contracts globally to supply 5G equipment for commercial use, leaving it well ahead of its US rivals.

    [Dec 26, 2018] Neoliberalism as Structure and Ideology

    The hypothesis is that due to emergence of mutual funds and other financial instruments the capitalist class became more homogeneous in its interests and more united with financial oligarchy.
    Notable quotes:
    "... In such a situation there were significant divisions within the capitalist class that attenuated its overall political clout. Industries divided according to policy preferences, and political parties, which were essentially interest group coalitions, attracted different segments of this class. (In the US the Republicans were just as much an interest group coalition as the Democrats, just different interests like small retail business, domestic mining, nonunion manufacturing, etc.) Public policy in this dispensation, whatever its ostensible justification, reflected sectoral influence. ..."
    "... Since the early 1970s capital ownership has become substantially more fungible in every respect. Equity funds of various sorts established themselves as institutional players, allowing individual capitalists to diversify via investment in these funds. Regulatory restrictions on capital movements were dismantled or bypassed. New information technology dramatically reduced (but not eliminated!) the fog of all financial markets. ..."
    "... The other side of the coin was political influence over ideas. Intellectuals who advanced the positions we now call neoliberal were rewarded with research funding, jobs and influence over government policy. ..."
    "... Lending conditionality reproduced in developing countries the same incentives that had shifted the intellectual environment in the core capitalist world. ..."
    "... This hypothesis -- and it's important to be clear that's what it is -- also gives us an explanation for why the 2008 crisis, while it did provoke a lot of reconsideration by intellectuals -- did not result in meaningful institutional or policy change: the underlying political economic factors were unaltered . And it implies that further intellectual work, necessary as it is, will not be enough to extricate us from the shackles of neoliberal political constraints. For that we need to contest the power that undergirds them. ..."
    "... The alliance (in the US, the focus of my comments) of the monied interests, providing the financial resources and seeking the repeal of the social and fiscal policies of the New Deal, and the heavily Southern-based evangelical/religious right, providing the voting bloc and seeking to turn back the progress of minorities and women in achieving more equal social and political rights -- created the powerful political base from which the revisionist onslaught was mounted. Reagan then provided the smiling face to sell the proposition that "government isn't the solution to your problems; government IS the problem" that effectively neutered the one institution capable of regulating the monied interests. ..."
    "... Neoliberalism is a dialectic between them more than it has been a fixed doctrine. The remarkable power and resistance to outside critique is attributable to the insular nature of that dialectic. ..."
    "... Where we are -- neoliberalism triumphant albeit spent ..."
    Dec 26, 2018 | econospeak.blogspot.com

    ... ... ...

    A standard narrative is that the Keynesian postwar order cracked up over the crisis of inflation during the mid-1970s. A conservative alternative that trusted markets more and government less was vindicated by events and established its intellectual dominance. After a lag of a few years, policy followed along. One can critique this on matters of detail: economic growth remained stronger during the 70s than it would be thereafter, anti-Keynesians did not have a superior understanding of economic developments, and no intellectual revolution was complete within the space of just a few years. But the deeper problem, it seems to me, is that this attributes vastly exaggerated agency to coteries of intellectuals. Do we really think that the elections of Reagan and Thatcher, for instance, were attributable to a shift in grad school syllabi in economics and related fields?

    I propose an alternative hypothesis. From the end of WWII to the collapse of the Bretton Woods monetary system, a large portion of capital was illiquid, its value tied to its existing use. The rich sought to diversify their portfolios, of course, but there were limits. Stock market transactions were beclouded by large information costs, and share ownership tended to be more stable and concentrated. Fortunes were rooted in specific firms and industries. In such a situation there were significant divisions within the capitalist class that attenuated its overall political clout. Industries divided according to policy preferences, and political parties, which were essentially interest group coalitions, attracted different segments of this class. (In the US the Republicans were just as much an interest group coalition as the Democrats, just different interests like small retail business, domestic mining, nonunion manufacturing, etc.) Public policy in this dispensation, whatever its ostensible justification, reflected sectoral influence.

    Since the early 1970s capital ownership has become substantially more fungible in every respect. Equity funds of various sorts established themselves as institutional players, allowing individual capitalists to diversify via investment in these funds. Regulatory restrictions on capital movements were dismantled or bypassed. New information technology dramatically reduced (but not eliminated!) the fog of all financial markets. And firms themselves became separable bundles of assets as new technology and business methods allowed for more integrated production across ownership lines. The combined result is a capitalist class with more uniform interests -- an interest in a higher profit share of income and greater freedom for capital in every respect.

    The crisis in real returns to capital during the 1970s, the true economic instigator, galvanized this reorganization of the political economy. (In the US the S&P peaked in 1972 and then lost almost half its inflation-adjusted value by the end of the decade. This is not an artifact of business cycle timing.)

    Of course, all understanding of the world is mediated by the way we think about it. The wealthy didn't say to themselves, "Gee, my assets are taking a hit, so the government needs to change course." They turned to dissident, conservative thinkers who explained the "failures" of the 70s as the result of too little concern for the engine of growth, which (of course) was understood to be private investment. Market-friendly policy would, it was said, reinvigorate investment and spur economic growth. Keynesianism was seen as having failed because it took investors for granted, taxing and regulating them and competing with them for finance; politicians needed to show respect. It's understandable why capitalists would interpret their problems in this way.

    The other side of the coin was political influence over ideas. Intellectuals who advanced the positions we now call neoliberal were rewarded with research funding, jobs and influence over government policy. When the World Bank and the IMF were remade in the wake of the 1982 debt crisis, this influence was extended internationally. Lending conditionality reproduced in developing countries the same incentives that had shifted the intellectual environment in the core capitalist world.

    This hypothesis -- and it's important to be clear that's what it is -- also gives us an explanation for why the 2008 crisis, while it did provoke a lot of reconsideration by intellectuals -- did not result in meaningful institutional or policy change: the underlying political economic factors were unaltered . And it implies that further intellectual work, necessary as it is, will not be enough to extricate us from the shackles of neoliberal political constraints. For that we need to contest the power that undergirds them.

    Cinclow20 said... December 18, 2018 at 5:30 PM

    ... ... ...

    The alliance (in the US, the focus of my comments) of the monied interests, providing the financial resources and seeking the repeal of the social and fiscal policies of the New Deal, and the heavily Southern-based evangelical/religious right, providing the voting bloc and seeking to turn back the progress of minorities and women in achieving more equal social and political rights -- created the powerful political base from which the revisionist onslaught was mounted. Reagan then provided the smiling face to sell the proposition that "government isn't the solution to your problems; government IS the problem" that effectively neutered the one institution capable of regulating the monied interests.

    2slugbaits said...December 18, 2018 at 7:10 PM

    An interesting discussion of the roots, differences and similarities between neoliberalism and ordoliberalism. And believe it or not, the many comments raise some interesting points. Only one real gaslighting comment.

    mainly macro Ordoliberalism, Neoliberalism and Economics

    Bruce Wilder said... December 24, 2018 at 2:01 PM
    ... ... ...

    One thing Barkley said should be repeated: neoliberalism has opposing poles quite a distance apart. Neoliberalism is a dialectic between them more than it has been a fixed doctrine. The remarkable power and resistance to outside critique is attributable to the insular nature of that dialectic. The neoliberal right has chosen its interlocutors, the centrist "left" very well, which is an important reason that the non-neoliberal real Left is emerging now from the sojurn in the politics of cultural critique where it went in the 1960's with no knowledge or interest in economics.

    It does not take a genius to see that human civilization and the natural ecology can only survive if people somehow manage to produce a rational architecture for political economy deliberately and on an unprecedented scale and level of sophistication. Where we are -- neoliberalism triumphant albeit spent and a Left at peak consciousness -- is exactly the wrong place to be in the political cycle.

    [Dec 25, 2018] If we are reaching neoliberal capitalism's end days, what comes next by John Menadue

    Right now neo-fascism is the most probably scenario of the social system after the decline of neoliberalism.
    Notable quotes:
    "... But, in Europe, there has always been a deep distrust of the Anglo-American celebration of "possessive individualism" and its repudiation of community and society. Remember Margaret Thatcher's contempt for the idea of "society"? So, it is unsurprising that neoliberalism's advocates dismiss recent European analyses of local, regional and global economies as the nostalgia of "old Europe", even as neoliberalism's failures stack up unrelentingly. ..."
    "... The consequences of these failures are largely unseen or avoided by policymakers in the US and their camp followers in the UK and Australia. They are in denial of the fact that not only has neoliberalism failed to meet its claimed goals, but it has worked devastatingly to undermine the very foundations of late-modern capitalism. The result is that the whole shambolic structure is tottering on the edge of an economic abyss. ..."
    "... If Streeck is correct, then we need to anticipate what a post-capitalist world may look like. He thinks it will be terrible. He fears the emergence of a neocorporatist state and close crony-like collaboration between big capital, union leaders, government and the military as the consequence of the next major global financial crisis ..."
    "... Jobs will disappear, Streeck believes. Capital will be intensely concentrated in very few hands. The privileged rich will retreat into security enclaves dripping with every luxury imaginable ..."
    "... Meanwhile, the masses will be cast adrift in a polluted and miserable world where life – as Hobbes put it – will be solitary, poor, nasty, brutish and short. ..."
    "... As Piketty and Streeck are pointing out to us, the post-neoliberal era has started to self-destruct. Either a post-capitalist, grimly neo-fascist world awaits us, or one shaped by a new and highly creative version of communitarian democracy. It's time for some great imagining. ..."
    Feb 05, 2017 | theconversation.com
    It is unfashionable, or just embarrassing, to suggest the taken-for-granted late-modern economic order – neoliberal capitalism – may be in a terminal decline. At least that's the case in what former Australian prime minister Tony Abbott likes to call the "Anglosphere" .

    What was once known as the Chicago school of economics – the neoclassical celebration of the "free market" and "small government" – still closes the minds of economic policymakers in the US and its satellite economies (although perhaps less so in contemporary Canada).

    But, in Europe, there has always been a deep distrust of the Anglo-American celebration of "possessive individualism" and its repudiation of community and society. Remember Margaret Thatcher's contempt for the idea of "society"? So, it is unsurprising that neoliberalism's advocates dismiss recent European analyses of local, regional and global economies as the nostalgia of "old Europe", even as neoliberalism's failures stack up unrelentingly.

    The consequences of these failures are largely unseen or avoided by policymakers in the US and their camp followers in the UK and Australia. They are in denial of the fact that not only has neoliberalism failed to meet its claimed goals, but it has worked devastatingly to undermine the very foundations of late-modern capitalism. The result is that the whole shambolic structure is tottering on the edge of an economic abyss.

    What the consequences might be

    Two outstanding European scholars who are well aware of the consequences of the neoliberal catastrophe are French economist Thomas Piketty and German economist Wolfgang Streeck.

    Piketty's 2013 book, Capital in the Twenty-First Century , charts the dangers of socioeconomic inequality in capitalism's history. He demonstrates how this inequality can be – and has been over time – fundamentally destructive of sustained economic growth.

    Most compellingly, Piketty documented in meticulous detail how contemporary neoliberal policies have constructed the worst forms of socioeconomic inequalities in history. His analysis has been underlined by the recent Oxfam report that showed a mere eight multi-billionaires own the equivalent amount of capital of half of the global population.

    Despite Piketty's scrupulous scholarship, Western neoliberal economies continue merrily down the road to nowhere. The foundations of that road were laid by the egregiously ideological policies of Thatcher and Ronald Reagan – and slavishly followed by Australian politicians on all sides ever since.

    Streeck's equally detailed scholarship has demonstrated how destructive of capitalism itself neoliberal policymaking has been. His latest book, How Will Capitalism End? , demonstrates how this neoliberal capitalism triumphed over its opponents (especially communism) by devouring its critics and opponents, obviating all possible alternatives to its predatory ways.

    If Streeck is correct, then we need to anticipate what a post-capitalist world may look like. He thinks it will be terrible. He fears the emergence of a neocorporatist state and close crony-like collaboration between big capital, union leaders, government and the military as the consequence of the next major global financial crisis .

    Jobs will disappear, Streeck believes. Capital will be intensely concentrated in very few hands. The privileged rich will retreat into security enclaves dripping with every luxury imaginable .

    Meanwhile, the masses will be cast adrift in a polluted and miserable world where life – as Hobbes put it – will be solitary, poor, nasty, brutish and short.

    What comes next is up to us

    The extraordinary thing is how little is known or understood of the work of thinkers like Piketty and Streeck in Australia today.

    There have been very fine local scholars, precursors of the Europeans, who have warned about the hollow promises of "economic rationalism" in Australia.

    But, like the Europeans, their wisdom has been sidelined, even as inequality has been deepening exponentially and its populist consequences have begun to poison our politics, tearing down the last shreds of our ramshackle democracy.

    The time is ripe for some creative imagining of a new post-neoliberal world that will repair neoliberalism's vast and catastrophic failures while laying the groundwork for an Australia that can play a leading role in the making of a cosmopolitan and co-operative world.

    Three immediate steps can be taken to start on this great journey.

    First, we need to see the revival of what American scholar Richard Falk called "globalisation from below" . This is the enlivening of international civil society to balance the power of the self-serving elites (multinational managers and their political and military puppets) now in power.

    Second, we need to come up with new forms of democratic governance that reject the fiction that the current politics of representative government constitute the highest form of democracy. There is nothing about representative government that is democratic. All it amounts to is what Vilfredo Pareto described as "the circulation of elites" who have become remote from – and haughtily contemptuous of – the people they rule.

    Third, we need to see states intervening comprehensively in the so-called "free market". Apart from re-regulating economic activity, this means positioning public enterprises in strategic parts of the economy, to compete with the private sector, not on their terms but exclusively in the interests of all citizens.

    As Piketty and Streeck are pointing out to us, the post-neoliberal era has started to self-destruct. Either a post-capitalist, grimly neo-fascist world awaits us, or one shaped by a new and highly creative version of communitarian democracy. It's time for some great imagining.


    This article is based on an earlier piece published in John Menadue's blog Pearls and Irritations.

    [Dec 24, 2018] Neoliberalism is being rejected around the world Can genuine progressives capitalize Salon.com

    Dec 24, 2018 | www.salon.com

    At the same time, however, it seems fair to point out that Trump and López Obrador both represent what the Times described as "a global repudiation of the establishment." Indeed, this fact could actually help to distinguish between the two leaders (along with other populist leaders) and their competing worldviews. While they stand on opposite sides of the political spectrum, both Trump and López Obrador are part of the global revolt against what critics call neoliberalism, and this is important for understanding our current era.

    The past 30-plus years has been defined by the political project of neoliberalism, spearheaded by the U.S. government and international financial institutions like the International Monetary Fund and the World Bank, with the utopian aim of creating a global capitalist economy perfectly guided by the invisible hand of the market (for neoliberals and free-market fundamentalists, the invisible hand is an almost divine concept, worshipped in economics departments around the country). The neoliberal era peaked in the 1990s, and in America it was Democratic President Bill Clinton who accomplished neoliberal "reforms" that right-wingers had long dreamed of, including financial deregulation, NAFTA and "ending welfare as we knew it" (he would probably have privatized Social Security too had it not been for Monica Lewinsky).

    Though the 1990s is often remembered as the beginning of our hyper-partisan age (demonstrated by the Clinton impeachment scandal), the irony is that Democrats and Republicans became closer than ever before on economic issues during this decade. The "Washington consensus" dominated this period, and it took a Democrat to pass a Republican trade deal and other conservative economic policies. (Not surprisingly, the Democratic Party's shift to the right simply resulted in the GOP shifting even further to the right.)

    Neoliberalism was a global project advanced by economic elites. Not surprisingly, then, the neoliberal policies of the past few decades have benefited those who pushed for them, creating enormous wealth for the richest individuals while leaving the world grossly unequal. According to Oxfam, 82 percent of the wealth created in 2017 went to the top one percent , while the poorest half got nothing. In America alone, inequality is at historic levels and more than 40 million people live in poverty; a UN report from last month notes that the U.S. "now has one of the lowest rates of intergenerational social mobility of any of the rich countries," and zip codes "are tragically reliable predictors of a child's future employment and income prospects."

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    In Europe, Latin America, Asia and the United States, the status quo is no longer acceptable to a populace that has been betrayed time and again throughout the neoliberal era. Leaders who represent this status quo are being thrown out of office left and right. Those who have challenged the "establishment" have been labeled "populists" by the press, of course, and thus are categorized more for what they stand against than what they stand for (this would be like identifying the Soviet Union and the U.S. for their anti-fascism, rather than their communism or capitalism).

    Some dispute the characterization of right-wing populists as anti-neoliberal, and correctly point out that most of the Trump administration's economic policies have actually been neoliberalism on steroids (e.g., the GOP tax bill, deregulation, etc.). Right-wing populism is purely about racism and xenophobia, these critics insist, and to make it about economics is to ignore these ugly realities. But as Thomas Frank pointed out in The Guardian back in 2016, "trade may be [Trump's] single biggest concern -- not white supremacy."

    "It seems to obsess him," wrote Frank, who watched several hours of Trump's speeches. "The destructive free-trade deals our leaders have made, the many companies that have moved their production facilities to other lands, the phone calls he will make to those companies' CEOs in order to threaten them with steep tariffs unless they move back to the US."

    Say what you will about Trump's tendency to lie and spew falsehoods, but on the issue of trade he has actually been pretty consistent since entering the White House, and free trade is one of the staples of the neoliberal project. On the left, free trade deals like NAFTA and TPP have also been major talking points, as we saw with Bernie Sanders' presidential campaign in 2016. There are other economic issues where some agreement exists, and right-wing populist parties in Europe are even more likely to be anti-neoliberal on economic issues. Marine Le Pen's National Front, for example, opposed austerity cuts and promised to increase welfare for the working class (at least for French citizens), while lowering the retirement age and increasing tariffs to benefit French companies (and, the claim goes, workers too).

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    Still, the left- and right-wing alternatives to neoliberalism are poles apart, and the differences between left-populists like López Obrador and Sanders and right-populists like Trump and Le Pen are hard to overstate. To appreciate just how different their worldviews are, it is worth considering how the left and right have historically understood themselves in relation to the Enlightenment and modernity.

    Throughout the modern era progressives and reactionaries have more or less rejected the status quo, with thinkers from both sides offering critiques of the modern world. The fundamental difference was that the left considered itself a part of the Enlightenment tradition, while the right was part of the "counter-Enlightenment" (this goes back to the French Revolution, when revolutionaries sat on the left side of the Estates General and royalists sat on the right).

    The left criticized modernity not because it rejected the modern world, but because it saw the Enlightenment project as incomplete. Karl Marx praised the bourgeoisie and called capitalism a "great civilizing influence," considering it to be a positive development in history. He also wrote the most influential critique of capitalism to date, and while he acknowledged that capitalism was progress over feudalism, he also believed that it must eventually be replaced with socialism to realize the goals of the Enlightenment. Put simply, Marx and other leftists believed in the idea of progress, long associated with the Enlightenment.

    On the right, criticisms of modernity came from a very different perspective. Reactionaries did not see the modern world as progress over the pre-modern world; rather, they saw it as a decline. Driven by nostalgia and resentment, reactionaries romanticized the past and believed that the ills of modernity could be cured by simply turning back the clock and restoring the status quo ante.

    In his classic book " Escape from Freedom ," the psychiatrist and social philosopher Erich Fromm attempted to make sense of the rise of fascism in the early 20th century, and in doing so offered a penetrating analysis of modernity. While the modern world had liberated men and women from social conventions of the past and various restrictions on the individual (i.e., "freedom from"), it had also severed what Fromm called "primary bonds," which gave security to the individual and provided meaning. Forced from their communities into urban and industrial environments, modern men and women were left alienated and rootless, feeling powerless and purposeless in the new world.

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    There were two ways that people could respond to this situation, Fromm argued; either they could reject freedom altogether and embrace counter-Enlightenment movements like fascism, or they could progress to a "positive freedom," where one can relate oneself "spontaneously to the world in love and work."

    "If the economic, social and political conditions on which the whole process of human individuation depends, do not offer a basis for the realization of individuality," wrote Fromm, "while at the same time people have lost those ties which gave them security, this lag makes freedom an unbearable burden." Freedom, he continued, "becomes identical with doubt, with a kind of life which lacks meaning and direction. Powerful tendencies arise to escape from this kind of freedom into submission or some kind of relationship to man and the world which promises relief from uncertainty, even if it deprives the individual of his freedom."

    The reactionary impulse would be to "escape from freedom" and restore the conventions and "primary bonds" of the past, while the progressive impulse would be to progress to a more complete and dynamic kind of freedom.

    The reader may be wondering where all of this fits in with the current revolt against neoliberalism. Put simply, the neoliberal age has left many people with the same kind of doubts and anxieties that Fromm discussed in his book almost 80 years ago. Numerous articles have been written in recent years about how the policies of neoliberalism have worsened stress and loneliness , exacerbated mental health problems , driven rising rates of suicide and the opioid crisis, and left people feeling desperate and hopeless in general. Globalization, deindustrialization, consumerism and "financialization"; all these economic trends are contributing to the breakdown of our democratic society, leading some to embrace authoritarian alternatives, as many did in Fromm's day.

    From this point of view, the global rise of populism that continued with López Obrador isn't much of a surprise. The popular rejection of neoliberalism around the world is undeniable at this point, but it is still unclear whether this rejection of the status quo will lead to reactionary or progressive change in the long run. López Obrador represents progressive change, as does Alexandria Ocasio-Cortez's surprise primary victory in New York's 14th congressional district. Trump and other far-right populists like Le Pen represent something very different.

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    It will ultimately come down to which side can offer the more appealing alternative, and the left should recognize that the more realistic and "pragmatic" approach isn't always the most politically persuasive. One of the most common criticisms of populists has been that they are selling a pipe dream, which to an extent is true -- especially for right-wing populists who base their entire worldview on falsehoods. If the left wants to stop reactionary populism, however, it will have to adopt an unapologetically populist approach of its own, and reject the dogma of neoliberalism once and for all.

    [Dec 19, 2018] Trump is neocons hostage and does not control the USA foreign policy. In this circumstances China needs to get tough on casino modul Adelson to get her message heard by Bolton and other neocons

    Dec 19, 2018 | www.unz.com

    In his recent article "Averting World Conflict with China" Ron Unz has come up with an intriguing suggestion for the Chinese government to turn the tables on the December 1 st arrest of Meng Wanzhou in Canada. Canada detained Mrs. Meng, CFO of the world's largest telecoms equipment manufacturer Huawei, at the request of the United States so she could be extradited to New York to face charges that she and her company had violated U.S. sanctions on Iran. The sanctions in question had been imposed unilaterally by Washington and it is widely believed that the Trump Administration is sending a signal that when the ban on purchasing oil from Iran comes into full effect in May there will be no excuses accepted from any country that is unwilling to comply with the U.S. government's demands. Washington will exercise universal jurisdiction over those who violate its sanctions, meaning that foreign officials and heads of corporations that continue to deal with Iran can be arrested when traveling internationally and will be extradited to be tried in American courts.

    There is, of course, a considerable downside to arresting a top executive of a leading foreign corporation from a country that is a major U.S. trading partner and which also, inter alia, holds a considerable portion of the U.S. national debt. Ron Unz has correctly noted the " extraordinary gravity of this international incident and its potential for altering the course of world history." One might add that Washington's demands that other nations adhere to its sanctions on third countries opens up a Pandora's box whereby no traveling executives will be considered safe from legal consequences when they do not adhere to policies being promoted by the United States. Unz cites Columbia's Jeffrey Sachs as describing it as "almost a U.S. declaration of war on China's business community." If seizing and extraditing businessmen becomes the new normal those countries most affected will inevitably retaliate in kind. China has already detained two traveling Canadians to pressure Ottawa to release Mrs. Meng. Beijing is also contemplating some immediate retaliatory steps against Washington to include American companies operating in China if she is extradited to the U.S.

    Ron Unz has suggested that Beijing might just want to execute a quid pro quo by pulling the licenses of Sheldon Adelson's casinos operating in Macau, China and shutting them down, thereby eliminating a major source of his revenue. Why go after an Israeli-American casino operator rather than taking steps directly against the U.S. government? The answer is simple. Pressuring Washington is complicated as there are many players involved and unlikely to produce any positive results while Adelson is the prime mover on much of the Trump foreign policy, though one hesitates to refer to it as a policy at all.

    Adelson is the world's leading diaspora Israel-firster and he has the ear of the president of the United States, who reportedly speaks and meets with him regularly. And Adelson uses his considerable financial resources to back up his words of wisdom. He is the fifteenth wealthiest man in America with a reported fortune of $33 billion. He is the number one contributor to the GOP having given $81 million in the last cycle. Admittedly that is chump change to him, but it is more than enough to buy the money hungry and easily corruptible Republicans.

    In a certain sense, Adelson has obtained control of the foreign policy of the political party that now controls both the White House and the Senate, and his mission in life is to advance Israeli interests. Among those interests is the continuous punishment of Iran, which does not threaten the United States in any way, through employment of increasingly savage sanctions and threats of violence, which brings us around to the arrest of Meng and the complicity of Adelson in that process. Adelson's wholly owned talking head National Security Adviser John Bolton reportedly had prior knowledge of the Canadian plans and may have actually been complicit in their formulation. Adelson has also been the major force behind moving the U.S. Embassy to Jerusalem, has also convinced the Administration to stop its criticism of the illegal Israeli settlements on Arab land and has been instrumental in cutting off all humanitarian aid to the Palestinians. He prefers tough love when dealing with the Iranians, advocating dropping a nuclear bomb on Iran as a warning to the Mullahs of what more might be coming if they don't comply with all the American and Israeli demands.

    [Dec 17, 2018] What economic philosophy will come after neoliberalism

    Dec 17, 2018 | thequestion.com

    Jana Bacevic 59 2 years ago PhD researcher at the University of Cambridge, Department of Sociology; sociology of knowledge, social theory, political economy of knowledge production.

    This is an extremely interesting and important question. In the past years, critics are increasingly proclaiming that neoliberalism has come to an end , or at least become too broad or too vague to be used as an explanatory term.

    Yet, neoliberalism has proven to be remarkably resilient. This, as Jamie Peck has argued, may be due to its propensity to 'fail forward', that is, perpetuate rather than correct or reverse the mechanisms that led to its failures in the first place – the economic/fiscal policies following the 2008 economic crisis are a good example. Or it may have to do with what Boltanski and Chiapello have dubbed 'the new spirit of capitalism', meaning its capacity to absorb political and societal challenges and subsume them under the dominant economic paradigm – as reflected, for instance, in the way neoliberalism has managed to coopt politics of identity.

    But the success of neoliberalism has arguably less to do with its performance as an economic philosophy (at least after 2008, that is patently not the case – even IMF has admitted that neoliberal policies may be exacerbating inequality), and more to do with what seems to be the consensus of political and economic elites over its application. Neoliberalism allows for the convergence of financial, governmental, military, industrial and technological networks of power in ways that not only make sustained resistance difficult, but also increasingly constrain possibilities for thinking about alternatives.

    This is not to say that heterodox economic ideas are lacking. Alternatives to mainstream (or neo-classical) economics range from Marxist and Keynesian approaches, to post-Keynesian, participatory, or 'sharing' economies, and the philosophy of degrowth. Yet, in the framework of existing system of political and economic relations, successfully implementing any of these would require a strong political initiative and at least some level of consensus beyond the level of any single nation-state.

    In this sense, the economic philosophy to succeed neoliberalism will be the one that manages to capture the 'hearts and minds' of those in power. While the Left needs to start developing sustainable economic alternatives, it seems that, in the short term, economic policies will be driven either by some sort of authoritarian populism, (as for instance in Trump's pre-election speeches), or a new version of neoliberalism (what Will Davies has called "punitive" neoliberalism). Hopefully, even from such a shrunk space, alternatives can emerge; however, if we are to draw lessons from the intellectual history of neoliberalism , they will require long-term political action to seriously challenge the prevailing economic order.

    5 Lucas Diaz-Molaro a year ago

    This isn very important question that i try to answer in my books. I think regulation and taxation are key, as well as moving toward a more local circular economy. You can download the books for free at

    endneoliberalism.org

    [Dec 16, 2018] A World of Multiple Detonators of Global Wars by James Petras

    So much for peace that neoliberal globalization should supposedly bring...
    Notable quotes:
    "... We face a world of multiple wars some leading to direct global conflagrations and others that begin as regional conflicts but quickly spread to big power confrontations. ..."
    "... In our times the US is the principal power in search of world domination through force and violence. Washington has targeted top level targets, namely China, Russia, Iran; secondary objectives Afghanistan, North and Central Africa, Caucuses and Latin America ..."
    "... China is the prime enemy of the US for several economic, political and military reasons: China is the second largest economy in the world; its technology has challenged US supremacy it has built global economic networks reaching across three continents. China has replaced the US in overseas markets, investments and infrastructures. ..."
    "... In response the US has resorted to a closed protectionist economy at home and an aggressive military led imperial economy abroad. ..."
    "... The first line of attack are Chinese exports to the US and its vassals. Secondly, is the expansion of overseas bases in Asia. Thirdly, is the promotion of separatist clients in Hong Kong, Tibet and among the Uighurs. Fourthly, is the use of sanctions to bludgeon EU and Asian allies into joining the economic war against China. China has responded by expanding its military security, expanding its economic networks and increasing economic tariffs on US exports ..."
    "... The US economic war has moved to a higher level by arresting and seizing a top executive of China's foremost technological company, Huawei. ..."
    "... Each of the three strategic targets of the US are central to its drive for global dominance; dominating China leads to controlling Asia; regime change in Russia facilitates the total submission of Europe; and the demise of Iran facilitates the takeover of its oil market and US influence of Islamic world. As the US escalates its aggression and provocations we face the threat of a global nuclear war or at best a world economic breakdown. ..."
    Dec 16, 2018 | www.unz.com

    We face a world of multiple wars some leading to direct global conflagrations and others that begin as regional conflicts but quickly spread to big power confrontations.

    We will proceed to identify 'great power' confrontations and then proceed to discuss the stages of 'proxy' wars with world war consequences.

    In our times the US is the principal power in search of world domination through force and violence. Washington has targeted top level targets, namely China, Russia, Iran; secondary objectives Afghanistan, North and Central Africa, Caucuses and Latin America.

    China is the prime enemy of the US for several economic, political and military reasons: China is the second largest economy in the world; its technology has challenged US supremacy it has built global economic networks reaching across three continents. China has replaced the US in overseas markets, investments and infrastructures. China has built an alternative socio-economic model which links state banks and planning to private sector priorities. On all these counts the US has fallen behind and its future prospects are declining.

    In response the US has resorted to a closed protectionist economy at home and an aggressive military led imperial economy abroad. President Trump has declared a tariff war on China; and multiple separatist and propaganda war; and aerial and maritime encirclement of China's mainland

    The first line of attack are Chinese exports to the US and its vassals. Secondly, is the expansion of overseas bases in Asia. Thirdly, is the promotion of separatist clients in Hong Kong, Tibet and among the Uighurs. Fourthly, is the use of sanctions to bludgeon EU and Asian allies into joining the economic war against China. China has responded by expanding its military security, expanding its economic networks and increasing economic tariffs on US exports.

    The US economic war has moved to a higher level by arresting and seizing a top executive of China's foremost technological company, Huawei.

    The White House has moved up the ladder of aggression from sanctions to extortion to kidnapping. Provocation, is one step up from military intimidation. The nuclear fuse has been lit.

    Russia faces similar threats to its domestic economy, its overseas allies, especially China and Iran as well as the US renunciation of intermediate nuclear missile agreement

    Iran faces oil sanctions, military encirclement and attacks on proxy allies including in Yemen, Syria and the Gulf region Washington relies on Saudi Arabia, Israel and paramilitary terrorist groups to apply military and economic pressure to undermine Iran's economy and to impose a 'regime change'.

    Each of the three strategic targets of the US are central to its drive for global dominance; dominating China leads to controlling Asia; regime change in Russia facilitates the total submission of Europe; and the demise of Iran facilitates the takeover of its oil market and US influence of Islamic world. As the US escalates its aggression and provocations we face the threat of a global nuclear war or at best a world economic breakdown.

    Wars by Proxy

    The US has targeted a second tier of enemies, in Latin America, Asia and Africa.

    In Latin America the US has waged economic warfare against Venezuela, Cuba and Nicaragua. More recently it has applied political and economic pressure on Bolivia. To expand its dominance Washington has relied on its vassal allies, including Brazil, Peru, Chile, Ecuador, Argentina and Paraguay as well as right-wing elites throughout the region

    As in numerous other cases of regime change Washington relies on corrupt judges to rule against President Morales, as well as US foundation funded NGO's; dissident indigenous leaders and retired military officials. The US relies on local political proxies to further US imperial goals is to give the appearance of a 'civil war' rather than gross US intervention.

    In fact, once the so-called 'dissidents' or 'rebels' establish a foot hole, they 'invite' US military advisers, secure military aid and serve as propaganda weapons against Russia, China or Iran – 'first tier' adversaries.

    In recent years US proxy conflicts have been a weapon of choice in the Kosovo separatist war against Serbia; the Ukraine coup of 2014 and war against Eastern Ukraine; the Kurd take over of Northern Iraq and Syria; the US backed separatist Uighurs attack in the Chinese province of Xinjiang.

    The US has established 32 military bases in Africa, to coordinate activities with local warlords and plutocrats. Their proxy wars are discarded as local conflict between 'legitimate' regimes and Islamic terrorists, tribality and tyrants.

    The objective of proxy wars are threefold. They serve as 'feeders' into larger territorial wars encircling China, Russia and Iran.

    Secondly, proxy wars are 'testing grounds' to measure the vulnerability and responsive capacity of the targeted strategic adversary, i.e. Russia, China and Iran.

    Thirdly, the proxy wars are 'low cost' and 'low risk' attacks on strategic enemies. The lead up to a major confrontation by stealth.

    Equally important 'proxy wars' serve as propaganda tools, associating strategic adversaries as 'expansionist authoritarian' enemies of 'western values'.

    Conclusion

    US empire builders engage in multiple types of aggression directed at imposing a unipolar world. At the center are trade wars against China; regional military conflicts with Russia and economic sanctions against Iran.

    These large scale, long-term strategic weapons are complemented by proxy wars, involving regional vassal states which are designed to erode the economic bases of counting allies of anti-imperialist powers.

    Hence, the US attacks China directly via tariff wars and tries to sabotage its global "Belt and Road' infrastructure projects linking China with 82 counties.

    Likewise, the US attacks Russian allies in Syria via proxy wars, as it did with Iraq, Libya and the Ukraine.

    Isolating strategic anti-imperial power via regional wars, sets the stage for the 'final assault' – regime change by cop or nuclear war.

    However, the US quest for world domination has so far taken steps which have failed to isolate or weaken its strategic adversaries.

    China moves forward with its global infrastructure programs: the trade war has had little impact in isolating it from its principal markets. Moreover, the US policy has increased China's role as a leading advocate of 'open trade' against President Trump's protectionism.

    ORDER IT NOW

    Likewise, the tactics of encircling and sanctioning Russia has deepened ties between Moscow and Beijing. The US has increased its nominal 'proxies' in Latin America and Africa but they all depend on trade and investments from China. This is especially true of agro-mineral exports to China.

    Notwithstanding the limits of US power and its failure to topple regimes, Washington has taken moves to compensate for its failures by escalating the threats of a global war. It kidnaps Chinese economic leaders; it moves war ships off China's coast; it allies with neo-fascist elites in the Ukraine. It threatens to bomb Iran. In other words the US political leaders have embarked on adventurous policies always on the verge of igniting one, too, many nuclear fuses.

    It is easy to imagine how a failed trade war can lead to a nuclear war; a regional conflict can entail a greater war.

    Can we prevent World War 3? I believe it will happen. The US economy is built on fragile foundations; its elites are deeply divided. Its main allies in France and the UK are in deep crises. The war mongers and war makers lack popular support. There are reasons to hope!


    Per/Norway , says: December 12, 2018 at 10:29 pm GMT

    I disagree. The parasitic terror regime that runs washington believe they can win a nuclear war, i have no hope left for peace. They need a culling of the "useless eaters", we are stealing the food out of their poor frightened children`s mouths by existing.
    Eric Zuesse wrote a decent article yesterday at the Saker blog about the US nuclear forces and its owners wet dream.
    "The U.S. Government's Plan Is to Conquer Russia by a Surprise Invasion"
    The actions of nato/EU/UK/ISR/KSA etc certainly supports his article, at least in my opinion.
    Anon [228] Disclaimer , says: December 12, 2018 at 11:28 pm GMT
    Useful and clear article.

    The US, and the West, by instigating wars elsewhere, and selling weapons to those, destroy countries and prosperity abroad. Those living in target countries find themselves miserable, with loss of everything. It is only natural that they may try to escape a living hell by emigrating to the West.

    People in the US and the West in general will not want mass immigration, and with good reason; but if you were in a war torn country or an impoverished country (as a result of western "help") you would also attempt to move away from the bombs, etc.

    If the West left the rest of the world alone (in terms of their regimes and in terms of their weapons), they might prosper and no longer need to run away from their home countries.

    Can we build a better world, please?!

    Godfree Roberts , says: December 12, 2018 at 11:32 pm GMT
    The sanctions and embargoes have failed in the past, when China was much weaker, so we can be quite confident that they will fail again, and quickly, as this timeline suggests:

    September 3, 2018 : Huawei unveils Kirin 980 CPU, the world's first commercial 7nm system-on-chip (SoC) and the first to use Cortex-A76 cores, dual neural processing units, Mali G76 GPU, a 1.4 Gbps LTE modem and supports faster RAM. With 20 percent faster performance and 40 percent less power consumption compared to 10nm systems, it has twice the performance of Qualcomm's Snapdragon 845 and Apple's A11 while delivering noticeable battery life improvement. Its Huawei-patented modem has the world's fastest Wi-Fi and its GPS receiver taps L5 frequency to deliver 10cm. positioning.

    September 5, 2018 . China's front-end fab capacity will account for 16 percent of the world's semiconductor capacity this year, increasing to 20 percent by 2020.

    September 15, 2018. China controls one third of 5G patents and has twice as many installations operating as the rest of the world combined.

    September 21, 2018 . China has reached global technological parity and now has twelve of the world's top fifty IC design houses (China's SMIC is fourth, Huawei's HiSilicon is seventh), and twenty-one percent of global IC design revenues. Roger Luo, TSMC.

    October 2, 2018 . Chinese research makes up 18.6 percent of global STEM peer-reviewed papers, ahead of the US at 18 percent. "The fact that China's article output is now the largest is very significant. It's been predicted for a while, but there was a view this was not likely to happen until 2025," said Michael Mabe, head of STM.

    October 14, 2018 . Huawei announces 7 nm Ascend 910 chipset for data centers, twice as powerful as Nvidia's v100 and the first AI IP chip series to natively provide optimal TeraOPS per watt in all scenarios. Available 2Q19.

    October 7, 2018 : China becomes largest recipient of FDI in H1, attracting an estimated 70 billion U.S. dollars, according to UNCTAD.

    October 8, 2018: Taiwan's Foxconn moves its major semiconductor maker and five integrated circuit design companies to Jinan, China.

    October 22, 2018 . China becomes world leader in venture capital, ahead of the US and almost twice the rest of the world's $53.4 billion YTD. The Crunchbase report says the entrepreneurial ecosystem in the world is undergoing a major transformation: it is now driven by China instead of the US.

    peterAUS , says: December 13, 2018 at 1:02 am GMT
    Apart from that "nuclear war" from:

    Isolating strategic anti-imperial power via regional wars, sets the stage for the 'final assault' – regime change by cop or nuclear war

    good article.
    Only idiot can believe that nuclear war can be won, IMHO. Elites aren't suicidal, oh no. On the contrary.

    Can they make a mistake and cause that war, definitely.

    Which brings us to the important part:

    Can we prevent World War 3? I believe it will happen. The US economy is built on fragile foundations; its elites are deeply divided. Its main allies in France and the UK are in deep crises. The war mongers and war makers lack popular support.

    Agree, but, that's exactly the reason I disagree with:

    There are reasons to hope!

    No need to be pedantic, of course there is always a reason for hope.
    But, I see it as so fertile ground for making The MISTAKE .

    Giuseppe , says: December 13, 2018 at 1:22 pm GMT

    Can we prevent World War 3? I believe it will happen. The US economy is built on fragile foundations; its elites are deeply divided. Its main allies in France and the UK are in deep crises. The war mongers and war makers lack popular support. There are reasons to hope!

    It's when the elite war mongers' backs are up against the wall that they come up with a cleverly designed false flag attack to rally public support for war. They are more dangerous now than ever.

    Splitpin , says: December 15, 2018 at 5:43 am GMT
    Agree about Russia and China, however Iran needs to be viewed not as a play for oil or the Islamic crowd but driven wholly and solely by Israel. Iran is not a threat to US in any context, only Israel.
    Wally , says: December 15, 2018 at 7:05 am GMT
    question:
    If the relatively small tariffs on Chinese goods amount to 'direct attacks on China', then what are the massive tariffs by China on US goods?
    Biff , says: December 15, 2018 at 8:57 am GMT
    The "Chess men" behind "The Wall Street Economy" have stated a few times that the only way to remain the dominant economy is to first: convince rivals that resistance is futile, and second: to atomize any potential rival (Ghaddaffi is a clear example).

    Breaking up Russia has been on the to-do list for decades, and I believe that the Chess Men have no idea what to do about containing China, and are clearly flat-footed, and desperate kidnapping a Chinese business executive.

    The Wall Street Economy depended on cheap Chinese labor it's own profits, and that was Ok until .?
    Until the writing on the Wall became ledgible .
    The smell of genuine fear is in the air.

    jilles dykstra , says: December 15, 2018 at 9:18 am GMT
    " The war mongers and war makers lack popular support. There are reasons to hope! "

    Is popular support needed to get a people in a war mood ?
    Both Pearl Harbour and Sept 11 demonstrate, in my opinion, that it is not very difficult to create a war mood.
    Yet, if another Sept 11 would do the trick, I wonder.
    Sept 11 has been debated without without interruption since Sept 11.
    After the 1946 USA Senate investigation into Pearl Harbour the USA government succeeded in preventing a similar discussion.
    Until now the west, Deep State, NATO, EU did not succeed in provoking Russia or China.
    Each time they tried something, in my opinion they did this several times, Russia showed its military superiority, at the same time taking care not to hurt public opinion in the west.

    annamaria , says: December 15, 2018 at 11:39 am GMT
    Is not it amazing that the morally miserable US, a "power in search of world domination through force and violence," is officially governed by self-avowed pious X-tians. What kind of corruption among the high-level clergy protects the satanists Pompeo, Bush, Rice, Clinton, Obama, Blair and such from excommunication?

    Russians explaining the perdition of the US deciders: https://www.rt.com/news/446533-sergey-shoigu-syria-inf/

    "Washington does little to nothing to restore peace and help the devastated region to recover from the long war, while its [US] airstrikes continue to rack up civilian deaths At the same time, the US military presence at the Al-Tanf airbase and the "armed gangs" around it prevent refugees from returning home."

    – Nothing new. The multi-denominational Syria has been pounded by the US-supported "moderate" terrorists (armed with US-provided arms and with UK-provided chemical weaponry) to satisfy the desires of Israel-firsters, arm-dealers and the multitude of war-profiteers that have been fattening their pockets at the US/UK taxpayers' expense.

    http://www.voltairenet.org/article204373.html

    "Timber Sycamore" [initiated by Obama] is the most important arms trafficking operation in History. It involves at least 17 governments. The transfer of weapons, meant for jihadist organizations, is carried out by Silk Way Airlines, a Azerbaïdjan public company of cargo planes."

    -- Biochemical warfare by the UK & US

    https://www.rt.com/news/424047-russian-mod-syria-statement/

    https://www.zerohedge.com/news/2018-09-23/us-history-chemical-weapons-use-complicity-war-crimes

    https://nationalinterest.org/feature/the-five-most-deadly-chemical-weapons-war-10897

    https://www.presstv.com/Detail/2018/10/04/576081/Russia-Kirillov-US-Georgia-Richard-Lugar-chemical-weapons-lab

    https://www.veteranstoday.com/2018/09/21/bombshell-secret-american-laboratory-performs-deadly-human-experiments-in-caucasus-georgia/

    WHAT , says: December 15, 2018 at 12:48 pm GMT
    @Godfree Roberts Huawei can announce whatever, there are much more experienced adversaries(IBM, intel and ARM) who can`t beat nV in computation, and especially in integration of silicon. Guess who`s running inference and computer vision in all these car autopilots.
    Anon [424] Disclaimer , says: December 15, 2018 at 1:13 pm GMT
    I do not think there will be an atomic war .

    I think we could have an economic collapse like the Soviet Union had , or like Argentina had in 2001 with the " corralito " https://en.wikipedia.org/wiki/Corralito .

    Being the complex and global society that we are , it would be a disaster , it would produce hunger , misery and all types of local wars .

    VirtualAnon34 , says: December 15, 2018 at 1:22 pm GMT
    "Notwithstanding the limits of US power and its failure to topple regimes "

    Have to agree with that statement. Seriously, wherein is this vaunted "superpower" that our American politicians always yap about? All I've seen in my lifetime is our military getting its butt kicked in Cuba, Vietnam, Somalia, Iraq, Afghanistan. What, besides insanity and hubris, makes them think they could win anything much less a war against Iran, China or Russia?

    Moi , says: December 15, 2018 at 2:02 pm GMT
    @Splitpin It's the other way around–Israel is a threat to Iran.
    Ilyana_Rozumova , says: December 15, 2018 at 2:22 pm GMT
    @WHAT What worth what? It did not help too much to GM. GM is shutting five of its plants.
    SteveK9 , says: December 15, 2018 at 2:37 pm GMT
    Mostly accurate, but 'closed protectionist society' ! Hardly. It's still very difficult to buy any manufactured goods made in this country. Of course this is part of the World economic circle countries use the US Dollar for all trade. They need dollars. We can print them and receive real goods in return. This has been going around and around for decades. It may come to an end in the not-too-distant future, but it has a lot of inertia.
    Bill Jones , says: December 15, 2018 at 2:47 pm GMT
    @jilles dykstra "Naturally the common people don't want war: Neither in Russia, nor in England, nor for that matter in Germany. That is understood. But, after all, IT IS THE LEADERS of the country who determine the policy and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is TELL THEM THEY ARE BEING ATTACKED, and denounce the peacemakers for lack of patriotism and exposing the country to danger. IT WORKS THE SAME IN ANY COUNTRY."

    –Goering at the Nuremberg Trials

    A mere piker compared to the American, Bernays

    http://www.historyisaweapon.com/defcon1/bernprop.html

    DESERT FOX , says: December 15, 2018 at 2:54 pm GMT
    The only threat to patriotic Americans is Zionism which has ruled the U.S. since it took control over the money supply and the taxes via the privately owned Zionist FED and IRS and has given America nothing to wars and economic destruction since the FED and IRS were put in place by the Zionist banking kabal in 1913 and both are UNCONSTITUTIONAL!

    The threat is not from China or Russia or Iran etc., the threat is from within the U.S. government which is controlled in every facet by the Zionists and dual citizens and is as foreign to the American people as if it were from MARS!

    Until the American people wake up to the fact that we are slaves on a Zionist plantation and are used as pawns in the Zionist goal of a satanic Zionist NWO and abolish the FED and IRS and break the chains of slavery that the FED and IRS have place upon us, until then nothing will change and the wars and economic destruction by the Zionist kabal will continue!

    Read The Controversy of Zion by Douglas Reed and The Committee of 300 by Dr. John Coleman and The Protocols of Zion, to see the Zionist satanic NWO plan.

    wraith67 , says: December 15, 2018 at 2:57 pm GMT
    Lost me at Kurd takeover of northern Iraq/Syria. The Kurds have defacto owned those areas since 1991, and earlier. Saddam gassing the Kurds didn't accomplish anything except for making himself a target, no Arab lived in those areas, the Kurds would kill them.
    Agent76 , says: December 15, 2018 at 3:22 pm GMT
    Nov 28, 2018 Belt & Road Billionaire in Massive Bribery Scandal

    The bribery trial of Dr. Patrick Ho, a pitchman for a Chinese energy company, lifts the lid on how the Chinese regime relies on graft to cut Belt and Road deals in its global push for economic and geopolitical dominance.

    Miro23 , says: December 15, 2018 at 3:26 pm GMT
    I agree with Bob Sykes' commentary over on Instapundit:

    Well, our "anti-ISIS" model in eastern Syria consists of defending ISIS against attacks by the Syrian government, allowing them to pump and export Syrian oil for their profit, arming them and allowing them to recruit new fighters. I suppose that means we should be arming the Taliban.

    ISIS was created by the CIA to fight against Assad. But they slipped the leash and became the fighting force for the dissident Sunni Arabs all along the Euphrates Valley. We only began to oppose them when their rebellion reached the outskirts of Baghdad, and even then the bulk of the fighting was done by Iraq's Shias and Iran. Now we are transferring them, or many of them, into secure (for ISIS) areas of Iraq.

    The three U.S. presidents, six secretaries of defense and five chairmen of the Joint Chiefs of Staff are, in fact, war criminals, in exactly the same sense that Hitler, Goebels, Goering, Himmler et al. were war criminals. Those presidents, secretaries and generals launched wars of aggression against Sudan, Somalia, Afghanistan, Iraq, Syria, Ukraine, Libya, Yemen not one of which threatened us in any way. They engineered coups d'état against two friendly governments, Egypt and Turkey. Now the fake American, anti-American neocons want to attack Iran, Venezuela, North Korea and even Russia and China.

    Green needs to get his head out of his arse. We, the US, are the great rogue terrorist state. We are the evil empire. We are the chief source of death and destruction in the world. How many hundreds of thousands of civilians have we murdered in the Middle East, Africa and Central Asia? How many cities have we bombed flat like Raqqa and Mosel. Putin is a saint compared to any US President.

    Winston2 , says: December 15, 2018 at 4:08 pm GMT
    Iran has always been at the center of the Great Game, the key square on the board to block
    Eurasia.You must either control Afghanistan AND Pakistan or Iran.
    With Pakistan now in the SCO, Iran is a US imperative.
    Israels antipathy is secondary and a useful foil, not the primary motive.
    Read MacKinder, the imperial power has changed, not the strategy.
    Durruti , says: December 15, 2018 at 4:29 pm GMT
    Open Letter to James Petras.

    Your article has a glaring emptiness.

    How is it possible for anyone to write an article titled:

    A World of Multiple Detonators of Global Wars

    without mentioning the Principal Detonator of Global Wars?? The Elephant!

    The United States of America is no longer a Sovereign Nation.

    The Local Political Power Elite (C. Wright Mills term), serve, are Minions, of the Zionist Jewish Financial Terrorist Initiators and Controllers of the Global New World Order.

    I would express this point in stronger terms, but I have not yet finished my coffee. The "Mulitiple Detonators" Petras discusses are useless unless Triggered by the Global Controllers.

    A Slight Digression: maybe:

    Petras may have written his exposé this way, understanding that he might safely avoid mention of the anti-Semitic (they hate Palestinians and other Arabs – actual Semites), Zionist Land Thieves, because a clueless Anarchist would appear and complete his article for him. If that is the case, I want half of the $ Unz is paying Petras for this article.

    In Conclusion: and by the number###:

    1. The American Power Elite and servile Politicians in America's Knesset in Washington DC, do not go to the Bathroom, without permission from their Zionist Oligarch masters.

    2. The American Gauleters, Quislings, (better known as Traitors), serve the Rothschild and other Foreign Oligarchs. Recently, only 1, of 100 'Senators' demanded that there be a discussion of the Bill to send another $35 Billion gift to the Zionist occupiers of Palestine. Poor Senator Rand Paul . How many ribs of his remain to be broken?

    We the American people, have one Senator. And he has a great father.

    3. Textbooks, Entertainment from Hollywood (key to all mind control), even Dictionaries, have been ruthlessly censored.

    4. Our elected Zionist slaves in Congress, and all State and local governing bodies, live in fear of saying (accidentally), some truth, and ending up working at Walmart or 7-11, (if they are lucky).

    5. Our young are effectively brainwashed in their schools; they have already been removed from their parents.

    6. Our politicians are bribed with our own tax money (re-routed by the Zionists AIPAC, etc.).

    7. The Zionist Entity has huge Financial Resources . They should be giving us 'Financial $$ Aid, not the other way around. Since NAFTA, we have entire cities & tons of infrastructure to rebuild.

    Excuse me : Girlfriend thinks I should go to work.

    Petras, I just fleshed out your, otherwise, promising article. You must understand – that the ethnic cleansing – genocide, against the Palestinian Nation, by the Terrorist Zionist Oligarchs, is the greatest single crime being committed on our Planet. All other crimes stem from this one.

    We Americans must Restore Our Republic!

    John F. Kennedy, Robert Kennedy, M L King, Malcolm X. John Lennon; we are late, but we are coming.

    God Bless!

    Durruti

    Durruti , says: December 15, 2018 at 5:09 pm GMT
    @DESERT FOX Agree with all.

    Worth repeating:

    The threat is not from China or Russia or Iran etc., the threat is from within the U.S. government which is controlled in every facet by the Zionists and dual citizens and is as foreign to the American people as if it were from MARS!

    One comment:

    Until the American people wake up to the fact that we are slaves on a Zionist plantation and are used as pawns in the Zionist goal of a satanic Zionist NWO and abolish the FED and IRS and break the chains of slavery that the FED and IRS have place upon us, until then nothing will change and the wars and economic destruction by the Zionist kabal will continue!

    In order to accomplish the above , we American Citizen Patriots – must Restore Our Republic – that, with our Last Constitutional President, John F. Kennedy, was destroyed by the Zionist Oligarchs and their American underling traitors, in a hail of bullets, on November 22, 1963.

    jilles dykstra , says: December 15, 2018 at 5:09 pm GMT
    @Miro23 " same sense that Hitler, Goebels, Goering, Himmler et al. were war criminals. "
    Why were they war criminals ?
    Because of the Neurenberg farce ?; farce according to the chairman of the USA Supreme Court in 1945:
    Bruce Allen Murphy, 'The Brandeis/Frankfurter Connection, The Secret Political Activities of Two Supreme Court Justices', New York, 1983
    Churchill and Lindemann in fact murdered some two million German civilians, women, children, old men. Not a crime ?
    Churchill refused the May 1941 Rudolf Hess peace proposal, not a crime ?
    FDR deliberately provoked Pearl Harbour, some 2700 casualties, his pretcxt for war, not a crime ?
    900.000 German hunger deaths between the 1918 cease fire and Versailles, the British food blockade, not a crime ?
    Will these wild accusations ever stop ?
    Reuben Kaspate , says: December 15, 2018 at 5:17 pm GMT
    I am all for the mother of all wars; however, it isn't going to come anytime soon, nay, not in our lifetime but when it does appear on the next century's horizon, it would be cathartic to all concerned. Rejoice!
    Charles Carroll , says: December 15, 2018 at 5:42 pm GMT
    @DESERT FOX If you want to know who rules over you, ask yourself who you are not permitted to criticize.
    Bill Jones , says: December 15, 2018 at 7:49 pm GMT
    @jilles dykstra ""Will these wild accusations ever stop ?"

    Nah, Don't you know that being a Holohoax victim is now genetically transmitted.

    "visiting the iniquity of the fathers upon the children unto the third and fourth generation of them that hate me;"

    And after the forth generation, there'll be something else.

    Ilyana_Rozumova , says: December 15, 2018 at 8:17 pm GMT
    @jilles dykstra They were war criminals because they lost the war. But hanging of Bock was a little bit overboard.
    Ilyana_Rozumova , says: December 15, 2018 at 9:10 pm GMT
    Europe is realigning. England leaving Euro. French population is in upheaval. Eventually France will leave the Euro also.Most of German tourists now are going to Croatia. Italy is loosing tourists.
    Italy living standard is declining. Germany is being pushed inevitably toward cooperation with Russia. Only supporter of Ukraine will remain USA. Ukraine will be only burden.
    Brussels power will evaporate. NATO will remain only on paper and will cease to be reality.
    .
    This will be great step toward peace in the world.
    Anon [118] Disclaimer , says: Website December 15, 2018 at 9:24 pm GMT
    Unexpected turn of events.

    http://theduran.com/the-real-reason-western-media-cia-turned-against-saudi-mbs/

    Ilyana_Rozumova , says: December 15, 2018 at 10:58 pm GMT
    @Anon Outstanding analysis,

    US is treating its allies as used toilet paper.
    Obviously Kashogi was sentenced to death for high treason in absence. The sentence was carried out on Saudi Arabia's territory. So in reality it is nobody's business.
    All hula-buu did happen because he was a reporter working for warmongering Zionist New york times.

    Socratic Truth , says: December 16, 2018 at 12:58 am GMT
    @Durruti I agree with you partly, especially when it comes to the US regarding Zionism and the power of the Israel lobby to influence US foreign policy and even domestic policy.
    But when it comes to Global governance, you have a somewhat narrow minded approach.
    Most of the ills today that happen in the world, is driven by the NEW WORLD ORDER OF NEOLIBERAL GLOBALIZATION.
    Unrelated phenomena, such as the destruction in the Middle East (Iraq, Afghanistan, Libya, and Syria), the destruction of Yugoslavia, the coup in Ukraine and the Greek economic catastrophe are a consequence of this NWO expansion. NWO expansion is the phasing out of national sovereignty (through economic and/or military violence) and its replacement by a kind of transnational sovereignty administered by a Transnational Elite. This is the network of the elites mainly based in the G7 countries, which control the world economic and political/ military institutions (WTO, IMF, World Bank, EU, European Central Bank, NATO, UN and so on), as well as the global media that set the agenda of the 'world community'.
    The US is an important part of this since it provides the Military Means to integrate countries that do not "comply" with the NWO dictates.
    The Zionists carry a lot of blame and are part of that drive for this NWO, but there are others, most of them in the US and Europe.

    Here's a good link to an article if you have time, with good info about NWO & Trasnational corporations that are mainly to blame about all the worlds and misery in our world today.

    THE MYTHS OF THE NEW WORLD ORDER

    http://www.pravdareport.com/opinion/columnists/15-12-2014/129299-new_world_order_myths-0/

    anon_4 , says: December 16, 2018 at 1:18 am GMT
    @WHAT back door Intel , embedded ARM Open source Red Hat-IBM Hummm?.

    I am not so sure, Mr. What. Experience may not mean much to abused IAI consumers. even if IAI catches up to the exponential fundamentals achieved by Huawei consumers might prefer back-door-free equipment and Operating Systems.

    Russian times reported a few weeks ago that Russia has a quite different new processor and an OS that does not use any IAI stuff and is developing a backup Internet for Russians which it expects to expand regionally,

    annamaria , says: December 16, 2018 at 1:28 am GMT
    Here is lengthy repost from ZeroHedge (the comment section): https://www.zerohedge.com/news/2018-12-14/leaked-memo-touts-uk-funded-firms-ability-create-untraceable-news-sites-infowar

    "What we have then, are criminal syndicates masquerading as philanthropic enterprises

    Norman Dodd, director of research for the (U.S.) REECE COMMITTEE in its attempt to investigate tax exempt foundations, stated:

    "The Foundation world is a coordinated, well-directed system, the purpose of which is to ensure that the wealth of our country shall be used to divorce it from the ideas which brought it into being."

    The Rothschilds rule the U.S. through the foundations, the Council on foreign Relations, and the Federal Reserve System, with no serious challenges to their power. Expensive 'political campaigns' are routinely conducted, with carefully screened candidates who are pledged to the program of the WORLD ORDER. Should they deviate from the program, they would have an 'accident', be framed on a sex charge, or indicted on some financial irregularity.

    Senator Moynihan stated in his book, "Loyalties", "A British friend, wise in the ways of the world, put it thus: "They are now on page 16 of the Plan." Moynihan prudently did not ask what page 17 would bring.

    "Tavistock's pioneer work in behavioural science along Freudian lines of 'controlling' humans established it as the world center of FOUNDATION ideology.

    [MORE]
    Its network extends from the University of Sussex to the U.S. through the Standford Research Institute, Esalen, MIT, Hudson Institute, HERITAGE FOUNDATION, Centre of Strategic and International Studies at Georgetown, where State Dept personnel are trained, US Air Force Intelligence, and the Rand and Mitre corporations.

    (at the time of writing, 1992) Today the Tavistock Institute operates a $6 billion a year network of foundations in the U.S., all of it funded by U.S. taxpayers' money. Ten major institutions are under its direct control, with 400 subsidiaries, and 3000 other study groups and think tanks which originate many types of programs to increase the control of the WORLD ORDER over the American people.

    The personnel of the FOUNDATIONS are required to undergo indoctrination at one or more of these Tavistock controlled institutions.

    A network of secret groups – the MONT PELERIN SOCIETY, TRILATERAL COMMISSION, DITCHLEY FOUNDATION, and CLUB OF ROME is the conduit for instructions to the Tavistock network.

    Tavistock Institute developed the mass brain-washing techniques which were first used experimentally on AMERICAN prisoners of war in KOREA.

    Its experiments in crowd control methods have been widely used on the American public, a surreptitious but nevertheless outrageous assault on human freedom by modifying individual behaviour through topical psychology.

    A German refugee, Kurt Lewin, became director of Tavistock in 1932. He came to the U.S. in 1933 as a 'refugee', the first of many infiltrators, and set up the Harvard Psychology Clinic, which originated the propaganda campaign to turn the American public against Germany and involve the U.S. in WWII.

    In 1938, Roosevelt executed a secret agreement with Churchill which in effect ceded U.S. sovereignty to England, because it agreed to let Special Operations Executive control U.S. policies. To implement this agreement, Roosevelt sent General Donovan to London for indoctrination before setting up the OSS (now the CIA) under the aegis of SOE-SIS. The entire OSS program, as well as the CIA has always worked on guidelines set up by the Tavistock Institute.

    Tavistock Institute originated the mass civilian bombing raids [against the German people] carried out by [the ALL LIES] Roosevelt and Churchill as a clinical experiment in mass terror, keeping records of the results as they watched the "guinea pigs" reacting under "controlled laboratory conditions".

    All Tavistock and American foundation techniques have a single goal – to break down the psychological strength of the individual and render him helpless to oppose the dictators of the WORLD ORDER.

    Any technique which helps to break down the family unit, and family inculcated principles of religion, honor, patriotism and sexual behaviour, is used by the Tavistock scientists as weapons of crowd control.

    The methods of Freudian psychotherapy induce permanent mental illness in those who undergo this treatment by destabilizing their character. The victim is then advised to 'establish new rituals of personal interactions', that is, to indulge in brief sexual encounters which actually set the participants adrift with no stable personal relationships in their lives – destroying their ability to establish or maintain a family.

    Tavistock Institute has developed such power in the U.S. that no one achieves prominence in any field unless he has been trained in behavioural science at Tavistock or one of its subsidiaries. Tavistock maintains 2 schools at Frankfort, birthplace of the Rothschilds, the FRANKFURT SCHOOL, and the Sigmund Freud Institute.

    The 'experiment' in compulsory racial integration in the U.S. was organized by Ronald Lippert of the OSS (forerunner of CIA) and the American Jewish Congress, and director of child training at the Commission on Community Relations.

    The program was designed to break down the individual's sense of personal knowledge in his identity, his racial heritage. Through the Stanford Research Institute, Tavistock controls the National Education Association.

    The Institute of Social Research at the Natl Training Lab brain washes the leading executives of business and government.

    Another prominent Tavistock operation is the WHARTON SCHOOL OF FINANCE.

    A single common denominator identifies the common Tavistock strategy – the use of drugs such as the infamous MK Ultra program of the CIA, directed by Dr Sidney Gottlieb, in which unsuspecting CIA officials were given LSD and their reactions studied like guinea pigs, resulting in several deaths – no one was ever indicted.

    (Source of info: author Eustace Mullins "The World Order: Our Secret Rulers" 2nd ed. 1992. He dedicated his book "to American patriots and their passion for liberty". note: No copyright restrictions)

    Socratic Truth , says: December 16, 2018 at 1:31 am GMT
    @Agent76 Excellent video. More people need to see this to understand how corrupt the China Totalitarian state works behind the scenes along with the US as part of the Globalization NWO movement to enrich the few and impoverish the rest of the world population.

    [Dec 14, 2018] Short Term Thinking Dooms U.S. Anti-China Strategy

    Notable quotes:
    "... The US rarely arrests senior businesspeople, US or foreign, for alleged crimes committed by their companies. Corporate managers are usually arrested for their alleged personal crimes (such as embezzlement, bribery or violence) rather than their company's alleged malfeasance. ..."
    "... Meng is charged with violating US sanctions on Iran. Yet consider her arrest in the context of the large number of companies, US and non-US, that have violated US sanctions against Iran and other countries. ..."
    "... The Trump administration is preparing actions this week to call out Beijing for what it says are China's continued efforts to steal American trade secrets and advanced technologies and to compromise sensitive government and corporate computers, according to U.S. officials. ..."
    "... Multiple government agencies are expected to condemn China, citing a documented campaign of economic espionage and the alleged violation of a landmark 2015 pact to refrain from hacking for commercial gain ..."
    "... Taken together, the announcements represent a major broadside against China over its mounting aggression against the West and its attempts to displace the United States as the world's leader in technology, officials said. ..."
    "... The actions come amid mounting intelligence showing a sustained Chinese hacking effort devoted to acquiring sophisticated American technologies of all stripes. A number of agencies -- including the Justice, State, Treasury and Homeland Security departments -- have pushed for a newly aggressive U.S. response. A National Security Council committee coordinated the actions ..."
    "... After three centuries of anglo-american imperialism the economic center of the world is moving back to the east . ..."
    "... The U.S. is way too late to prevent this move. Its best and most profitable chance is not to challenge, but to accommodate it. That again would require to respect international laws and treaty obligations. The U.S. is not willing to do either. ..."
    "... Nothing except a large scale war that results in the destruction of the industrial centers of east Asia, while keeping the U.S. and Europe save, could reverse the trend. Nuclear weapons on all sides and the principal of mutual assured destruction have made such a war unthinkable. What we are likely to see instead will be proxy conflicts in various other countries. ..."
    "... The current U.S. strategy is to restrict China's access to foreign markets, advanced technologies, global banking and higher education. While that may for a moment slow down China's rise it will in the long run strengthen China even more. Instead of integrating into the world economy it will develop its own capacities and international systems. ..."
    "... dh posted a link on the last thread to China banning import and sale of all iPhones in China (strange, I thought they were made in China? Must be exported and re-imported?). ..."
    "... This is interesting. China hits a top US company manufacturing in China by granting an injunction in a case of one US company against another US company, in which one accuses the other of intellectual property theft. China was not expected to find in Qualcomm's favour, according to the article (perhaps in part because Apple manufactures in China therefore is a client of China, so it was expected China might favour Apple). If this decision was influenced by the arrest, the US can hardly point the finger at China! ..."
    "... In my opinion, China should make these criminal actions of the US extremely painful indeed, and as quickly as possible ..."
    "... With Trump's utterance, he also exposed how he/his government has abused Canada's extradition law for political purposes. Officially in this extradition procedure, the US now has 60 days to submit a complete extradition request which requires far more detail. Meng's court date is set for February. In any case, Canada's rubberstamping of extradition requests (90% are by the US) was already successfully challenged once in the Diab case with France, was criticized by Canada's Superior Court (extraditions are processed at the provincial judicial level), so Trudeau's hiding behind 'judicial process' is two-faced cowardliness. ..."
    "... What's even more damning for the collective absolute stupidity of capitalist bigwigs is that I could see this coming more than 20 years ago, yet these idiots blindly charged as if short-term profits were all they wanted and would be enough to ensure their eternal dominance. ..."
    "... What an empire does not control they destroy. ..."
    "... The "own goal" was not outsourcing manufacturing to China but in not isolating China by bringing Russia into the Western fold. Instead, they kicked Russia while it was down via capitalist "Shock Doctrine" - hoping for total capitulation. Kissinger admits(*) this when, in his typical roundabout way, he says that no one anticipated Russia's ability to absorb pain. ..."
    "... Does that moron Kissinger know nothing about WW2? That Kissinger projects an inability to absorb pain onto the Russians suggests that Kissinger knows the Americans have no ability to absorb pain themselves ..."
    "... Maybe now Shell executives will be arrested for crimes against humanity in Nigeria. ..."
    "... After all, as you stated, these maneuvers wrt Meng are emanating from John (I am the Eggman) Bolton's office and clearly evidence his trademarked hard-boiled belligerence which of course is heartily endorsed by Trump (as an "Art of the Deal" negotiating ploy by the master debater himself) who selected The Walrus in the first place. Or second place if you count Bolton's earlier appointment by that other intellectual giant of the GOP, GW Bush. ..."
    "... "Kissinger admits(*) this when, in his typical roundabout way, he says that no one anticipated Russia's ability to absorb pain." Then Kissinger is a bigger fool than I thought. He's old enough to know about WWII, and previous wars as well. I mean, he did study the Napoleonic wars... ..."
    "... She's not being accused of trading with Iran. She's being accused of bank fraud (providing false information to obtain a loan). ..."
    "... The charges against Meng were brought by Richard P. Donoghue, the United States Attorney for the Eastern District of New York. Donoghue was appointed as Interim United States Attorney for the Eastern District by Attorney General Jeff Sessions on January 3, 2018, and as Attorney on May 3, 2018. ..."
    "... The bottom line is that the bar for extradition from Canada is extremely low, which should worry Ms Meng. ..."
    "... The historical West is still violently opposed to the objective rise of a fairer and more democratic polycentric world order. Clinging to the principles of unipolarity, Washington and some other Western capitals appear unable to constructively interact with the new global centres of economic and political influence. A wide range of restrictions are applied to the dissenters, ranging from military force and unilateral economic sanctions to demonisation and mud-slinging in the spirit of the notorious "highly likely." There are many examples of this dirty game...This has seriously debased international law. Moreover, attempts have been made to replace the notion of law with a "rules-based order" the parameters of which will be determined by a select few. ..."
    "... We are especially concerned about the activities of the US administration aimed at destroying the key international agreements. These include withdrawal from the Joint Comprehensive Plan of Action known as the Iran nuclear deal, the declared intention to withdraw from the Intermediate-Range Nuclear Forces Treaty (INF Treaty), an open line for revising the settlement principles in the Middle East, as well as sabotaging the Minsk Agreements on overcoming the internal Ukrainian crisis. The trade wars that have been launched contrary to the WTO principles are rocking the global economic architecture, free trade and competition standards. The US establishment, blindly believing in the idea of their exceptionalism, continues to appoint rivals and adversaries, primarily among the countries that pursue an independent foreign policy. Everyone can see that Washington is a loose cannon, liable to act incongruously, including regarding Russia where any steps taken by US President Donald Trump to develop stable and normal channels of communication with Moscow on the biggest current problems are promptly blocked by those who want to continue or even strengthen the destructive approach to relations with Russia, which developed during the previous US administration. ..."
    "... Overall, it looks as if the Americans and some of our other Western colleagues have forgotten the basics of diplomacy and the art of dialogue and consensus over the past 25 years. One result of this is the dangerous militarisation of the foreign policy thinking. As RIAC Director General Andrey Kortunov recently pointed out at a Valdai Discussion Club meeting, the Clausewitz formula can be changed to a mirror image, "Politics is a continuation of war by other means. ..."
    "... Unfortunately, the U.S. ruling class cares more about the psychic gratification it derives from dominating the world. ..."
    "... The prosecutor's case against Meng is fundamentally weak. For instance, there is no identification of a "co-conspirator", necessary to a charge of conspiracy. It does not seem to have been developed much beyond the information developed in the 2013 Reuters investigation. At least half of that relies on unnamed "former employees" and unnamed persons who claimed to have dealt with Skycom in Iran. ..."
    Dec 12, 2018 | www.moonofalabama.org

    The United States issued an arrest warrant against the chief financial officer and heir apparent of Huawei, Meng Wanzhou. At issue is a six years old alleged violation of sanctions against Iran. Mrs. Meng was arrested in Canada. She has been set free under a stringent $10 million bail agreement . An extradition trial will follow in February or March.

    It is unprecedented that an officer of a large company is personally indicted for the alleged sanction violations by a subsidiary company:

    The US rarely arrests senior businesspeople, US or foreign, for alleged crimes committed by their companies. Corporate managers are usually arrested for their alleged personal crimes (such as embezzlement, bribery or violence) rather than their company's alleged malfeasance.
    ...
    Meng is charged with violating US sanctions on Iran. Yet consider her arrest in the context of the large number of companies, US and non-US, that have violated US sanctions against Iran and other countries. In 2011, for example, JPMorgan Chase paid US$88.3 million in fines for violating US sanctions against Cuba, Iran and Sudan. Yet chief executive officer Jamie Dimon wasn't grabbed off a plane and whisked into custody.

    The U.S. indicted dozens of banks for violating its sanction regime. They had to pay huge fines (pdf) but none of their officers were ever touched.

    We called this U.S. operation a hostage taking to blackmail China . President Trump confirmed that this is indeed the case:

    U.S. President Donald Trump told Reuters on Tuesday he would intervene in the U.S. Justice Department's case against Meng if it would serve national security interests or help close a trade deal with China.

    The arrest of Meng is but one part of a larger political campaign against China directed out of the office of National Security Advisor John Bolton:

    The Trump administration is preparing actions this week to call out Beijing for what it says are China's continued efforts to steal American trade secrets and advanced technologies and to compromise sensitive government and corporate computers, according to U.S. officials.

    Multiple government agencies are expected to condemn China, citing a documented campaign of economic espionage and the alleged violation of a landmark 2015 pact to refrain from hacking for commercial gain.

    In typical propaganda style the U.S. media depict the Chinese as enemies:

    Taken together, the announcements represent a major broadside against China over its mounting aggression against the West and its attempts to displace the United States as the world's leader in technology, officials said.

    ...

    The actions come amid mounting intelligence showing a sustained Chinese hacking effort devoted to acquiring sophisticated American technologies of all stripes. A number of agencies -- including the Justice, State, Treasury and Homeland Security departments -- have pushed for a newly aggressive U.S. response. A National Security Council committee coordinated the actions.

    One wonders what those "mounting aggressions" are supposed to be. Is the U.S. not constantly spying and hacking for economic or political gain?

    Other reports today of alleged Chinese hacking are obviously part of the concerted anti-China campaign. As usual no evidence is presented for the vague allegations:

    U.S. government investigators increasingly believe that Chinese state hackers were most likely responsible for the massive intrusion reported last month into Marriott's Starwood chain hotel reservation system, a breach that exposed the private information and travel details of as many as 500 million people, according to two people briefed on the government investigation.

    These people cautioned that the investigation has not been completed, so definitive conclusions cannot be drawn. But the sweep and tactics of the hack, which took place over four years before being discovered, prompted immediate speculation that it was carried out by a national government.

    The new anti-China campaign follows a similar push of anti-Russian propaganda three month ago.

    China has taken first countermeasures against Canada's hostage taking on behalf of the United States. It detained Michael Kovrig, a former Canadian diplomat who now works for the International Crisis Group. Beijing suggest that the ICG is operating illegally in China :

    "The relevant organization has violated Chinese laws because the relevant organization is not registered in China," Foreign Ministry spokesman Lu Kang said at a press briefing Wednesday.

    China sharply tightened its rules on NGOs operating in the country last year, ..

    This will not be the sole Chinese measure against Canada for its role in enforcing extraterritorial U.S. sanctions.

    The string of U.S. accusations and measures against China are partly to protect the market share of U.S. companies against better and cheaper Chinese products and partly geopolitical. Neither has anything to do with protecting the international rule of law.

    After three centuries of anglo-american imperialism the economic center of the world is moving back to the east .


    bigger

    The U.S. is way too late to prevent this move. Its best and most profitable chance is not to challenge, but to accommodate it. That again would require to respect international laws and treaty obligations. The U.S. is not willing to do either.

    Nothing except a large scale war that results in the destruction of the industrial centers of east Asia, while keeping the U.S. and Europe save, could reverse the trend. Nuclear weapons on all sides and the principal of mutual assured destruction have made such a war unthinkable. What we are likely to see instead will be proxy conflicts in various other countries.

    The current U.S. strategy is to restrict China's access to foreign markets, advanced technologies, global banking and higher education. While that may for a moment slow down China's rise it will in the long run strengthen China even more. Instead of integrating into the world economy it will develop its own capacities and international systems.

    The U.S. can temporarily hinder the telecommunication equipment provider Huawei by denying it access to U.S. designed chips. It will probably do so. But that will only incentivize Huawei to start its own chip production. With a few years delay it will be back and out-compete U.S. companies with even better and cheaper products.

    It is typical for the current U.S. to seek short term advantage while disregarding the long term negative effects of its doing. It is a major reason for China's rise and its future supremacy.

    Posted by b on December 12, 2018 at 07:07 AM | Permalink

    Comments next page " The reason she is violating trade sanctions against Iran is because Trump suspended the Iran Nuclear treaty. How short-sighted is that?


    fayez chergui , Dec 12, 2018 7:21:43 AM | link

    Well, all these sanctions are pushing target countries to be self sufficient. That's wonderful. Us are pushing countries for a better production and decrease itself. Smart.
    oldenyoung , Dec 12, 2018 8:03:14 AM | link
    the King Liar has spoken...the boss of the mafia group U$A... The Chinese will interpret this as a kidnapping for blackmail and act accordingly...this can only get much worse...

    way to go Donald...stupid is its own reward...

    regards

    OY

    BM , Dec 12, 2018 8:42:16 AM | link
    dh posted a link on the last thread to China banning import and sale of all iPhones in China (strange, I thought they were made in China? Must be exported and re-imported?). This concerns a patent dispute between US company Qualcomm and Apple, over which Qualcomm sued Apple in Chinese courts. The existence of the action in the courts must predate the Meng arrest, but the court decision to support Qualcomm could be influenced by the arrest.

    https://www.cnn.com/2018/12/10/tech/china-iphone-ban/index.html
    Posted by: dh | Dec 11, 2018 3:05:37 PM | 6

    This is interesting. China hits a top US company manufacturing in China by granting an injunction in a case of one US company against another US company, in which one accuses the other of intellectual property theft. China was not expected to find in Qualcomm's favour, according to the article (perhaps in part because Apple manufactures in China therefore is a client of China, so it was expected China might favour Apple). If this decision was influenced by the arrest, the US can hardly point the finger at China!

    It gets better: The Apple executive states in the article that they have stocks of all models in China and sales will not stop. How can this be, if sales are banned? Surely China can then arrest several Apple executives in China for breaking the injunction? Would depend of course on the terms of the injunction, of which the article gave no details.

    In my opinion, China should make these criminal actions of the US extremely painful indeed, and as quickly as possible. One person arrested in China is not enough - it should be 10 Americans arrested for 1 Chinese, plus 5 Canadians. China should make sure the US and Canada understand that the ratio will stay constant if the US/Canada respond to the arrests in China. China should also take extremely painful action against US telecomms companies in China to compensate for the campaign against Huawei - it could include denying access to comms links, forcing US telcom communications to go through very expensive route, ceasing negotiations for investment consortia in favour of non-US companies, etc. The difficulty to navigate, of course, is the risk of inciting escalating actions against Huawei; but the Chinese will find excellent startegies I am sure.

    daffyDuct , Dec 12, 2018 8:44:52 AM | link
    It may be the case that the Huawei equipment is very, very secure, has much better performance. Soon, China will be the tech leader, hence the panic. I have a snippet below, but peruse the article in full on the 5G landscape.

    "Huawei has been pouring money into research on 5G wireless networks and patenting key technologies. The company has hired many experts from abroad as well to decide the technical standards for the next generation of wireless communication technology.

    As of early 2017, 10% of 1450 patents essential for 5G networks were in Chinese hands in which majority belongs to Huawei and ZTE.

    Huawei spent around $12 Billion on R&D in 2017, which was threefold of Ericsson's spending of $4.1 Billion. This year, according to estimates, it will spend $800 million in 5G research and development alone.

    The company wants to involve AI in 5G which according to them is a much more integral element of Huawei's 5G strategy. The company also plans to launch a full range of Huawei commercial equipment including wireless access networks, core networks, and devices.

    Huawei has also revealed its hopes to launch smartphones ready for supporting 5G networks by 2019 and starting selling in the mid-2019. The company is also said to be working on developing a brand-new chipset for 5G services.

    Huawei and Vodafone made the 5G call using non-standalone 3GPP 5G-NR standard and sub 6 GHz spectrum. The two companies built a 5G NR end-to-end test network for the trial and used 3.7GHz spectrum. They also used Huawei Radio Access Network and core network equipment to support the test with microservice-centric architecture, control plane/user plane separation, and unified access and network slicing technology.

    Huawei also started manufacturing products that provide 5G services. In Mobile World Congress, Huawei launched its 5G customer-premises equipment (CPE), the world's first commercial terminal device supporting 3GPP standard for 5G. Huawei used its self-developed chipset Balong 5G01 – world's first commercial chipset supporting the 3GPP standard for 5G, with downlink speed up to 2.3 Gbps."

    https://www.greyb.com/companies-working-on-5g-technology/

    Josh , Dec 12, 2018 8:47:39 AM | link

    With Trump's utterance, he also exposed how he/his government has abused Canada's extradition law for political purposes. Officially in this extradition procedure, the US now has 60 days to submit a complete extradition request which requires far more detail. Meng's court date is set for February. In any case, Canada's rubberstamping of extradition requests (90% are by the US) was already successfully challenged once in the Diab case with France, was criticized by Canada's Superior Court (extraditions are processed at the provincial judicial level), so Trudeau's hiding behind 'judicial process' is two-faced cowardliness.

    Canada needs to amend its extradition law, become much more stringent, and arm this law against the bullying and abusive southern neighbor who prefers to lord its own laws over others than abide by any kind of international law.

    Timothy Hagios , Dec 12, 2018 8:50:51 AM | link
    We've been at war with Eurasia long enough. Time for Eastasia! The main question is whether Putin will remain Emmanuel Goldstein or if someone Chinese will get the honor.
    bjd , Dec 12, 2018 9:02:26 AM | link
    China should just dump US treasuries wholesale, and the US is done for within a week.
    Russ , Dec 12, 2018 9:13:19 AM | link
    Here's a counter-shot in the trade war.

    China is set to introduce maximum residue limits (MRLs) of 200 parts per billion (ppb) or lower for glyphosate in all imported final food products and raw materials including grains, soybeans and other legumes before the end of 2019, according to Sustainable Pulse sources.....

    It is expected that China will now import more grains from Russia, where glyphosate is not widely used as a desiccant. This also enables China to use glyphosate as a political tool in the current U.S. / China trade war, as food and raw material imports from the U.S., which often contain high levels of the weedkiller, will be put under major pressure.

    https://www.gmwatch.org/en/news/latest-news/18647-china-set-to-shock-markets-with-low-glyphosate-residue-limits-in-food-imports

    That'll hit Monsanto's Roundup pretty hard. Of course China doesn't really have any problem with glyphosate - it's long been a major producer and exporter itself. So this is obviously a trade war action.

    Clueless Joe , Dec 12, 2018 9:14:45 AM | link
    "It is typical for the current U.S. to seek short term advantage while disregarding the long term negative effects of its doing. It is a major reason for China's rise and its future supremacy."

    Well, the economic and industrial rise of China is the ultimate proof of this. Instead of making sure China would have a limited and purely internal development and would never become such a fearsome rival, Western (specially US) capitalist fools decided to outsource their production there, creating the monster they feared and fear even more nowadays.

    I've never seen such a ridiculous and brilliant own goal in any World Cup. What's even more damning for the collective absolute stupidity of capitalist bigwigs is that I could see this coming more than 20 years ago, yet these idiots blindly charged as if short-term profits were all they wanted and would be enough to ensure their eternal dominance.

    V , Dec 12, 2018 9:19:57 AM | link
    I think it's pretty clear to China, Russia, India, and many others, that trading in dollars is a losing strategy. Thus the dollar is very fast losing its position as the world reserve currency. The EU is not using dollars for Iran's oil. India is not using dollars for its purchase of Russia's S-400.

    It's not only US anti-China strategy; but the US insistence to be the hegemon; the rest of the planet will not have it, period. The US is done dictating what the rest of the planet will do/follow... Bye, bye, American pie............

    Entropy Wins , Dec 12, 2018 9:29:34 AM | link
    Short term thinking dooms the US economically and politically.
    dh , Dec 12, 2018 9:32:41 AM | link
    BM @4 I'm not sure where Qualcomm stands in relation to China. It could be a bargaining chip...excuse the pun. The Apple ban applies to the older iPhone 8 & 7 not the new Xs & Xr......but that may change. Apple is already having trouble selling phones in China and the Huawei dispute won't help.
    pasha , Dec 12, 2018 9:52:18 AM | link
    What is the legal basis for Meng's arrest? What Canadian law is she alleged to have violated? Or is American wish fulfillment now part of Canadian jurisprudence?
    flayer , Dec 12, 2018 9:55:11 AM | link
    As a non-American I've got half a mind to find a way to purchase some Iranian products and then send the US State Department an e-mail telling them to suck it.
    Fernando Martinez , Dec 12, 2018 10:11:44 AM | link
    What an empire does not control they destroy.
    Jackrabbit , Dec 12, 2018 10:38:23 AM | link
    Posted by: Clueless Joe | Dec 12, 2018 9:14:45 AM | 10

    The "own goal" was not outsourcing manufacturing to China but in not isolating China by bringing Russia into the Western fold. Instead, they kicked Russia while it was down via capitalist "Shock Doctrine" - hoping for total capitulation. Kissinger admits(*) this when, in his typical roundabout way, he says that no one anticipated Russia's ability to absorb pain.

    * In his lunch interview with the Financial Times this past summer.

    ralphieboy , Dec 12, 2018 10:52:25 AM | link
    @pasha #14

    "What is the legal basis for Meng's arrest? What Canadian law is she alleged to have violated? Or is American wish fulfillment now part of Canadian jurisprudence?"

    As I understand it, the USA and Canada have an extradition agreement, and corporate fraud is also a crime in Canada.

    Hoarsewhisperer , Dec 12, 2018 11:08:40 AM | link
    This idiocy seems certain to increase curiosity in Huawei products by telcos worldwide. Business managers use technical experts to evaluate available technologies when contemplating upgrades to their systems. They're certainly not swayed by MSM spin doctors.

    This issue could soon be overtaken by a brand new reality. China is planning to launch a worldwide free wifi internet service based on more than 100 satellites, which could be interpreted as a Commie scheme to undermine the profitability of telcos.

    https://www.abc.net.au/news/2018-11-30/chinese-company-to-provide-free-internet-worldwide-by-2026/10568434

    Nick Baam , Dec 12, 2018 11:11:35 AM | link
    Not clear exactly which officials said, "Taken together, the announcements represent a major broadside against China over its mounting aggression against the West... The actions come amid mounting intelligence showing a sustained Chinese hacking effort..." but do know it's very unusual to repeat a verb in consecutive sentences. Mantra alert! Mounting... mounting... mounting... hear the drums of war.
    Ghost Ship , Dec 12, 2018 11:15:24 AM | link
    he says that no one anticipated Russia's ability to absorb pain

    Does that moron Kissinger know nothing about WW2? That Kissinger projects an inability to absorb pain onto the Russians suggests that Kissinger knows the Americans have no ability to absorb pain themselves

    Edward , Dec 12, 2018 11:22:50 AM | link
    Maybe now Shell executives will be arrested for crimes against humanity in Nigeria.
    john , Dec 12, 2018 11:24:23 AM | link
    Hoarsewhisperer says:

    China is planning to launch a worldwide free wifi internet service based on more than 100 satellites, which could be interpreted as a Commie scheme to undermine the profitability of telcos

    cool. digital nomadism and growing your own food will be the ticket.

    Harry , Dec 12, 2018 11:26:07 AM | link
    The story I heard was that it was a screw up. Mira Ricardel was fired because she pissed off Melania about airplane seats. She was fired before inter-agency coordination for the arrest but after the warrant for the arrest was issued - the warrant was issued back in August. That and the fact that Trudeau hates Trump explains this idiocy. Trudeau was left to weigh up the US request against the poor timing of the US request from the US point of view. No one from the WH got back to the Canadians to ask them to wait.

    So Justin decided to go ahead to screw Trump. Fun, no?

    Jackrabbit , Dec 12, 2018 11:32:48 AM | link
    ralphieboy | Dec 12, 2018 10:52:25 AM | 18: corporate fraud is also a crime in Canada.

    More specifically, she's accused of inducing banks to provide financing that was illegal due to US sanctions. It appears that as Huawei CFO, she certified that her company doesn't trade with Iran despite the fact that Huawei has an Iran-based subsidiary (SkyCom Tech).

    donkeytale , Dec 12, 2018 11:44:22 AM | link
    Is this an example of "US short term strategical thinking" or "Trump's-as-per-usual (non) thinking?"

    After all, as you stated, these maneuvers wrt Meng are emanating from John (I am the Eggman) Bolton's office and clearly evidence his trademarked hard-boiled belligerence which of course is heartily endorsed by Trump (as an "Art of the Deal" negotiating ploy by the master debater himself) who selected The Walrus in the first place. Or second place if you count Bolton's earlier appointment by that other intellectual giant of the GOP, GW Bush.

    Please, the US voted less for Trump to be our trade representative then even the British voted for their own ridiculous "alt-right" trade adventure wildride, AKA "Brexit."

    And we now have another pretty solid election behind us illustrating even further that Trump's worldview doesn't represent most of the US. He represents only a dwindling "base" of mostly old white male reactionary racist very scared supporters whose presence within the GOP has terrified the GOP toadies into supporting most everything Trump wants because he delivers judges and tax cuts to the rich.

    But again, the majourity of the toadies don't support Trump on China. He has them by their shriveled up balls is all.

    Jackrabbit , Dec 12, 2018 11:52:01 AM | link
    Ghost Ship | Dec 12, 2018 11:15:24 AM | 21:
    That Kissinger projects an inability to absorb pain onto the Russians ...
    This is a misreading. Kissinger is not projecting but explaining. Look at the Financial Times interview for more clarity. Also, they didn't fail to consider WWII. They miscalculated. And then they doubled down (as the neocons always do).
    Clueless Joe , Dec 12, 2018 11:52:11 AM | link
    Jackrabbit 17
    "Kissinger admits(*) this when, in his typical roundabout way, he says that no one anticipated Russia's ability to absorb pain." Then Kissinger is a bigger fool than I thought. He's old enough to know about WWII, and previous wars as well. I mean, he did study the Napoleonic wars...
    Jackrabbit , Dec 12, 2018 11:58:35 AM | link
    Clueless Joe | Dec 12, 2018 11:52:11 AM | 28

    You have to remember, this was economic warfare, not military. And the USA/West were pretending to be helpful. IIRC, Yeltsin was happy for this "help" too.

    Jose Garcia , Dec 12, 2018 12:21:30 PM | link
    "The government and us are cut from the same cloth." Sam Giancana, former Mob boss from Chicago. Deep State, you say? No way, Jose. More like the Gambino (Democrat's) and the Genovese (Republicans). You don't need "colors" to identify yourself as a gang member. You can wear double breasted suits and have the same bad intentions as any member of the Crips, Bloods, Mafia or Mexican Cartels. The US government is one great big Tammany Hall. Nothing has changed since the days of Boss Tweed. Instead of being centered in New York, it's now in our nation's capital. Mah Rohn! Forget about it!
    Fidelios Automata , Dec 12, 2018 12:22:34 PM | link
    This is beyond outrageous. US law is not the law of the world. The Chinese may trade with whomever they choose.
    Jackrabbit , Dec 12, 2018 12:29:14 PM | link
    Fidelios Automata | Dec 12, 2018 12:22:34 PM | 31:
    The Chinese may trade with whomever they choose.
    She's not being accused of trading with Iran. She's being accused of bank fraud (providing false information to obtain a loan).
    LittleWhiteCabbage , Dec 12, 2018 12:37:53 PM | link
    https://www.motherjones.com/politics/2003/07/sidestepping-sanctions/

    According to the above article, American firms set up foreign subsidiaries to do business with sanctioned countries. So if SkyCom is an Iranian subsidiary, what can be Sabrina Meng Wanzhou's crime? Or even if SkyCom is a Hong Kong-based subsidiary? The city-state effectively maintains its own laws and financial architecture, as part of one country, two systems.

    Grieved , Dec 12, 2018 12:41:16 PM | link
    It's a bit OT but this thing of Russia absorbing pain - to be fair, I always thought that producing Putin at the last moment was really stretching survival to a fine thread. The neocons almost won there. The country was almost done for. It took a man whose father nursed life back into his wife when medics figured she was done for...

    Russia's ultimate salvation was way too close to the edge of the cliff for my taste.

    Laura Rosiln , Dec 12, 2018 1:05:05 PM | link
    two things of interest: Canadian Telecoms Face $1 Billion Cost to Remove Huawei Gear, Globe & Mail Says.
    https://www.bloomberg.com/news/articles/2018-12-08/canadian-telecoms-face-1-billion-to-remove-huawei-tech-g-m

    South Korea to get the world's first 5G commercial network in Q1, 2019 https://www.youtube.com/watch?v=4nD-FnRSqfI

    karlof1 , Dec 12, 2018 1:06:33 PM | link
    Ya'll know how the Chinese finger trap works, yes? Instead of his fingers, Trump's got his whole head inside, and he's stuck real good. There're only two ways out: Trump admits China can't be beaten so its better to join them or he cuts off his head to free his body--both are essentially suicide, although the former is merely political instead of actual.
    BraveNewWorld , Dec 12, 2018 1:12:55 PM | link
    There is zero chance she gets deported to the US because doing so would mean a Canadian court blessing the idea that the US is the sole legal authority of every thing on planet earth. There isn't a a judge in Canada that is goin g to sign off on the idea that US law trumps Canadian law and international law in Canada.
    Jared , Dec 12, 2018 1:16:27 PM | link
    There is a strange ambiguous nature to the post. It seems there is a reluctance to address the issues. It has long been claimed that China has a tendency to copy or steal intellectual property. Most "I/P" is horse shit anyway - e.g. Apple and the rounded corners. Apparently there has been some actual espionage, but that is probably pretty common its just that China has used it to good advantage (if we accept that they have used it - as I do).

    It is quite odd to to make such a fuss in the absence of smoking gun - maybe Mueller is in need of something to investigate?

    I am baffeled by the whole Iran thing and the nations in terror of U.S. sanctions. What is this "international law" of which we speak? The implication is that because Mr Trump (Bolton) does not approve of a treaty that now Iran and RoW has violated a law and are subject to sanction by the U.S.? I find it hard to comprehend.

    vk , Dec 12, 2018 1:24:04 PM | link
    This first paragraph from a today's Global Times op-ed nicely summarizes the 21st Century:
    For a long time in the future, the international situation will evolve around the rise of China, the decline of the US and the uncertain development level of Russia.
    Anya , Dec 12, 2018 1:24:42 PM | link

    No arrests among the Israelis. None. The loyalty to Israel by Israel-firsters (and their corrupting influence on the US Congress) overpowers any loyalty to the US.

    But to arrest a woman because of the illegal economic sanctions against Iran (on Israelis' prodding) is fine for US "deciders"

    ToivoS , Dec 12, 2018 1:38:52 PM | link
    Anya | Dec 12, 2018 1:24:42 PM | 40

    Thanks for assembling those links. That is a good compilation. I was vaguely aware of those stories but had forgotten most of the details. It is so true. And you didn't even get to the Jonathan Pollard betrayal!

    james , Dec 12, 2018 1:48:53 PM | link
    thanks b! and thanks to the many informative comments.. i encourage others to read the jeffery sachs article in b's article near the top under the word 'unprecedented"...

    @23 john.. thanks.. i will take a look..

    @24 harry.. thanks.. that is an interesting conjecture..

    @38 jared.. larvov made some comments on the use of the term 'rule of law' which is different from 'international law'.. i can't find the article from yesterday that i read on this, but essentially he is saying the usa wants to toss international law and replace it with 'rule of law', or 'law based rules' and do away with international law, as international law is not working in the usa's favour at this point..'rule of law' or 'law based rules' is something that a country can make up as it goes along.. the usa wants to drop international law essentially.. if i find larvov's comments, i will post them...

    Don Bacon , Dec 12, 2018 2:41:01 PM | link
    Here's the legal mumbo-jumbo from B.C. which includes details on the charges against Meng. The poor banks were "victim banking institutions."
    The investigation by U.S. authorities has revealed a conspiracy between and among Meng and other Huawei representatives to misrepresent to numerous financial institutions. . . .The motivation for these misrepresentations stemmed from Huawei's need to move money out of countries that are subject to U.S. or E.U. sanctions--such as Iran, Syria, or Sudan--through the international banking system. At various times, both the U.S. and E.U. legal regimes have imposed sanctions that prohibit the provision of U.S. or E.U. services to Iran, such as banking services....

    Because Meng and other Huawei representatives misrepresented to Financial Institution 1 and the other financial institutions about Huawei's relationship with Skycom, these victim banking institutions were induced into carrying out transactions that they otherwise would not have completed. As a result, they violated the banks' internal policies, potentially violated U.S. sanctions laws, and exposed the banks to the risk of fines and forfeiture. .

    Michael Droy , Dec 12, 2018 2:49:03 PM | link
    Very accurate. Yes of course the smart move would have been to welcome China into a multi-polar world, but it is too late now, and I doubt the US could ever have managed that. Trade war and probable actual war has been inevitable for some time. An alien visiting earth would want to view every event through the prism of imminent US-China war.

    Right now we see a US circling of the wagons, with threats against outsiders. In particular Iran, NK and Russia are villified because the message is "look what happens if you don't come in on our side". We think the casual slanders about these countries are just vulgar Americans, but they are really calculated warnings to other countries.

    Don Bacon , Dec 12, 2018 2:49:15 PM | link

    The charges against Meng were brought by Richard P. Donoghue, the United States Attorney for the Eastern District of New York. Donoghue was appointed as Interim United States Attorney for the Eastern District by Attorney General Jeff Sessions on January 3, 2018, and as Attorney on May 3, 2018.

    Donoghue is one of five U.S. attorneys serving in a "working group" under the Justice Department's recently announced China Initiative. Launched by then-Attorney General Jeff Sessions, the China Initiative is a broad-based strategy designed to counter Chinese economic espionage and a range of other national security threats. Donoghue has been leading an investigation of Huawei since 2016 for possible violations of U.S. sanctions against Iran.

    The Eastern District serves over eight million residents through its Criminal Division, with approximately 115 Assistant U.S. Attorneys, and its Civil Division, with approximately 60 U.S.Attorneys. But what the heck, forget New Yorkers, Donoghue has bigger fish to fry.

    Don Bacon , Dec 12, 2018 3:00:54 PM | link
    If one has an interest on seeing how the war-mongers visualize the US-China standoff, check out this blog where I regularly get roasted. (roasted bacon?)
    xLemming , Dec 12, 2018 3:03:18 PM | link
    @43 DB

    Not to be confused with actual "victim banking" customers - of which there are legion. Great comments on this thread - always worth the drive...

    William Bowles , Dec 12, 2018 3:26:48 PM | link
    Posted by: Grieved | Dec 12, 2018 12:41:16 PM | 34

    Hmmm... following the downfall of the drunkard Yeltsin (the first miscalculation of the Empire, hubris strikes again), they put their money on Medvedev, the 'Atanticist'. Bad move! Putin was the response. Nationalism bad? I don't think so, it's what enabled Stalin to win WW2 and it enabled Putin to pull the country, but as said, only just! Phew.

    70 years of isolating the Soviet Union meant that they really didn't have a handle on the Western propaganda machine. In the 80s the North Koreans made the same mistake.

    A slight aside: I and a bunch of other journos, activists were invited to a wonderful slap up meal held at the N.Korean UN delegation HQ in Manhattan. Food great but the video they showed horrendous! Imagine 1 1/2hrs of the Great Leader and endless displays in stadiums waving flags in unison. They then asked us what we thought of it (that was the purpose of 12 course meal). When they were told it would go down like a lead balloon, they just didn't get it. They lived in a different world, ditto the Soviets.

    BTW, the video was made for US consumption.

    On the other hand, Verso brought out a book (I have it somewhere) on the aesthetics of East European cityscapes during the Soviet period and lamented on the loss of individuality, following the fall of socialism and the rise of McDonaldism. How ironic. And we though (were taught) that E. European design and architecture was drab!

    ex-SA , Dec 12, 2018 3:32:40 PM | link
    MBA ideology, which is narrowly focused on the next quarter results, bottom line, and bonuses for executives has devastated / destroyed industrial base of the 5 eyes!
    Jen , Dec 12, 2018 4:42:32 PM | link
    Don Bacon @ 46:

    I saw the discussion thread at that BreakingDefense.com post you linked to, and I must say you should seek help for that masochistic tendency that drives you to post there and risk being savaged by armchair generals whose idea of military strategy comes from playing wall-2-wall computer games.

    I should think a better example from Ancient Greek history that we should heed, rather than Thucydides' Trap (discussions of which use very selective examples to "prove" its premise) is Athens' military expedition to Syracuse to conquer the city and all of Sicily in 415 BCE. How did that turn out for Athens?

    http://www.livius.org/articles/concept/peloponnesian-war/sicilian-expedition/
    http://www.livius.org/sources/content/thucydides/destruction-of-the-athenian-army/?

    Godfree Roberts , Dec 12, 2018 4:54:40 PM | link

    I should add that the US put China under total embargoes on food, ag equipment, finance, technology for 25 years during Maos' tenure. Yet he grew the economy by 7.25% annually, doubled the population, its life expectancy and literacy during that time.

    Hodi , Dec 12, 2018 4:56:46 PM | link
    [email protected] there is any question whether Canadian courts will side with American laws you only need to google Qmar Khadr to answer the question.
    james , Dec 12, 2018 4:59:06 PM | link
    @46 don bacon.. thanks for the link.. in it admiral Davidson says "I see a fundamental divergence of values that leads to two incomparable visions of the future. I think those two incomparable visions are between China and the rules-based international order."

    there is that ''rules-based international order'' quote again - which i was mentioning to @38 jared in my post @42..
    what the fuck is ''rules-based international order'' supposed to mean? you mean like - ignore international law and replace it with ''rule-basd international order''??

    i agree with jen... don, you must be a bit of a masochist!

    RibCluck , Dec 12, 2018 5:03:48 PM | link
    @ Don Bacon

    I definitely second Jen's remark about BreakingDefense. Reading that post was very distressing and I can imagine they would roast you and many who follow and admire b. But, as the saying goes, it is also good to know "how the enemy" thinks. Or in this case how our gov + thinks.

    farm ecologist , Dec 12, 2018 5:16:31 PM | link
    @6 Josh

    Canada's rubberstamping of extradition requests (90% are by the US)was already successfully challenged once in the Diab case with France

    Not exactly. Diab was arrested in 2008 and, after a long series of legal proceedings (ending with the refusal of the Canadian Supreme Court to hear his appeal), finally extradited to France in 2014. The case against Diab was flimsy to nonexistent to begin with, but "good enough" to meet Canadian standards. In spite of the continued insistence by French prosecutors that they had a legitimate case, multiple judges disagreed and Diab was finally released earlier this year and allowed to return to Canada.

    The bottom line is that the bar for extradition from Canada is extremely low, which should worry Ms Meng.

    lysias , Dec 12, 2018 5:24:56 PM | link
    The way the U.S. seems intent on punishing Australian Assange for exposing U.S. secrets exhibits the same determination to apply U.S. law to everyone all over the world.
    Loz , Dec 12, 2018 5:35:37 PM | link
    @52 James -
    http://www.mid.ru/en/foreign_policy/news/-/asset_publisher/cKNonkJE02Bw/content/id/3413324

    20 November 201815:24
    Foreign Minister Sergey Lavrov's remarks at the general meeting of the Russian International Affairs Council, Moscow, November 20, 2018

    "The historical West is still violently opposed to the objective rise of a fairer and more democratic polycentric world order. Clinging to the principles of unipolarity, Washington and some other Western capitals appear unable to constructively interact with the new global centres of economic and political influence. A wide range of restrictions are applied to the dissenters, ranging from military force and unilateral economic sanctions to demonisation and mud-slinging in the spirit of the notorious "highly likely." There are many examples of this dirty game...This has seriously debased international law. Moreover, attempts have been made to replace the notion of law with a "rules-based order" the parameters of which will be determined by a select few.

    We are especially concerned about the activities of the US administration aimed at destroying the key international agreements. These include withdrawal from the Joint Comprehensive Plan of Action known as the Iran nuclear deal, the declared intention to withdraw from the Intermediate-Range Nuclear Forces Treaty (INF Treaty), an open line for revising the settlement principles in the Middle East, as well as sabotaging the Minsk Agreements on overcoming the internal Ukrainian crisis. The trade wars that have been launched contrary to the WTO principles are rocking the global economic architecture, free trade and competition standards. The US establishment, blindly believing in the idea of their exceptionalism, continues to appoint rivals and adversaries, primarily among the countries that pursue an independent foreign policy. Everyone can see that Washington is a loose cannon, liable to act incongruously, including regarding Russia where any steps taken by US President Donald Trump to develop stable and normal channels of communication with Moscow on the biggest current problems are promptly blocked by those who want to continue or even strengthen the destructive approach to relations with Russia, which developed during the previous US administration.

    Overall, it looks as if the Americans and some of our other Western colleagues have forgotten the basics of diplomacy and the art of dialogue and consensus over the past 25 years. One result of this is the dangerous militarisation of the foreign policy thinking. As RIAC Director General Andrey Kortunov recently pointed out at a Valdai Discussion Club meeting, the Clausewitz formula can be changed to a mirror image, "Politics is a continuation of war by other means."

    Russia is a consistent supporter of the development of international life based on the principles of the UN Charter. We are a serious obstacle in the way of different destructive undertakings." etc

    Lavrov is always an interesting read.

    spudski , Dec 12, 2018 5:36:27 PM | link
    Second Canadian detained in China, according to Freeland.
    lysias , Dec 12, 2018 5:39:32 PM | link
    Considering the eventual results of the Peloponnesian War for all combatants, Thucydides' Trap turned out to be a trap for everyone. They all would have been better off peacefully settling their differences. Same goes for World War One. And the same goes for a declining U.S. facing a rising China.

    What the U.S. should do is to negotiate with China a deal which recognizes the status of China as a superpower in return for an economic relationship that preserves the U.S. standard of living.

    Unfortunately, the U.S. ruling class cares more about the psychic gratification it derives from dominating the world.

    Don Bacon , Dec 12, 2018 6:03:18 PM | link
    @ 52 james
    re: "rules-based international order"
    This is widely and repeatedly used by the Pentagon; I've also seen it used by the Australia government (no surprise there from a US puppet). Of course we know that it's a code-phrase for. . .let's not change the current US-dominated world disorder with its US-led wars, assassinations and torture.

    Other pet phrases, taken from my blog link above:
    ... revisionist great powers like China and Russia
    ... China's state-led, market-distorting economic model
    ... democratic, liberal values that draws us together with our allies and differentiates us from China."

    Don Bacon , Dec 12, 2018 6:19:44 PM | link
    @ 57 Loz
    Russia's Lavrov is a smart guy and gets it right, as a realist, but I prefer Iran's Khamenei who always looks on the bright side.

    . . .from a speech delivered on November 3, 2018, by Ayatollah Khamenei

    . . . the US waged military wars and military actions,
    . . .There has also been an economic war in this 40-year challenge
    . . .They have waged a media war as well.
    Well, there is an important truth which is sometimes not seen by some people: its dazzling clarity makes it go unnoticed. This truth is a bright and shining one, which is the fact that in this 40-year challenge, the side which has been defeated represents the US and the side which has achieved victory represents the Islamic Republic. --This is a very important truth. What is the reason behind America's defeat? The reason for their defeat was that it was they who began the attack. It was they who initiated corrupt actions. It was they who imposed sanctions, and it was they who launched a military attack, but they have not achieved their goals. --This is the reason why the US has been defeated.
    And he's right, Iran has defeated the US, which is why Washington is so down on Iran. The defeats have come in Iraq, and Syria, and next in Afghanistan . . .plus in Iran itself, which has stood up to the greatest world power for forty years full of sanctions and assaults, and thereby served as a model and inspiration for other countries large and small.
    jayc , Dec 12, 2018 6:46:23 PM | link
    The prosecutor's case against Meng is fundamentally weak. For instance, there is no identification of a "co-conspirator", necessary to a charge of conspiracy. It does not seem to have been developed much beyond the information developed in the 2013 Reuters investigation. At least half of that relies on unnamed "former employees" and unnamed persons who claimed to have dealt with Skycom in Iran.

    If these persons cannot be produced then all that evidence cannot rise above hearsay. The coincidences left to the prosecutors to suggest a shell corporation should be then overwhelmed by the perfectly legal offshore documentation, which represents common corporate practice worldwide. If the US courts still nail Huawei, the precedent could put all large businesses and business persons everywhere at criminal risk for currently accepted practices.

    The exit door could be a finding by the Canadian court, tacitly ok'ed by the Americans, that the case lacks merit and Meng is freed sometime in the spring to a chorus of self-congratulatory hurrahs over "rule of law". If the intent was to damage the Huawei brand in the West, then mission already accomplished.

    james , Dec 12, 2018 6:49:31 PM | link
    @57 loz... thanks for finding that! that is basically it... ditto don's comments which reflect this same mindset from the exceptional nation...

    @58 spudski.. thanks for the update on that.. it would seem china has been reading @4 Bm's comments!!!

    james , Dec 12, 2018 6:54:41 PM | link
    here is our canuck foreign affairs minister Freeland using the term as well.. "It, I think, is quite obvious that it ought to be incumbent on parties seeking an extradition from Canada, recognizing that Canada is a rule-of-law country, to ensure that any extradition request is about ensuring that justice is done, is about ensuring that the rule of law is respected and is not politicized or used for any other purpose," she said."
    https://www.cbc.ca/news/politics/china-missing-person-questioned-1.4943591
    james , Dec 12, 2018 6:55:45 PM | link
    last paragraph in that link is even better - here.. ""I think in the world today, where the rule of law is under threat in some parts of the world, being a rule-of-law country is more important now than ever," Freeland said. "And what I can commit to for Canadians, and for our partners around the world, is that Canada will very faithfully follow the rule of law."
    Jen , Dec 12, 2018 7:07:04 PM | link
    BM @ 4:

    My suggestion in the previous comments thread was noticed only by one (James) but I'm sure it still holds up well.

    Huawei could undertake to pay Sabrina Meng's bail or at least her security detail when she has to leave her house. Huawei then sends the amount paid to Beijing and Beijing charges Ottawa for the amount paid ... and includes interest payment for each and every day that Ottawa declines to pay the principal.

    Tit-4-tat actions against US companies, however desirable, might have unfortunate long-term consequences especially if elements in the US Deep State are expecting them and are prepared for them.

    karlof1 , Dec 12, 2018 7:21:25 PM | link
    Loz @57--

    Thanks for reposting Lavrov's acute observations, thus revealing that Russia and China already know the what and why of the Outlaw US Empire's doings. Frankly, I was surprised nobody commented about my Monopoly Game analogy from yesterday which illustrates the situation the Outlaw US Empire finds itself in thanks to its unilateral and exceptionalisms. Indeed, for its opponents, moves made by the Outlaw US Empire can fairly well be anticipated and thus quickly countered. And thanks to the desire by most nations for multilateralism, Russia and China find receptive audiences and ready allies in their campaign to neuter the international outlaw bully.

    A Must Remember: The USA has never wanted to subordinate itself to any rules other than its own that it can change whenever it suits itself. The key evidence of this is that while the Senate was ratifying the UN Charter in late July of 1945, the Executive branch was embarking on its terroristic Anti-Communist Crusade by arming and facilitating the infiltration of former Nazi SS and Gestapo agents into the Soviet-held regions of Eastern Europe thereby violating the newly negotiated international system of law and its own Constitution, and making itself THE primary International Outlaw Nation, which it proudly continues to be to this day.

    donkeytale , Dec 12, 2018 7:21:36 PM | link
    Don Bacon Lettuce and Tomato @ 61

    Excellent post.

    Brad Smith , Dec 12, 2018 7:21:46 PM | link
    Great article and I would say that you are getting the political implications, the hypocrisy and the rest of it pretty much spot on.

    I'll add this just for the heck of it.

    This case started a while back when ZTE narked out Huawei for using third party cutouts to avoid the sanctions. The ZTE case was in England. Because Hauwei is not the legal owner of these chips or code it makes it "theft by conversion". Using banks to launder the money is bank fraud as well.

    What a lot of people are missing, legally, is that this is not the same at all as violating sanctions by selling your own products. They do not own the chips or proprietary software in any legal sense. The chips and code are still owned by the parent company that developed them, China has what amounts to a licensing agreement with the parent companies. If Weng had violated the sanctions by transferring her own code and her own chips then it would be out of our jurisdiction. However, once they violated the terms and conditions of the contract they not only have committed fraud they have committed theft by conversion of a US owned product and they used US banks to launder the money. This is why she is actually being charged with fraud and not sanctions violations. I'd bet that if they go full hardball she would be charged with Bank Fraud as well. That's the one that comes with the most prison time.

    In short, violating sanctions doesn't usually get you arrested because it doesn't also include theft, fraud although money laundering gets them sometimes. But of course we also know that the rest of the article is pretty much correct. She was actually arrested as part of the entire back and forth over trade and all the rest. Our government normally would not pick a top dog to do jail time, so why now and why her? 5G and access to markets are a big part but so is a real concern over the constant pirating, malware, spyware, backdoor access to the Chinese government to all the encryption they use, etc. etc.

    I'm only adding my comments to remind people that the US actually does have a rock solid case against her company, so don't be at all surprised if she isn't eventually charged unless Trump does something to stop it. They were caught red handed committing fraud by using third party cut outs and lying to the banks involved as well. If the US really wants to push it they are within their legal rights under our laws to do it. She essentially stole US property and laundered the proceeds with US banks. Go ahead and try that yourself and see if you get away with it.

    Transferring a product you do not own to a third party in violation of a contract is theft by conversion. It's the same as if I recorded a football game and then sold it against their wishes and then laundered the money. It's not the violation of the sanctions per se that will get her in trouble, it's transferring stolen property, fraud and money laundering that they are actually holding over her head. If they want to, they can send her away for a long time and they know it. This could get really ugly.

    Ghost Ship , Dec 12, 2018 7:24:31 PM | link
    Don That breakingdefence seems as broken as other neo-lib sites such as Lawyers, Guns and Money.

    BTW, we are coming up for the sixtieth anniversary of the the Cuban revolutionaries kicking out the dictator Batista. Cuba, which then went on to impose massive defeats on Reagan and Thatcher by bringing down their beloved (Reagan and Thatcher's, that is) apartheid in South Africa. We are repeatedly told that it was Russian MiGs which it did but they were operated and flown by Cubans, and if Castro hadn't sent them to defeat the apartheid state in Angola, it's doubtful the conservatives in the Soviet Union would have done so. So, Cuba has been in the trenches for twenty years more than Iran and still appears to be undefeated.

    Finally, the Angry Arab has an essay up at Al Akhbar about the US secret war on Communism that is worth a read. The machine translation is readable.

    c1ue , Dec 12, 2018 7:30:44 PM | link
    Sorry, but the readers here seem to have no clue whatsoever about Putin's past.
    Putin was part of the group under the St. Petersburg mayor - it was because of this that he was put in power as Yeltsin's 2nd in command. And equally it was because of Putin's position under Yeltsin which made him acceptable to foreign powers as Russia's new head.
    Medvedev has always been an Atlanticist; much like the 1% in the US, his background is global technocracy which naturally gravitates him toward the US. Having a close relative on Gazprom doesn't hurt either.
    Point is, Putin didn't come out of nowhere nor was he a nobody.
    That he is a very articulate and thoughtful leader - that was the only surprise.
    Pft , Dec 12, 2018 7:36:17 PM | link
    China just ordered a boatload or more of soybeans and says they wont let this interfere with trade talks.

    Just the way Trump likes to deal. Meng will work out of her expensive Vancouver home as hostage until a trade deal is done. Then she gets released w/o extradition

    Anya , Dec 12, 2018 7:37:03 PM | link
    "Top Ten American War Criminals Living Freely Today:" https://rense.com/general69/tpten.htm
    karlof1 , Dec 12, 2018 7:40:48 PM | link
    Brad Smith @69--

    How many US corporations are guilty of doing the same do ya think? As for industrial espionage, I have just one word--ECHELON.

    There's an excellent reason why the Outlaw US Empire wants to change the rules of the game that it initially designed: It can no longer win using them; indeed, it can be defeated by what it emplaced. Reminds me of an old Sting hit Fortress Around Your Heart ; in fact, it's quite apt.

    Pft , Dec 12, 2018 7:51:51 PM | link
    From Christopher Black

    http://pacificfreepress.com/2018/12/10/opinion/taking-huawei-hostage-the-canadian-angle-on-meng-arrest.html

    "The pretext for her arrest is that Huawei has violated US sanctions against Iran. But the "sanctions" imposed on Iran by the US recently are illegal under international law, that is under the UN Charter that stipulates that only the Security Council can impose economic sanctions on a nation..... There is, therefore, no law that she or Huawei is violating. ....

    (Trudeau stated) that this arbitrary arrest was not politically motivated ...... Article 2 of the Treaty (with the US) requires that Canada can only act on such a request if, and only if, the offence alleged is also an offence by the laws of both contracting parties. But the unilaterally imposed and illegal sanctions placed against Iran by the USA, are not punishable acts in Canada and even in the USA the "sanctions" are illegal as the are in violation of the UN Charter.

    Article 4 (1) of the Treaty states:
    "Extradition shall not be granted in any of the following circumstances:
    (iii) When the offense in respect of which extradition is requested is of a political character, or the person whose extradition is requested proves that the extradition request has been made for the purpose of trying to punish him (or her) for an offense of the above-mentioned character.....

    So, Prime Minister Trudeau cannot evade responsibility for this hostage taking, this arbitrary arrest and detention since his government had to consider the US request and consider whether it was politically motivated. ....... It was a political arrest. The rule of law in Canada has been suspended, at least in her case, and so can be in any case.

    No Pasaran , Dec 12, 2018 8:08:10 PM | link
    Trudeau's insinuation that extradition is a purely judicial process in Canada is simply wrong. The "International Assistance Group" in the Department of Justice works actively with the requesting state against the person sought for extradition, and this can be a hugely political process involved outright lies to the court, as the Diab case revealed. Extradition law in Canada is so politicized that even when a judge commits someone for extradition, the matter is then referred to the Minister of Justice, who has the ultimate say. All of this is to maintain Canadian political alliances at the expense of the rights of the accused. Extradition, kidnapping and extraordinary rendition are almost indistinguishable in Canada.
    dh , Dec 12, 2018 8:14:16 PM | link
    @75 "Canadians should be angry about their nation being led by people whose loyalty is to Washington instead of to the Canadian people whose interests they care nothing for."

    So is Christopher Black suggesting Canada put Meng on a plane back to China and give Trump the finger? How would that be good for the Canadian people?

    jayc , Dec 12, 2018 8:14:18 PM | link
    Brad #69
    She is being charged with bank fraud. That is why she is being threatened with up to 60 years in prison. But the attribution of the cut out or shell company, Skycom, with Huawei is based on anecdotal evidence which can be effectively challengd. Alleging that Meng herself knowingly conspired to make false representation is a huge stretch, and none of the evidence assembled comes close to that. Also, the sanction violation involved less than $2 million of Hewlett Packard "gear", not high-end proprietary tech.
    T , Dec 12, 2018 8:16:03 PM | link
    Your opinion on this? How could China win a trade war since it is relying on its large trade surplus with the US? As Trump said, trade-surplus countries suffer more in trade wars, as it is they who get hit with tariffs.

    In Giant Trade War Concession, China Prepares To Replace "Made In China 2025"

    https://www.zerohedge.com/news/2018-12-12/giant-trade-war-concession-china-prepares-replace-made-china-2025

    In First Major Purchase Since "Trade War Truce", China Buy 500,000 Tonnes Of US Soybeans

    https://www.zerohedge.com/news/2018-12-12/first-major-purchase-trade-war-truce-china-buy-500000-tonnes-us-soybeans

    Brad Smith , Dec 12, 2018 8:17:12 PM | link
    Karlof1 I agree, it's damage control at this point in time.

    And yeah they have wanted "total information awareness" for a while. I think that was the term they used in the "Project for a new American Century" talking points wasn't it? They wanted to grab every bit of data produced in the entire world and store it. TOTAL information awareness. And they published that plan right out in the open for everyone to read. Then they went right ahead and built the facilities, infrastructure, hired all the people to man it and nobody did jack nothing to stop em either. (dem terrorsts might get us if we complain too much)

    Why we didn't run those neo-con fools out of town on a rail is beyond me but the reality is that people will put up with damn near anything before they really demand change.

    By the way which would you prefer, a phone with a backdoor by China or a backdoor by the US? Pretty lousy choice either way if you ask me. I bet if Heuwei would give our "intel" agencies the backdoor key to their devices they would be just fine with that as a "settlement".

    karlof1 , Dec 12, 2018 8:20:28 PM | link
    Finnian Cunningham's OP/ED serves as a complementary to b's. A taste:

    "The US has increasingly been wielding its legal definitions and measures as if it is the world's judge and jury.

    "In recent years, American lawmakers have created a slew of legal weapons, including the Magnitsky Act, the Global Magnitsky Act, the Countering America's Adversaries Through Sanctions Act, which give Washington the supposed power to penalize any country it deems to be in breach of its national laws.

    "The arbitrariness of US "justice" has got to the febrile point where Washington is threatening all nations, including its supposed European allies, with legal punishment if they don't toe the line on its designated policy."

    His conclusion:

    "Washington's lawless pursuit of its nationalistic interests is turning the globe into a seething jungle of distrust and resentment. The political chaos in Washington – where even the president is accused by domestic opponents of abusing democratic norms – is fanning out to engulf the rest of the world.

    "America's erstwhile claim of being the world's sheriff has taken on a macabre twist. Increasingly in the eyes of the world, it is a renegade state which absurdly justifies its criminality with lofty claims of rule of law."

    IMO, the world can do very well without the English-speaking nations of the Western Hemisphere. Containing them would be far easier than Eurasia, even with bases strewn globally, for they must trade with the rest of the world to keep their current standard of living whereas the rest of the world doesn't need to reciprocate. Yes, there's a very good reason why the USA called its late 19th Century trade policy the Open Door--a policy that continues today. Trump seems to want autarky, so give it to him by calling his massive bluff. Leave Uncle Scam sitting alone at his Monopoly Board masturbating while the rest of the world plays Diplomacy and Go! Send an unmistakable message that he's the Bullying Misfit and shatter his exceptional ego. Hopefully if the correct psychological approach is used, a planet devastating war can be avoided; but the latter cannot be feared when dealing with the International Bully as it must be taught a lesson it will never forget.

    dh , Dec 12, 2018 8:20:58 PM | link
    @79 I'm not sure anybody will come out a clear winner....though Trump will claim victory for sure. A large order of soy beans makes a nice gesture, so would buying a few airplanes from Boeing, but the Chinese still have a few red lines they won't cross. All depends how hard Trump wants to push.
    Peter AU 1 , Dec 12, 2018 8:21:29 PM | link
    "Moreover, attempts have been made to replace the notion of law with a "rules-based order"

    About time this was voiced publicly and Lavrov is the man to do it. It has been very noticeable over the last few years that our western or five eyes "rule of law" narrative has been replaced by "rules based order" or so called "international norms".

    Don Bacon , Dec 12, 2018 8:39:04 PM | link
    @ james, in a snarky response to a warmonger at Breaking Defense, who misunderstood a previous james comment: --
    . . ."thanks for yours as well.. usually the american trolls are always reminding others of how they abide by law, when in fact, it is quite the opposite..."
    ...a classic put-down. kudos.
    karlof1 , Dec 12, 2018 8:42:08 PM | link
    Brad Smitrh @80--

    Thanks for your reply! I own the most fundamental of cell phones used for rudimentary texting and emergencies as I have no need for further sophistication, and I had to be talked into buying that one! So, I'd prefer to have no backdoors anywhere near my person at anytime and strive to establish that condition.

    Indeed, this entire situation ought to bring governmental interference in citizen privacy to the fore so it can finally have the debate it deserves--Constitutionally, the government is in violation, it knows it, but tries to circumvent Primary Law by using the National Security canard. Should the citizen have an expectation of privacy within his/her own space or not? If not, then the entire Bill of Rights is null and void.

    Don Bacon , Dec 12, 2018 8:57:49 PM | link
    @ 79 T
    In Giant Trade War Concession, China Prepares To Replace "Made In China 2025"
    The revised plan would play down China's bid to dominate manufacturing and be more open to participation by foreign companies, these people said.

    That's what the US has been complaining about, isn't it? The American manufacturers are invited in and then have to give up all their trade secrets to be allowed to manufacture in China, until the locals take over with their newly acquired knowledge.

    Regarding soybeans, China needs it to feed their hogs. Apparently Brazil didn't work out in the long term.

    kooshy , Dec 12, 2018 8:58:14 PM | link
    @Don, Thank you for the great brave job of posting on the out of realty redneck' site. A daily dose of reality comments should really F*s the warmonger bastard' day.
    Pft , Dec 12, 2018 8:59:54 PM | link
    Dh@77

    I fail to see how exercising their sovereign right is giving Trump the finger, or bad for the Canadian people. However Canada has basically become the US 51st state since NAFTA and the first Gulf War, so they follow orders

    The new NAFTA will push up drug prices even more so they may soon join their brothers south of the border and enjoy declining life expectancy due to unaffordable Drug prices

    daffyDuct , Dec 12, 2018 9:11:26 PM | link
    From ZeroHedge "Below we present some pertinent thoughts on the arrest of Huawei CFO Meng Wanzhou from former Fed Governor Larry Lindsey and current head of the Lindsay Group."

    .. Then along comes a story in the South China Morning Post about an October meeting with employees in which Meng said that there are cases where, "the external rules are clear-cut and there's no contention, but the company is totally unable to comply with in actual operations. In such cases, after a reasonable decision-making process, one may accept the risk of temporary non-compliance."

    That statement is full of euphemisms, but it makes putting the corporate interest ahead of complying with the law the official position of management. Put that in the context of a four-year anti-corruption campaign by Xi and a purge of top-level tech executives who have gotten too big for their britches. In Xi's new world it may be one thing to have said that it was ok to put China's interests first, but she is putting the corporate interests ahead of China's interests.

    Also note that these comments were in quotes from an internal (and closed) Huawei meeting. How did the SCMP acquire these direct quotes? The SCMP is one of the world's truly great papers, publishing candid news and commentary focused on getting to the truth in a way that is only a distant memory in American newspapers. That said, it is also like Hong Kong – one nation, two systems. If Beijing really wanted a story out, it would provide the sources and the reporters would do the rest. And if they really wanted a story spiked it probably would be spiked. Those direct quotes obviously came from Chinese authorities and the story was printed at a very inconvenient time for Meng – when she was protesting her innocence. Somebody in Beijing thinks Meng is a loose cannon.

    Let's be a little conspiratorial or, more precisely, try and create a narrative that fits the facts. It arguably serves everyone's interests for Ms. Meng to be taught a lesson. It is in Bolton's and the DoJ's interest to send a message that access to power
    and connections does not buy you a get out of jail free card. It is in Xi's interest, or at least in the interests of major portions of the Chinese government, to send a signal that even the extremely well-connected still have to toe the party line.

    ...The detention did not involve any surprises. The charges against Meng were leveled three months before her arrest. The market reaction seemed to be based on the notion that this was a last-minute surprise. As for the Chinese, Xi and Company knows where everyone is going and when. They certainly knew that Meng was traveling to Vancouver, that she had a warrant for her arrest outstanding, and that Canada extradites to the U.S. They did nothing to warn her.

    ... Our conspiracy theory holds that she will be released when everyone thinks the lesson has been learned. America scores a win in terms of signal value about enforcing Iran sanctions whether Meng spends two weeks, two months, or the rest of her life behind bars. Xi will have signaled what he thinks about prioritizing corporate interests over national interests and bending regulations.

    ... One does not have to buy this conspiracy theory in all its detail to get at the essential truth that markets need to digest. Meng's arrest is not going to affect the outcome of the trade talks. Xi (and China) have too much of a stake in this to let the antics of a close friend's naughty daughter stand in the way of him getting what he wants. And once an example is made, America also has too much to lose.

    https://www.zerohedge.com/news/2018-12-12/larry-lindsey-something-about-huawei-cfo-arrest-doesnt-make-sense

    dh , Dec 12, 2018 9:12:23 PM | link
    @88 "I fail to see how exercising their sovereign right is giving Trump the finger..."

    ReallY? Then you haven't been watching Trump. He would go ballistic. He would probably renegotiate NAFTA ....again. He could put thousands of Canadians out of work overnight if he felt like it.

    Don Bacon , Dec 12, 2018 9:17:49 PM | link
    @ 69 BS
    ". . .the US actually does have a rock solid case against her company,"

    . . .to repeat from 43:

    The investigation by U.S. authorities has revealed a conspiracy between and among Meng and other Huawei representatives to misrepresent to numerous financial institutions. . . .The motivation for these misrepresentations stemmed from Huawei's need to move money out of countries that are subject to U.S. or E.U. sanctions--such as Iran, Syria, or Sudan--through the international banking system. At various times, both the U.S. and E.U. legal regimes have imposed sanctions that prohibit the provision of U.S. or E.U. services to Iran, such as banking services....
    Because Meng and other Huawei representatives misrepresented to Financial Institution 1 and the other financial institutions about Huawei's relationship with Skycom, these victim banking institutions were induced into carrying out transactions that they otherwise would not have completed. As a result, they violated the banks' internal policies, potentially violated U.S. sanctions laws, and exposed the banks to the risk of fines and forfeiture.

    So if Skycom belonged to Huawei, and the banks were "induced," there were problems --
    1. violation of banks' internal policies
    2. potentially violated US sanctions
    3. exposed banks to US punishment
    But if Skycom was an independent corporation the sanctions violations would have been okay? What am I missing. And why would the US punish banks when they were knowingly duped.
    Pft , Dec 12, 2018 9:21:36 PM | link
    T@79

    " How could China win a trade war since it is relying on its large trade surplus with the US? As Trump said, trade-surplus countries suffer more in trade wars, as it is they who get hit with tariffs."

    Well, you do know tarrifs on imports are paid by the US importer and on to the consumer. China pays not a dime of US tarrifs

    Now it could be hurt if US buyers could order from other countries. However, this is not an option for every import as there are production capacity, quality and price constraints. In the short term orders to China would not be affected much since there are not many good alternatives

    China has some weapons of their own. US military required certain rate metals from China for weapons, China basically clothes America and of course many electronics , furniture, tools and toys come from China. Witholding or taxing these exports is a weapon they have yet to use.

    Furthermore, much of the profits of US companies come from manufacturing or buying from China. Prices get marked up as much as 10 times what China receives

    18% of its exports go to US. With 20% of GDP based on exports that means US is responsible for 3.6% of Chinas GDP. Tarrifs might affect 20% of exports meaning the hit on GDP would be 0.7%. With GDP growth over 6% they wont feel too much pain.

    Kadath , Dec 12, 2018 9:38:57 PM | link
    Re:Brad Smith @69

    "hey do not own the chips or proprietary software in any legal sense. The chips and code are still owned by the parent company that developed them, China has what amounts to a licensing agreement with the parent companies. If Weng had violated the sanctions by transferring her own code and her own chips then it would be out of our jurisdiction. However, once they violated the terms and conditions of the contract they not only have committed fraud they have committed theft by conversion of a US owned product and they used US banks to launder the money. This is why she is actually being charged with fraud and not sanctions violations." -

    I've heard US government make this argument in courts before and historically US courts have generally agreed with it. However, this legal argument ignores the huge practical consideration of this rule within the current international economic system (i.e. the real world). Namely, for the last 70 years (post-WW2) the US has encouraged and promoted Liberal free market world economic integration, that each country should focus on the specialization of their economies to produce a small number of goods at a low production cost and then purchase all other goods they needed from other countries that specialized in that good (i.e. internal economic self-sufficiency is bad). Generally people hear this and immediately think of how Germany specializes in mechanical engineering, Japan specializes in high-tech computer and so on. However the realty in the world today is that is specialization goes much further in that a single circuit board in a computer WILL contain transistors made in Korea, Inductors made in Japan, Capacitators made in Taiwan, Transistors made in the US and then assembled in China. At each stage of the manufacturing / assembly process costs are carefully analyzed to minimize costs based on the provider, transportation costs, etc... to produce the goods at the lowest possible cost and maximize profits. This is what people call the Global Supply chain that has for the last 30 years underpinned the entire world manufacturing economy. N(OTE: I'm not saying this is good or bad from a moral stance, merely that this is what it is and the motive for it)

    What the US is doing, by asserting that US law indefinitely applies to any component (including intellectual or financial) that is made in or travels through the US and is then subsequently assembled or sold in a 3rd (or 4th or 5th or 6th....) country that is subject to US sanctions is a direct attack on the Global Supply Chain economy and is extremely dangerous to standard of living we've become accustom to in the Western world. Historically, when the US used sanctions like this against Cuba, North Korea, Iran, China and the Soviet Union, these countries were relatively much weaker than the US and not integrated into the Western World economy (nor were they well integrated with each other economically speaking), so the US was able to retard their economic development. However after more than 40 years of increasing integration the Western world (US, Canada, Mexico, Europe) is totally dependant on the Global Supply Chain, so now that the US is expanding their sanctions to everyone they are effectively sabotaging their own economy and the economies of their allies/vassals. Conversely, the US rivals (Particularity Russia, China & Iran) are become more economically integrated with each other and are already experienced with economic independence from the Western Market.

    The two most likely outcomes from the US actions are 1) The non-western world becomes more integrated with each other and independent of the Western market, effectively re-dividing the world like we saw during the Cold War, only now instead of Capitalist vs Socialist, it will be Neo-Liberal Fascism vs National independence (i.e. a return to the pre-1914 concept of the state) 2) The Western World will become more divided with their economies weakened as the US asserts more direct control over their vassals, impoverishing their vassals' economies in order to consolidated wealth & power into their preferred elites who will ensure their control over their vassal countries. As the quality of life of the average citizen declines and Western countries become more politically unstable and economically stagnate, we may even see a "Prague Spring" type of event, where a Western government moves away from the US/NATO/EU alliance only to suffer a US/NATO backed invasion similar to the Soviet invasion of Czechoslovakia in 1968.

    dumbass , Dec 12, 2018 9:49:01 PM | link
    >> Well, you do know tarrifs on imports
    >> are paid by the US importer and on to
    >> the consumer. China pays not a dime of
    >> US tarrifs

    No, I don't know that. It depends.

    If China's exporters have tiny margins and the consumer can afford to pay more, then yes.

    If China's exporters have big margins and fear losing market share (not necessarily to domestic American manufacturers but to other foreign manufacturers), they might choose to sell at a "lower but still profitable" price in order for the POS price to remain nearly the same and for them to retain their market share.

    dumbass , Dec 12, 2018 9:54:11 PM | link
    >> With GDP growth over 6% they
    >> wont feel too much pain.

    Pft, I agree bigly there. (And thanks for doing the math.) Despite my prior post, I doubt China cares about "maintaining market share" to ship real product to a nation that provides almost nothing but threats in payment.

    dumbass , Dec 12, 2018 9:57:57 PM | link
    >> we may even see a "Prague Spring" type
    >> of event, where a Western government moves
    >> away from the US/NATO/EU alliance only to
    >> suffer a US/NATO backed invasion similar
    >> to the Soviet invasion of Czechoslovakia
    >> in 1968.

    As a small step in that direction, someone mentioned a few French "police" vehicles bore EU insignia.

    T , Dec 12, 2018 10:01:23 PM | link
    @Pft 92

    "18% of its exports go to US. With 20% of GDP based on exports that means US is responsible for 3.6% of Chinas GDP. Tarrifs might affect 20% of exports meaning the hit on GDP would be 0.7%. With GDP growth over 6% they wont feel too much pain."


    This 18 - 19 percent export number is not true, as in does not take into account exports to the US via Hong Kong. This is only mainland exports. But China also "exports" a lot to HK, and then these goods are exported to the rest of the world. So exports to the US are more than 18 percent.

    https://tradingeconomics.com/china/exports-by-country

    Second, the biggest China trade surplus is with the US. Its trade surplus with the EU or Russia is far smaller. If they lose it, they lose a lot.

    As for tarrifs, they encourage companies to move away from China to other asian countries.

    South-east Asia will gain from a prolonged trade war, analysts say

    https://www.straitstimes.com/asia/east-asia/south-east-asia-will-gain-from-a-prolonged-trade-war-analysts-say

    And the US is waging the trade war via other means, for example it is urging allies to drop China's IT companies. New Zealand and Japan are dropping Huawei and ZTE. EU is warning too. No doubt there will be other US allies following. So costs for China will be substantial.

    Japan sets policy that will block Huawei and ZTE from public procurement as of April

    https://www.japantimes.co.jp/news/2018/12/10/business/japan-sets-policy-will-block-huawei-zte-public-procurement-april/

    Europe should be wary of Huawei, EU official says

    https://www.reuters.com/article/us-eu-china-huawei/europe-should-be-wary-of-huawei-eu-tech-official-says-idUSKBN1O611X

    What happens if the West and probably India block Chinese Tech companies? Costs for China will be substantial.

    T , Dec 12, 2018 10:04:52 PM | link
    Btw latest estimates show Chinese GDP growth dropping below 6 % after 2020. As opposed to India's nearly 8 %.
    Don Bacon , Dec 12, 2018 10:23:01 PM | link
    China's trillion dollar Belt & Road Initiative will change everything, so why get hung up on the past. The BRI provides China with an opportunity to use its considerable economic means to finance infrastructure projects around the world.

    [Dec 13, 2018] China accused of taking 'hostages' after Meng's arrest in Vancouver Asia Times

    Notable quotes:
    "... "In this case, it is clear the Chinese government wants to put maximum pressure on the Canadian government," Guy Saint-Jacques, the former Canadian ambassador to Beijing , said. Canadian Foreign Minister Chrystia Freeland went on to criticize statements by US President Donald Trump, who said in an interview on Tuesday that he was ready to intervene in the Meng affair if it helped seal a trade deal with the world's second-largest economy. ..."
    Dec 13, 2018 | www.atimes.com

    Her case has angered Beijing and shaken Canada's relations with China, which is embroiled in a trade war with Washington.

    "In this case, it is clear the Chinese government wants to put maximum pressure on the Canadian government," Guy Saint-Jacques, the former Canadian ambassador to Beijing , said. Canadian Foreign Minister Chrystia Freeland went on to criticize statements by US President Donald Trump, who said in an interview on Tuesday that he was ready to intervene in the Meng affair if it helped seal a trade deal with the world's second-largest economy.

    "Our extradition partners should not seek to politicize the extradition process or use it for ends other than the pursuit of justice and following the rule of law," she said at a press conference.

    [Dec 13, 2018] Averting World Conflict with China by Ron Unz

    Notable quotes:
    "... New York Times ..."
    "... Wall Street Journal ..."
    "... Washington Post ..."
    "... this is a clear sign that Canada no longer exists as an independent nation, but is a colony of the USA/Israeli empire. ..."
    "... This story is not about an ultra-wealthy Chinese heiress enduring an odd adventure in Canada. This story is about a complete loss of Canadian sovereignty, because detaining this lady is outright insane. Canada was conquered without firing a shot! Welcome back to the royal empire run as a dictatorship. ..."
    "... If only America focused its attention inward, on growth and stability, instead of transcendent American Imperialism then the world may stand a chance. ..."
    "... Western positions on climate, neoliberalism, migration, in my opinion point into the same direction: critical thinking, almost gone. ..."
    "... Defrauding the nation into "war of aggression" is the supreme crime one can commit against the American People. The "SUPREME CRIME"! ..."
    "... Every "penny" belonging to each and every Neocon Oligarch who CONSPIRED TO DEFRAUD US INTO ILLEGAL WAR should be forfeit until the debt from those wars is paid down .. IN FULL ! ..."
    "... Canada may be the obvious criminal. But on consideration, isn't it rather like the low-level thug who carries out a criminal assignment on the orders of a gang boss? And isn't it the gang boss who is the real problem for society? ..."
    "... and Ms. Meng was seized on the same day that he was personally meeting on trade issues with Chinese President Xi. Some have even suggested that the incident was a deliberate slap in Trump's face. ..."
    Dec 13, 2018 | www.unz.com

    As most readers know, I'm not a casual political blogger and I prefer producing lengthy research articles rather than chasing the headlines of current events. But there are exceptions to every rule, and the looming danger of a direct worldwide clash with China is one of them.

    Consider the arrest last week of Meng Wanzhou, the CFO of Huawei, the world's largest telecom equipment manufacturer. While flying from Hong Kong to Mexico, Ms. Meng was changing planes in the Vancouver International Airport airport when she was suddenly detained by the Canadian government on an August US warrant. Although now released on $10 million bail, she still faces extradition to a New York City courtroom, where she could receive up to thirty years in federal prison for allegedly having conspired in 2010 to violate America's unilateral economic trade sanctions against Iran.

    Although our mainstream media outlets have certainly covered this important story, including front page articles in the New York Times and the Wall Street Journal , I doubt most American readers fully recognize the extraordinary gravity of this international incident and its potential for altering the course of world history. As one scholar noted, no event since America's deliberate 1999 bombing of China's embassy in Belgrade , which killed several Chinese diplomats, has so outraged both the Chinese government and its population. Columbia's Jeffrey Sachs correctly described it as "almost a US declaration of war on China's business community."

    Such a reaction is hardly surprising. With annual revenue of $100 billion, Huawei ranks as the world's largest and most advanced telecommunications equipment manufacturer as well as China's most internationally successful and prestigious company. Ms. Meng is not only a longtime top executive there, but also the daughter of the company's founder, Ren Zhengfei, whose enormous entrepreneurial success has established him as a Chinese national hero.

    Her seizure on obscure American sanction violation charges while changing planes in a Canadian airport almost amounts to a kidnapping. One journalist asked how Americans would react if China had seized Sheryl Sandberg of Facebook for violating Chinese law especially if Sandberg were also the daughter of Steve Jobs.

    Indeed, the closest analogy that comes to my mind is when Prince Mohammed bin Salman of Saudi Arabia kidnapped the Prime Minister of Lebanon earlier this year and held him hostage. Later he more successfully did the same with hundreds of his wealthiest Saudi subjects, extorting something like $100 billion in ransom from their families before finally releasing them. Then he may have finally over-reached himself when Washington Post columnist Jamal Khashoggi, a Saudi dissident, was killed and dismembered by a bone-saw at the Saudi embassy in Turkey.

    We should actually be a bit grateful to Prince Mohammed since without him America would clearly have the most insane government anywhere in the world. As it stands, we're merely tied for first.

    Since the end of the Cold War, the American government has become increasingly delusional, regarding itself as the Supreme World Hegemon. As a result, local American courts have begun enforcing gigantic financial penalties against foreign countries and their leading corporations, and I suspect that the rest of the world is tiring of this misbehavior. Perhaps such actions can still be taken against the subservient vassal states of Europe, but by most objective measures, the size of China's real economy surpassed that of the US several years ago and is now substantially larger , while also still having a far higher rate of growth. Our totally dishonest mainstream media regularly obscures this reality, but it remains true nonetheless.

    Provoking a disastrous worldwide confrontation with mighty China by seizing and imprisoning one of its leading technology executives reminds me of a comment I made several years ago about America's behavior under the rule of its current political elites:

    Or to apply a far harsher biological metaphor, consider a poor canine infected with the rabies virus. The virus may have no brain and its body-weight is probably less than one-millionth that of the host, but once it has seized control of the central nervous system, the animal, big brain and all, becomes a helpless puppet.

    Once friendly Fido runs around foaming at the mouth, barking at the sky, and trying to bite all the other animals it can reach. Its friends and relatives are saddened by its plight but stay well clear, hoping to avoid infection before the inevitable happens, and poor Fido finally collapses dead in a heap.

    Normal countries like China naturally assume that other countries like the US will also behave in normal ways, and their dumbfounded shock at Ms. Meng's seizure has surely delayed their effective response. In 1959, Vice President Richard Nixon visited Moscow and famously engaged in a heated "kitchen debate" with Premier Nikita Khrushchev over the relative merits of Communism and Capitalism. What would have been the American reaction if Nixon had been immediately arrested and given a ten year Gulag sentence for "anti-Soviet agitation"?

    Since a natural reaction to international hostage-taking is retaliatory international hostage-taking, the newspapers have reported that top American executives have decided to forego visits to China until the crisis is resolved. These days, General Motors sells more cars in China than in the US, and China is also the manufacturing source of nearly all our iPhones, but Tim Cook, Mary Barra, and their higher-ranking subordinates are unlikely to visit that country in the immediate future, nor would the top executives of Google, Facebook, Goldman Sachs, and the leading Hollywood studios be willing to risk indefinite imprisonment.

    Canada had arrested Ms. Meng on American orders, and this morning's newspapers reported that a former Canadian diplomat had suddenly been detained in China , presumably as a small bargaining-chip to encourage Ms. Meng's release. But I very much doubt such measures will have much effect. Once we forgo traditional international practices and adopt the Law of the Jungle, it becomes very important to recognize the true lines of power and control, and Canada is merely acting as an American political puppet in this matter. Would threatening the puppet rather than the puppet-master be likely to have much effect?

    Similarly, nearly all of America's leading technology executives are already quite hostile to the Trump Administration, and even if it were possible, seizing one of them would hardly be likely to sway our political leadership. To a lesser extent, the same thing is true about the overwhelming majority of America's top corporate leaders. They are not the individuals who call the shots in the current White House.

    Indeed, is President Trump himself anything more than a higher-level puppet in this very dangerous affair? World peace and American national security interests are being sacrificed in order to harshly enforce the Israel Lobby's international sanctions campaign against Iran, and we should hardly be surprised that the National Security Adviser John Bolton, one of America's most extreme pro-Israel zealots, had personally given the green light to the arrest. Meanwhile, there are credible reports that Trump himself remained entirely unaware of these plans, and Ms. Meng was seized on the same day that he was personally meeting on trade issues with Chinese President Xi. Some have even suggested that the incident was a deliberate slap in Trump's face.

    But Bolton's apparent involvement underscores the central role of his longtime patron, multi-billionaire casino-magnate Sheldon Adelson, whose enormous financial influence within Republican political circles has been overwhelmingly focused on pro-Israel policy and hostility towards Iran, Israel's regional rival.

    Although it is far from clear whether the very elderly Adelson played any direct personal role in Ms. Meng's arrest, he surely must be viewed as the central figure in fostering the political climate that produced the current situation. Perhaps he should not be described as the ultimate puppet-master behind our current clash with China, but any such political puppet-masters who do exist are certainly operating at his immediate beck and call. In very literal terms, I suspect that if Adelson placed a single phone call to the White House, the Trump Administration would order Canada to release Ms. Meng that same day.

    Adelson's fortune of $33 billion ranks him as the 15th wealthiest man in America, and the bulk of his fortune is based on his ownership of extremely lucrative gambling casinos in Macau, China . In effect, the Chinese government currently has its hands around the financial windpipe of the man ultimately responsible for Ms. Meng's arrest and whose pro-Israel minions largely control American foreign policy. I very much doubt that they are fully aware of this enormous, untapped source of political leverage.

    Over the years, Adelson's Chinese Macau casinos have been involved in all sorts of political bribery scandals , and I suspect it would be very easy for the Chinese government to find reasonable grounds for immediately shutting them down, at least on a temporary basis, with such an action having almost no negative repercussions to Chinese society or the bulk of the Chinese population. How could the international community possibly complain about the Chinese government shutting down some of their own local gambling casinos with a long public record of official bribery and other criminal activity? At worst, other gambling casino magnates would become reluctant to invest future sums in establishing additional Chinese casinos, hardly a desperate threat to President Xi's anti-corruption government.

    I don't have a background in finance and I haven't bothered trying to guess the precise impact of a temporary shutdown of Adelson's Chinese casinos, but it wouldn't surprise me if the resulting drop in the stock price of Las Vegas Sands Corp would reduce Adelson's personal net worth were by $5-10 billion within 24 hours, surely enough to get his immediate personal attention. Meanwhile, threats of a permanent shutdown, perhaps extending to Chinese-influenced Singapore, might lead to the near-total destruction of Adelson's personal fortune, and similar measures could also be applied as well to the casinos of all the other fanatically pro-Israel American billionaires, who dominate the remainder of gambling in Chinese Macau.

    The chain of political puppets responsible for Ms. Meng's sudden detention is certainly a complex and murky one. But the Chinese government already possesses the absolute power of financial life-or-death over Sheldon Adelson, the man located at the very top of that chain. If the Chinese leadership recognizes that power and takes effective steps, Ms. Meng will immediately be put on a plane back home, carrying the deepest sort of international political apology. And future attacks against Huawei, ZTE, and other Chinese technology companies would not be repeated.

    China actually holds a Royal Flush in this international political poker game. The only question is whether they will recognize the value of their hand. I hope they do for the sake of America and the entire world.


    Carlton Meyer , says: Website December 13, 2018 at 5:36 am GMT

    This is no surprise. Anyone who follows political events knows that John Bolton is insane, so no surprise that he devised this insane idea. The problem will be corrected within a week, and hopefully Bolton sent to an asylum.

    However, this is a clear sign that Canada no longer exists as an independent nation, but is a colony of the USA/Israeli empire. Canada provides soldiers for this empire in Afghanistan even today, and in Latvia. Most Canadians can't find that nation on a map, but it's a tiny unimportant nation in the Baltic that NATO adsorbed as part of its plan for a new Cold War.

    This story is not about an ultra-wealthy Chinese heiress enduring an odd adventure in Canada. This story is about a complete loss of Canadian sovereignty, because detaining this lady is outright insane. Canada was conquered without firing a shot! Welcome back to the royal empire run as a dictatorship.

    Cloak And Dagger , says: December 13, 2018 at 5:40 am GMT
    I hope someone in China is reading this article. I would love to see Adelson and his cohorts go down in flames. This would fit right in with China's current anti-corruption foray. Xi has a reputation for hanging corrupt officials. Shutting down Adelson's casinos would be consistent with what Xi has been doing and increase his popularity, not least of all, right here in the US.
    Tusk , says: December 13, 2018 at 5:43 am GMT
    If only America focused its attention inward, on growth and stability, instead of transcendent American Imperialism then the world may stand a chance. The future will suffer once China's debt traps collapse and like America it begins placing military globally. America would be the one country who could work towards a Western future but this will never be the case. Better start learning Mandarin lest we end up like the Uyghurs.
    Frankie P , says: December 13, 2018 at 5:55 am GMT
    @Anonymous Use your brain. The Chinese elite want to use the political clout that Adelson and the other big casino Jews have with the US government. To gain lobby power from a proven expert, Shelly Adelson, they are willing to allow him to make the big bucks in Macao. They expect quid pro quo.
    sarz , says: December 13, 2018 at 6:02 am GMT
    Great suggestion, based on sound analysis, especially your pointing out the centrality of Zionism in Trump's foreign policy.

    I wish you would blog more.

    Anonymous [346] Disclaimer , says: December 13, 2018 at 6:11 am GMT
    The Chinese are pussies and will always back down. The U.S. laughed in their face after they bombed and killed them in Belgrade and got crickets from the Chinamen. China can't project much power beyond its borders. They can't punch back. The Chinese (and East Asians) are only part of the global business racket because they are efficient worker bees facilitating the global financial system. They have no real control over the global market. And if they start to think they do they'll get a quick lesson. Like they're getting with Meng, who is being treated like coolie prostitute. LMAO.
    Baxter , says: December 13, 2018 at 6:44 am GMT
    I always enjoy fresh writing from Mr. Unz. Clarity of thought is a fine thing to witness in language. It should be stated, America is not in any danger.the empire is and is in terminal decline. As Asia's economic might grows in leaps ad bound, so does the empire scramble to thwart losing its global grip.

    As Fred Reed once pointed out, declining empires rarely go quietly. Will America's leadership gamble on a new war to prevent asia's ascendancy?
    I think it's possible.

    But what do I know. As my father once said, "I'm just a pawn in a game."

    To his credit he had the wherewithal to see that. Alas, most Americans are asleep.

    renfro , says: December 13, 2018 at 8:08 am GMT
    The call for Ms. Meng's arrest had to come from the US Treasury's Office of Foreign Assets Control. They enforce every thing related to sanctions, which they claim is what Meng was arrested for– sale of phones and software to Iran. But they also say they had been on her company's case since 2013 so their timing is rather suspect.

    What else I don't understand is her company has research and offices in Germany, Sweden, the U.S., France, Italy, Russia, India, China and Canada ..So if what they sold or attempted to sell to Iran wasn't outright 'stolen' intellectual property from the US or even if it was why not transfer it to and or have it made in China or some country not signed onto the Iran sanctions and then sell it to Iran. I haven't boned up on exactly what kinds of phone software they were selling but I think it has something to do with being able to bypass NSA and others intercepts.

    The Alarmist , says: December 13, 2018 at 8:49 am GMT
    You are assuming Meng is not a sacrificial pawn in some larger game.

    It would be priceless for Xi to shut down Adelson's operations in Macau for a few days or weeks, but I'm afraid Xi is very much akin to Capitain Louis Renault in Casablanca , and after walking into a Macau casino and uttering the phrase, "I am shocked- shocked- to find that gambling is going on in here!" might admit in the next breath, "I blow with the wind, and the prevailing wind happens to be from Jerusalem."

    jilles dykstra , says: December 13, 2018 at 9:06 am GMT
    Half a century or so propaganda like 'the USA policing the world' of course had effect. Not realised is that in normal circumstances police is not an autonomous force, but has to act within a legal framework. The illusion of this framework of course exists, human rights, democracy, whatever
    anon [426] Disclaimer , says: December 13, 2018 at 9:09 am GMT
    She's out on bail. Agree that Bolton blindsided Trump. Trump is going to try to turn this into some sort of PR gesture when he pardons her. No way he will let this mess up his trade deal. Which is beached until she exonerated.
    jilles dykstra , says: December 13, 2018 at 9:28 am GMT
    @Anonymous

    What is true of these stories of course cannot be known with certainty, but it is asserted that USA military technology is way behind China and Russia. Several examples exist, but of course, if these examples tell the truth, not sure. PISA comparisons of levels of education world wide show how the west is intellectually behind the east.

    Western positions on climate, neoliberalism, migration, in my opinion point into the same direction: critical thinking, almost gone.

    Tom Welsh , says: December 13, 2018 at 9:41 am GMT
    "I very much doubt that they are fully aware of this enormous, untapped source of political leverage".

    I very much doubt whether that is the case. As far as I know, most Chinese people are distinguished by their intelligence, thoroughness and diligence. What do the thousands of people employed by China's foreign ministry and its intelligence services do all day, if they are unaware of such important facts?

    However I also doubt if China's leaders are inclined to see matters in nearly such a black and white way as many Westerners. Jewish people seem to get along very well in China and with the Chinese, which could be because both have high levels of intelligence, culture, and subtlety. As well as being interested in money and enterprise.

    It's certainly an interesting situation, and I too am waiting expectantly for the other shoe to drop.

    Tom Welsh , says: December 13, 2018 at 9:45 am GMT
    @TheMediumIsTheMassage

    Yes, whatever your bias is, China is a "normal" country. In the sense of being closer to the ideal than most countries – not of being average.

    You may bewail some of the "human rights" issues in China, although I believe they may be somewhat magnified for PR purposes. But when did China last attack another country without provocation and murder hundreds of thousands of its citizens, level its cities, or destroy the rule of law? (Like Afghanistan, Iraq, Libya )

    The Chinese seem to be law-abiding, sensible, and strongly disposed to peace. Which is something the world needs a lot more of right now.

    alexander , says: December 13, 2018 at 9:47 am GMT
    @Dan Hayes "why hasn't anyone before thought of it.. "

    " WHY HASN'T ANYONE BEFORE THOUGHT OF IT !!"

    You must be kidding me.

    For over three years I have been issuing comment after comment after comment .Like a crazed wolf howling in a barren forest .That the "number one" priority of the American people should be demanding the seizure of ALL the assets of Neocon oligarchic class.

    Why ?

    Not because they are "oligarchs." ..or some might own "casinos" but because they "deliberately" Conspired to Defraud the American People into illegal Wars of Aggression and have nearly bankrupted the nation in the process.

    That's why.

    And it is the worlds BEST REASON to seize the assets a thousand times better than "bribery charges." I have issued statement after statement to that affect ,on Unz Review, in the hope that at some point it might, at least subliminally, catch on.

    What I have witnessed over the past six years, is a lot of intelligent, thoughtful people "correctly diagnosing" the issues which plague the nation But no one had any idea of what to do about it. I have been pointing out, that if people really want to do something about it then do whats RIGHT: Seize the assets of the defrauders.!

    Of course we can. Of course we can Its the LAW! Defrauding the nation into "war of aggression" is the supreme crime one can commit against the American People. The "SUPREME CRIME"!

    (If you don't think so, go ask your local Police Officer. He will tell you FLAT OUT ..it is the Worst crime "Conspiracy to Defraud into Mass Murder! .Not good ! You can even ask him if there is a statute of limitations. He will probably say something like " Yeah .When the Sun collapses!")

    And they are GUILTY as charged There is no doubt , .. not anymore. We all know it and can "prove" it ! Every "penny" belonging to each and every Neocon Oligarch who CONSPIRED TO DEFRAUD US INTO ILLEGAL WAR should be forfeit until the debt from those wars is paid down .. IN FULL !

    The keys to the kingdom are right there, right in front of your noses. If you want to change things ."take action" the law is on YOUR side. We don't need China to do a damn thing ..We just need the American People to rise up,"apply the law" and take back their country and its solvency.

    Tom Welsh , says: December 13, 2018 at 9:47 am GMT
    @Nonny

    Canada may be the obvious criminal. But on consideration, isn't it rather like the low-level thug who carries out a criminal assignment on the orders of a gang boss? And isn't it the gang boss who is the real problem for society?

    Brabantian , says: December 13, 2018 at 9:59 am GMT
    An article with the identical take as Ron Unz, including the idea that China has its key lever via Sheldon Adelson's casinos, was published on the Canadian website of Henry Makow also noting that USA political king-maker Adelson, is a major force behind the anti-Iran obsessions that partly grounded the arrest of Ms Meng, and so well-deserves consequences here...

    In the Jeffrey Sachs article linked above, Sachs lists no less than 25 other companies which have been 'violating US sanctions' and admitted guilt via paying of fines, but never suffered any executive arrests, including banks including JP Morgan Chase, Bank of America, PayPal, Toronto-Dominion Bank, and Wells Fargo.

    In terms of international law, the Meng case violates numerous basic legal and United Nations norms :

    This is also a significant humiliation of President Trump personally, his own advisors apparently colluding to render him powerless and uninformed

    The Meng case brings to mind the story of another sanctions-violating 'target' arrested at USA request, the great USA chess master and non-Zionist Jew, Bobby Fischer (1943-2008).

    Born in Chicago, Illinois, USA, Fischer impressed the world with his genius, but, like Ms Meng became criminally indicted by the USA regime, for the 'crime' of playing chess in Yugoslavia when the Serb government was under USA 'sanctions'. Harassed across the globe, Fischer was jailed in Japan in 2004-05 by embarrassed Japanese leaders, for this fake 'crime' which few people in the world thought was wrong. Fischer had been using his celebrity voice to strongly criticise the USA & Israeli governments, making him also a political target, much as Ms Meng is a political target due to her being a prominent citizen and quasi-princess of China.

    The Japanese, loath to be the instrument of Fischer's USA imprisonment, finally allowed Bobby to transit to Iceland where he was given asylum and residency. Living not far from Iceland's NATO military base, Fischer became quickly and mysteriously struck with disease, and Fischer died in Reykjavik, perhaps a victim of a CIA-Mossad-Nato assassination squad.

    The Chinese government, I am told, directly understands the power and role of Sheldon Adelson here, and Chinese inspectors are perhaps inside Adelson's Macau properties as you read this. Perhaps Chinese officials may show up soon in Adelson's casinos, and repeat the line of actor Claude Rains' character in the 1942 film 'Casablanca' -
    "I'm shocked, shocked, to find that gambling is going on in here!"

    OMG , says: December 13, 2018 at 10:24 am GMT
    @renfro Seconded
    LondonBob , says: December 13, 2018 at 10:32 am GMT
    @renfro http://www.atimes.com/article/did-trumps-enemies-try-to-derail-a-trade-deal-with-china/

    Article suggests the Office of Terrorism and Financial Intelligence which Mr Giraldi has commented on.

    http://www.unz.com/pgiraldi/israels-fifth-column-2/

    Heros , says: December 13, 2018 at 10:47 am GMT
    @sarz Great links.

    What we have to realize is that just as there is no real difference between Democrats and Republicans because they are both owned by the same people, so must we realize that in reality there is little difference between the leaders of the worlds countries because they are all owned by the same central banks. This is why Nate Rothschild famously stated "give me control of a countries money supply, and I care not who makes its laws" . All the world's central banks are tied together by BIS, WB and IMF and the US marines. This is the reason Syria, Libya, NK and Venezuela have been taken down: Rothchild central bank control.

    So this Huaiwei arrest almost certainly has nothing to do with the "trade war", and is with certainly a hit by one side of the Kabal against the other. Zionist Nationalists versus Chabad Lubbovitz perhaps?

    Jared Kushner has been lying pretty low lately and recently was stripped of his security clearance. He was linked to Kissilev the Russian ambassador, plus he was pushing Trump to help protect MBS in SA. I would bet that he is at the center of this storm.

    AndrewR , says: December 13, 2018 at 10:54 am GMT
    I'm honestly shocked no one has stated the obvious: very, very few Americans would be likely to care if Sheryl Sandberg were arrested on dubious charges in China. I cant say I would be one of those few people.

    I also should note that the crown prince of KSA is Mohammad bin Salman. Salman is his father, the king. The crown prince is Mohammad, son of (aka "bin") Salman.

    AndrewR , says: December 13, 2018 at 11:00 am GMT
    @Nonny Lmao! Canada is a vassal state of the US. The US govt ordered Canada to arrest Meng, and Canada's govt dutifully complied.
    AndrewR , says: December 13, 2018 at 11:11 am GMT
    @TheMediumIsTheMassage In many ways China does deviate from international norms, but of course so does the United States. As Tom Welsh pointed out, Chinese foreign policy is downright angelic compared to the US, even if you consider Tibet and Xinjiang to be illegitimately occupied territories (an argument I'm sympathetic to). Perhaps China would act as belligerently as the US does if China were the sole global superpower, but it's not, so it's fair to judge China favorably compared to the US.
    Sean , says: December 13, 2018 at 11:18 am GMT Godfree Roberts , says: December 13, 2018 at 11:20 am GMT
    @TheMediumIsTheMassage It's certainly abnormal in having a functioning democracy and the trust of 90% of its citizens.

    Is there anything else that disqualifies it from normalcy?

    AndrewR , says: December 13, 2018 at 11:21 am GMT
    @Craig Nelsen Trump deserves it for hiring Bolton at all. Perhaps one might argue Trump was blackmailed into doing so but he doesn't seem to be acting like a blackmailed man.
    SimplePseudonymicHandle , says: December 13, 2018 at 12:16 pm GMT
    Mr. Unz, at no time since Ms. Wanzhou's arrest have I felt myself in a position to judge that this was a strategically unwise or incautious act. It might be, but apparently I'm to be contrasted from so many of your readers, and you, simply for understanding myself to have an inadequate handle on the facts to make the call. That would be true, that my handle on the facts would be inadequate, even if I didn't have personal knowledge of Huawei's suspicious practices or their scale.

    I worry that you don't seem to evidence the presence of someone trusted who will go toe to toe with you as Devil's Advocate. Too often, on affairs of too great a consequence, you come across too strongly, when the data doesn't justify the confidence. A confident error is still an error and Maimonides' advice on indecision notwithstanding, a confident error is a candidate for hubris, the worst kind of error. All of this, of course, assumes you make these arguments in good faith because if not the calculus changes mightily.
    Too many of your readers evidence that they interpret this event and form an opinion of it based on nothing but this higher order syllogism:

    Because I distrust the US government
    [or because I distrust those I believe to control the US government]
    It follows that this was an unjustified act or else a dangerous strategic error

    After this higher order syllogism is accepted without due critique, evidence is sought to justify it and no further consideration of the possibilities is tallied.

    At minimum you need to have run a permutation where you seriously consider that : it is well know to US operatives, if not to US citizens, you, and your readers, that Huawei is actively, constantly and maliciously waging covert war on the USA. You should at least consider this possibility. If true, this act may merely be a shot across the bow that notifies China of a readiness to expose things China may not wished exposed, and might stop endangering US citizens, if it were made aware such things stand to be exposed.

    If that's true, not only are you a fishing trawler captain causing distraction with a loudspeaker yelling at the captain of the destroyer that just fired the warning shot across the bow of a Chinese vessel that is likely covert PLA/N, but now you may be positioning your trawler to block the destroyer.
    Do you really have enough information to know this is wise? Do you really know as much as the destroyer captain?
    I will be away today, in the off chance you reply and I don't immediately answer it is because I can't.

    ariadna , says: December 13, 2018 at 12:24 pm GMT
    Superb, as always, Ron Unz!
    For someone who says he has no background in economics you you put your finger dead center on the money nexus of this "puppet run by another puppet controlled by another puppet dangling from the strings of a still bigger puppet" chain from hell.
    I wish someone would read out the entire article, may be with photos of the culprits, on Youtube with subtitles in Chinese.
    Wizard of Oz , says: December 13, 2018 at 12:26 pm GMT
    @Craig Nelsen Nobody is suggesting that "the order" came from Bolton or that he could indeed give any such order. True his not telling Trump about what was about to happen bears a sinister interpretation.
    lavoisier , says: Website December 13, 2018 at 12:32 pm GMT
    @TheMediumIsTheMassage I think what he means by normal are countries whose leaders are interested in the well being of their nation and the people they rule. No divided or corrupted loyalties to another nation.

    By this standard the United States is clearly not a normal country.

    Che Guava , says: December 13, 2018 at 12:33 pm GMT
    Well said, Mr. Unz.

    I was finding the arrest hard to believe, too.

    One angle you did not mention, Cisco (U.S. company) of course until not too many years ago had a near-monopoly on the kind of network systems Huawei is selling as number one now (actually, I did not know of Huawei's success there, thought of it as a handset maker), that may be a factor here.

    There are a few Chinese or U.S. people of that descent on this site, mainly PRC-sympathetic, it would be very amusing if they were able to ignite a big discussion of your hypothetical reprisals

    Ahoy , says: December 13, 2018 at 12:35 pm GMT
    @ Anonymous [346] #10

    For whatever is worth, if any.

    During the bombing of Belgrade a missile fell on the Chinese Embassy. A local tv reporter approached a Chinese Embassy official and asked him. What are you going to do now? The answer was.

    "Ask me this question forty years from now"

    Strictly personal, Wow!

    Durruti , says: December 13, 2018 at 12:52 pm GMT
    @Brabantian Nice comment.

    Yes, poor Bobby Fischer.

    The Meng case brings to mind the story of another sanctions-violating 'target' arrested at USA request, the great USA chess master and non-Zionist Jew, Bobby Fischer (1943-2008).

    Fischer was another victim of Zionist controlled American imperialism. Yugoslavia, the child of Woodrow Wilson, became the victim of the Imperialist war Against Russia. Russia's brother, and ally, Yugoslavia, was destroyed by the kind democrat gang administration of Wm (that was not sex), Clinton.

    Nonny , says: December 13, 2018 at 12:55 pm GMT
    @Tom Welsh You complicate things by bringing up the Mafia boss. Who committed the actual crime? Who kidnapped the woman?
    Anon55 , says: December 13, 2018 at 12:58 pm GMT
    Excellent article, and an ingenious suggestion regarding the Adelson casinos. But I wouldn't hold my breath waiting for a casino shutdown. Having worked in the marketing end of the casino industry myself, I can tell you the most coveted demographic lists were always the Chinese players, words like fanatical and obsessive don't even come close to describing their penchant for gambling. I could literally see casino shutdowns in China causing a national Gilet Jaune moment followed by the overthrow of the Communist Party LOL.

    I would definitely welcome seeing more Ron Unz articles on current topics.

    Jim Christian , says: December 13, 2018 at 1:04 pm GMT
    @Carlton Meyer Any chance this is Democrat, Deep State types at State and Justice manufacturing this cluster-f in order to make Trump look unaware? This is a President that respects casinos. And business. If Bolton and Company pulled this from behind the scenes without Executive knowledge or authorization, is that even legal? More treason? But given the circumstances, how does all this even GET to Iran, hurt Iran at all? What was supposedly illegal was done in 2010. Are we certain bags of cash from the Chinese and Russians and Iran weren't traveling about Democrat-ruled DC back then? Grabbing this chick helps the case against Iran? I'm at a loss as to how.

    And so the thought of a more local political benefit/purpose, stirring a diplomatic shit-storm on Trump's watch, something he'd have to take responsibility for. To start a near war, sort of like the Bay of Pigs. Operatives, pulling tricks, writing checks the President then has to cover, looking like an unelectable mook throughout.

    I'm happy to give the AIPAC kiddies full credit, I just don't see the damage to Iran in all this. For crying out loud, we carted $500 billion cash over to Iran under Obama's watch, what, 2013 or 2014ish? I don't know how we skip over THAT, to get to trade shenanigans in 2010, also taking place under Obama's watch. What was Holder doing when he was AG after all, why no action then? If it's Israeli-driven today, why wasn't Israel pushing Holder to take action against Huawei back in 2010?

    Makes no sense.

    TRASH(NOT) , says: December 13, 2018 at 1:06 pm GMT
    @TheMediumIsTheMassage How is the USA a "normal" country in any sense of the word? It once was truly great among the nations of the world but that ship sailed looooong back.

    We invade for fake "freedom", inject the poison of homo mania into nations that do not do the bidding of the homos and/or bend to the will of the chosen ones, pretend it's all for some good cause then invite the survivors to displace the founding stock of this country. You call that "normal"??

    We are nothing more than a vehicle for every kind of degenerate (((loser))) with cash to use our men and women as their private mercenaries. We spread filth around the place, destroy nations and proclaim ourselves as the peace-makers with the shrill voice of a worn out street prostitute on kensingtion ave (philly).

    We are like that hoe, living out the last days of her aids infested body, with a grudge on the world for something that was completely of our (((own))) making. Philly might have been the birthplace of this country but camden is where we are all headed. And looking at China, we are dysfunctional beyond repair. Of course we still have quite a few things the Chinese might want to emulate (no the SJW versions but the read deal) but looking at our other maladies, they probably won't who'll blame them?

    Icy Blast , says: December 13, 2018 at 1:08 pm GMT
    Gosh I hope Agent Orange gets a copy of this article. But I am afraid he is surrounded by Bolton-type traitors.
    Anon [257] Disclaimer , says: December 13, 2018 at 1:09 pm GMT
    @Anon Yes it was s Portuguese colony. Interesting that Persian traders including Jews were in Macau going back st least to 500 AD probably more.

    Ron, have you sent this article to the Chinese ambassador in DC yet?

    Strange that the Chinese let Adelson in. The Macau casinos have thrived for a long time. The Portuguese left valuable casinos and the Chinese let the Jews in soon after the Portuguese left.

    It makes sense that foreign casino operators would want to move into Macau, but why would China let foreigners in?

    Could it be that one of the largest investors in China since the mid 1970s Richard Blum husband of Dianne Feinstein has something to do with it??
    She's as much the Senator representing China as a Senator representing California.

    Ronnie , says: December 13, 2018 at 1:11 pm GMT
    Another interesting aspect of all this is the "suicide" of Physics Professor Zhang Shoucheng at Stanford just a few hours after Meng was arrested on Dec 1. According to reliable Chinese sources and widespread reporting on social media Zhang was the conduit to China from Silicone Valley. He was richly rewarded by Chinese investment in his US companies. IMHO the Chinese understand the role of Israel and Adelson in US politics but are cautious in going this far. The Chinese are taking the light touch approach with Trump and his Adelson selected neocons. A Chinese businessman Guo WenGui with the highest connections to the Chinese elites and security services has sought political asylum in the USA. On the internet he daily speaks to the Chinese diaspora (in Mandarin) on the complex developments in Chinese official corruption. The NY Times has now started to take him seriously (good idea ) and reports that he and Steve Bannon have formed an alliance to expose Chinese government activities. You can read all this in the NY Times. Unz should translate Guo Wengui into English and publish his commentaries. In my analysis he is usually right about China and has shown remarkable predictive powers. He knows how and what the Chinese think, where the bones are buried and what comes next. He and Bannon plan to reveal the facts about the recent suicide in France of another prominent Chinese businessman Wang Jian who was Chairman of Hainan Airlines parent company.
    Buzz Mohawk , says: December 13, 2018 at 1:18 pm GMT
    This article by Mr. Unz is a good example of why people should read and support the Unz Review. No one is better equipped to shed light on otherwise unmentioned interests behind mainstream news events like this one.

    Kudos for making a smart suggestion that no doubt will be heard by people who could carry it out.

    Ilyana_Rozumova , says: December 13, 2018 at 1:37 pm GMT
    Good article, but it is only scratching the surface.
    Many things would be explained if somebody would find out what is the volume of US investment in China, and what percentage of it is Jewish.
    That would shed light why the rabid Jewish press in US so bestially attacking Trump, after Trump started to impose tariffs on Chinese goods.
    I do not know, but I could guess that Trump reached deep into Jewish profits.
    We have no choice than wait what will happen to tariffs after Trump will be replaced.
    RVBlake , says: December 13, 2018 at 1:40 pm GMT
    @Carlton Meyer Canada declared an end to participating in combat operations in Afghanistan in July 2011 and withdrew its combat forces, leaving a dwindling number of advisors to Afghan forces. The last Canadian soldier departed Afghanistan in March 2014. You are spot on regarding Bolton's certifiability.
    Virgile , says: December 13, 2018 at 1:50 pm GMT
    Trump has been totally phagocyted by the Neo-Cons in the foreign policy. The two pillars of the neocons foreign policy are now Saudi Arabia and Israel. Trump is benefitting from the neo-cons intelligence and their powerful financial network that he is convinced would help in his reelection.
    Once he is re-elected then he may decrease his reliance on them but for the next few years the jewish lobby will prevail in Trump's foreign policy. Unless they are not able to protect Trump from falling under the democrats assaults or been eliminated from power, they are on for more wars, more troubles and more deaths. History will place Trump near Bush junior as neo-cons puppets responsible for the largest destruction of countries since WWII.
    eah , says: December 13, 2018 at 1:50 pm GMT
    Doesn't really address the core problem.
    Anon [257] Disclaimer , says: December 13, 2018 at 2:02 pm GMT
    @Brabantian Interesting that she was arrested in the Chinese colony of Vancouver BC. Maybe the Canadian government is asserting sovereignty over Vancouver at long last.

    That must have been frightening. There she was sitting in the VIP lounge surrounded by deferential airline clerks as usual and suddenly she's under arrest.

    Johnny Smoggins , says: December 13, 2018 at 2:02 pm GMT
    The most disappointing thing about this whole incident, so far, is China's timidity in dealing with America.

    Holding some C level former Canadian diplomat? Come on China, prove you're a serious nation, you can do much, much better.

    Johnny Smoggins , says: December 13, 2018 at 2:06 pm GMT
    @Carlton Meyer Canada has been a vassal state of the U.S. since it stopped being a vassal state of the U.K. in the 1960′s.
    Sean , says: December 13, 2018 at 2:10 pm GMT

    Since the end of the Cold War, the American government has become increasingly delusional, regarding itself as the Supreme World Hegemon.

    More delusional than when in 1957 the US government gave Iran a nuclear reactor and weapons grade uranium? In his latter years Khashoggi 's relative, the weapons dealer Adnan Khashoggi, much later mused on what the US was trying to achieve by giving Iran vast amounts of armaments, when all it did was set off an arms race in the region. America then switched to Iraq as its cop on the beat and gave them anything they asked for, and were placatory of Saddam when he started talking crazy. This was under the US government least attentive to Israel. Yes things should be more balanced as Steven Walt suggests

    Averting World Conflict with China, by Ron Unz - The Unz Review If it wants to create the conditions for a final settlement of the Palestinian problem, then America should be more even handed but it must also be very cautious about Iran. We don't know who will be in power there in the future and history shows that once those ME counties are given an inch they take a mile.

    Saudi Arabia seems quite sensible, its liking for US gov bonds that even Americans think offer too low a rate of interest is easily explained as payment for US protection. Killing Khashoggi that way was a dreadful moral and foreign policy mistake from someone who is too young for the amount of authority he has been given, but the victim did not beg for death like more than a few Uygurs are doing right now. The CIA agent China rounded up with the help of it's network of double agents in the US were doubtless glad to have their interrogation terminated.

    https://www.bloomberg.com/news/features/2018-10-20/vancouver-is-drowning-in-chinese-money

    Some sweeteners from Adelson are likely in the Tsunami of dirty Chinese money, which are amusingly being laundered in Canadian casinos. As Walt points out the Chinese elite want bolt holes and bank accounts in north America. By the way most of the ill gotten gains are from sale of opiates such as fentanyl.

    Targeting Sheldon Adelson's Chinese Casinos

    Yes that will work, especially when added to what China is already doing in targeting farmers who supported Trump, so he is definitely not going to be reelected now you have explained all this to them, and you are also opening up Harvard to their children, which can only redound to the detriment of white gentiles. Deliberate pouring of the vials of wrath or just accidentally spilling them? I am begining to wonder.

    Silva , says: December 13, 2018 at 2:35 pm GMT
    @Nonny Someone commits a crime while wearing a hat, and you blame the hat? What's wrong with you?
    Almost Missouri , says: December 13, 2018 at 2:43 pm GMT
    Thank you, Ron, for a clear-headed and insightful article.

    There are however, two tiny infelicities, which I would not want for them to distract from the article's merit.

    First, I think the Saudi Arabian Prince you are referring to is Prince Mohammed bin Salman, not "Prince Salman". "Prince Mohammed" would be the abbreviated form of his name. "Bin" is of course the Arabic equivalent of the Hebrew "ben" indicating paternity, rather than a middle name, so "Salman" is not his surname. "Prince Salman" would refer to the current Saudi King before he was King, rather than to the current Prince.

    Second, maybe the hypothetical of China seizing Sheryl Sandberg of Facebook is not the best analogy since I, and I suspect others who are aware of her key role in empowering and enriching a deceptive and parasitical industry, would not be terribly troubled if China seized her. Indeed, we might consider it a public service. Admittedly, it is hard to find a good analogy for a prominent female executive of a US national champion company since so many of our prominent companies are predatory rather than productive and scorn their native country rather than serve it.

    Anon [732] Disclaimer , says: December 13, 2018 at 2:53 pm GMT

    and Ms. Meng was seized on the same day that he was personally meeting on trade issues with Chinese President Xi. Some have even suggested that the incident was a deliberate slap in Trump's face.

    The unmistakable style is there.

    Bill H , says: Website December 13, 2018 at 2:56 pm GMT
    @Baxter "America is not in any danger." America is in very great danger, but only from within.

    Almost half of all millenials believe that Capitalism is evil and that the Socialism should be the guiding economic principle of this nation. When you point out that it has failed for every nation in history that has tried it, notably the Soviet Union and more recently Venezuela, they retort that it is because those countries "did it wrong" and that "we will do it right." When you ask for specifics as what they "did wrong" that we will "do right" they stare at you wordlessly as if you are the one who is an idiot.

    It should also be pointed out that a vast majority of Democrats think that Ocasio-Cortez is brilliant and that we need more legislators like her.

    anonomy , says: December 13, 2018 at 2:58 pm GMT
    What if Ms. Meng, was giving Iranian dissidents phones and other equipment to undermine the Government of Iran, starting another color revolution, that sucks in America and Israel? What if the Trump administration asked that this not be done in order to end the endless "revolutions" that have been happening and bankrupting our country and threatening Israel? What if the sanctions are benefiting Iran's government too? China was allowed to become so large at our expense when we opened up trade and moved businesses over there, but this was to keep them from being too cozy with Soviet Russia, just ask Nixon.
    DESERT FOX , says: December 13, 2018 at 3:00 pm GMT
    Part of the Zionist plan for a Zionist NWO was laid by David Rockefeller when he sent Kissinger to China to open up Chinas slave labor to the NWO types like Rockefeller and the Zionist controlled companies in the U.S. and part of the plan was the deindustrialization of America thus bringing down the American standard of living while raising the standard of living in China.

    I will never believe the fake disagreement between the Zionist controlled U.S. and the Chinese government as long as G.M and Google and the other companies that have shut down their operations in the U.S. and opened operations in China, it is all a NWO plan to bring down we Americans to third world status and then meld all of us into a Zionist satanic NWO.

    The enemy is not at the gates, the enemy is in the government and its name is Zionism and the Zionist NWO!

    [Dec 08, 2018] Neocons Sabotage Trump s Trade Talks - Huawei CFO Taken Hostage To Blackmail China

    Highly recommended!
    Notable quotes:
    "... It was Bolton who a week ago intentionally damaged U.S. relations with China. ..."
    "... Meng Wanzhou is a daughter of the founder and main owner of Huawei, Ren Zhengfei, and was groomed to be his successor. The company is extremely well regarded in China. It is one its jewel pieces and, with 170,000 employees and $100 billion in revenues, an important political actor. ..."
    "... The arrest on December 1 happened while president Trump was negotiating with president Xi of China about trade relations. Trump did not know about the upcoming arrest but Bolton was informed of it ..."
    "... It was a trap. The arrest is a public slap in the face of China and to Xi personally. It will not be left unanswered. Whatever Trump may have agreed upon with Xi is now worthless. John Bolton intentionally sabotaged the talks and the U.S. relations with China. ..."
    "... Having read this in context with the comments (especially those by Denk and others) previous on this topic, I would ask if anyone can provide a time line of US clandestine negative (and sometimes fatal) actions against high level Chinese engineers and telecoms. Again, the above summary is outstanding. ..."
    "... The terrifying aspect is Bolton, Pompeo - puppets both for shadow power players - have no constraints whatsoever, and obviously operate without any constraint or regard for our severely (cognitively and emotionally) challenged president ..."
    "... The timing of this arrest - while Trump and Xi are dining and Sabrina Meng is on her way to the G-20 conference gives a loud message that Trump is serves at the pleasure of his neocon staff - and son in law, the latter being instrumental in the firing of Rex Tillerson, the hiring of Bolton, Pompeo and the impending firing of Gen. Kelly. ..."
    "... Trump is a global front for a different approach to maintaining global hegemony but make no mistake, Trump is not fronting for you ..."
    "... Arresting US business execs by China is a mistake that would be cheered by Bolton and Navarro. The provocation of arresting Meng is designed by the Trump team to provoke China to arrest US business leaders and thus destroy their direct investment into China. ..."
    "... The enemy of China is not US businesses but rather the neocon dominated US govt. To impact this group, China needs to cut off their drug supply(their financing) thru no longer buying their USTs to finance and enable their massive military spending and financial aggression. ..."
    "... Canada's role in this is shocking. It is all of a piece with the surrender to the USA in the Trade negotiations whereby, inter alia, Canada is not allowed to enter into Trade agreements with 'non-market' economies. The non-market formulation being code for unapproved by Uncle Sam. No doubt the Nazi Freeland is running this show. In this she is ably seconded by the 'opposition' Tories and the social fascist NDP which is as enthusiastic for war against China as it is for an attack on the Donbas. ..."
    "... Those who talk about Trump, Pompeo, Bolton, Kelly, etc. direct our attention to a shell game. They are all in on the scam. How better to say it? There is one party: the war party. Trump is a member of TEAM USA. US political maestros dance to the tune of the Deep State/neolibcon. ..."
    "... With respect to Foreign Policy, how much real difference is there between Clinton, Bush, Obama, and Trump? They have all supported MIC, Israel, and expanding the Empire - aka Job #1 ..."
    "... Bolton works for Adelson probably Pompeo does too. So Trump can't fire their crazy asses any time he chooses. ..."
    "... Adelson has made millions with his gambling dens. In some ways it's a bit like what the East India Company did with opium. ..."
    "... I think we can assume that the arrest was not an unwelcome surprise for Trump, or he would have reversed it. He knew, and accepts it. It's total asymmetric war on China. The arrest was on December 1. Trump twitter, Dec 7 China talks are going very well! here ..."
    "... Does the fact that Huawei recently passed Apple for the number 2 phone sales have anything to do with this ..."
    "... CNN: A judge in the US District Court for the Eastern District of New York issued a warrant for Meng's arrest on August 22, it was revealed at the hearing Friday here . She was arrested on December 1. Meng didn't know about this "issued warrant?" How does this 'system of laws' work, anyhow? Perhaps the warrant issue was classified secret, for US national security? ..."
    "... The problem with Iran is (as was with Iraq, Libya, Venezuela, and even Syria) that a country with an independent/non-aligned foreign policy has control of a large quantity of valuable natural resources for which there is a constant and relatively insatiable demand. If they cannot be controlled they they should be destroyed so they cannot pursue their own agenda and ignore the dictates of the west. China and Russia are this problem writ large, and they have nukes and a means of delivery to all corners of the globe... ..."
    Dec 08, 2018 | www.moonofalabama.org

    Neocons Sabotage Trump's Trade Talks - Huawei CFO Taken Hostage To Blackmail China Willy2 , Dec 7, 2018 2:30:00 PM | link

    CNN reports that White House chief of staff John Kelly is expected to resign soon . There have been similar rumors before, but this time the news may actually be true. That is bad for Trump and U.S. policies. Kerry is one a the few counterweights to national security advisor John Bolton. His replacement will likely be whoever Bolton chooses. That will move control over Trump policies further into the hands of the neo-conservatives.

    It was Bolton who a week ago intentionally damaged U.S. relations with China.

    The U.S. Justice Department arranged for Canada to arrest the chief financial officer of Huawei, Meng Wanzhou, over alleged U.S. sanctions violations with regards to Iran. The case is not over the sanction Trump recently imposed, but over an alleged collision with the sanction regime before the nuclear deal with Iran. The details are still unknown.

    Meng Wanzhou is a daughter of the founder and main owner of Huawei, Ren Zhengfei, and was groomed to be his successor. The company is extremely well regarded in China. It is one its jewel pieces and, with 170,000 employees and $100 billion in revenues, an important political actor.

    The arrest on December 1 happened while president Trump was negotiating with president Xi of China about trade relations. Trump did not know about the upcoming arrest but Bolton was informed of it :

    While the Justice Department did brief the White House about the impending arrest, Mr. Trump was not told about it. And the subject did not come up at the dinner with Mr. Xi. Mr. Trump's national security adviser, John R. Bolton, said on NPR that he knew about the arrest in advance, ..

    Bolton surely should have informed Trump before his dinner with Xi, in which Bolton took part, but he didn't.

    It was a trap. The arrest is a public slap in the face of China and to Xi personally. It will not be left unanswered. Whatever Trump may have agreed upon with Xi is now worthless. John Bolton intentionally sabotaged the talks and the U.S. relations with China.

    Cont. reading: Neocons Sabotage Trump's Trade Talks - Huawei CFO Taken Hostage To Blackmail China

    Posted by b at 02:00 PM | Comments (76) - I almost starting to feel sorry for D.A.A.D. Trump.
    - We have seen in the last years that the US has been (deliberately) ratcheting up tensions in the Far East. And the summit between Trump & Kim Jung Un was a severe threat for that (deliberate) increase of tensions. But the US & european media have told their readers/listener/watchers that China was to blame for the increase of tensions.


    Jen , Dec 7, 2018 2:34:44 PM | link

    The death of Shoucheng Zhang, by falling from a building, supposedly due to depression, reminded me of an incident I had read about years ago, of another scientist's death in 1953 in vaguely similar circumstances. I had forgotten the fellow's name but I remembered the incident had something to do with the CIA and the administration of LSD so I used those two terms along with "fall" and "window" and was able to dig up the details.

    In 1953, CIA researcher Frank Olson was administered LSD without his consent by researchers working in the Project MK Ultra program. Olson became severely depressed and resigned from the CIA. He was later found dead, apparently after falling out of a motel building through a window, and his death was ruled a suicide. In the 1970s, his family ordered an autopsy and the autopsy showed that Olson had died from head injury trauma before falling through the window. A CIA agent was found to have been staying at the same motel in a separate room at the time Olson died. The family sued the US government and received $750,000 in compensation and an apology from the CIA.
    https://thoughtcatalog.com/jeremy-london/2018/08/mkultra-conspiracy/

    One wonders if Zhang's death had been, ahem, "arranged" according to that template. The description of Zhang from the Stanford University News website's obituary that B linked to in his post does not sound like a profile of someone who suffered depression on and off.

    PavewayIV , Dec 7, 2018 2:35:17 PM | link
    This has to be embarrassing as hell to Trump - he should be absolutely furious with Bolton and Pompeo. And all this for violating sanctions on Iran? I feel like on crazy pills. We live in interesting times.
    Richard , Dec 7, 2018 2:38:20 PM | link
    So, if Bolton sabotaged Trump's efforts to do some sort of deal with China, in whose interest is Bolton working. You'd think that a trade deal with China would be good for the US. Is Bolton working against US interest.

    If we accept the Globalist/Nationalist framework, then does this not mean that Bolton is helping the nationalists against US interests. And what are the implications of that.

    jayc , Dec 7, 2018 2:38:29 PM | link
    Trump's rapid departure from Argentina may well have been motivated by receiving the information about the arrest after the well hyped dinner. If that is the case, Bolton should have been fired on the spot. The lack of any statement about this affair from Trump is curious. There may be an element of blackmail at play here too, related to Mueller's machinations ahead of the G20. A malignancy is loose, no doubt.
    abierno , Dec 7, 2018 2:52:06 PM | link
    Thank you for this excellent column. Having read this in context with the comments (especially those by Denk and others) previous on this topic, I would ask if anyone can provide a time line of US clandestine negative (and sometimes fatal) actions against high level Chinese engineers and telecoms. Again, the above summary is outstanding.

    The terrifying aspect is Bolton, Pompeo - puppets both for shadow power players - have no constraints whatsoever, and obviously operate without any constraint or regard for our severely (cognitively and emotionally) challenged president, as this report makes clear.

    The timing of this arrest - while Trump and Xi are dining and Sabrina Meng is on her way to the G-20 conference gives a loud message that Trump is serves at the pleasure of his neocon staff - and son in law, the latter being instrumental in the firing of Rex Tillerson, the hiring of Bolton, Pompeo and the impending firing of Gen. Kelly.

    psychohistorian , Dec 7, 2018 2:56:18 PM | link
    I can't believe that Trump did not know about the detention of Meng Wanzhou before hand. Trump is a TV actor and he is apprenticing for a higher spot for himself and family is the elite pecking order.

    While we might want to give Trump credit for being who he is, the elite that fronted him know exactly what his style and penchants are. Trump is a global front for a different approach to maintaining global hegemony but make no mistake, Trump is not fronting for you nor I

    freetrade , Dec 7, 2018 3:11:30 PM | link
    From the perspective of China, their most appropriate response in this complicated situation IMO, should be to accelerate their gradual reduction of USTs.

    All those articles about how China will hurt itself if it gradually sells down USTs are nonsense articles placed into the media to throw off attention to what is already happening. Russia and Turkey have alrdy done it on a smaller scale, it's a no-brainer that China can do it also. Why should China finance the US govt to wage war on itself?

    If China and other countries gradually stop buying USTs, actual demand will collapse and many other holders will sell or reduce likewise. Mnuchin is fantasizing when he says there will still be strong demand. Any demand will be from the US Treasury buying its own USTs, like a dog licking its own rear quarters.

    Arresting US business execs by China is a mistake that would be cheered by Bolton and Navarro. The provocation of arresting Meng is designed by the Trump team to provoke China to arrest US business leaders and thus destroy their direct investment into China.

    The enemy of China is not US businesses but rather the neocon dominated US govt. To impact this group, China needs to cut off their drug supply(their financing) thru no longer buying their USTs to finance and enable their massive military spending and financial aggression.

    How to do that without crashing the markets n decreasing China's own assets? Sell and reduce USTs gradually. And pretend u r not doing it. Eventually the lack of buying will force the Fed to raise rates or force the US Treasury to buy its own USTs, further debasing the US dollar.

    In history, all empires fall this way, they keep on printing or taking out the silver content until their currency gets debased into nothing, and nobody wants it.

    dh , Dec 7, 2018 3:14:42 PM | link
    Looks like Bolton wants war with China. I recall he was hired during the North Korea talks to add a bit of muscle and now Trump is stuck with him whether he likes it or not.

    Re. Meng....apparently she faces fraud charges related to the Skycom affair. Of course that is just what we're told. Who knows what kind of pressure she will come under once they get her in the US.

    "Meng Wanzhou -- the chief financial officer for the Chinese tech giant Huawei -- is wanted in the U.S. on allegations of fraud, a bail hearing has been told." https://www.cbc.ca/news/canada/british-columbia/bail-hearing-huawei-cfo-1.4936150

    chu teh , Dec 7, 2018 3:24:15 PM | link
    1959, CIA disobeyed Pres Eisenhower's ban on further overflights of USSR until after his summit meeting with Khrushchev. Then the U-2 was brought down over USSR and the live pilot captured. The US officially denied it happened.

    The USSR cancelled the summit meeting.

    At first, Eisenhower claimed to have no knowledge of the operation and was outraged when the truth revealed. UN Ambassador Stevenson made a vehement speech at the UN denying it happened, followed immediately with USSR producing both the plane's wreckage and its pilot.

    Then USSR showed the pilot and wreckage was publicly displayed. Pilot F G Powers had safely bailed-out and was put on-trial in Moscow, convicted and then allowed to return to the US.

    Mission Accomplished! by the unelected leaders of the US [who were certain their man Nixon would be the next President, followed by quick re-capture of Cuba and then war in Vietnam. Both those operations already directly involved Nixon, who was fully "in" on The Bay of Pigs and, earlier, plans for US "support" of Saigon leaders in "South" Vietnam with whom he established communications during his 1953 visit as Ike's new Vice-President.]

    james , Dec 7, 2018 3:30:06 PM | link

    ...that data on this is more shocking then i realized.. the death of prof zhang - apparent suicide, is bizarre here..

    i agree that the usa has been taken over by small minded neo cons that would try to use meng wanzhou as leverage.. the fact Bolton knew and Trump didn't.. i am not buying that, or Bolton is more manipulative then i realized.. they are all that stupid though.. i hope Canada doesn't allow this, but under the wuss Justin Trudeau, i am not holding my breath..

    @ 12 dh... wanted for ignoring us sanctions on iran from 2009 to 2014... what the fuck has that to do with canada?? is canada now doing book keeping, and everything else for the usa? the usa can go fuck themselves.. if Canada wasn't a 2 bit vassal state, that is what we would tell the usa..

    Uncle $cam , Dec 7, 2018 3:31:59 PM | link
    Flashback Friday

    Oh, and what happened to the head of interpol, Meng Hongwei recently???

    A. Person , Dec 7, 2018 3:46:11 PM | link
    OT, but just to a degree.

    Today is Dec.7, a day in 1941 that Pres. Roosevelt aptly called "A Day of Infamy," as the Japanese military attacked Pearl Harbor.

    We now know that the very top echelons of US government first correctly anticipated and then knew precisely when and how the attack would occur. The 3,000 (+/-) GI's who were sacrificed were considered "acceptable losses." (The 3,000 civilians who were sacrificed on 9/11 were also considered "acceptable losses.") "Infamy" is an accurate word for US .gov conduct.

    (Pls, do not comment to this OT. Wait for the next open thread, if you must.)

    John Gilberts , Dec 7, 2018 4:28:57 PM | link
    Trudeau says he knew about the arrest in advance.

    https://www.theglobeandmail.com/politics/article-canada-prepared-for-possible-chinese-cyber-retaliation-over-arrest-of/

    Looks like Trump was out of the loop. Trudeau is mainly photo-op material only. This would have been Chrystia Freeland, the Nazi grand-daughter's file.

    ashley albanese , Dec 7, 2018 5:29:38 PM | link
    In Australia - endless media trumpeting the closed door to Chinese telcos from Australia and New Zealand but one has to go out of one's way to discover our neighbor Papua New GUINEA has continued using HuaHwei products albeit under U S pressure not to do so
    bevin , Dec 7, 2018 5:32:00 PM | link
    1/ "... the rise first of Communism and then of Islam as world forces opposing imperialism."

    Has Islam, in fact, been in opposition to imperialism? For the most part, as in India/Pakistan, it has been a very useful imperialist foil against nationalism and socialism. There have been sincere and effective muslim campaigns against imperialism but equally there have been imperialist financed 'islamic' campaigns against enemies of the Empire.

    2/ Canada's role in this is shocking. It is all of a piece with the surrender to the USA in the Trade negotiations whereby, inter alia, Canada is not allowed to enter into Trade agreements with 'non-market' economies. The non-market formulation being code for unapproved by Uncle Sam. No doubt the Nazi Freeland is running this show. In this she is ably seconded by the 'opposition' Tories and the social fascist NDP which is as enthusiastic for war against China as it is for an attack on the Donbas.

    I used to be a member of this, once mildly socialist party. I am proud to say that I was expelled.

    Rolf , Dec 7, 2018 5:38:42 PM | link
    Five Eyes Against Huawei

    7 DECEMBER 2018, http://www.voltairenet.org/article204264.html

    Washington has asked Ottawa to arrest Meng Wanzhou and to extradite her. The motive for the war undertaken by Washington against Huawei is deep-rooted and spurious are the justifications.

    The heart of the problem is that the Chinese firm uses a system of encryption that prevents the NSA from intercepting its communications. A number of governments and secret services in the non-Western world have begun to equip themselves exclusively with Huawei materials, and are doing so to protect the confidentiality of their communications.

    The covers/excuses for this war are theft of intellectual property or in the alternative, trade with Iran and North Korea, and violating rules of competition by benefitting from national subsidies.

    The Five Eyes is a system of electronic espionage by Australia, Canada, the United States, New Zealand and the United Kingdom. They have begun to exclude Huawei from their auctions.

    Jackrabbit , Dec 7, 2018 5:46:11 PM | link

    Those who talk about Trump, Pompeo, Bolton, Kelly, etc. direct our attention to a shell game. They are all in on the scam. How better to say it? There is one party: the war party. Trump is a member of TEAM USA. US political maestros dance to the tune of the Deep State/neolibcon.

    Fine distinctions between senior US govt officials make me want to tear my hair out. In US govt only whistle-blowers are white knights. Everyone else is engaging in good guy/bad guy bullshit and controlled opposition.

    With respect to Foreign Policy, how much real difference is there between Clinton, Bush, Obama, and Trump? They have all supported MIC, Israel, and expanding the Empire - aka Job #1.

    Willy2 , Dec 7, 2018 5:46:51 PM | link
    - Bolton was appointed under pressure from one Sheldon Adelson, who was a (large) donor to the Trump campaign. In that regard, it was (nearly) impossible for Trump to fire Bolton.
    Castellio , Dec 7, 2018 5:50:25 PM | link
    Jen @2

    In terms of Frank Olsen, there is a very good six part documentary series on Netflix called "Wormwood". Most important are the interviews with Olsen's son. His search for the truth took many years (too many years) and he finally uncovered the final levels of deceit. Worth the time.

    dh , Dec 7, 2018 5:53:10 PM | link
    @14 ".. wanted for ignoring us sanctions on iran from 2009 to 2014... what the fuck has that to do with canada?? "

    Absolutely nothing james. I suspect they are using that charge, rather than getting into 5G backdoor whatever, to make the extradition process go faster. They don't want it to drag on for years.

    dh , Dec 7, 2018 5:56:39 PM | link
    @32 Right. Bolton works for Adelson probably Pompeo does too. So Trump can't fire their crazy asses any time he chooses.
    CDWaller , Dec 7, 2018 6:18:32 PM | link
    Surely it's Bolton who must go. That was an enormous betrayal. The one thing that Trump had going for him was the performance of the stock market. His neocon enemies in the form of Bolton, managed to strike two blows simultaneously; increase conflict with China and tank the market.
    Daniel , Dec 7, 2018 6:32:55 PM | link
    Too many posters letting Trump off the hook here. He's a brilliant 4D chess master but at the same time he's also a vulnerable naif who lets neocons, ziofascists and other hostile entities keep hijacking his administration for their own ends? Bit of a problem there. You can't have it both ways.

    Occam's Razor says the Trump administration's foreign policy, possibly with Russia as an exception, is run with the full approval of Donald John Trump. He's no friend of China, remember, and Steve Bannon's plan to befriend Russia was designed to keep it from partnering with China against the United States.

    It's almost 2019 and like the Obots of 2010 it's time to accept that your man is a busted flush, a fraud, an American exceptionalist through and through.

    jayc , Dec 7, 2018 6:37:39 PM | link
    The "fraud" charge goes back to 2009/10, and concerns an alleged misrepresentation over the relationship between a company called SkyComm and Huawei. The alleged sanction violation by SkyComm had nothing to do with Iran's nuclear or military programs, and may not have even proceeded beyond a negotiation phase. The alleged "fraud", or misrepresentation, rests on a technical interpretation of complicated interlocking corporate structures. The prosecutors and the defence will likely both be correct in their presentations, as it is a muddle, but the well has already been poisoned by the now well-publicized accusations that Huawei is a Communist trojan horse. It's very thin gruel to proceed with such a high profile arrest.
    Sasha , Dec 7, 2018 8:22:10 PM | link
    @Posted by: Rolf | Dec 7, 2018 5:38:42 PM | 30
    The heart of the problem is that the Chinese firm uses a system of encryption that prevents the NSA from intercepting its communications. A number of governments and secret services in the non-Western world have begun to equip themselves exclusively with Huawei materials, and are doing so to protect the confidentiality of their communications.

    And not only the governments and secret services, Huawei is widely popular all along EU amongst the common working class user ( which means millions and millions of users....) especially because of its advantageous price and great capabilities.... I myself own a Huawei device, my friends own Huaweis....Glad to hear that "Five Eyes" can not spy on us....I am very fidel to marks/services who do not deceive me, but after knowing this new "capability", I am thinking in keeping Huawei as my header mark....Just waiting for them to launch the laptop "Five Eyes" waterproof and I will be throwing this old one to the trash bin....

    dh , Dec 7, 2018 8:58:58 PM | link
    Well it seems we have to wait until Monday to see if Meng gets bail or not. That's a long time for Trump to keep his mouth shut on anything.
    Glenn Brown , Dec 7, 2018 9:03:38 PM | link
    @32,36
    I wonder how Adelson would react to a Chinese boycott of his casinos in Macau and Singapore? A lot of his wealth has come from Chinese gamblers. Given Adelson's connections to Bolton and Trump, it would seem like an obvious pressure point.
    james , Dec 7, 2018 9:29:36 PM | link
    @38 lili... denk was discussing this on the open thread yesterday.. see his links @68 / 76 and etc on this page.. no one is discussing this..

    @48 peter au.. it certainly appears that way.. funny thing how trump sold himself on a number of topics, but not that one.. meanwhile, i guess the loot from adelson is quite good... stick with me and you don't need any stickin russian oligarch.. what is quite amazing is how blind the average amerikkkan is to all this.. they are still stuck on the mueller investigation which has been running on empty for some time... they would never do an investigation on isreal, or zionists influence on us elections, as it is too friggin' obvious for anyone looking... better to skip that and continue to serve israel.. thus the constant fixation with iran..

    james , Dec 7, 2018 9:30:59 PM | link
    or russia and china, as the case may be... the top 3 evil countries, according to obama, or was that north korea.. i guess trump will have to revise it.. the usa is pathetic.. canada is not far behind..
    Don Bacon , Dec 7, 2018 9:38:22 PM | link
    Trump didn't know b/c the NYTimes said so?
    I've got this bridge....
    China's response may not be immediate, but it will come.
    I'm reminded of the sudden death of Vice Adm. Scott Stearney, commander of the Navy's 5th Fleet, Persian Gulf, discovered inside his home in Bahrain last weekend, a "suspected suicide."
    Iran always gets even.
    psychohistorian , Dec 7, 2018 9:41:09 PM | link
    To those of us that understand that all/most of the politicians are working for the same team, it should be easy to see the good cop/bad cop dynamic being used here.

    If b thinks Trump is a good cop, as he presents him here (yes, b has written that he disagrees with all/most of what Trump does) as do other commenters that post here, I would posit that "they" are being successful in working that meme at this time.

    China will not back down and now will play hardball back, but in a globalist sense I expect them to continue to take the high road as the West mires itself further in the muck of its religion of private finance.

    Another commenter mentioned the strategy of China dumping its massive amount of US Treasuries. I think we are getting to that moment and the response of the US is to default on whomever is holding its debt...............

    and then the war we have been in for some time turns serious.

    The problem the elite have is making the public have the fervor to slaughter themselves for the purpose of continuing a society run by and only servicing the elite. I don't understand how they have managed all these centuries but here we are, a bit still in the dark ages of a thousand years ago.

    dh , Dec 7, 2018 9:57:33 PM | link
    @55. Very interesting idea. Adelson has made millions with his gambling dens. In some ways it's a bit like what the East India Company did with opium.
    Don Bacon , Dec 7, 2018 10:14:47 PM | link
    I think we can assume that the arrest was not an unwelcome surprise for Trump, or he would have reversed it. He knew, and accepts it. It's total asymmetric war on China. The arrest was on December 1. Trump twitter, Dec 7 China talks are going very well! here
    Anunnaki , Dec 7, 2018 10:21:01 PM | link
    Does the fact that Huawei recently passed Apple for the number 2 phone sales have anything to do with this
    Hoarsewhisperer , Dec 7, 2018 10:21:55 PM | link
    This is a 100% neocon clusterfuck. It is vital to the success of Trump's Drain The Swamp strategy that The Swampers be given every opportunity to put their anti-US influence on public display. At least now we know which weirdos are responsible for the US policy of "Let's do SOMETHING, even it it's stupid."

    I've been scouring the 'News' and the www for evidence that China agreed to uphold US sanctions on Iran to an extent that would invite the US to punish China for disregarding US whims. No luck, so far.

    What makes this story entertaining is that the US has not only surrendered its lead in Military Tech, from the Good Old Days, but Computer and Communications Tech too. You have to be pretty desperate to admit a blunder of that magnitude, albeit obliquely, as in this case.

    slit , Dec 7, 2018 10:24:07 PM | link
    Unlikely that few in Trump's cabinet or Senate Foreign Relations committee could even pass the physics section of a college entrance exam, and have little idea what quantum encryption even is (Chinese published on it first a couple of years ago).

    That presumption alone suggests Pompeo Bolton etc are just finger puppets ... which oligarch has all those cia contracts again?

    They are in well over their heads. They can't even keep up with the Russians. They will likely get stung by Chinese scorpions without even knowing what hit them!

    dh , Dec 7, 2018 10:28:27 PM | link
    @63 Indirectly yes. According to Jim Cramer....whose objectivity I am increasingly coming to respect....Apple will lose out because of the arrest.

    "Top tech players like Apple, Micron, Intel and Qualcomm are all "worth less today than yesterday," says the "Mad Money" host."

    https://www.cnbc.com/2018/12/06/cramer-huawei-cfo-arrest-just-made-companies-like-apple-less-valuable.html

    Hoarsewhisperer , Dec 7, 2018 10:52:40 PM | link
    Another 'unintended consequence' of the neocon gambit to embarrass Trump by by-passing him, will be renewed interest in something Vlad said in one of Oliver Stone's Putin's Interviews.

    In the context of Vlad's feelings about POTUS Trump, Vlad said words to the effect that it's too soon to say. Everyone knows that AmeriKKKa has been run by the Permanent Bureaucracy (not the POTUS). A lot of people would have been 'too busy' to watch the Putin Interviews but World Leaders, everywhere, would not have been among them. So as of December 1, 2018, that cat is well and truly out of the bag and all eyes, as usual, are on Trump. Again.

    Don Bacon , Dec 7, 2018 10:54:09 PM | link
    CNN: A judge in the US District Court for the Eastern District of New York issued a warrant for Meng's arrest on August 22, it was revealed at the hearing Friday here . She was arrested on December 1. Meng didn't know about this "issued warrant?" How does this 'system of laws' work, anyhow? Perhaps the warrant issue was classified secret, for US national security?

    Actually, I fear, it's a conspiracy of intel agencies, security advisors and courts to conduct domestic and foreign policy. It's a non-elected "government" which elected politicians can't touch. For those that doubt it, check out this important interview with intel whistleblowers Shipp, Binney and Kiriakou which describes Washington corruption is here . (h/t Carlton Meyer)
    Politicians can't touch this secret government lest their security clearances be removed.

    Don Bacon , Dec 7, 2018 11:03:36 PM | link
    @70
    In the two-hour interview John Kiriakou points out that the intel agencies have their favorite courts. His delayed case, resurrected by Obama, was heard by a court in eastern Virginia, which had a 98% conviction rate. They got him for a couple years in prison. General Petraeus, however, who did much worse, had his case heard in a court in western Virginia, and he got probation. It appears that the US District Court for the Eastern District of New York is good for anti-China warrants.
    the pessimist , Dec 7, 2018 11:48:53 PM | link
    D B@70 I read that she was aware of the warrant and avoided traveling to the USA because of it as she had been doing to ?" visit her son who was in school here"? but likely thought Canada safe. Wrong.

    So China seems fearful to me - detaining the head of INTERPOL for instance and re-educating the Uyghurs en mass, plus the heavy internet censorship. But they cannot disengage from the west economically without risking social upheaval. Nor can the US afford to disengage from China for roughly the same reason (unlike Russia from whom the US gets rocket engines but little else they cannot obtain from other sources).

    In a few years time (2, or perhaps 3) both Russia and China will have deployed weapons that can deter anything but a full on nuclear attack, and their military capability will continue to advance. US strategy seems to be to disrupt, slow, and sabotage both to the extent it is able using economic and political weapons and military posturing. I don't believe it can catch up and this creates extra danger - the longer it waits the greater the gap will be - economic and military. Many of the responses seem borderline hysterical to me - not a good thing.

    The problem with Iran is (as was with Iraq, Libya, Venezuela, and even Syria) that a country with an independent/non-aligned foreign policy has control of a large quantity of valuable natural resources for which there is a constant and relatively insatiable demand. If they cannot be controlled they they should be destroyed so they cannot pursue their own agenda and ignore the dictates of the west. China and Russia are this problem writ large, and they have nukes and a means of delivery to all corners of the globe...

    [Dec 08, 2018] White House, Trudeau seek to distance themselves from Huawei move

    This is about destruction of neoliberalism. Transnational financial elite under neoliberalism is above the law. the USA blatantly breaches this convention now. And will pay the price.
    This is Onion-style humor is no it : White House, Trudeau seek to distance themselves from Huawei move
    Notable quotes:
    "... The official, speaking on condition of anonymity, acknowledged that the arrest could complicate efforts to reach a broader U.S.-China trade deal but would not necessarily damage the process. ..."
    "... Meng's detention also raised concerns about potential retaliation from Beijing in Canada, where Prime Minister Justin Trudeau sought to distance himself from the arrest. ..."
    Dec 08, 2018 | finance.yahoo.com

    Huawei Technologies Co Ltd's chief financial officer, Meng Wanzhou, the 46-year-old daughter of the company's founder, was detained in Canada on Dec. 1, the same day Trump and Chinese President Xi Jinping dined together at the G20 summit in Buenos Aires.

    A White House official told Reuters Trump did not know about a U.S. request for her extradition from Canada before he met Xi and agreed to a 90-day truce in the brewing trade war.

    Meng's arrest during a stopover in Vancouver, announced by the Canadian authorities on Wednesday, pummeled stock markets already nervous about tensions between the world's two largest economies on fears the move could derail the planned trade talks.

    The arrest was made at Washington's request as part of a U.S. investigation of an alleged scheme to use the global banking system to evade U.S. sanctions against Iran, according to people familiar with the probe.

    Another U.S. official told Reuters that while it was a Justice Department matter and not orchestrated in advance by the White House, the case could send a message that Washington is serious about what it sees as Beijing's violations of international trade norms.

    The official, speaking on condition of anonymity, acknowledged that the arrest could complicate efforts to reach a broader U.S.-China trade deal but would not necessarily damage the process.

    Meng's detention also raised concerns about potential retaliation from Beijing in Canada, where Prime Minister Justin Trudeau sought to distance himself from the arrest.

    "The appropriate authorities took the decisions in this case without any political involvement or interference ... we were advised by them with a few days' notice that this was in the works," Trudeau told reporters in Montreal in televised remarks.

    [Dec 08, 2018] America's act against China borders on military aggression

    Dec 08, 2018 | www.moonofalabama.org

    spudski , Dec 6, 2018 12:56:44 PM | link

    Michael Hudson's comment on Naked Capitalism:

    December 6, 2018 at 9:47 am

    I think that America's act against China borders on military aggression. The US is saying, "Don't deal with any country that we're imposing sanctions on. We want to grab Iran's oil. That's why we overthrew Mossedegh. That's why we installed the Shah and his police state. We want Saudi Arabia's money, and they told us we have to support the Sunni against Shi'ites, so our foreign policy is that of Saudi Arabia when it comes to the fate of who can and who cannot trade with Iran. China must follow our orders or we will do everything we can to stop its own development. It need only look at how we treated Iran to see what may be in store for it."
    This raises the Cold Wa to a new dimension.


    karlof1 , Dec 6, 2018 4:18:27 PM | link

    dh @99--

    Yes, guilty as charged. I expect a major challenge to the illegality of the Outlaw US Empire's attempts at Extraterritoriality which has yet to be attempted but now must be done. China has a very distinctive history regarding such treatment and will not let it pass. The Trade War will escalate and the Empire's top tier of oligarchs will lose billions.

    Circe , Dec 6, 2018 4:21:24 PM | link
    Blue peacock Walrus must be Boltonnnn! He just parrotted exactly the same bull about stolen property except with the caveat that it's not the reason for her arrest!!! 😉😎 It's about doing business with Iran! F.U. AMERICA!

    ARREST MBS INSTEAD, DAMN YOU EFFING HYPOCRITES! I can't get over Trudeau was a pasty to this woman's arrest! THIS IS INSANE.

    [Dec 08, 2018] The incident shows that the US and some other countries that follow the US didn't abide by the bottom line of international law at all. From now on, we should reduce or cancel important people's visits to the US, Canada and some other countries like the UK, Australia and New Zealand.

    Notable quotes:
    "... The incident shows that the US and some other countries that follow the US didn't abide by the bottom line of international law at all. From now on, we should reduce or cancel important people's visits to the US, Canada and some other countries like the UK, Australia and New Zealand. The warning applies to not only Chinese citizens, but also citizens of any other country. ..."
    "... Given the extreme risks of the political struggle in the US, Chinese scientists and technological experts in the West, particularly in the UKUSA countries (the US, UK, Canada, Australia and New Zealand) are advised to make some risk prevention arrangements for their own sake and the sake of their children. ..."
    "... Unlike China's State-owned enterprises, Huawei is a genuine private firm. But the severe political discrimination and repulsion from the US reflect an undeniable fact - the political gap between China and the US and a few other Western nations is too wide to bridge. ..."
    Dec 08, 2018 | www.moonofalabama.org

    karlof1 , Dec 7, 2018 5:04:01 PM | link

    Avoided a knee-jerk response, did some chores, read some other items, then went looking for English language Chinese reactions, like this one provided by Global Times , which said several different things to different audiences, although toward its bottom we find this:

    " The incident shows that the US and some other countries that follow the US didn't abide by the bottom line of international law at all. From now on, we should reduce or cancel important people's visits to the US, Canada and some other countries like the UK, Australia and New Zealand. The warning applies to not only Chinese citizens, but also citizens of any other country.

    " Given the extreme risks of the political struggle in the US, Chinese scientists and technological experts in the West, particularly in the UKUSA countries (the US, UK, Canada, Australia and New Zealand) are advised to make some risk prevention arrangements for their own sake and the sake of their children. "

    Global Times also published this editorial with its emphasis on the entire affair being an attack on Huawei's competitiveness, although suddenly in the middle it says this:

    " Unlike China's State-owned enterprises, Huawei is a genuine private firm. But the severe political discrimination and repulsion from the US reflect an undeniable fact - the political gap between China and the US and a few other Western nations is too wide to bridge. "

    A bit of a bombshell that seems to contradict what came before and after, which is an exploration of how "the political gap" can be narrowed. This line says:

    "Meanwhile, China needs to ease its geopolitical and ideological tensions with the US and the West through expanding its opening-up to the world."

    Unfortunately, the Outlaw US Empire has no interest in "eas[ing] its geopolitical and ideological tensions" with China, Russia or any other nation as its unelected helmsmen want everything for themselves a la Monopoly winners, thus rendering Chinese attempts at appeasement vacuous--Real Men want it all; sharing--Win-Win--is for wussies.

    [Dec 08, 2018] Opinion Huawei bust reveals the real US-China trade war - Livemint

    Export restrictions, and threats of restrictions, are thus probably not just about sanctions -- they're about making life harder for the main competitors of US tech companies
    Dec 08, 2018 | www.livemint.com
    U.S. President Donald Trump and Chinese President Xi Jinping was mainly about tariffs, especially on items like automobiles.

    But the startling arrest in Canada of a Chinese telecom company executive should wake people up to the fact that there's a second U.S.-China trade war going on -- a much more stealthy conflict, fought with weapons much subtler and more devastating than tariffs. And the prize in that other struggle is domination of the information-technology industry.

    The arrested executive, Wanzhou Meng, is the chief financial officer of telecom-equipment manufacturer Huawei Technologies Co. (and its founder's daughter). The official reason for her arrest is that Huawei is suspected of selling technology to Iran, in violation of U.S. sanctions. It's the second big Chinese tech company to be accused of breaching those sanctions -- the first was ZTE Corp. in 2017. The U.S. punished ZTE by forbidding it from buying American components -- most importantly, telecom chips made by U.S.-based Qualcomm Inc.

    Those purchasing restrictions were eventually lifted after ZTE agreed to pay a fine, and it seems certain that Huawei will also eventually escape severe punishment. But these episodes highlight Chinese companies' dependence on critical U.S. technology. The U.S. still makes -- or at least, designs -- the best computer chips in the world. China assembles lots of electronics, but without those crucial inputs of U.S. technology, products made by companies such as Huawei would be of much lower-quality.

    Export restrictions, and threats of restrictions, are thus probably not just about sanctions -- they're about making life harder for the main competitors of U.S. tech companies. Huawei just passed Apple Inc. to become the world's second-largest smartphone maker by market share (Samsung Electronics Co. is first). This marks a change for China, whose companies have long been stuck doing low-value assembly while companies in rich countries do the high-value design, marketing and component manufacturing. U.S. moves against Huawei and ZTE may be intended to force China to remain a cheap supplier instead of a threatening competitor.

    The subtle, far-sighted nature of this approach suggests that the impetus for the high-tech trade war goes far beyond what Trump, with his focus on tariffs and old-line manufacturing industries, would think of. It seems likely that U.S. tech companies, as well as the military intelligence communities, are influencing policy here as well.

    In fact, more systematic efforts to block Chinese access to U.S. components are in the works. The Export Control Reform Act, passed this summer, increased regulatory oversight of U.S. exports of "emerging" and "foundational" technologies deemed to have national-security importance. Although national security is certainly a concern, it's generally hard to separate high-tech industrial and corporate dominance from military dominance, so this too should be seen as part of the trade war.

    A second weapon in the high-tech trade war is investment restrictions. The Trump administration has greatly expanded its power to block Chinese investments in U.S. technology companies, through the Committee on Foreign Investment in the United States. CFIUS has already canceled a bunch of Chinese deals:

    The goal of investment restrictions is to prevent Chinese companies from copying or stealing American ideas and technologies. Chinese companies can buy American companies and transfer their intellectual property overseas, or have their employees train their Chinese replacements. Even minority stakes can allow a Chinese investor access to industrial secrets that would otherwise be off-limits. By blocking these investors, the Trump administration hopes to preserve U.S. technological dominance, at least for a little while longer.

    Notably, the European Union is also moving to restrict Chinese investments. The fact that Europe, which has opposed Trump's tariffs, is copying American investment restrictions, should be a signal that the less-publicized high-tech trade war is actually the important one.

    The high-tech trade war shows that for all the hoopla over manufacturing jobs, steel, autos and tariffs, the real competition is in the tech sector. Losing the lead in the global technology race means lower profits and a disappearing military advantage. But it also means losing the powerful knowledge-industry clustering effects that have been an engine of U.S. economic growth in the post-manufacturing age. Bluntly put, the U.S. can afford to lose its lead in furniture manufacturing; it can't afford to lose its dominance in the tech sector.

    The question is whether the high-tech trade war will succeed in keeping China in second place. China has long wanted to catch up in semiconductor manufacturing, but export controls will make that goal a necessity rather than an aspiration. And investment restrictions may spur China to upgrade its own homegrown research and development capacity.

    In other words, in the age when China and the U.S. were economically co-dependent, China might have been content to accept lower profit margins and keep copying American technology instead of developing its own. But with the coming of the high-tech trade war, that co-dependency is coming to an end. Perhaps that was always inevitable, as China pressed forward on the technological frontier. In any case, the Trump administration's recent moves against Chinese tech -- and some similar moves by the EU -- should be seen as the first shots in a long war.

    (This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed)

    [Dec 08, 2018] The trade war targets the entire Chinese high tech industry, especially the Made in China 2030 proj. Huawei in less than 30 years it has displaced CISCO as the world's no 1 network supplier, presently gunning Samsung for top spot in mobile phone preeminence

    Dec 08, 2018 | www.moonofalabama.org

    denk , Dec 8, 2018 12:12:43 AM | link

    b

    This is 'eight nations alliance' [1] mark2 no less. The military encirclement of China is in place, to be sprung if necessary. The trade war targets the entire Chinese high tech industry, especially the Made in China 2030 proj. Huawei is the crown jewel of emerging Chinese high tech, its rise is nothing less than astounding. In less than 30 years it has displaced CISCO as the world's no 1 network supplier, presently gunning Samsung for top spot in mobile phone preeminence.

    It makes lots of people scare. [2]

    They use false pretext to wage wars OF terror, now they use false pretext to launch a trade war, hyping up Huawei's 'security risk'. But nsa has been 'monitoring' Huawei since 2007, even hacked into its Shenzhen HQ, to look for incriminating evidence of CCP collaboration, it turned out naught. There'r absolutely No Evidence Huawei Spies on Americans, [3]

    Just like the lack of evidence didn't prevent fukus attack on 'terrorist' countries, it sure doesn't stop Washington from mounting a frontal assault on Huawei. Huawei is currently shut out of the 5lies markets plus SK, JP, courtesy of Washington. The 'battle' has extended to the Pacifics isles,
    where Washington/Oz joint force to arm twist Solomon isle to drop a undersea cable contract with Huawei.

    They tried that again with PNG, asking them to renege on their contract with Huawei, but the PNG PM is made of sterner stuff, lecturing fukus on the importance of integrity and law, no less.

    hhhhh

    When the Meng kidnap news broke, my jaw dropped in amazement, ....They'r really getting really desperate now.

    ... ... ...


    [1]

    http://www.warrelics.eu/forum/attachments/japanese-militaria/925359d1452969003-evolution-imperial-japan-s-war-medals-1875-1945-a-17.troops_of_the_eight_nations_alliance_1900.jpg

    [2]
    Huawei's U.S. competitors among those pushing for scrutiny of Chinese tech firm
    It was long thought that we were the number-one economy and China just supplied cheap labor,"

    Guthrie said. "Now it is clear that China has lot to offer in terms of innovation and Industrial policy and state investment, and now people are scared

    https://www.washingtonpost.com/business/technology/huaweis-us-competitors-among-those-pushing-for-scrutiny-of-chinese-tech-firm/2012/10/10/b84d8d16-1256-11e2-a16b-2c110031514a_story.html?utm_term=.9a08c5b5a9bb


    Watch out Cisco. Huawei's coming!

    https://etherealmind.com/watch-out-cisco-huaweis-coming/

    China's Huawei takes aim at Cisco with SDN programmable switch Huawei Technologies is bringing its own "software-defined networking" switch globally in a bid to raise its profile and expand in a market dominated by Cisco.
    https://www.computerworld.com/article/2484793/networking/china-s-huawei-takes-aim-at-cisco-with-sdn-programmable-switch.html

    [3]
    https://motherboard.vice.com/en_us/article/59w49b/huawei-surveillance-no-evidence

    [Dec 08, 2018] Huawei's Meng Snagged Due to US Bank Sanctions

    Games in US intelligence agencies are one thing, but the fact that this arrest is a severe blow, almost knockdown for neoliberalism is another.
    From comments: "Spot on with your comment. As you point out, this event will cast a dark shadow over executive travel for a long time to come, including those American executives who will now be fearful of countermeasures."
    Dec 08, 2018 | www.nakedcapitalism.com

    Moreover, John Bolton is the sort who'd love to collect a high profile scalp like the arrest of Meng, so it's credible that he would find a way to go ahead whether or not the China trade negotiation team was on board.

    Meng has her bail hearing in Vancouver today, so we will probably learn more about the expected process and timetable.


    Alex V , December 7, 2018 at 3:56 am

    Wondering why US dollars would ever be involved in transactions between a Chinese supplier, a UK bank, and Iranian customers Assuming usage of correspondent banks in NYC? Would also be a reason for where the indictment was filed.

    The conspiracy theorist in me says that transactions are being routed through the US not for any practical reason, or due to customer wishes, but only to expose them to US jurisdiction for potential prosecution. An alternative to SWIFT is desperately needed

    A. A. , December 7, 2018 at 4:13 am

    The FCPA is extremely expansive: a non U.S. company doing business in the U.S. must not do business with Iran directly or indirectly if it knows or has reason to suspect the business is related to Iran. So if they have the evidence it all looks like a slam dunk.

    As to SWIFT, doesn't the U.S. have access to all SWIFT transactions, even those not touching U.S. banks? They'd certainly have the Five Eyes SWIFT data.

    Plus apparently the U.S. has (or had) access to Huawei's email traffic.

    Yves Smith Post author , December 7, 2018 at 5:26 am

    Not correspondent banks. HSBC has a New York branch, as does pretty much every foreign bank with an international business. Dollar transactions clear though the US because no bank is going to run intraday balances with other banks without the end of day settlement ultimately being backstopped by the Fed. That means running over Fedwire.

    Alex V , December 7, 2018 at 5:53 am

    Ah, thanks for the technical detail on why it would be cleared through the US. The Masters of the Universe really are unwilling to take any risk unless it's socialized in some way. Still curious why they would ever let it touch US jurisdiction, but I guess the details of the case will eventually reveal that.

    William Bowles , December 7, 2018 at 4:21 am

    See Voltaire Net for the reasons: Huawei's unbreakable encryption:

    http://www.voltairenet.org/article204264.html

    "The heart of the problem is that the Chinese firm uses a system of encryption that prevents the NSA from intercepting its communications. A number of governments and secret services in the non-Western world have begun to equip themselves exclusively with Huawei materials, and are doing so to protect the confidentiality of their communications."

    laodan , December 7, 2018 at 9:03 am

    There is also this other article on Voltaire Network " Behind the US attack on Chinese Smartphones " by Manlio Dinucci. 2018-10-05

    "The struggle centred around Huawei illustrates the way in which economic and military preoccupations inter-connect. Already, many States have observed that Washington is so far unable to decode this technology. Thus, as they did in Syria, they have entirely re-equipped their Intelligence services with Huawei material, and forbid their civil servants to use any others."

    Taking into account this story from Syria the following dismissal, by China's Foreign Ministry spokeswoman Hua Chunying of a report in The New York Times, could be understood differently than it was initially

    "China on Thursday denounced a U.S. newspaper report that it is listening to Donald Trump's phone calls as "fake news," and suggested he exchange his iPhone for a cellphone made by Chinese manufacturer Huawei".
    in AP, 2018-10-26, "China denies spying on Trump's phone, suggests he use Huawei".

    The Rev Kev , December 7, 2018 at 5:08 am

    So I turned on the local TV network to see how the story would be spun to find out what the official line would be. There was no mention of the fact in the story that Meng was just not the CFO of Huawei but also the daughter – the daughter – of the founder. More to the point, nearly every scene showing Meng was when she was on-stage with Putin somewhere so there is your guilt by association right there. They even used close-ups of the two together though the stage was full of people seated there.
    Something else in that story that I noticed. It featured the last day of the G-20 when the American and Chinese delegation were facing each other over a conference table. On the right was Trump and a bit further down was John Bolton. Now Trump has said he had no idea that this arrest was taking place but Bolton said that he know beforehand. Does it not seem strange that Bolton would not have pulled Trump aside beforehand and said 'Hey boss, we are going to do something never done before and arrest a high-level Chinese citizen which could blow up your whole agreement. You know, just so you know.'
    With this is mind, it may be fairer to say that this was more a case of 'Huawei's Meng Targeted using US Bank Sanctions'. The pity is that the US Justice Department finds no trouble with targeting a corporation nearly 7,000 miles away but just can't seem to target Wall Street which is only about 200 miles away from their headquarters. And I am afraid that I am not too impressed with that internal Huawei memo as probably most international corporations want to know where they can push the envelope. Personally I would be more interested on a memo from the Clinton Foundation listing the amounts needed to gain access the SecState and how much could be purchased for that amount. Both memos would amount to the same thing.
    This is new this development. The US has targeted individuals with sanctions but for the first time they are attempting the extraterritorial rendition of a foreign citizen in connection with sanctions violations meaning extraterritorial jurisdiction which means that American laws apply all over the world. Could you imagine if this became standard practice? The chill it would put on executive travel? The possibilities of tit for tat arrests? US tech execs have already been warned on China travel. Do they really want to go there? This is nothing less that a US declaration of war on firms competing with US business interests like they have done with Russia.
    I would be also wary of this massive 'coincidence' in the timing of her arrest. The US Justice Department would probably know Meng's travel schedule better that she would – Bolton with his contacts would see to that. It may be that events in her calendar were pre-arranged for her. The Justice Department has a long history of setting up people. Canada's involvement is simply another member of the Five Eyes group doing active participation. It has not escaped my notice that all the countries rejecting Huawe's 5G technology – Australia, the UK, New Zealand – are also members of the Five Eyes. Not looking good.

    Yves Smith Post author , December 7, 2018 at 5:33 am

    This is not a rendition. Meng's extradition is all being done by the book. She is still in Canada, and will have a bail hearing today. She will have the opportunity to contest her extradition in Canada. Assuming she loses, she then goes to the US to face charges.

    And I'm not keen about the CT. A top Chinese tech company like Huawei which knows it's on America's shit list would have a very well protected Intranet. The US does not have access to Chinese telcoms to locate or steal the data of Chinese citizens. Get real.

    Thuto , December 7, 2018 at 6:13 am

    I'm not sure I embrace the notion of all this being done by the book as much as you Yves. After all, even charades can have the appearance of procedural compliance and the following of by the book rules, in fact, perhaps the incentive to create the appearance of following the rules is even more pronounced in a high profile case such as this. As to whether she will have a fair opportunity to defend herself, this is a watershed moment for Canada and she's is in the spotlight here and no matter which way it goes, the decision to extradite or not will have irrevocable implications on her international relations.

    Yves Smith Post author , December 7, 2018 at 8:08 am

    This is not a rendition. Canada isn't the UK. It's not going to bend its court processes, particularly since Chinese have become big investors in Canada and Trump has been astonishingly rude to Trudeau. And it has an independent judiciary.

    Marshall Auerback , December 7, 2018 at 9:00 am

    I was pretty unimpressed by Trudeau's pusillanimity. He tried to give the impression that Canada was just an innocent bystander in this whole process. Get real. If there's an extradition treaty, the US has to make a formal request to the Canadian government. The idea that the PM wasn't consulted on this is nonsensical. Justin engaging in his own version of "cakeism". Wants to stay on the good side of both Beijing and Washington, which is an impossible thing to do. Trudeau is already on Trump's sh*t list, and I'm sure Xi is taking his measure of the man as well. Probably not terribly impressed with him either.

    rd , December 7, 2018 at 10:07 am

    I have family and friends in Canada. Trust me, Canadians would be REALLY pissed if they thought that the Canadian judiciary was rolling over for Trump and Bolton.Trump is not making Canadian friends by running around throwing tantrums over NAFTA given that US-Canada trade is one of the most balanced trade relationships in the world with very little net trade deficit for either side.

    I think this is very much being done by the book. Is there a viable law that is not, by itself, a human rights violation? Is there credible evidence that this person broke this law? Those are the basic questions that will need to be answered in a Canadian court room to have an extradition move forward.

    Canadians want the big powers to have coherent rational laws and treaties related to trade etc. and then follow them. They also want to have rational, coherent international plans on addressing conflicts and have historically been very strong supporters of the UN and routinely have blue helmet troops all around the world on peace-keeping missions. Canada can do this safely because it has balanced relationships with most countries around the world. It will not do these types of arrests and extraditions on a whim because that would upset Canada's role in the world.

    William Bowles , December 7, 2018 at 2:52 pm

    Judging from what I've read, the US are claiming she committed fraud by alleging that a company, Skycom that allegedly did business with Iran was not separate from Huawei. Here's the BBC's take:

    "On Friday, US prosecutors told the Supreme Court of British Columbia that Ms Meng had used a Huawei subsidiary called Skycom to evade sanctions on Iran between 2009 and 2014 .

    "They said she had publicly misrepresented Skycom as being a separate company." – https://www.bbc.co.uk/news/world-us-canada-46490053

    Note the dates!!!! This is surely a setup!

    Thuto , December 7, 2018 at 5:52 am

    Spot on with your comment. As you point out, this event will cast a dark shadow over executive travel for a long time to come, including those American executives who will now be fearful of countermeasures.

    rd , December 7, 2018 at 10:10 am

    Sounds like a good reason for executives not to break laws

    JTMcPhee , December 7, 2018 at 11:05 am

    Whose laws, one might ask? The US says ITS laws rule the world. ISDS says corporate right to profit (by their accounting methods that discount externalities to zero) outweighs ALL national and local laws.

    And having spent some years as a lawyer, and observing several different kinds of courts in operation, I would dare to challenge the assertion that "courts have to follow rules." Like they have done in the foreclosure mess, maybe? Like the shenanigans displayed via Chicago's "Operation Greylord" prosecutions? Or in traffic courts in small towns in Flyover Country? how about the US bankruptcy courts, where shall we say "bad decisions" are endemic? Remember Julius Hoffman? how about Kimba Woods, who sua sponte curtailed Michael Milken's jail term for his junk bond racket? Even FISA, of course?

    And the assertion that Canadian judges are beyond political maneuvering runs up against a whole lot of reports and studies that cast the integrity of the Canadian bar into not insignificant doubt. Look to "corruption in canadian courts" for a nice assortment, like this one, https://www.huffingtonpost.ca/jj-mccullough/canada-judicial-appointments_b_5264567.html , and this, http://www.waterwarcrimes.com/canadian-legal-and-judicial-corruption.html , for example, and other more scholarly views.

    Yes, let us wait and see how this plays out, and then we can study what history's actors have done, judiciously as we must

    Lynne , December 7, 2018 at 11:29 am

    Good luck with that. It's almost impossible in the US never to break the law in some way. It just takes a cop or prosecutors motivated enough. I find it hard to believe it's not the same in China, let alone Russia or the UK, to name a few.

    Geoff _S , December 7, 2018 at 1:47 pm

    This law school lecture is 45mins long but really fun (it's got 2.5 million views). You should never talk to the police – one reason being that, as Lynne says, there are SO many possible offences, that you can never be sure you are not guilty of something .

    Don't Talk to the Police!
    https://www.youtube.com/watch?v=d-7o9xYp7eE

    RMO , December 7, 2018 at 7:58 pm

    "Sounds like a good reason for executives not to break laws "

    Yeah, I remember when all those HSBC executives were arrested, tried and thrown in jail. Good times The U.S. government really believes in the rule of law. Remember when the Chief Executive was sent to prison for life for committing "the supreme war crime" and shredding the U.S. Constitution?

    Rules are for little people Meng isn't big enough to be unprosecutable apparently.

    adrena , December 7, 2018 at 11:03 pm

    Exactly. America is acting as the world's police.

    And Trudeau has no spine.

    Thuto , December 7, 2018 at 5:31 am

    So the US DOJ, according to "people familiar with the matter", has been investigating Huawei for at least two years. My math tells me this is roughly since the signing of the deal between Iran and the P5+1 countries in 2016, a deal subsequently incorporated into international law by the UN. Now a bank that has run a laundry service for dirty money is suddenly thrust into victimhood and (with Uncle Sam's boot on its neck no doubt) is "cooperating" with the investigation? You couldn't make this more surreal if you tried.

    If this isn't the final act in peeling off the rose tinted glasses from countries that still consider the US a trusted friend and loyal ally, one wonders how much more evidence they need to see it for what it really is, a duplicitous, hypocritical, tyrannical imperialist. The irony of this charade being undertaken by the department of "justice" makes this even more egregious. Expect development of an alternative system to Swift to go into overdrive after this.

    W , December 7, 2018 at 9:38 am

    The point isn't "Is the US acting legally/by the book in enforcing the law", it's "Why is the US legally enforcing the law in this case and not the million other cases equally deserving of enforcement?" When the law isn't enforced evenly, then the law just becomes a cover story for dishing out and withholding punishment by authorities.

    lawrence j silber , December 7, 2018 at 10:16 am

    Very interesting-actually mystifying. The powers that are- from their pronouncements,haven't a clue about modern money, and in that framework the benefits of the reserve currency they print. Maybe they do, but why, for what appears a minimal foreign corporate compliance offence, would we want China, Russia, and a host of others to find enough cause to continue their effort on a replacement reserve? Why are we so hell bent on militarising the dollar? Save it for really big fish. Sure, its extremely difficult under the current political framework for the world to organise and opt away from our dollar , but the stability and leadership America has offered since the end of ww11, maybe appears diminishing. Given Trump just made a deal with Xi, at the same time his vip citizen was being targeted- obviously kind of humiliating-,as well as the administration turning a blind eye to the murderous soprano fiefdom of Saudi Arabia; from any rational standpoint prioritising human rights over crooked bank compliance issues , this looks keystone cop like! Sure we only have a little info, but it still smells of hypocritical, imperialistic, one hand doesnt know what the other hand is doing idiots in charge. Mike Hudson sees nefarious purposes,maybe hes a bit hawkish, but this just seems so obtuse given the g20 hand shakes. Going to be very interesting watching China's response. Then again maybe this lady is a criminal.

    makedoanmend , December 7, 2018 at 5:40 am

    " the US Justice Department finds no trouble with targeting a corporation nearly 7,000 miles away but just can't seem to target Wall Street which is only about 200 miles away from their headquarters "

    This.

    Having power over others seems to be a standard condition of our species. How one uses or abuses power reveals the inner nature of the one(s) wielding the power. There need not be a conspiracy of the powerful, just a consensus of how power should be used so that the sum total exercises of the powerful reveal where their interests intersect. The rest of us just got get out of the way.

    If one wants to know what interesting times look like, well, we have front row seats. And its in 3-D.

    I must admit that President Trump is doing a better job than former President Obama in ramping up a new theatre of economic warfare across the globe. Former President Obama was rather crude, what with his drones. I'm thinking we have to update von Clausewitz's dictum: "War is the continuation of politics by other means." to something along the lines of "Economics is a continuation of war by other means."

    The USA polity is certainly making it up close and personal.

    timbers , December 7, 2018 at 8:13 am

    Indeed. The possibilities for China to retaliate are seemingly endless though they won't have the long arm the U.S. has.

    Perhaps China should respond by trying to arrest and indicting some of the Wall Street big wigs Obama never indicted. I'm sure China could come up with reasons why fraud Wall Street committed violated Chinese law and damaged China.

    Of course, being an exporter to the U.S. I'm sure China would much rather this go away, than to retaliate.

    lawrence j silber , December 7, 2018 at 10:35 am

    Very interesting-actually mystifying. The powers that are- from their pronouncements,haven't a clue about modern money, and in that framework the benefits of the reserve currency they print. Maybe they do, but why, for what appears a minimal foreign corporate compliance offence, would we want China, Russia, and a host of others to find enough cause to continue their effort on a replacement reserve? Why are we so hell bent on militarising the dollar? Save it for really big fish. Sure, its extremely difficult under the current political framework for the world to organise and opt away from our dollar , but the stability and leadership America has offered since the end of ww11, maybe appears diminishing. Given Trump just made a deal with Xi, at the same time his vip citizen was being targeted- obviously kind of humiliating-,as well as the administration turning a blind eye to the murderous soprano fiefdom of Saudi Arabia; from any rational standpoint prioritising human rights over crooked bank compliance issues , this looks keystone cop like! Sure we only have a little info, but it still smells of hypocritical, imperialistic, one hand doesnt know what the other hand is doing idiots in charge. Mike Hudson sees nefarious purposes,maybe hes a bit hawkish, but this just seems so obtuse given the g20 hand shakes. Going to be very interesting watching China's response. Then again maybe this lady is a criminal.

    NotTimothyGeithner , December 7, 2018 at 11:14 am

    Why are we so hell bent? The U.S. hyper power status started in 1991. This is a generation where they knew nothing else, coming off 45 years where allies did what they were told.

    https://en.wikipedia.org/wiki/The_Grand_Chessboard

    Whether its throwing around terms such as "American exceptionalism" or "indispensable nation", there is a religious fervor around the U.S. among American foreign policy elites.

    Then there is imperial rot. The tenures in the U.S. Senate are longer than the Soviet Politburo. At a practical level the Bushes and Clintons (not exactly great people) have been responsible for who gets promoted in Washington and who develops marketable connections since 1986 with Reagan's alzheimers kicking in big time if not longer.

    JTMcPhee , December 7, 2018 at 11:21 am

    In many places in the US, if I jaywalk, I am a criminal. What corporate executive is not a criminal, given the mass of laws that apply (until said criminals can bribe the legislatures into de-criminalizing the bad behaviors)? Not to mention persuading the executive branch to not prosecute, for all kinds of "political" reasons? Ask Wells Fargo and the other Banksters how that works. Selective or non-prosecution for me, "the full weight of the law," that fraudulent notion, for thee, I guess. And none of that is in any way new.

    Speaking of Chinese criminals, I would add an anecdote. I have not been able to find the episode, but one of the formerly investigative programs (20-20 or 60 Minutes, I believe) took part in a sting of a Chinese corp that sells counterfeit medicines. This was maybe 8-10 years ago. A very pretty if somewhat English-challenged young woman met with a bunch, maybe 10, men and women who she thought were buyers for distributors and Pharma corps in the US and I believe Canada. This meeting took place in a West Coast S city as I recall.

    She offered that her company produced counterfeit meds using "latest technology" that from the shape and color and texture and markings of the pills and package inserts, right down to the packaging, holograms and all, could not be distinguished from the original. The products were touted as being biologically inactive and "safe." She averred that her company could deliver any quantity, from cartons to container loads, at very reasonable and attractive price.

    But that is a little different case from what appears at this point (barring correction as the "case" develops) from the Huawei matter.

    John k , December 7, 2018 at 9:15 pm

    Not easy for another entity to take over the reserve currency.
    China Germany etc want a trade surplus with us, so they must accept and store dollars. Very similarly. Many individuals want to save dollars because they don't trust their own currency. And some countries actually use dollars as their currency.
    So the desire to accept or save dollars in exchange for their goods means the dollar is the reserve currency. This won't change until something else becomes more attractive to savers and mercantilists.

    cbu , December 7, 2018 at 11:20 am

    I agree that "done by the book" is irrelevant here. Selective enforcement is the issue. Wall Street crooks have committed greater sins yet none of them is really punished.

    Anyone could have written an "internal memo" like that. Proving its authenticity is a different matter. After all, the biggest "smoking gun" I have ever seen in my life was the "evidence" of Iraqi WMD.

    Another interesting aspect of the case is that as I suspected, it might be difficult to prove that Huawei sold Iran some specific American technologies that still have valid patents in effect.

    Synoia , December 7, 2018 at 11:25 am

    I personally know IBM and others breached the US arms control export laws by exporting Cryptography to Apartheid South Africa, and believe that Shell Oil has broken nearly all environmental laws in the Niger Delta for decades.

    Where is the equity?

    Eclair , December 7, 2018 at 11:43 am

    Fascinating discussion, Yves and commenters.

    Is this what happens when a government is sliding rapidly down the slope of loss of legitimacy?' We become acutely aware of the selective enforcement of its laws; a situation that our poor and black and brown citizens have known for decades.

    We have even become aware that the laws themselves are not always enacted for the public good, but for the enrichment of certain small segments of the population.

    This is not a good place to be. I mean this state of mind, not the NC site, which, as always, provides the opportunity for much thoughtful and creative discussion.

    Carolinian , December 7, 2018 at 1:27 pm

    Don't forget that the US ambassador to Germany threatened secondary sanctions against Germany if they went ahead with Nordstream2. Trump then walked that back. But as for this latest move, we know that Bolton at least was informed of the impending arrest so it's fair to say that such a sensitive action would not have happened without some form of White House approval–even if it wasn't Trump himself. It's probably not a CT therefore to say that there's more going on here than a prosecutor making a routine request. The administration hawks are firing a shot over the bow of anyone who defies them on Iran (the place "real men" go to). Given what we know about Bolton's Iran obsession it may not even have much to do with China.

    And this bully boy approach to the rest of the world isn't only coming from Trump's neocons since sanctions bills are a bipartisan favorite of our Congress. Apparently being bribed on domestic matters isn't enough (unless you consider foreign policy to only be about MIC profits). Doing the bidding overseas actors and their supporters taps a whole other vein.

    thepanzer , December 7, 2018 at 2:17 pm

    Link to Moon of Alabama for "B"'s take on the situation.

    Carolinian , December 7, 2018 at 3:27 pm

    Corrected link

    https://www.moonofalabama.org/2018/12/neocons-sabotage-trumps-trade-talks-huawei-cfo-taken-hostage-to-blackmail-china.html#more

    Carolinian , December 7, 2018 at 3:39 pm

    Just to add: B pretty much buys the hostage CT.

    Todde , December 7, 2018 at 2:18 pm

    The US doesn't apply the law equally.

    Color me surprised

    Harrold , December 7, 2018 at 3:31 pm

    Flights that over fly US airspace are required to submit their manifests and passenger names are bounced against the National Crime Information Center databases by CBP.

    I would venture that her flight overflew Alaskan airspace and that is how they found out she was on board.

    [Dec 07, 2018] Huawei CFO Charged With Fraud, Deemed Flight Risk Whose Bail Couldn't Be High Enough

    So the USA decided to take hostages ;-) The key rule of neoliberalism is the financial oligarchy is untouchable. This is a gangster-style move which will greatly backfire.
    Now Russian financial executives would think twice about visiting UK, Canada, New Zealand or Australia. and that's money lost. Probably forever.
    Dec 07, 2018 | www.zerohedge.com

    Appearing in court wearing a green jumpsuit and without handcuffs, Meng reportedly looked to be in good spirits in a Vancouver courtroom where the prosecutions' case was detailed publicly for the first time. Specifically, the US alleges that Meng helped conceal the company's true relationship with a firm called Skycom, a subsidiary closely tied to its parent company as it did business with Iran.

    Meng used this deception to lure banks into facilitating transactions that violated US sanctions, exposing them to possible fines. The prosecutor didn't name the banks, but US media on Thursday reported that a federal monitor at HSBC flagged a suspicious transaction involving Huawei to US authorities, according to Bloomberg. Prosecutors also argued that Meng has avoided the US since learning about its probe into possible sanctions violations committed by Huawei, and that she should be held in custody because she's a flight risk whose bail could not be set high enough. Before Friday's hearing, a publication ban prevented details about the charges facing Meng from being released. However, that ban was lifted at the beginning of her hearing. Meng was arrested in Vancouver on Saturday while on her way to Mexico, according to reports in the Canadian Press.

    Canadian Foreign Affairs Minister Chrystia Freeland said Canada's ambassador in Beijing had briefed the Chinese foreign ministry on Meng's arrest. The Chinese Embassy in Ottawa had branded Meng's detention as a "serious violation of human rights" as senior Chinese officials debate the prospects for retaliation. Freeland said McCallum told the Chinese that Canada is simply following its laws - echoing Prime Minister Justin Trudeau's claim that Meng's arrest was the result of a legal process happening independent of politics.

    Friday's hearing in Vancouver is just the start of a legal process that could end with Meng being extradited to stand trial in the US. Even if prosecutors believe there is little doubt as to Meng's guilt, the extradition process could take months or even years.

    youshallnotkill , 39 seconds ago link

    Anything involving Iran is inherently political. The US is abusing Interpol in no less brazen fashion than Russia and China when seeking the extradition of dissidents. Canada shouldn't accomodate this BS.

    [Dec 06, 2018] Huawei CFO arrested 'Gloves are now fully off,' says Eurasia Group

    Dec 06, 2018 | www.cnbc.com

    The arrest of Huawei's global chief financial officer in Canada, reportedly related to a violation of U.S. sanctions, will corrode trade negotiations between Washington and Beijing, risk consultancy Eurasia Group said Thursday.

    "Beijing is likely to react angrily to this latest arrest of a Chinese citizen in a third country for violating U.S. law," Eurasia analysts wrote.

    In fact, Global Times -- a hyper-nationalistic tabloid tied to the Chinese Communist Party -- responded to the arrest by posting on Twitter a statement about trade war escalation it attributed to an expert "close to the Chinese Ministry of Commerce."

    "China should be fully prepared for an escalation in the #tradewar with the US, as the US will not ease its stance on China, and the recent arrest of the senior executive of #Huawei is a vivid example," said the statement, paired with a photo of opposing fists with Chinese and American flags superimposed upon them.

    [Dec 06, 2018] Trump-Xi trade deal What Chinese state media is saying

    Dec 06, 2018 | www.cnbc.com

    U.S. President Donald Trump and Chinese President Xi Jinping met over a dinner during the G-20 summit in Argentina after months of increasing trade tensions between the two countries. The U.S. has imposed tariffs on $250 billion worth of Chinese goods, while Beijing has retaliated with duties on $110 billion of U.S. goods.

    The White House's latest round of tariffs on $200 billion goods was set to rise to 25 percent from 10 percent on Jan. 1, 2019, but Trump agreed at the G-20 meeting not to do so.

    The catch is, however, that Xi and Trump must find resolution on "forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft, services and agriculture" within 90 days, according to the White House press secretary's statement.

    That gives the leaders until early March -- past Christmas, New Year's and Chinese New Year -- to find a way to keep tariffs from rising.

    However, official online statements about Chinese Foreign Minister Wang Yi's briefing on the meeting did not discuss the technology transfers or the 90-day condition.

    The timeframe and details on areas of disagreement also did not appear in online reports from China's state news agency Xinhua , People's Daily -- the official Communist Party paper -- and CGTN -- the English-language version of state broadcaster CCTV.

    The articles did note the U.S. and China agreed to work towards mutual benefits, and generally indicated Beijing would increase purchases of U.S. goods. The state media also said the two parties discussed North Korea denuclearization. The Chinese press also said Trump upheld a "One-China Policy" regarding Taiwan -- something not mentioned in the White House statement.

    On top of that, Trump tweeted late Sunday evening that "China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40%."

    Prior to that Twitter post, there had not been any mention of such an agreement in Chinese sources.

    [Dec 06, 2018] Canada arrests Huawei CFO, who is wanted by US authorities

    Dec 06, 2018 | www.cnbc.com

    The arrest is related to violations of U.S. sanctions, a person familiar with the matter said. Reuters was unable to determine the precise nature of the violations. Meng Wanzhou, who is one of the vice chairs on the Chinese technology company's board and the daughter of company founder Ren Zhengfei, was arrested on Dec. 1 and a court hearing has been set for Friday, a Canadian Justice Department spokesman said.

    [Dec 06, 2018] UK spy chief raises questions over China's 5G rollout

    Dec 06, 2018 | www.cnbc.com

    The U.K.'s spy chief said that decisions still had to be made on China's role in building Britain's 5G network.

    ... ... ...

    Last week, New Zealand banned Huawei from providing tech for its 5G rollout -- the third member of the Five Eyes security alliance to do so. At the time, New Zealand's government said it had identified a "significant network security risk."

    Fellow members Australia and the U.S. have also excluded Chinese telecoms firms from providing 5G equipment for their domestic networks, leaving Canada and the U.K. as the only members not to rule out using the telecoms giant.

    All three nations cited national security fears as the reason for excluding Chinese companies from their 5G rollouts, with Younger's Australian counterpart referring to them as "high-risk vendors."

    ... ... ...

    Huawei and ZTE – another Chinese firm blocked from the U.S. 5G market – have repeatedly denied that their involvement in the rollouts would give China's government access to international networks. Warning to Russia China wasn't the only country raising security questions for MI6. Younger told his audience the U.K. faced many adversaries who regarded themselves as being in a state of "perpetual confrontation" with the nation -- including Russia.

    "I urge Russia or any other state intent on subverting our way of life not to underestimate our determination and our capabilities, or those of our allies," he said.

    "I should emphasize that even as the Russian state seeks to destabilize us, we do not seek to destabilize Russia. We do not seek an escalation. If we see a change in Russian behavior, we will respond positively. But we will be implacable in defense of our people and our vital interests."

    ... ... ...

    [Dec 03, 2018] The problem with giving any novel political idea a really extended trial is that you have to try it out on live human beings.

    Dec 03, 2018 | discussion.theguardian.com

    MatthewBall -> Rainborough , 8 Jun 2013 14:19

    @Rainborough -

    How many alternative economic systems would you say have been given a fair trial under reasonably favorable circumstances?

    A good question. Answer: admittedly, not a huge number - but not none either. Feudalism held sway in the middle ages and mercantilism in the 18th century, before both fell out of fashion. In the 20th century Russia stuck with communism for 74 years, and many other countries tried it for a while. At one time (around 1949-89) there were enough countries in the communist block for us to be able to say that they at least had a fair chance to make it work - that is, if it didn't work, they can't really blame it on the rest of the world ganging up on them.

    Lately, serious challengers to the global economic order have been more isolated (Venzuela, Cuba, North Korea?) - so maybe you could argue that, if they are struggling, it is because they have been unfairly ganged up on. But then again, aren't they pursuing a version of socialism that has close affinities to that tried in the Soviet Union?

    The problem with giving any novel political idea a really extended trial is that you have to try it out on live human beings. This means that, once a critical mass of data has built up that indicates a political idea doesn't work out as hoped, then people inevitably lose the will to try that idea again.

    So my question is: are critics of the current world economic order able to spell out exactly how their proposed alternative would differ from Soviet-style socialism?

    [Dec 02, 2018] China and the United States have agreed to halt new tariffs as both nations engage in trade talks with the goal of reaching an agreement within 90 days

    Dec 02, 2018 | www.zerohedge.com

    Teamtc321 , 5 hours ago link

    Update: Trump Wins

    ------------------------------------------------------

    Reuters December 1, 2018

    BUENOS AIRES (Reuters) - China and the United States have agreed to halt new tariffs as both nations engage in trade talks with the goal of reaching an agreement within 90 days, the White House said on Saturday after U.S. President Donald Trump and Chinese President Xi Jinping held high-stakes talks in Argentina.

    Trump agreed not to boost tariffs on $200 billion of Chinese goods to 25 percent on Jan. 1 as previously announced, as China agreed to buy an unspecified but "very substantial" amount of agricultural, energy, industrial and other products, the White House said. The White House also said China "is open to approving the previously unapproved Qualcomm Inc <QCOM.O> NXP <NXPI.O> deal should it again be presented."

    The White House said that if agreement on trade issues including technology transfer, intellectual property, non-tariff barriers, cyber theft and agriculture have not been reached with China in 90 days that both parties agree that the 10 percent tariffs will be raised to 25 percent.

    https://www.yahoo.com/news/u-china-declare-90-day-halt-tariffs-white-023232628--finance.html?.tsrc=notification-brknews

    [Nov 27, 2018] Will Trump bring America down

    Nov 27, 2018 | www.atimes.com

    Why US allies are pushing back

    US allies in Europe and Asia did not expect to be treated like vassal states, at least not openly. Succumbing to Trump's demands is an admission of being a lapdog.

    US allies in Europe and Asia have no choice but to push back against Trump's bullying and condescending stances. They are elected by their citizens to protect the countries' sovereignty and interests, after all. Too, these leaders must save face and protect their legacies.

    One of the first European leaders having the courage to defy Trump is French President Emmanuel Macron, calling for the establishment of a European Union army independent of the US to defend itself against Russia, China and possibly America itself. His proposal is supported by German Chancellor Angela Merkel.

    Asian allies, particularly India, also seem to have pushed back , buying Iranian oil whether the US likes it or not.

    Washington's attempt to revive the Quadrilateral Security Dialogue comprising itself and soulmates Australia, India and Japan may be losing support. Instead of joining with the US to contain China, India and Japan are seeking rapprochement with the Asian giant. Even "deputy sheriff" Australia is apparently having second thoughts, as one of its states is officially joining China's Belt and and Road Initiative.

    In short, these three allies might finally realize that joining the US in containing China is harmful to their national interests. Fighting that nuclear power on their own soil might not be a good idea.

    No country treats the US 'unfairly'

    The fact of the matter is no country treats the US "unfairly" or is "eating its lunch." On the contrary, it could be argued that it is the other way around.

    Having emerged as the world's strongest nation during and after World War II, US foreign policies have one goal: Shape the world to its image. That process began at the 1944 Bretton Woods Conference, insisting on using the US dollar as the world reserve currency and writing the trade rules. In this way, the US has accumulated a very powerful tool, printing as much money as it wants without repercussions to itself. For example, when a country wants to cash its US Treasury holdings, all America has to do is print more greenbacks.

    To that end, the US is clearly "eating other countries' lunch." Indeed, a major reason the US can afford to build so many weapons is that other countries are paying for them.

    US trade practices

    On trade, the US in 1950 rejected the UK's proposal of forming an International Trade Organization (ITO) modeled after the International Monetary Fund and World Bank because it feared the ITO might have harmed American manufacturing. In its place, the US proposed and succeeded in forming the General Agreement on Tariffs and Trade (GATT) framework to negotiate tariff rates on goods.

    Being the world's most powerful economy and biggest trading nation at that time, the US dominated the world trading system and wrote its rules. For example, it was the US that invented and implemented non-tariff trade barriers such as anti-dumping duties and national-security concerns to block imports. For example, the US imposed tariffs on Canadian, EU, Mexican and other countries' steel and aluminum from entering its market for security reasons.

    It is laughable for the US to accuse Canada, the EU and Mexico of posing a national-security threat. They are, in fact, America's most staunch allies.

    US foreign direct investment abroad

    US companies bring with them ideas and technology (for which they charge exorbitant prices) when investing in a foreign market such as China and elsewhere. The capital needed to build factories is largely funded by the host country or other partners. For example, it is Taiwanese and Japanese investors that built Foxconn factories in China to assemble American electronic gadgets such as the iPad.

    What's more, US companies charge huge prices for the products they make in China. According to the Asian Development Bank and other research organizations, Chinese labor, for example, receives a small percentage of the profits Apple takes in from gadgets it produces in China. This lopsided profit distribution raises the question: Who is "eating whose lunch?"

    America has itself to blame

    The US cannot blame China or any other country for its declining global influence and dominance – America, particularly under Donald Trump, did that to itself. Chinese President Xi Jinping, indeed, has advocated cooperation and dialogue as ways to defuse conflicts and attain a better world.

    No country has ever even hinted at attacking the US; it is after all the world's most powerful nation, armed with enough conventional and nuclear weapons to blow up the world. The "threats" are exaggerated or invented by US neoconservatives and vested interests to scare Americans into supporting huge defense spending.

    'Fake news' can only go so far

    Using "fake news" to pressure countries into submission might work with those unable to fight back, but could be extremely costly against powers such as China and Russia. For example, Trump's escalating trade tensions with China are already adversely affecting the US economy, as seen in falling GDP growth, decreasing stock prices, a huge agricultural inventory, and rising poverty.

    According to United Nations, the impoverished American population is being hit the hardest under the Trump administration. The US Federal Reserve and others are projecting significant economic decline in the foreseeable future if the trade war does not end.

    One can only imagine what a nuclear war would bring.

    Donald Trump is probably no less bullying than his predecessors (perhaps with the exception of George W Bush), but he is more open about it. Bush's outburst, "You are either with us or against us," earned America a bad reputation when he demanded that allies join him to invade Iraq.

    Trump has bullied or offended everyone, friends and foes alike. Unless he shifts gear, he could alienate friends as well as foes, which could erode US geopolitical influence and economic growth or might even bring the country down. He cannot threaten sovereign nations without incurring huge costs to America.

    [Oct 02, 2018] A Rational Backlash Against Globalization

    Notable quotes:
    "... The vote for Brexit and the election of protectionist Donald Trump to the US presidency – two momentous markers of the ongoing pushback against globalization – led some to question the rationality of voters. This column presents a framework that demonstrates how the populist backlash against globalisation is actually a rational voter response when the economy is strong and inequality is high. It highlights the fragility of globalization in a democratic society that values equality. ..."
    "... See original post for references ..."
    "... Aversion to inequality thus reflects envy of the economic elites rather than compassion for the poor. ..."
    Oct 02, 2018 | www.nakedcapitalism.com

    Posted on September 28, 2018 by Yves Smith Yves here. Haha, Lambert's volatility voters thesis confirmed! They are voting against inequality and globalization. This important post also explains how financialization drives populist rebellions.

    By Lubos Pastor, Charles P. McQuaid Professor of Finance, University of Chicago Booth School of Business and Pietro Veronesi, Roman Family Professor of Finance, University of Chicago Booth School of Business. Originally published at VoxEU

    The vote for Brexit and the election of protectionist Donald Trump to the US presidency – two momentous markers of the ongoing pushback against globalization – led some to question the rationality of voters. This column presents a framework that demonstrates how the populist backlash against globalisation is actually a rational voter response when the economy is strong and inequality is high. It highlights the fragility of globalization in a democratic society that values equality.

    The ongoing pushback against globalization in the West is a defining phenomenon of this decade. This pushback is best exemplified by two momentous 2016 votes: the British vote to leave the EU ('Brexit') and the election of a protectionist, Donald Trump, to the US presidency. In both cases, rich-country electorates voted to take a step back from the long-standing process of global integration. "Today, globalization is going through a major crisis" (Macron 2018).

    Some commentators question the wisdom of the voters responsible for this pushback. They suggest Brexit and Trump supporters have been confused by misleading campaigns and foreign hackers. They joke about turkeys voting for Christmas. They call for another Brexit referendum, which would allow the Leavers to correct their mistakes.

    Rational Voters

    We take a different perspective. In a recent paper, we develop a theory in which a backlash against globalization happens while all voters are perfectly rational (Pastor and Veronesi 2018). We do not, of course, claim that all voters are rational; we simply argue that explaining the backlash does not require irrationality. Not only can the backlash happen in our theory; it is inevitable.

    We build a heterogeneous-agent equilibrium model in which a backlash against globalization emerges as the optimal response of rational voters to rising inequality. A rise in inequality has been observed throughout the West in recent decades (e.g. Atkinson et al. 2011). In our model, rising inequality is a natural consequence of economic growth. Over time, global growth exacerbates inequality, which eventually leads to a pushback against globalization.

    Who Dislike Inequality

    Agents in our model like consumption but dislike inequality. Individuals may prefer equality for various reasons. Equality helps prevent crime and preserve social stability. Inequality causes status anxiety at all income levels, which leads to health and social problems (Wilkinson and Pickett 2009, 2018). In surveys, people facing less inequality report being happier (e.g. Morawetz et al. 1977, Alesina et al. 2004, Ferrer-i-Carbonell and Ramos 2014). Experimental results also point to egalitarian preferences (e.g. Dawes et al. 2007).

    We measure inequality by the variance of consumption shares across agents. Given our other modelling assumptions, equilibrium consumption develops a right-skewed distribution across agents. As a result, inequality is driven by the high consumption of the rich rather than the low consumption of the poor. Aversion to inequality thus reflects envy of the economic elites rather than compassion for the poor.

    Besides inequality aversion, our model features heterogeneity in risk aversion. This heterogeneity generates rising inequality in a growing economy because less risk-averse agents consume a growing share of total output. We employ individual-level differences in risk aversion to capture the fact that some individuals benefit more from global growth than others. In addition, we interpret country-level differences in risk aversion as differences in financial development. We consider two 'countries': the US and the rest of the world. We assume that US agents are less risk-averse than rest-of-the-world agents, capturing the idea that the US is more financially developed than the rest of the world.

    At the outset, the two countries are financially integrated – there are no barriers to trade and risk is shared globally. At a given time, both countries hold elections featuring two candidates. The 'mainstream' candidate promises to preserve globalization, whereas the 'populist' candidate promises to end it. If either country elects a populist, a move to autarky takes place and cross-border trading stops. Elections are decided by the median voter.

    Global risk sharing exacerbates US inequality. Given their low risk aversion, US agents insure the agents of the rest of the world by holding aggressive and disperse portfolio positions. The agents holding the most aggressive positions benefit disproportionately from global growth. The resulting inequality leads some US voters, those who feel left behind by globalization, to vote populist.

    Why Vote Populist?

    When deciding whether to vote mainstream or populist, US agents face a consumption-inequality trade-off. If elected, the populist delivers lower consumption but also lower inequality to US agents. After a move to autarky, US agents can no longer borrow from the rest of the world to finance their excess consumption. But their inequality drops too, because the absence of cross-border leverage makes their portfolio positions less disperse.

    As output grows, the marginal utility of consumption declines, and US agents become increasingly willing to sacrifice consumption in exchange for more equality. When output grows large enough -- see the vertical line in the figure below -- more than half of US agents prefer autarky and the populist wins the US election. This is our main result: in a growing economy, the populist eventually gets elected. In a democratic society that values equality, globalization cannot survive in the long run.

    Figure 1 Vote share of the populist candidate

    Equality Is a Luxury Good

    Equality can be interpreted as a luxury good in that society demands more of it as it becomes wealthier. Voters might also treat culture, traditions, and other nonpecuniary values as luxury goods. Consistent with this argument, the recent rise in populism appears predominantly in rich countries. In poor countries, agents are not willing to sacrifice consumption in exchange for nonpecuniary values.

    Globalization would survive under a social planner. Our competitive market solution differs from the social planner solution due to the negative externality that the elites impose on others through their high consumption. To see if globalization can be saved by redistribution, we analyse redistributive policies that transfer wealth from low risk-aversion agents, who benefit the most from globalization, to high risk-aversion agents, who benefit the least. We show that such policies can delay the populist's victory, but cannot prevent it from happening eventually.

    Which Countries Are Populist?

    Our model predicts that support for populism should be stronger in countries that are more financially developed, more unequal, and running current account deficits. Looking across 29 developed countries, we find evidence supporting these predictions.

    Figure 2 Vote share of populist parties in recent elections

    The US and the UK are good examples. Both have high financial development, large inequality, and current account deficits. It is thus no coincidence, in the context of our model, that these countries led the populist wave in 2016. In contrast, Germany is less financially developed, less unequal, and it runs a sizable current account surplus. Populism has been relatively subdued in Germany, as our model predicts. The model emphasises the dark side of financial development – it spurs the growth of inequality, which eventually leads to a populist backlash.

    Who are the Populist Voters?

    The model also makes predictions about the characteristics of populist voters. Compared to mainstream voters, populist voters should be more inequality-averse (i.e. more anti-elite) and more risk-averse (i.e. better insured against consumption fluctuations). Like highly risk-averse agents, poorer and less-educated agents have less to lose from the end of globalization. The model thus predicts that these agents are more likely to vote populist. That is indeed what we find when we examine the characteristics of the voters who supported Brexit in the 2016 EU referendum and Trump in the 2016 presidential election.

    The model's predictions for asset prices are also interesting. The global market share of US stocks should rise in anticipation of the populist's victory. Indeed, the US share of the global stock market rose steadily before the 2016 Trump election. The US bond yields should be unusually low before the populist's victory. Indeed, bond yields in the West were low when the populist wave began.

    Backlash in a booming economy

    In our model, a populist backlash occurs when the economy is strong because that is when inequality is high. The model helps us understand why the backlash is occurring now, as the US economy is booming. The economy is going through one of its longest macroeconomic expansions ever, having been growing steadily for almost a decade since the 2008 crisis.

    This study relates to our prior work at the intersection of finance and political economy. Here, we exploit the cross-sectional variation in risk aversion, whereas in our 2017 paper, we analyse its time variation (Pastor and Veronesi 2017). In the latter model, time-varying risk aversion generates political cycles in which Democrats and Republicans alternate in power, with higher stock returns under Democrats. Our previous work also explores links between risk aversion and inequality (Pastor and Veronesi 2016).

    Conclusions

    We highlight the fragility of globalization in a democratic society that values equality. In our model, a pushback against globalization arises as a rational voter response. When a country grows rich enough, it becomes willing to sacrifice consumption in exchange for a more equal society. Redistribution is of limited value in our frictionless, complete-markets model. Our formal model supports the narrative of Rodrik (1997, 2000), who argues that we cannot have all three of global economic integration, the nation state, and democratic politics.

    If policymakers want to save globalization, they need to make the world look different from our model. One attractive policy option is to improve the financial systems of less-developed countries. Smaller cross-country differences in financial development would mitigate the uneven effects of cross-border risk sharing. More balanced global risk sharing would result in lower current account deficits and, eventually, lower inequality in the rich world.

    See original post for references


    JTMcPhee , September 28, 2018 at 10:34 am

    "rising inequality is a natural consequence of economic growth. " For which definition of growth? Or maybe, observing that cancer is the very model of growth, for any definition?

    Nice model and graphs, though.

    What kind of political economy is to be discerned, and how is one to effectuate it with systems that would have to be so very different to have a prayer of providing lasting homeostatic functions?

    The Rev Kev , September 28, 2018 at 10:50 am

    And what happens in a world where, due to depleted resources, growth is no longer an option and we start living in a world of slow contraction?

    paulmeli , September 28, 2018 at 12:28 pm

    Starvation pain and death absent some kind of (fair) rationing mechanisms.

    Olga , September 28, 2018 at 2:24 pm

    Actually, I can hardly wait. If nothing else will get folks motivated to effect change – this could (let's hope).

    drumlin woodchuckles , September 28, 2018 at 3:29 pm

    The global overclass can hardly wait too. They think they are in position to guide the change to their desired outcome. Targeted applied Jackpot Engineering, you know.

    joey , September 28, 2018 at 5:24 pm

    hoping for an alpha test tube environment or better soma in my next go round?

    Bobby Gladd , September 28, 2018 at 4:12 pm

    Frase's "Quadrant IV" – Hierarchy + Scarcity = Exterminism (see "Four Futures")

    d , September 28, 2018 at 2:11 pm

    At some point if the majority dont think they get any benefit from the economy, they will put a stake through it, and replace it with some thing that works?now that could be some thing very different, but it will happen

    Olga , September 28, 2018 at 2:22 pm

    I had the same thought – growth as defined in the current, neoliberal model. There is nothing inevitable about inequality – it is caused by political choices.

    Tony Wikrent , September 28, 2018 at 10:44 am

    It is painful to find these assumptions accepted at NC.

    "the economy is strong"

    Not from my perspective. Or from the perspectives of the work force or the industrial base replacing themselves. Or the perspective of a 4 to 5 trillion dollar shortfall in infrastructure funding.

    "In our model, rising inequality is a natural consequence of economic growth."

    Well, that simply did not happen 1946 to 1971.

    "populist delivers lower consumption but also lower inequality to US agents."

    REALLY? Consumption of WHAT? Designer handbags and jeans? What about consumption of mass public transit and health care services? I'm very confident that a populist government that found a way to put a muzzle on Wall Street and the banksters would increase consumption of things I prefer while also lessening inequality.

    Reading through this summary of modeling, it occurred to me that the operative variable was not inequality so much as "high financial development."

    paulmeli , September 28, 2018 at 12:32 pm

    It is painful to find these assumptions accepted at NC.

    "the economy is strong"

    "In our model, rising inequality is a natural consequence of economic growth."

    "populist delivers lower consumption but also lower inequality to US agents."

    Agreed, BS but likely to be skewered as the comment section picks up steam.

    There's a lot of skeptics lurking here.

    JEHR , September 28, 2018 at 1:09 pm

    Thanks for pointing out the weaknesses in the article.

    a different chris , September 28, 2018 at 12:33 pm

    Posting doesn't apply "acceptance" at NC. I think that has been made pretty darn clear on a number of occasions.

    Olga , September 28, 2018 at 2:45 pm

    Yes and also, let's not throw the baby out with the bath water. These days, just saying that globalisation leads to inequality and people act rationally, when they push back – even though choices are limited – is pretty revolutionary. We need other analyses along those lines, maybe with a few corrections. Thanks for posting!

    shinola , September 28, 2018 at 1:01 pm

    "Redistribution is of limited value in our frictionless, complete-markets model"

    That's nice. But in what universe do these "frictionless, complete-markets" actually exist?

    juliania , September 28, 2018 at 1:37 pm

    " In our model, a populist backlash occurs when the economy is strong because that is when inequality is high. "

    Yes to the above comments. This sentence really stuck in my throat. A strong economy to me is one that achieves balanced equality. Somehow this article avoids the manner in which the current economy became "strong". Perhaps a better word is "corrupt". (No 'perhaps' really; I'm just being polite.)

    Otherwise some good points being made here.

    juliania , September 28, 2018 at 1:41 pm

    I also didn't like that the anti-neoliberalists are being portrayed as not having sympathy for the poor. Gosh, we are a hard-hearted lot, only interested in our own come-uppance and risk-adversity.

    Robert Valiant , September 28, 2018 at 2:52 pm

    Isn't equality just a value?

    A "strong" economy is one that is growing as measured by GDP – full stop. Inequality looks to me like a feature of our global economic value system, not a bug.

    paulmeli , September 28, 2018 at 3:29 pm

    Inequality is a problem of distribution. Is a strong economy one that provides the most to a few or a fair share to the many?

    High GDP growth could reflect either but which is most important?

    If your neighbor is out of work it looks like a recession, if you're out of work it feels like a depression.

    Synoia , September 28, 2018 at 2:22 pm

    Friction-less Markets exist in where there is much lube.

    Trump is probably an expert in that area.

    paulmeli , September 28, 2018 at 3:30 pm

    "Redistribution is of limited value in our frictionless, complete-markets model"

    This is complete BS. So is your model.

    Kit , September 28, 2018 at 5:36 pm

    A universe with spherical consumers of uniform size and density.

    Economics is like physics, or wants to be. If you want practicality, you need something more like engineering.

    Andrew Watts , September 28, 2018 at 5:56 pm

    I only read these articles to see what the enemy is thinking. The vast majority of economists are nothing more than cheerleaders for capitalism. I imagine anybody who strays too far from neoliberal orthodoxy is ignored.

    Patrick , September 28, 2018 at 10:56 am

    the Trump/Brexit populist thinking has nothing to do with equality. it has do do with who should get preferential treatment and why -- it's about drawing a tight circle on who get's to be considered "equal".

    not sure how you can pull a desire for equality from this (except through statistics, which can be used to "prove" anything).

    Outis Philalithopoulos , September 28, 2018 at 1:23 pm

    I'm confused – so the evidence of statistics should be discounted, in favor of more persuasive evidence? Consisting of your own authoritative statements about the motives of other people?

    In the future, please try to think about what sorts of arguments are likely to be persuasive to people who don't already agree with you.

    paulmeli , September 28, 2018 at 3:35 pm

    In the Trump/neoliberal world we get what we "deserve". Or do we deserve what we get?

    The majority of the population believes the losers didn't try hard enough.

    In a world full of Einsteins the bottom 20% would still live in poverty. Life is graded on a curve.

    Louis Fyne , September 28, 2018 at 10:57 am

    If you consider yourself an "environmentalist," then you have to be against globalization.

    (From the easiest to universally agree upon) the multi-continental supply chain for everything from tube socks to cobalt to frozen fish is unsustainable, barring Star Trek-type transport tech breakthroughs.

    (to the less easily to universally agree upon) the population of the entire developed (even in the US) would be stablized/falling/barely rising, but for migration.

    mass migration-fueled population growth/higher fertility rates of migrants in the developed world and increased resource footprint is bad for both the developed world and developing world.

    Jeremy Grimm , September 28, 2018 at 2:51 pm

    The long, narrow, and manifold supply lines which characterize our present systems of globalization make the world much more fragile. The supply chains are fraught with single points of systemic failure. At the same time Climate Disruption increases the risk that a disaster can affect these single points of failure. I fear that the level of instability in the world systems is approaching the point where multiple local disasters could have catastrophic effects at a scale orders of magnitude greater than the scale of the triggering events -- like the Mr. Science demonstration of a chain-reaction where he tosses a single ping pong ball into a room full of mousetraps set with ping pong balls. You have to be against globalization if you're against instability.

    The entire system of globalization is completely dependent on a continuous supply of cheap fuel to power the ships, trains, and trucks moving goods around the world. That supply of cheap fuel has its own fragile supply lines upon which the very life of our great cities depends. Little food is grown where the most food is eaten -- this reflects the distributed nature of our supply chains greatly fostered by globalization.

    Globalization increases the power and control Corporate Cartels have over their workers. It further increases the power large firms have over smaller firms as the costs and complexities of globalized trade constitute a relatively larger overhead for smaller firms. Small producers of goods find themselves flooded with cheaper foreign knock-offs and counterfeits of any of their designs that find a place in the market. It adds uncertainty and risk to employment and small ventures. Globalization magnifies the power of the very large and very rich over producers and consumers.

    I believe the so-called populist voters and their backlash in a "booming" economy are small indications of a broad unrest growing much faster than our "booming" economies. That unrest is one more risk to add to the growing list of risks to an increasingly fragile system. The world is configured for a collapse that will be unprecedented in its speed and scope.

    Olga , September 28, 2018 at 2:54 pm

    Actually, the way I see it – if one considers oneself an environmentalist, one has to be against capitalism, not just globalization. Capitalism is built on constant growth – but on a planet, with limited resources, that simply cannot work. Not long term unless we're prepared to dig up and/or pave over everything. Only very limited-scale, mom-and-pop kind of capitalism can try to work long term – but the problem is, it would not stay that way because greed gets in the way every time and there's no limiting greed. (Greed as a concept was limited in the socialist system – but some folks did not like that.)

    tagyoureit , September 28, 2018 at 3:22 pm

    "Capitalism is built on constant growth." I have a 'brand new' view of photosynthesis. Those plants (pun intended) are 'capitalist pigweeds'

    John Wright , September 28, 2018 at 11:21 am

    The paper posits:

    " Given their low risk aversion, US agents insure the agents of the rest of the world by holding aggressive and disperse portfolio positions."

    That low risk aversion could be driven by the willingness of the US government to provide military/diplomatic/trade assistance to US businesses around the word. The risk inherent in moving factories, doing resource extraction and conducting business overseas is always there, but if one's government lessens the risk via force projection and control of local governments, a US agent could appear to be "less risk averse" because the US taxpayer has "got their back".

    This paper closes with

    "If policymakers want to save globalization, they need to make the world look different from our model. One attractive policy option is to improve the financial systems of less-developed countries. Smaller cross-country differences in financial development would mitigate the uneven effects of cross-border risk sharing. More balanced global risk sharing would result in lower current account deficits and, eventually, lower inequality in the rich world."

    Ah yes, to EVENTUALLY lower inequality, the USA needs to "improve the financial systems of less-well developed countries"

    Perhaps the USA needs to improve its OWN financial system first?

    Paul Woolley has suggested, the US and UK financial systems are 2 to 3 times they should be.

    And the USA's various financial industry driven bubbles, the ZIRP rescue of the financial industry, and mortgage security fraud seem all connected back to the USA financial industry.

    Inequality did not improve in the aftermath of these events as the USA helped preserve the elite class.

    Maybe the authors have overlooked a massive home field opportunity?

    That being that the USA should consider "improving" its own financial system to help inequality.

    shinola , September 28, 2018 at 1:17 pm

    In my model, eventually, we are all equally dead.

    Lee , September 28, 2018 at 11:26 am

    I'm glad to see that issues and views discussed pretty regularly here in more or less understandable English have been translated into Academese. Being a high risk averse plebe, who will not starve for lack of trade with China, but may have to pay a bit more for strawberries for lack of cheap immigrant labor, I count myself among the redistributionist economic nationalists.

    jrs , September 28, 2018 at 1:59 pm

    I suspect strawberries would be grown elsewhere than the U.S., without cheap immigrant labor (unless picking them is somehow able to be automated).

    polecat , September 28, 2018 at 5:19 pm

    Yes, it's called u-pickum @ home ..

    Right now I'm making raisins from the grapes harvested here at home .. enough to last for a year, or maybe two. Sure, it's laborous to some extent, but the supply chain is very short .. the cost, compared to buying the same amount at retait rates, is minuscule, and they're as 'organic' as can be. The point I'm trying to make is that wth some personal effort, we can all live lighter, live slower, and be, for the most part, contented.
    Might as well step into collapse, gracefully, and avoid the rush, as per J. M. Greer's mantra.

    Wukchumni , September 28, 2018 at 12:45 pm

    The UK had become somewhat dependent on Switzerland for wristwatches prior to WW2, and all of the sudden France falls and that's all she wrote for imports.

    Must've been a mad scramble to resurrect the business, or outsource elsewhere.

    My wife and I were talking about what would happen if say the reign of error pushes us into war with China, and thanks to our just in time way of life, the goods on the shelves of most every retailer, would be plundered by consumers, and maybe they could be restocked a few times, but that's it.

    Now, that would shock us to our core consumerism.

    Inode _buddha , September 28, 2018 at 2:11 pm

    People might actually start learning how to fix stuff again, and value things that can be fixed.

    polecat , September 28, 2018 at 5:39 pm

    I recently purchased a cabinet/shelf for 20 tubmans, from a repurposing/recycling business, and, after putting a couple of hundred moar tubmans into it .. some of which included recycled latex paints and hardware .. transformed it into a fabulous stand-alone kitchen storage unit. If I were to purchase such at retail, it would most likely go for close to $800- $1000.00 easy !!
    With care, this 'renewed' polecat heirloom will certainly outlive it's recreator, and pass on for generations henceforth.

    Duck1 , September 28, 2018 at 6:24 pm

    I thought a Tubman was a double sawbuck, or at least a Hamilton. Otherwise, you're doing it right kid.

    HotFlash , September 28, 2018 at 1:09 pm

    Oh well, Canada not on any of the charts. Again. We are most certainly chopped moose liver. Wonder what the selection criteria were?

    JEHR , September 28, 2018 at 1:15 pm

    Yes, thank goodness there was no mention of Canada's failure to negotiate a trade treaty with our best friend. All of a sudden, Canadians seem to be the target of a lot of ill will in other articles.

    JTMcPhee , September 28, 2018 at 1:47 pm

    I think it's just ill- informed jealousy. Us US mopes think Canadians are much better off than we Yanks, health care and such. You who live there have your own insights, of course. Trudeau and the Ford family and tar sands and other bits.

    And some of us are peeved that you don't want us migrating to take advantage of your more beneficent milieu.

    Wukchumni , September 28, 2018 at 1:54 pm

    It's a different vibe up over, their housing bubble crested and is sinking, as the road to HELOC was played with the best intentions even more furiously than here in the heat of the bubble.

    Can Canada bail itself out as we did in the aftermath, and keep the charade going?

    Jonathan T McPhee , September 28, 2018 at 3:10 pm

    Do they have a sovereign currency, and as yet not exhausted real world extractable resources?

    And I guess by "Canada" you are talking about the elite and the FIRE, right? "There are many Canadas " https://www.youtube.com/user/RedGreenTV

    Unna , September 28, 2018 at 3:20 pm

    Feel free to fill out that 8 inch high pile of Canadian immigration documentation, so ya'all can come on up and join the party. Or just jump on your pony and ride North into the Land of the Grandmother. Trudeau wants more people and has failed to offer proper sacrifice to the god Terminus, the god of borders, so .

    Just don't move to "Van" unless you have a few million to drop on a "reno'ed" crack shack. When the god Pluto crawls back into the earth, the housing bubble will burst, and it's not going to be pretty.

    Wukchumni , September 28, 2018 at 3:29 pm

    That's funny as our dam here is called the Terminus Reservoir, if the name fits

    I'm just looking for an ancestral way out of what might prove to be a messy scene down under, i'd gladly shack up in one of many of my relatives basements if Max Mad breaks out here.

    Unna , September 28, 2018 at 5:33 pm

    Handwriting's been on the wall. Canada's very nice, not perfect, but what place is? And: It's not the imperial homeland.

    JerryDenim , September 28, 2018 at 1:59 pm

    Great article, interesting data points, but besides placing tariffs on Chinese imports there is nothing populist about Trump, just empty rhetoric. Highly regressive tax cuts for the wealthy, further deregulation, wanton environmental destruction, extremist right-wing ideologues as judges, a cabinet full of Wall Street finance guys, more boiler-plate Neo-Lib policies as far as I can tell.

    I fear Trump and the Brexiters are giving populism a bad name. A functioning democracy should always elect populists. A government of elected officials who do not represent the public will is not really a democracy.

    feox , September 28, 2018 at 2:43 pm

    Aversion to inequality thus reflects envy of the economic elites rather than compassion for the poor.

    That's ridiculous. Indeed, the Brexit campaign was all about othering the poor and powerless immigrants, as well as the cultural, artistic, urban and academic elites, never the the moneyed elites, not the 1%. The campaign involved no dicussion what's so ever of the actual numbers of wealth inequality.

    When deciding whether to vote mainstream or populist, US agents face a consumption-inequality trade-off. If elected, the populist delivers lower consumption but also lower inequality to US agents.

    How can anyone possibly write such a thing? The multi-trillion tax cut from Donald Trump represents a massive long time rise in inequality. Vis-à-vis Brexit, the entire campaign support for that mad endeavor came from free-trader fundamentalists who want to be free to compete with both hands in the global race-to-the-bottom while the EU is (barely) restraining them.

    Trump and Brexit voters truly are irrational turkeys (that's saying a lot for anyone who's met an actual turkey) voting for Christmas.

    Jonathan T McPhee , September 28, 2018 at 3:05 pm

    Some of us mopes who voted for Trump did so as a least-bad alternative to HER, just to try to kick the hornet's nest and get something to fly out: So your judgment is that those folks are "irrational turkeys," bearing in mind how mindless the Christmas and Thansgiving turkeys have been bred to be?

    Better to arm up, get out in the street, and start marching and chanting and ready to confront the militarized police? I'd say, face it: as people here have noted there is a system in place, the "choices" are frauds to distract us every couple of years, and the vectors all point down into some pretty ugly terrain.

    Bless those who have stepped off the conveyor, found little places where they can live "autarkically," more or less, and are waiting out the Ragnarok/Gotterdammerung/Mad Max anomie, hoping not to be spotted by the warbands that will form up and roam the terrain looking for bits of food and fuel and slaves and such. Like one survivalist I spotted recently says as his tag-line, "If you have stuff, you're a target. If you have knowledge. you have a chance–" this in a youtube video on how to revive a defunct nickel-cadmium drill battery by zapping it with a stick welder. (It works, by the way.)He's a chain smoker and his BMI must be close to 100, but he's got knowledge

    precariat , September 28, 2018 at 3:24 pm

    The papers's framing of the issues is curious: the populace has 'envy' of the well-off; and populism (read envy) rises when the economy is strong and inequality rises (read where's my yaht?).

    The paper lacks acknowledgement of the corruption, fraud, and rigging of policy that rises when an overly financialized economy is 'good.' This contributes to inequality. Inequality is not just unequal, but extremely disproportionate distributions which cause real suffering and impoverishment of the producers. It follows (but not to the writer of this paper) that the citizens take offense at and objection to the disproprtionate takings of some and the meager receipts of the many. It's this that contributes to populism.

    And the kicker: to save globalization, let's financialize the less developed economies to mitigate cross-border inequalities. Huh? Was not the discussion about developed nations' voters to rising inequality in face of globalization? The problem is not cross-border 'envy.' It's globalization instrinsically and how it is gamed.

    Mark Pontin , September 28, 2018 at 7:05 pm

    Short version: It's the looting, stupid.

    Agreed.

    knowbuddhau , September 28, 2018 at 3:54 pm

    I'm with Olga. It's good to see that voting "wrong" taken seriously, and seen as economically rational. Opposing globalization makes sense, even in the idiosyncratic usage of economics.

    The trouble, of course, is that the world of economics is not the world we live in.

    Why does the immigrant cross the border? Is it only for "pecuniary interests," only for the money? Then why do so many send most of it back across the border, in remittances?

    If people in poor countries aren't willing to sacrifice for "luxuries," like a dignified human life, who was Simon Bolivar, Che Guevara, or more recently, Berta Cáceres?

    Seems to be a weakness of economic models in general: it's inconceivable that people do things for other than pecuniary interests. In the reductionist terms of natural science, we're social primates, not mechanical information engines.

    If this model were a back patio cart, like the one I'm building right now, I wouldn't set my beer on it. Looks like a cart from a distance, though, esp when you're looking for one.

    Darthbobber , September 28, 2018 at 6:02 pm

    To the extent that the backlash has irrational aspects in the way it manifests, I would suspect that it relates to the refusal of the self-styled responsible people to participate in opening more rational paths to solutions, or even to acknowledge the existence of a problem. When the allegedly responsible and knowledgeable actors refuse to act, or even see a need to act, it's hardly surprising that the snake oil vendors grow in influence.

    Charlie , September 28, 2018 at 6:21 pm

    I'm always leery of t-test values being cited without the requisite sample size being noted. You need that to determine effect size. While the slope looks ominously valid for the regression model, effects could be weak and fail to show whether current account deficits are the true source. Financialization seems purposely left out of the model.

    [Sep 22, 2018] The implications of US-China trade war - World Socialist Web Site

    18 September 2018
    Notable quotes:
    "... Washington Post ..."
    "... Popularity of National Socialism in capitalist country like Germany was exactly due to that process of corruption of working class who embassy stoped to question system as long as provided them with goods. ..."
    "... Henceforth, most goods manufactured for US consumption were to be produced abroad, from Mexico to China. Once US based multinationals started down this road, European and even Japanese ones followed. This did not mean an increase in productive forces but a substitution of one labour force for another. ..."
    "... Thus the rise of Chinese industry was as much a part of this process as the deindustrialisation of formerly prosperous parts of the US and the UK. This has nothing to do with the evolution of our species and everything to do with the evolution of capitalism. This is what I mean by globalisation. ..."
    "... It has not eradicated national borders but is a major factor in the recent development of far right nationalism in Europe. It is a strong contributor to the restructuring of western economies so that only a minority of British workers have full time permanent jobs. It is also used as leverage to drive down wages in western economies. ..."
    "... I do not believe what I mean by globalisation is progressive at all. It has been pushed by the most reactionary political forces in western societies as an integral part of what the WSWS calls a social counter revolution. As the WSWS again points out it makes the preservation of national welfare states or a decent standard of living for working class people impossible. I am not calling for this to be reversed under capitalism. ..."
    "... "...globalised production is the exploitation of lower wage rates in developing countries." ..."
    "... As if domestic production were not the same thing. The author is essentially arguing for "lesser evil" exploitation in the interests of society as a whole. Reformists always do. ..."
    "... "The crisis also exposed in full glare another of the central myths of the capitalist order -- that the state is somehow a neutral or independent organisation committed to regulating social and economic affairs in the interests of society as a whole." - Ten years since the collapse of Lehman Brothers ..."
    "... "Keynes was a reformist and capable of formulating policies which, if followed, would make capitalism more amenable to the interests of the majority of people." ..."
    "... The most important theoretical source of his thinking is his own work "The General Theory of Employment, Money and Interest" which is available to read or download free online. ..."
    "... The US wants to reinforce it's declining global hegemonic position at any cost. Now they started with economic war against countries they see as not cooperating to their demands, but under current conditions this could easily transform into Global war at some point in future. ..."
    Sep 22, 2018 | www.wsws.org

    In the aftermath of the global financial crisis ten years ago, the leaders of the world's major powers pledged that never again would they go down the road of protectionism which had such disastrous consequences in the 1930s -- deepening the Great Depression and contributing to the outbreak of world war in 1939.

    Yesterday US President Donald Trump announced tariffs on $200 billion worth of Chinese goods in what the Washington Post described as "one of the most severe economic restrictions ever imposed by a US president."

    A levy of 10 percent will be imposed starting from September 24 and will be escalated to 25 percent in 2019 if the US does not receive what it considers to be a satisfactory agreement. The new tariffs, which will cover more than 1,000 goods, come on top of the 25 percent tariff already imposed on $50 billion worth of industrial products. Trump has threatened further measures on the remaining Chinese exports to the US totalling more than $250 billion.

    China has threatened retaliatory action including tariffs and other, as yet unspecified measures, against the US, meaning that the world's number one and number two economies are locked into a rapidly escalating trade war that will have global consequences.

    Announcing the decision, Trump called on China to take "swift action" to end what he called its "unfair trade practices" and expressed the hope that the trade conflict would be resolved.

    But there is little prospect of such an outcome because, while the US is demanding that the trade deficit with China be reduced, the conflict does not merely centre on that issue. China has made offers to increase its imports from the US, all of which have been rejected. The key US demand is that the Chinese government completely abandon its program of economic development and remain subservient to the US in high-tech economic sectors.

    As the position paper issued by Washington in May put it: "China will cease providing market-distorting subsidies and other types of government support that can contribute to the creation or maintenance of excess capacity in industries targeted by the Made in China 2025 industrial plan."

    In other words, China must completely scrap the foundational structures of its economy so that it presents no threat to the economic dominance of US capitalism, a dominance which the US intends to maintain, if it considers necessary, by military means. This was made clear earlier this year when Washington designated China as a "strategic competitor," that is, a potential military enemy. This is the inherent, objective, logic of the latest trade war measures.

    Their full significance can only be grasped when viewed with the framework of the historical development of the global capitalist economy.

    After the disastrous decade of the 1930s, and as the world plunged into war, leading figures within the Roosevelt administration recognised that this situation was due in no small measure to the division of the world into rival trade and economic blocs which tariff and other trade restrictions had played a major role in creating.

    Post-war planning centred on trying to overcome this contradiction between the global economy and its division into rival great powers and blocs through the development of a mechanism that ensured the expansion of world trade. This was the basis of the series of measures set in place in the immediate aftermath of the war: the Bretton Woods monetary system which tied major currencies to the dollar in fixed exchange rates, the General Agreement on Tariffs and Trade that sought to bring down tariff barriers and the establishment of the International Monetary Fund and the World Bank to ensure international economic collaboration.

    These measures, however, did not overcome the inherent contradictions of capitalism, above all between the global economy and the nation-state system. Rather, they sought to contain and mitigate them within a system based on the overwhelming economic dominance of the US.

    But the growth of the world capitalist economy and the strengthening of the other major powers undermined the very foundations on which they were based -- the absolute dominance of the US. Within the space of a generation, the weakening of the US position was revealed in August 1971 when it scrapped the Bretton Woods monetary system declaring that the dollar would no longer be redeemable for gold.

    The period since then has seen the ongoing weakening of the position of the US, which was graphically revealed in the financial meltdown ten years ago when the US financial system was shown to be a house of cards based on rampant speculation and outright criminal activity. This situation has continued in the subsequent decade, threatening, another, even more disastrous, financial crisis.

    The US is now not only confronted with the economic power of its European rivals but a major new one in the form of China. It is striving to reverse this situation. As Leon Trotsky explained some eighty years ago, the hegemony of the US would assert itself most powerfully not in conditions of boom but above all in a crisis when it would use every means -- economic and military -- against all rivals to maintain its position.

    The trade war measures against China are only one expression of this process. The US has already carried out protectionist measures against Europe and Japan through the imposition of tariffs on steel and aluminium and has threatened tariffs on cars and auto parts, which will be invoked unless they join its push on China.

    And as the China tariffs are imposed, top officials of the European Union are meeting to discuss how they might overcome the financial sanctions the US will impose against European companies if they maintain economic ties with Iran after November 4 following the unilateral abrogation of the Iran nuclear deal.

    The deal was not overturned because Iran had breached the agreement -- international agencies found that it had fully complied. Rather, the United States unilaterally abrogated the treaty in order to strengthen the strategic position of the US in the Middle East by countering the influence of Iran, and because European corporations stood to benefit from the opening up of new economic opportunities in that country at the expense of their US rivals.

    Now the State Department has warned that European companies are "on the railroad tracks" if they defy US sanctions and firms that deal with the "enemy" will be barred from access to the US financial system.

    Writing in the 1930s, Leon Trotsky explained that the interdependence of every country in the global economy meant that the program of economic nationalism, of the kind now being practised by the Trump administration, was a reactionary "utopia" insofar as it set itself the task of harmonious national economic development on the basis of private property.

    "But it is a menacing reality insofar as it is a question of concentrating all the economic forces of the nation for the preparation of a new war," he wrote five years before the outbreak of World War II.

    This "menacing reality" is now once again expressed in the fact that the trade war measures against China, as well as those against Europe and Japan, have all been invoked on "national security" grounds. Just as the US prepares for war, so too do all the other major powers. This drive does not arise from the heads of the capitalist politicians -- their actions are only the translation into politics of the objective logic and irresolvable contradictions of the capitalist system over which they preside.

    But there is another more powerful logic at work. The very development of globalised production, which has raised the contradiction of the outmoded nation-state system with its rival great powers to a new peak of intensity, has laid the foundations for a planned world socialist economy. And it has created in the international working class, unified at an unprecedented level, the social force to carry it out.

    The latest Trump trade war measures underscore the urgency for the political and theoretical arming of the working class with the program of world socialist revolution, fought for by the International Committee of the Fourth International, if civilisation is to go forward and the plunge into barbarism averted.

    Nick Beams

    ReplyShare › +

    Warren Duzak4 days ago

    Beams excellent piece included:
    "As the position paper issued by Washington in May put it: "China will
    cease providing market-distorting subsidies and other types of government support that can contribute to the creation or maintenance of excess capacity in industries targeted by the Made in China 2025 industrial plan."

    This issue of "government support" in China is reflected in the U.S. but in a different way. Nashville and Tennessee governments alone have given hundreds of millions of dollars in "tax incentives," payment for worker training and outright "grants" to corporations in "government support."
    Hospital Corporation of America (HCA) got millions for, of all things, furniture for new offices which included thousands of dollars for a guitar-shaped table.
    Gaylord's Opryland Resort got almost $14 million from the city to build a $90 million hotel Waterpark that would only be open to hotel guests!
    The state and its capitol are prepared to give Amazon more than $1.5 billion to have the corporation move is second U.S. headquarters here.
    Like the Chinese government and oligarchs, neither state nor city will reveal the details or total amount.
    As the WSWS has so correctly observed before, "the hypocrisy is breathtaking."

    Jerome_Stern5 days ago
    I should say I do not agree that globalised production is a beneficial or positive economic development. I accept that as a by product there is a positive political result namely the creation and expansion of the international working class. But the only reason for globalised production is the exploitation of lower wage rates in developing countries. If the cost of labour, taking into account currency exchange rates as well as wage levels, were the same in every country and region, there would be no advantage in producing most commodities in Asia for sale in North America or Europe (or vice versa). Also, I do not accept that free trade is in everyone's interest. The only argument ever advanced in it's favour by economists, the comparative advantage argument, is spurious. Even its originators, Adam Smith and David Ricardo, accepted that the benefits would only apply if capital was immobile across national boundaries, which hardly applies today. The US economy's industrial growth, though the result of several factors, was only possible because the US rejected free trade in favour of protective tariffs which protected its infant industries from foreign competition. What is the central fallacy in the comparative advantage argument is that the prosperity of the majority of a country's citizens under capitalism depends on a strong, capital intensive, manufacturing sector, but which also requires a large labour input. Only those jobs can pay a sufficiently high wage to workers. Their spending power also invigorates the whole economy.
    Kalen Jerome_Stern4 days ago
    Your quite reasonable concerns are partially addressed here with Quasi-Marxist analysis:

    FALLACY OF FREE MARKET AND FREE TRADE: A THEORETICAL VIEW.
    https://contrarianopinion.w...

    Thy major point about this issue global or local is often completely missed namely that this dispute have nothing to do with Workers Socialist Revolution but to perhaps see ways how to save capitalism in a way of sharing more wealth with working class, how to suppress class struggle with Bread and Games or War, an old Roman method of divide and conquer.

    Hence, capital controls, tarrifs , barriers, subsidies are instruments of having any possibility of real social policies in capitalism system making it more livable and longer lasting than in case of intensified pressure on working class and class struggle of globalism versus nationalism.

    Popularity of National Socialism in capitalist country like Germany was exactly due to that process of corruption of working class who embassy stoped to question system as long as provided them with goods.

    Little did they know, that they were in 1930 confronted with no permanent political solution to their class issues via improvement of standard of living and importance of their labor on the propaganda spectrum,but with dead end politics of submission to one political sellouts or another since their forced unity was just subordinated to capitalist imperative of ufettered economic and military growth via extreme exploitation.

    And that is what's wrong with nationalism namely it is shutting down paths of class struggle toward class liberation, as it neuters this struggle.

    Jerome_Stern Joe Williams4 days ago
    There is a difference between the growth of global productive capacity and globalisation. Prior to the latter process, manufacturing capacity was increased including by western investment in developing countries, especially in Latin America. But production in those countries was for local regional and national markets.

    The US accepted competition from the German economy as a price to be paid for avoiding the postwar threat of socialism. But the Japanese export driven model of growth was eventually unacceptable. The US demanded the Japanese destroy this model by raising their own currency to a level which made their exports much less competitive. The Japanese rich were given financial opportunities in the US as compensation.

    However, when the South Koreans and other nations copied the Japanese model, the US government and US multinationals radically changed their economic policy. A conscious choice was made by the Reagon administration to export manufacturing jobs en masse to developing countries as well as attacking the incomes of US workers who had jobs.

    Henceforth, most goods manufactured for US consumption were to be produced abroad, from Mexico to China. Once US based multinationals started down this road, European and even Japanese ones followed. This did not mean an increase in productive forces but a substitution of one labour force for another.

    Thus the rise of Chinese industry was as much a part of this process as the deindustrialisation of formerly prosperous parts of the US and the UK. This has nothing to do with the evolution of our species and everything to do with the evolution of capitalism. This is what I mean by globalisation.

    It has not eradicated national borders but is a major factor in the recent development of far right nationalism in Europe. It is a strong contributor to the restructuring of western economies so that only a minority of British workers have full time permanent jobs. It is also used as leverage to drive down wages in western economies.

    Of course in recent years the Chinese and Indian economies have grown under these policies so that there is now an increase of global capacity. Nor do I believe this process has led to a genuinely more efficient system of production and distribution. To produce products in one part of the world for distribution to another part half way around the world is very inefficient, if the product could be made nearer to the point where it would be used. It however becomes profitable if the labour used to produce it is much cheaper than that available where the the object is to be sold.

    I do not believe what I mean by globalisation is progressive at all. It has been pushed by the most reactionary political forces in western societies as an integral part of what the WSWS calls a social counter revolution. As the WSWS again points out it makes the preservation of national welfare states or a decent standard of living for working class people impossible. I am not calling for this to be reversed under capitalism.

    That seems impossible. Only the overthrow of capitalism offers the possibility of positive change. But under international socialism, globalised production chains will finally be seen for what they are, an unnecessary and inefficient encumbrance on humanity.

    Joe Williams Jerome_Stern3 days ago
    I think you are largely confusing globalisation with imperialism. I think you are also misunderstanding the wsws position. The wsws does not call for xenophobic or nationalist policies to close borders and keep workers imprisoned in their home countries to be used as a captive labor force by the domestic bourgeoisie. The wsws calls for an internationalist and proletarian socialist movement in conformity with that advocated by the workers movement ever since the publication of the communist manifesto.
    Hermit Crab Jerome_Stern3 days ago
    profitability =/= efficiency
    Hermit Crab Jerome_Stern2 days ago
    I really could not care less what you call it. I just want people to start treating each other better. What makes those with sticky fingers think that they are so G.D. better than everyone else that they can condemn whole segments to poverty and even death, all for the sake of their bits of imaginary ego-boosts?

    ALL of the "isms" in the world have never worked out a justification for greed and the lust for power. No matter what the system, crooked people always try to exploit others, and blame justify it all on their "good genes". (edited)

    Capitalism is no better or worse because it just doesn't matter what the system is, the crooks will always cheat that system to get more than everyone else.

    denis ross Joe Williams4 days ago
    An interesting theory to describe what is essentially creation of a world customs union based on the model that created Germany in 1871, the Zollverein. Spreading the customs union (Zollverein) worldwide was the reason for the two world wars--instead of maintaining a world federation politically and economically. The United Nations was designed to be a federation, but under post-1945 changes in the USA and subsequent pressures on the UN and its member states, it began developing into a union, not a federation. This was accompanied with creation of a global Zollverein, tariff free borders and free trade.

    The difference politically between a union and a federation is that in a federation the member states award limited operating powers to a central coordinating body which does what the members want; in a union the central body holds all the powers and tells the members what to do.

    sumwunyumaynotno denis ross4 days ago
    The United Nations "holds all the powers and tells the members what to do" ? That's news to me. As far as I can tell, the members do what they damn well please. The UN is more like a fractured federation with a nearly impotent central body - the so-called "Security Council" - which issues edicts but has no enforcement power. Same with the World Court.
    Hermit Crab sumwunyumaynotnoa day ago
    The UN was designed by the victors of WWII to be "crippled", mere window-dressing as a calming salve for the developing nations. From the start, it was meant to be largely ineffective as the world's policeman and justice system .

    All the nation states with any significant power are still more interested in preserving as much their own power and hegemonic control as possible.

    Greg Jerome_Stern4 days ago
    "...globalised production is the exploitation of lower wage rates in developing countries."

    As if domestic production were not the same thing. The author is essentially arguing for "lesser evil" exploitation in the interests of society as a whole. Reformists always do.

    "The crisis also exposed in full glare another of the central myths of the capitalist order -- that the state is somehow a neutral or independent organisation committed to regulating social and economic affairs in the interests of society as a whole." - Ten years since the collapse of Lehman Brothers

    Hermit Crab Greg3 days ago
    I suppose the determination of what constitutes the "interests of society as a whole" depends on which end of the stick one's "society" is holding.
    Greg Jerome_Sterna day ago
    "However my fundamental advocacy of policy would be that of international socialism the result of which would be the handing of power to the working class to be exercised democratically ."

    The "handing of power" from whom exactly?

    As it is now, the minority holds the power. So it's reasonable to think you mean they would hand the power over to the majority.

    Which would be silly. But whether or not that was your meaning, "the handing of power to the working class to be exercised democratically" besides being exactly backwards, is an opportunist "understanding" of Marxism. It implies a perspective where the state does not need to be destroyed.

    "The crucial question for Marx was what was the social material force -- the class -- created by capitalist society itself, which would be the agency, the driving force, of this transformation." - A promotion of the "life-style" politics of the pseudo-left

    It's a version of the frequently and historically repeated goal of replacing one petty bourgeoisie minority with another, betraying the material interests of the working class and the revolution every time.

    It seems like you might have just mentioned that phrase as an aside but it might indicate the deeper problem.

    Before you start analyzing which policies might be recommended (which seems to be mainly what interests you) you have to understand the class nature of the problem. That doesn't come down only to understanding that there are two classes in struggle in society and then applying your everyday petty bourgeois thinking to it.

    Have you read David North's Lenin, Trotsky and the Marxism of the October Revolution ? It was written back in March yet it's still posted on the wsws main page--for a reason.

    It provides a concise explanation of some of the fundamental ideas and way of thinking you have to understand if you want to have any kind of intelligent conversation about socialism.

    sumwunyumaynotno Jerome_Stern4 days ago
    Nick Beams did not say that "globalised production chains employed represent a genuinely beneficial development in some deep sense." He said that such an outcome is impossible under capitalism and the system of competing nation-states.

    The only "deep sense" is that he said it would be possible for globalization to have a positive effect for humanity if the international working class were able to abolish capitalism, the pursuit of private profit, warring nation-states, and institute socialism.

    imaduwa5 days ago
    Thank you comrade Nick Beams. US's century is 20th and a bygone one. You finely point out on the basis of Trotskysm the mortal danger that humanity faces resulting from the inter-imperialist rivalry that is escalating by the day.

    Besides, the US's taking up of its rival China, the second biggest economy, in trade war pose a military confrontation to which Russia could be attracted on to China side.

    Also Russia has been taken up by American imperialism independently as a target. Brexit hard or soft would also confound economic nationalism that is gathering momentum hugely. US sanctions on Iran is bound to sharpen the conflict between European imperialists. Also India appears to be in crisis on whether to abide by US dictats as per its Iranian economic connection especially on oil purchase. US's increasing protectionism has already gone out of control as per its implications to global polity and military activity. In view of this critical situation the role of the working class, national and international, should determine the future of humanity. Role of the revolutionary triumvirate, ICFI/SEP/IYSSE, is of paramount importance. I appeal to national working classes to build SEP as your national party of the socialist revolution. I appeal to youth and students to build your national chapters of the IYSSE in schools, universities etc. as quickly as possible. World war is haunting. Very existannce of the humanity on this palnet is uncertain, if we unitedly as workers, youth and students fail to empower the party of the world revolution, ICFI. Victory to international socialist revolution. Death to protectionism whose major advocate is US capitalism/imperialism. Down with the psudo left and the trade unions.

    Jerome_Stern5 days ago
    Keynes, who designed the Bretton Woods system, also proposed an international banking system and currency (called the Bancor). The purpose was to prevent the kind of unbalanced world trade which now dominates the global economy. Under his proposed system, countries with chronic trade surpluses would be penalised, thus preventing a situation like the present with some nations being massive exporters and others massive importers. Instead, all countries would hover around balanced trade where their imports equaled their exports in value. The US government told Keynes to shut up about this plan or they would cancel their promised postwar loans to the UK. The reason was that at the time the US planned to be a net exporter. Incidentally, Keynes warned that if the system of managed currency exchange rates were abandoned, the financial markets would become a "virtual senate" which would have the power to dictate economic policies to nation states.
    Greg Jerome_Stern4 days ago
    "Keynes, who designed the Bretton Woods system, also proposed an international banking system and currency (called the Bancor). The purpose was to prevent the kind of unbalanced world trade which now dominates the global economy."

    Perpetually caught in a "lesser evil" loop of some variety or another from which the reformist never escapes, applying the same failed (ruling class) logic over, and over and over and over...

    "But this solves nothing because, as Marx's analysis showed, the crises of capitalism cannot be overcome by reforms to the monetary system because, while they necessarily express themselves there, they were rooted in the very foundations of the capitalist economy, in its DNA so to speak -- that is, in the social relations based on profit and the market system." -Ten years after Lehman: New financial crises in the making

    Jerome_Stern Greg4 days ago
    Keynes' suggestion would have "solved" or rather prevented one problem, but not every problem of capitalism. Keynes was a reformist and capable of formulating policies which, if followed, would make capitalism more amenable to the interests of the majority of people.

    He was consciously trying to save capitalism from itself and said so. But you rightly point out there is a major problem with this thinking, namely that it ignores the self interest of governments and capitalists alike, who ignore such concepts of "enlightened" self interest in favour of short term advantage.

    Political reality intruded in Keynes' well-intentioned designs immediately as I've mentioned and the whole Bretton Woods edifice was knocked down as soon as it proved inconvenient for US interests.

    Similarly, I strongly suspect Keynes would have disapproved of financial deregulation, but the underlying development of US capitalism led to unstoppable political pressure for its implementation.

    Greg Jerome_Stern3 days ago
    "Keynes was a reformist and capable of formulating policies which, if followed, would make capitalism more amenable to the interests of the majority of people."

    For the life of me I can't figure why you'd praise a policy that more effectively persuades or controls the masses to their own detriment and to the economic benefit of a minority--other than to conclude that like Keynes and the rest of the petty bourgeoisie, you're a reformist.

    Jerome_Stern Warren Duzak4 days ago
    The most important theoretical source of his thinking is his own work "The General Theory of Employment, Money and Interest" which is available to read or download free online.

    I only recently learned of his Bancor proposal in an article by George Monbiot originally published in the Guardian. I read it on the Znet website, but I can't remember when.

    As for his quote about the financial markets becoming a virtual senate, I read that in some article about finance but don't remember the source. Sorry I can't be more helpful. There could be other books on his theories but he is somewhat unfashionable as mainstream economics has mostly reverted to a more ideologically driven right wing position.

    Charlotte Ruse5 days ago
    "In January, while Trump was requesting Congress to allocate funds for the US-Mexico border wall, China sent delegates to Chile, inviting Latin American leaders to participate in the Belt and Road Initiative. Months later, as Trump bullied US allies at the NATO summit, China was wrapping up the "16+1 summit" in Bulgaria, where Chinese investment and diplomatic relations were marketed to Central and Eastern European leaders. And most recently, Chinese President Xi Jinping wrapped up his travels throughout Africa, where he was visiting with heads of state and deepening China's relationships with the continent of the future, while America picks a one-sided trade fight with Rwanda."

    The US "makes war" while China makes business deals. Pick your poison--two capitalists countries controlled by oligarchs which can only offer the working-class continued exploitation.

    https://www.geopoliticalmon...

    Sebouh805 days ago
    An Excellent piece of article that explains clearly the trajectory that got us into US-China trade war, and what this means for the Global Capitalist System going forward. If we remember when trade war topic was first brought into picture Trump administration officials were saying imposing tariffs on China and Europe were the only way to correct the unfair trade balances. However, as the months progressed it quickly became known that US officials were using unfair trade practices of China as a scapegoat to demand further concessions from the Chinese authorities. These concessions include complete dismantlement of Made in China 2025 program and put a hold to their Silk Road initiative. In other words, Donald Trump and the entire American ruling circles see China as an existential long term threat and they are using trade war as a weapon to contain China's rising political and economical ambitions.

    For now Trump is increasing the tariffs so as to force the Chinese leadership to acquiesce to his conditions. Of course, I would expect in the coming days Chinese authorities to rebuff this latest round of sanctions and that they would retaliate their own tariffs.

    On the other hand, the Trump administration has put Iran under severe sanctions, and they also warned all big European Multinational corporations like Total and others to stop doing business with Iran after November. So as we can see we are in a very precarious Global situation right now due to rising contradictions between the needs of Global economy and nation states.

    The US wants to reinforce it's declining global hegemonic position at any cost. Now they started with economic war against countries they see as not cooperating to their demands, but under current conditions this could easily transform into Global war at some point in future.

    [Sep 18, 2018] Neoliberal EU faces the same crisis as the USA -- rejection of globalization by the majority of population

    Neoliberalism like Bolshevism in 60 tries to crush dissenters.
    Sep 18, 2018 | www.unz.com

    the obligatory four freedoms of the EU are free movement of goods, services, persons and capital throughout the Union. Open borders. That is the essence of the European Union, the dogma of the Free Market.

    The problem with the Open Border doctrine is that it doesn't know where to stop. Or it doesn't stop anywhere. When Angela Merkel announced that hundreds of thousands of refugees were welcome in Germany, the announcement was interpreted as an open invitation by immigrants of all sorts, who began to stream into Europe. This unilateral German decision automatically applied to the whole of the EU, with its lack of internal borders. Given German clout, Open Borders became the essential "European common value", and welcoming immigrants the essence of human rights.

    Very contrasting ideological and practical considerations contribute to the idealization of Open Borders. To name a few:

    This combination of contrasting, even opposing motivations does not add up to a majority in every country. Notably not in Hungary.

    It should be noted that Hungary is a small Central European country of less than ten million inhabitants, which never had a colonial empire and thus has no historic relationship with peoples in Africa and Asia as do Britain, France, the Netherlands, and Belgium. As one of the losers in World War I, Hungary lost a large amount of territory to its neighbors, notably to Romania. The rare and difficult Hungarian language would be seriously challenged by mass immigration. It is probably safe to say that the majority of people in Hungary tend to be attached to their national identity and feel it would be threatened by massive immigration from radically different cultures. It may not be nice of them, and like everyone they can change. But for now, that is how they vote.

    In particular, they recently voted massively to re

    Like the Soviet Union, the European Union is not merely an undemocratic institutional framework promoting a specific economic system; it is also the vehicle of an ideology and a planetary project. Both are based on a dogma as to what is good for the world: communism for the first, "openness" for the second. Both in varying ways demand of people virtues they may not share: a forced equality, a forced generosity. All this can sound good, but such ideals become methods of manipulation. Forcing ideals on people eventually runs up against stubborn resistance.

    There are differing reasons to be against immigration just as to be for it. The idea of democracy was to sort out and choose between ideals and practical interests by free discussion and in the end a show of hands: an informed vote. The liberal Authoritarian Center represented by Verhofstadt seeks to impose its values, aspirations, even its version of the facts on citizens who are denounced as "populists" if they disagree. Under communism, dissidents were called "enemies of the people". For the liberal globalists, they are "populists" – that is, the people. If people are told constantly that the choice is between a left that advocates mass immigration and a right that rejects it, the swing to the right is unstoppable.


    Johnny Rottenborough , says: Website September 17, 2018 at 11:17 pm GMT

    Orban's reputation in the West as dictator is unquestionably linked to his intense conflict with Hungarian-born financier George Soros

    And not only Soros, of course:

    'I know that this battle is difficult for everyone. I understand if some of us are also afraid. This is understandable, because we must fight against an opponent which is different from us. Their faces are not visible, but are hidden from view; they do not fight directly, but by stealth; they are not honourable, but unprincipled; they are not national, but international; they do not believe in work, but speculate with money; they have no homeland, but feel that the whole world is theirs.' -- Viktor Orbán

    Carlton Meyer , says: Website September 18, 2018 at 4:30 am GMT
    Watch the great Hungarian foreign minister repel attacks by the BBCs arrogant open borders propagandist, rudely treating him like an ignorant child and calling him a racist for defending his nation.
    Anonymous , [224] Disclaimer says: September 18, 2018 at 5:34 am GMT

    Economic liberals maintain that because Europe is aging, it needs young immigrant workers to pay for the pensions of retired workers.

    Not gonna happen. Their 80 IQ skills are uncompetitive and useless in Europe even before Automation erases those low-skilled positions in the coming decade or two. Meanwhile, (real) European youth unemployment rate is 20%. Young Europeans are not making babies because they don't have a stable future. This can only get worse as the hostile invaders get preferential, Affirmative Action treatment, in schools and workplaces. None of this is accidental.

    ... ... ...

    jilles dykstra , says: September 18, 2018 at 7:19 am GMT
    There are, in my opinion, two reasons for letting the mass immigration happen:
    - the Brussels belief, expressed in a 2009 official document, not secret, that the EU needs 60 million immigrants.
    - a Merkel belief dat the Germans are bad, they caused two world wars and perpetrated the holocaust, so the German people must be changed through mass immigration.

    The Brussels belief seems to be based mainly on the increasing average age in the EU.
    It is incomprehensible to me, at the same time fear that robots slowly will do all simple jobs.

    The Merkel belief, on the other side of the Atlantic, where few understand German, and cannot or do not watch German tv, I wonder how many understand that the 20th century propaganda of the victors still is decisive in German daily life and politics.
    The danger of neonazi's and fascism is everywhere.
    Nationalism, the equivalent of building gas chambers.

    The EU also is based on the 20th century fairy tales, only the EU prevented wars in Europe after WWII.
    The idea that Germans were victims in two world wars, and, until Hitler became power in 1933, also between the world wars, in unthinkable.
    The idea that Endlösung meant deportation to Madagaskar, even more unthinkable.

    That jews, as one Rothschild wrote to another around 1890, have and had but one enemy, themselves, the world unthinkable is too weak.
    Yet
    'From prejudice to destruction', Jacob Katz, 1980, Cambridge MA
    explains it, things as 'close economic cooperation, intermarriage, ostentious behaviour'.
    In this respect
    'Christianity and the Holocaust of the Hungarian Jewry', Moshe Y Herclz, 1993 New York University press
    also is a very interesting book, after jews in the thirties had been banned from many intellectual professions not a single Hungarian newspaper could be published any more.

    Soros trying to force Muslim immigrants on deeply catholic Hungary, he was born in Hungary, experienced anti semitism, revenge ?

    John Siman , says: September 18, 2018 at 11:20 am GMT
    I was recently in Budapest on business and will likely be returning soon: It is the most beautiful city I have ever seen, with stunning architectural restoration projects, almost non-existent police and military presence, food and wines that rival those of Paris, and a very friendly, non-bureaucratic and non-obsese (as opposed to the USA) population. I would like to hear from others who have recently visited and have knowledge of the country. Viszlát! -- John
    Felix-Culpa , says: September 18, 2018 at 11:27 am GMT
    When the fort of folly that Globalism is finally falls, Diana Johnstone's article will be cited as exemplary in exposing its hidden grammar. That fall cannot be far off now given that psy-ops can only work if people are ignorant of the manipulation afoot.

    Great opening, Diana. For forty years the presstitude media have leaned on the use of implication as argument to have the ninety-nine percent buy what they are selling. What was not pointed out very well until now, is that their implications are all false. Now, only a dummy among the dumbed-down cannot see it.

    Buzz Mohawk , says: September 18, 2018 at 11:46 am GMT
    For those who have the patience to read the English subtitles, here is an excellent speech given by Orbán in July. Here he outlines his thinking on the issues facing Hungary and the world.

    Viktor Orbán is a very intelligent leader, and he has the vast majority of the Hungarian people behind him. History has taught those people many things, and they have had enough. They are not fools. Look to them as an example for all of us.

    https://youtu.be/RfU-SVsGpsc

    Hans Vogel , says: September 18, 2018 at 12:36 pm GMT
    @John Siman I was recently in Budapest on business and will likely be returning soon: It is the most beautiful city I have ever seen, with stunning architectural restoration projects, almost non-existent police and military presence, food and wines that rival those of Paris, and a very friendly, non-bureaucratic and non-obsese (as opposed to the USA) population. I would like to hear from others who have recently visited and have knowledge of the country. Viszlát! -- John Wherever US influence is not yet overwhelming (and such places are becoming fewer every day, unfortunately), you will still find "old-fashioned" ways of interaction, few fatties, and decent food and drink.

    People may become fat for many reasons, but most fatties these days in the Anglosphere belong to the underclass. These wretches get fat from eating expensive trash at McDonald's and other fast food outlets, and drinking Coca Cola and similar sugar-saturated garbage. Their behavior may seem strange because their brains have largely withered away through endless TV watching (mainly US or US-inspired visual trash), their hearing impaired by ear- and mind numbing noise passing for music.

    I am afraid the way out of that prison is long and tortuous for all victims of US neoliberalism.

    Michael Kenny , says: September 18, 2018 at 1:44 pm GMT
    The usual anti-EU propaganda that Ms Johnstone has been peddling for at least a dozen years, although she has recently moved from claiming to be a far-leftist to claiming to be a far-rightest. Whatever pretext "proves" the EU to be evil is trotted out! However, she points out very clearly Viktor Orban's dilemma. The choice for Hungary is between the EU and Putin's tanks. After 40 years of occupation by a Soviet Union in which the ethnic Russians acted as colonial overlords and the general contempt which Hungarians have for Slavs, choosing the latter option would be political suicide for any Hungarian leader. Thus, Orban is stuck with the EU whether he likes it or not and the other Member States are stuck with Orban whether they like it or not. In addition, two of Ms Johnstone's factual claims need to be corrected. The "EU" is taking no step whatsoever to strip Hungary of its political rights. The (according to Ms Johnstone, "largely rubber stamp") European Parliament has adopted a resolution calling on the Member States to sanction Hungary. The EP always does something attention-grabbing in the run up to elections and since Ms Johnstone once worked for the European Parliament (as a far-leftist!), I'm sure she knows that. Imposing sanctions, as always in the EU, is a matter for the sovereign Member States and the decision has to be unanimous. Poland has already said it will not vote for sanctions, so the whole thing is a dead letter. Secondly, the claim that Hungary "never had a colonial empire" is untrue. It never had a colonial empire outside Europe but before 1918, it ruled over Slovakia, most of Croatia, Transylvania, now part of Romania, and the Vojvodina, now part of Serbia (so much for Ms Johnstone's supposed "expertise" on ex-Yugoslavia!). In general, the frantic, almost hysterical, tone of the article suggests that Ms Johnstone doesn't believe that Viktor Orban is going to be the cause of the imminent and inevitable demise of the hated EU that she has been predicting for as long as I have been reading her articles (and that goes back at least 14 years!).
    Hans Vogel , says: September 18, 2018 at 2:38 pm GMT
    @Michael Kenny The usual anti-EU propaganda that Ms Johnstone has been peddling for at least a dozen years, although she has recently moved from claiming to be a far-leftist to claiming to be a far-rightest. Whatever pretext "proves" the EU to be evil is trotted out! However, she points out very clearly Viktor Orban's dilemma. The choice for Hungary is between the EU and Putin's tanks. After 40 years of occupation by a Soviet Union in which the ethnic Russians acted as colonial overlords and the general contempt which Hungarians have for Slavs, choosing the latter option would be political suicide for any Hungarian leader. Thus, Orban is stuck with the EU whether he likes it or not and the other Member States are stuck with Orban whether they like it or not. In addition, two of Ms Johnstone's factual claims need to be corrected. The "EU" is taking no step whatsoever to strip Hungary of its political rights. The (according to Ms Johnstone, "largely rubber stamp") European Parliament has adopted a resolution calling on the Member States to sanction Hungary. The EP always does something attention-grabbing in the run up to elections and since Ms Johnstone once worked for the European Parliament (as a far-leftist!), I'm sure she knows that. Imposing sanctions, as always in the EU, is a matter for the sovereign Member States and the decision has to be unanimous. Poland has already said it will not vote for sanctions, so the whole thing is a dead letter. Secondly, the claim that Hungary "never had a colonial empire" is untrue. It never had a colonial empire outside Europe but before 1918, it ruled over Slovakia, most of Croatia, Transylvania, now part of Romania, and the Vojvodina, now part of Serbia (so much for Ms Johnstone's supposed "expertise" on ex-Yugoslavia!). In general, the frantic, almost hysterical, tone of the article suggests that Ms Johnstone doesn't believe that Viktor Orban is going to be the cause of the imminent and inevitable demise of the hated EU that she has been predicting for as long as I have been reading her articles (and that goes back at least 14 years!). Judging by your name, you are not a European, but an Englishman, or from somewhere else in the Anglosphere. It is a good thing for England and especially the English to be leaving the EuSSR, which is more of a prison than commonly realized. Ruled by a greedy class of corrupt and, to make it worse, utterly mediocre, politicians, incompetent and stupid bureaucrats (yes, I know this is an oxymoron) in the exclusive interest of ruthless big corporations, human rights do not exist in the EuSSR.

    Since the fall of the Berlin Wall, Europe has seen a wave of privatizations on a scale only comparable to what happened in the former USSR. Nevertheless, taxation has increased to a point where today, the average EuSSR "citizen" pays between 75% and 80% taxes on every Euro he earns. The middle class is on its way to extinction. The judiciary is a joke, education has been dismantled or stupidified, health care is a disaster, save in Southern Europe where many doctors and nurses still have a sense of humanity.

    The piece by Mrs. Johnstone may not be flawless, but it says what needs to be said.

    anonymous , [739] Disclaimer says: September 18, 2018 at 3:26 pm GMT
    Lots of important things switch sides.

    70 years ago the Democrat party in the American South was the party of regular working class White Southerners and promoted Southern heritage and Southern history including Confederate history.

    Then things change.

    Now the national Democrat party and the Democrat party in the South hates Whites Southerners, hates Southern heritage and Southern history and are promoting the desecration of Confederate monuments and confederate graves.

    60 years ago Hungarian was under Soviet Communist domination and Hungarian patriots looked to the West – especially American and Great Britain to help them achieve some personal freedom from Communism.

    Now things have completely changed. It's the Wester (EU) UK BBC, American mass media that restricts freedom and National Christianity in Hungary and pretty much everywhere else. Russia is once again a health European Christian nation. Nobody in Hungary, Eastern Europe or Russia wants to allow their countries to be invaded by millions of 3rd world Muslim rapists.

    So I living in Chicago IL (Obama was my neighbor) look to Hungary, Poland, Russia and Eastern Europe for any small dose of freedom.

    Things change.

    [Sep 02, 2018] Most of the premises of traditional imperialist power politics including forced globalization are simply blown away

    Notable quotes:
    "... At least neither Russia nor China are bombing hospitals, schools and bus full of children for oil ..."
    Sep 02, 2018 | www.zerohedge.com

    Jim in MN -> Majestic12 Fri, 08/31/2018 - 20:30 Permalink

    Not Pepe's best sauce, but always worth a read. He's best when he's reporting from the field. His armchair geopolitics aren't that much better than anyone else's.

    That said, Eurasian integration, Western Hemispheric energy independence, the populist revolt against forced globalization/sovereignty elimination/kleptocracy and the outbreak of global peace are all changing the chessboard profoundly. Most of the premises of traditional imperialist power politics are simply blown away. Instead, a new 'Chinese Peace with Russian Muscle' is the de facto hegemony in the vast bulk of the world, including parts of South American and most of Africa. With the Brits and French too slow and stupid to react, the Germans as weaselly and venal as ever, and the Japanese comatose, the hulk known as the G7 is heeling over into full capsize mode. And, good riddance.

    Now the G20 has to either stand up or collapse. Much depends on which outcome develops.

    However it works out, we can all stand and cheer that it is not a US dependent historical course any more. We've ceded our moral and military leadership. Perhaps we can reform, even if by bloody revolution, and re-emerge with something to give the rest of the world. Free markets, liberty, democracy, freedom of thought......the future is now really a question of whether any of these ideas will have a chance in a remade global order dominated, so far, by dictatorship, corruption, and moral crime.

    So, we tend to our own house now. Anyone got a pack of matches?

    Ace006 -> Jim in MN Sat, 09/01/2018 - 03:36 Permalink

    ** We've ceded our moral and military leadership **

    Kosovo, Iraq, Afghanistan, Benghazi, Libya, Syria, Ukraine, Georgia, NATO expansion, the Clintoons, the Bush dynasty of mediocrity, our open border, offshoring, Muslim ass kissing, free-ranging Antifa filth, media monopoly and lies, foreigners taking university slots, sexual confusion, ass kissing homosexuals, groveling before bat shit crazy feminists, destruction of our basic legal document through judicial usurpation, diseased leftists spouting lies and delusion, excusing black dysfunction, fiscal incontinence, unaddressd monopolies, attacks on free speech, criminal immunity for elites, a president who won't exercise his authority and tolerates insubordination, an unaccountable bureaucracy, a loose cannon prosecutor, Jewish political domination, slobbering over Israel as though Jerusalem is our capitol not Washington, denigration of the white majority culture, celebration of miscegenation, degradation of marriage, our diseased educational establishment, rampant vote fraud, illegal and unconstitutional wars, chest beating about "exceptionalism," and a generally crap culture all say you're right.

    DEDA CVETKO -> Majestic12 Fri, 08/31/2018 - 21:57 Permalink

    There will be no sudden and dramatic collapse. There will only be a slow, painful, never-ending, degrading decay into nothingness, a death from one million pundits, a process readily apparent (literally) all around us. Tune in to CNN, see for yourself.

    hongdo -> Conscious Reviver Sat, 09/01/2018 - 15:37 Permalink

    I see your point, but I am not convinced bankers work independently. Bankers do not have a monopoly on psychotics. The psychotics in gov have as much greed and craving for power as the bankers and I believe they work around, with, and against each other for various reasons just like everything else in the world works. Thus a one dimensional theory will not be complete - and maybe that is what you are arguing: to include bankers in geopolitics. I agree the bankers are a big part of the rotten problem but like when I am overseas - I watch the guys with the guns.

    sarz -> shuckster Sat, 09/01/2018 - 05:59 Permalink

    Most of the planet has put up with a lot of shit from America It's good that it's finally coming to an end.

    "We have about 50% of the world's wealth but only 6.3% of its population... Our real task in the coming period is to devise a pattern of relationships which will permit us to maintain this position of disparity without positive detriment to our national security. To do so, we will have to dispense with all sentimentality and daydreaming, and our attention will have to be concentrated everywhere on our immediate national objectives. We need not deceive ourselves that we can afford today the luxury of altruism and world benefaction... We should cease to talk about vague and unreal objectives such as human rights, the raising of the living standards, and democratization. The day is not far off when we are going to have to deal in straight power concepts. The less we are then hampered by idealistic slogans, the better."

    George Kennan, State Department memo, 1948

    America never gave up on the idealistic slogans -- the figleaf for the Empire of Chaos. Finally shutting the fuck up after the game is over will be welcome.

    me or you Fri, 08/31/2018 - 20:14 Permalink

    At least neither Russia nor China are bombing hospitals, schools and bus full of children for oil.

    [Sep 02, 2018] Escobar- Get Ready For A Major Geopolitical Chessboard Rumble

    Notable quotes:
    "... No wonder one of the side effects of progressive Eurasia integration will be not only a death blow to Bretton Woods but also to "democratic" neoliberalism. ..."
    Sep 02, 2018 | www.zerohedge.com

    Alastair Crooke took a great shot at deconstructing why Western global elites are terrified of the Russian conceptualization of Eurasia.

    It's because "they 'scent' a stealth reversion to the old, pre-Socratic values: for the Ancients the very notion of 'man', in that way, did not exist. There were only men: Greeks, Romans, barbarians, Syrians, and so on. This stands in obvious opposition to universal, cosmopolitan 'man'."

    So it's Heraclitus versus Voltaire – even as "humanism" as we inherited it from the Enlightenment, is de facto over.

    Whatever is left roaming our wilderness of mirrors depends on the irascible mood swings of the Goddess of the Market.

    No wonder one of the side effects of progressive Eurasia integration will be not only a death blow to Bretton Woods but also to "democratic" neoliberalism.

    What we have now is also a remastered version of sea power versus land powers. Relentless Russophobia is paired with supreme fear of a Russia-Germany rapprochement – as Bismarck wanted, and as Putin and Merkel recently hinted at. The supreme nightmare for the U.S. is in fact a truly Eurasian Beijing-Berlin-Moscow partnership.

    The Belt and Road Initiative (BRI) has not even begun; according to the official Beijing timetable, we're still in the planning phase. Implementation starts next year. The horizon is 2039.

    [Aug 31, 2018] The globalists would find use for a Trump presidency, more so in fact than a Clinton presidency

    Notable quotes:
    "... I was not sure whether Trump was controlled opposition or simply a useful scapegoat for the economic crisis that globalists are clearly engineering. Now it appears that he is both. ..."
    "... Many businessmen end up dealing with elitist controlled banks at some point in their careers. But when Trump entered office and proceeded to load his cabinet with ghouls from Goldman Sachs, JP Morgan, the Council on Foreign Relations and give Wilber Ross the position of Commerce Secretary, it became obvious that Trump is in fact a puppet for the banks. ..."
    "... If one examines the history of fake coups, there is ALWAYS an element of orchestrated division, sometimes between the globalists and their own puppets. This is called 4th Generation warfare, in which almost all divisions are an illusion and the real target is the public psyche. ..."
    "... the overall picture is not as simple as "Left vs. Right." Instead, we need to look at the situation more like a chess board, and above that chess board looms the globalists, attempting to control all the necessary pieces on BOTH sides. Every provocation by leftists is designed to elicit a predictable response from conservatives to the point that we become whatever the globalists want us to become. ..."
    "... Therefore it is not leftists that present the greatest threat to individual liberty, but the globalist influenced Trump administration. A failed coup on the part of the left could be used as a rationale for incremental and unconstitutional "safeguards." And conservatives may be fooled into supporting these measures as the threat is overblown. ..."
    Aug 31, 2018 | www.zerohedge.com

    ... ... ...

    At that time I was certain that the globalists would find great use for a Trump presidency, more so in fact than a Clinton presidency. However, I was not sure whether Trump was controlled opposition or simply a useful scapegoat for the economic crisis that globalists are clearly engineering. Now it appears that he is both.

    Trump's history was already suspicious. He was bailed out of his considerable debts surrounding his Taj Mahal casino in Atlantic City in the early 1990s by Rothschild banking agent Wilber Ross , which saved him from embarrassment and possibly saved his entire fortune . This alone was not necessarily enough to deny Trump the benefit of the doubt in my view.

    Many businessmen end up dealing with elitist controlled banks at some point in their careers. But when Trump entered office and proceeded to load his cabinet with ghouls from Goldman Sachs, JP Morgan, the Council on Foreign Relations and give Wilber Ross the position of Commerce Secretary, it became obvious that Trump is in fact a puppet for the banks.

    Some liberty movement activists ignore this reality and attempt to argue around the facts of Trump's associations. "What about all the media opposition to Trump? Doesn't this indicate he's not controlled?" they say. I say, not really.

    If one examines the history of fake coups, there is ALWAYS an element of orchestrated division, sometimes between the globalists and their own puppets. This is called 4th Generation warfare, in which almost all divisions are an illusion and the real target is the public psyche.

    This is not to say that leftist opposition to Trump and conservatives is not real. It absolutely is. The left has gone off the ideological deep end into an abyss of rabid frothing insanity, but the overall picture is not as simple as "Left vs. Right." Instead, we need to look at the situation more like a chess board, and above that chess board looms the globalists, attempting to control all the necessary pieces on BOTH sides. Every provocation by leftists is designed to elicit a predictable response from conservatives to the point that we become whatever the globalists want us to become.

    ... ... ...

    As this is taking place, conservatives are growing more sensitive to the notion of a leftist coup, from silencing of conservative voices to an impeachment of Trump based on fraudulent ideas of "Russian collusion."

    To be clear, the extreme left has no regard for individual liberties or constitutional law. They use the Constitution when it suits them, then try to tear it down when it doesn't suit them. However, the far-left is also a paper tiger; it is not a true threat to conservative values because its membership marginal, it is weak, immature and irrational. Their only power resides in their influence within the mainstream media, but with the MSM fading in the face of the alternative media, their social influence is limited. It is perhaps enough to organize a "coup," but it would inevitably be a failed coup.

    Therefore it is not leftists that present the greatest threat to individual liberty, but the globalist influenced Trump administration. A failed coup on the part of the left could be used as a rationale for incremental and unconstitutional "safeguards." And conservatives may be fooled into supporting these measures as the threat is overblown.

    I have always said that the only people that can destroy conservative principles are conservatives. Conservatives diminish their own principles every time they abandon their conscience and become exactly like the monsters they hope to defeat. And make no mistake, the globalists are well aware of this strategy.

    Carroll Quigley, a pro-globalist professor and the author of Tragedy and Hope, a book published decades ago which outlined the plan for a one world economic and political system, is quoted in his address ' Dissent: Do We Need It ':

    "They say, "The Congress is corrupt." I ask them, "What do you know about the Congress? Do you know your own Congressman's name?" Usually they don't. It's almost a reflex with them, like seeing a fascist pig in a policeman. To them, all Congressmen are crooks. I tell them they must spend a lot of time learning the American political system and how it functions, and then work within the system. But most of them just won't buy that. They insist the system is totally corrupt. I insist that the system, the establishment, whatever you call it, is so balanced by diverse forces that very slight pressures can produce perceptible results.

    For example, I've talked about the lower middle class as the backbone of fascism in the future. I think this may happen. The party members of the Nazi Party in Germany were consistently lower middle class. I think that the right-wing movements in this country are pretty generally in this group."

    Is a "failed coup" being staged in order to influence conservatives to become the very "fascists" the left accuses us of being? The continuing narrative certainly suggests that this is the game plan.

    * * *

    If you would like to support the publishing of articles like the one you have just read, visit our donations page here . We greatly appreciate your patronage.

    [Aug 31, 2018] Big Money refuses to return to reality as its addicted to Smoke Mirrors since that s what was used to gain its power and will now double-down

    Notable quotes:
    "... For dessert today, I offer Russia's Grand Strategy Revisited published on the 24th. The Outlaw US Empire is in the midst of a Seldon Crisis but lacks the means to even recognize the spectacular mess its made for itself, much of which is quite visibly articulated in its NDS I linked to above. ..."
    "... By every metric I've observed, the USA's citizenry from all political POVs wants a return to Reality for that's the only basis from which to address and solve the many domestic problems. ..."
    Aug 31, 2018 | www.moonofalabama.org

    karlof1 , Aug 30, 2018 5:38:27 PM | 34

    Too Funny! Trump whines, threatens pullout from WTO again! After decades of bullying nations and impoverishing their people, other nations are using the Outlaw US Empire's WTO as a weapon against it, so Trump cries Unfair! As I wrote above, Big Money's trapped within its own web.

    The "Softies" are yet another entity in the Smoke & Mirrors Fun House designed to fool and gain citizenry's consent to be robbed blind.

    Russians already went through that and are very wary as illustrated by the very sensitive nature of the recent Pension System Reform Debate and legislation that Putin had to solve using his political capital.

    As with all politicians, you won't know what you elected until you learn how your rep votes issues, although some can be anticipated by examining their past behavior as with our pseudo Democrat-Socialist.

    For dessert today, I offer Russia's Grand Strategy Revisited published on the 24th. The Outlaw US Empire is in the midst of a Seldon Crisis but lacks the means to even recognize the spectacular mess its made for itself, much of which is quite visibly articulated in its NDS I linked to above.

    By every metric I've observed, the USA's citizenry from all political POVs wants a return to Reality for that's the only basis from which to address and solve the many domestic problems.

    Big Money refuses as its addicted to Smoke & Mirrors since that's what was used to gain its power and will now double-down.

    [Aug 24, 2018] The establishment are shocked that the ordinary people want out of the European Union (EU). They just don't realize that people are fed up being used, abused, dictated to, lied to, manipulated

    Aug 24, 2018 | consortiumnews.com

    Stephen J. , August 18, 2018 at 9:57 am

    The powerful always want more power.
    -- -- -- -- -- -- -- -- -- -- -- -- -- –
    June 26, 2016

    "Brexit: Are The Serfs Finally Rebelling"?

    The establishment are shocked that the ordinary people want out of the European Union (EU). They just don't realize that people are fed up being used, abused, dictated to, lied to, manipulated, and forced into an EU dictatorship by treacherous politicians.

    These are some of the same politicians who scurry to the meetings of the so-called elites in Davos, and also attend Bilderberg meetings. And many of them, when they leave politics, finish up on the boards of banks and multi-national corporations with the rest of the money-manipulating bandits that got bailed out with taxpayers' dollars, some of whom, I believe, should be in jail .

    [much more info at link below]

    https://graysinfo.blogspot.com/2016/06/brexit-are-serfs-finally-rebelling.html

    [Aug 19, 2018] End of "classic neoliberalism": to an extent hardly imaginable in 2008, all the world's leading economies are locked in a perpetually escalating cycle of economic warfare.

    Highly recommended!
    Notable quotes:
    "... But to an extent hardly imaginable in 2008, all the world's leading economies are locked in a perpetually escalating cycle of economic warfare. This global trade war is spearheaded by the Trump White House, which sees trade sanctions and tariffs, such as the onslaught it launched against Turkey, as an integral component of its drive to secure the United States' geopolitical and economic interests at the expense of friend and foe alike. ..."
    "... But while they are deeply divided as to their economic and geo-political objectives, the capitalist ruling classes are united on one essential question. However the next stage of the ongoing breakdown of world capitalism proceeds, they will all strive by whatever means considered necessary to make the working class the world over pay for it. ..."
    "... In 2008, capitalist governments around the world, above all in the US, derived enormous benefit from the decades-long suppression of the class struggle by the trade unions and the parties of the political establishment. The rescue operation they carried out on behalf of parasitic and criminal finance capital would not have been possible without it ..."
    Aug 19, 2018 | thenewkremlinstooge.wordpress.com

    Northern Star August 16, 2018 at 3:07 pm

    http://www.wsws.org/en/articles/2018/08/16/pers-a16.html

    "But to an extent hardly imaginable in 2008, all the world's leading economies are locked in a perpetually escalating cycle of economic warfare. This global trade war is spearheaded by the Trump White House, which sees trade sanctions and tariffs, such as the onslaught it launched against Turkey, as an integral component of its drive to secure the United States' geopolitical and economic interests at the expense of friend and foe alike.

    The character of world economy has undergone a major transformation in the past decade in which economic growth, to the extent it that it occurs, is not driven by the development of production and new investments but by the flow of money from one source of speculative and parasitic activity to the next."

    "But while they are deeply divided as to their economic and geo-political objectives, the capitalist ruling classes are united on one essential question. However the next stage of the ongoing breakdown of world capitalism proceeds, they will all strive by whatever means considered necessary to make the working class the world over pay for it.

    This is the lesson from the past decade which, in every country, has seen a deepening attack on wages, social conditions and living standards as wealth is redistributed up the income scale, raising social inequality to unprecedented heights.

    In 2008, capitalist governments around the world, above all in the US, derived enormous benefit from the decades-long suppression of the class struggle by the trade unions and the parties of the political establishment. The rescue operation they carried out on behalf of parasitic and criminal finance capital would not have been possible without it."

    [Aug 14, 2018] No matter how globalism is repackaged, it always smells the same way in the end.

    Aug 14, 2018 | www.zerohedge.com

    Authored by Michael Snyder via The American Dream blog,

    No matter how globalism is repackaged, it always smells the same way in the end.

    For decades, the globalists have subtly (or sometimes not so subtly) been moving us toward a world in which national borders have essentially been made meaningless . The ultimate goal, of course, is to merge all the nations of the world into a "one world socialist utopia" with a global government, a global economic system and even a global religion.

    The European Union is a model for what the elite hope to achieve eventually on a global scale . The individual nations still exist, but once inside the European Union you can travel wherever you want, economic rules have been standardized across the Union, and European institutions now have far more power than the national governments.

    Liberty and freedom have been greatly restricted for the "common good", and a giant horde of nameless, faceless bureaucrats constantly micromanages the details of daily life down to the finest details.

    With each passing day the EU becomes more Orwellian in nature, and that is why so many in Europe are completely fed up with it.

    Rich Monk Tue, 08/14/2018 - 16:28 Permalink

    The (((Money Changers))) have always been Humanity's greatest threat!

    taketheredpill Tue, 08/14/2018 - 16:28 Permalink

    I would support TERM LIMITS on Congress and Senate...

    [Aug 14, 2018] Trump's Trade War with China Undermining China's Dependence on Neoliberalism

    Notable quotes:
    "... Trump in fact was not the consensus candidate of the American capitalist class back to the 2016 election. So with respect to these economic policies, especially about his trade protectionist measures, these new tariffs imposed on the Chinese goods, let's put it this way: These are not, certainly not the traditional kind of neoliberal economic policy as we know it. So some sections of the American manufacturing sector [capitalists] may be happy about this. But I would say the majority of the American capitalists probably would not approve this kind of trade war against China. ..."
    "... So on the Chinese part, ironically, China very much depends on these overall what Martin Wolf called liberal global order, which might better be called the model of global neoliberal capitalism. So China actually much more depends on that. ..."
    "... despite whatever happened to the U.S., China would still be committed to the model of openness, committed to privatization and the financial liberalization. The Chinese government has declared new measures to open up a few economic sectors to foreign investment. ..."
    "... for China to rearrange towards this kind of domestic consumption-led model of economic development, the necessary condition is that you have income, wealth redistribution towards the workers, towards poor people. And that is something that the Chinese capitalists will resist. And so that is why and so far China has not succeeded in transforming itself away from this export-led model based on exploitation of cheap labor. ..."
    "... first of all, China is not socialist at all today. So income of economic sector, the [space] sector accounts for a small number, a small fraction of the overall economy, by various measurements. ..."
    "... And so it's expected China will also become the world's largest importer of natural gas by the year 2019. So you are going to have China to be simultaneously the largest importer of oil, natural gas, and coal. ..."
    "... let's say the Chinese government right now, even though is led by the so-called Communist Party, is actually much more committed to the neoliberal global order that the Trump administration in the U.S. ..."
    "... The Trump administration of this trade protectionist policy, although not justified, it reflects fundamental social conflicts within the U.S. itself, and that probably cannot be sorted out by the Americans' current political system. ..."
    "... So the overall neoliberal regime has become much more unstable. ..."
    Aug 14, 2018 | therealnews.com

    PAUL JAY: Welcome to The Real News Network. I'm Paul Jay.

    The Financial Times chief economic columnist Martin Wolf has called Trump's trade wars with Europe and Canada, but obviously the big target is China, he's called this a war on the liberal world order. Well, what does this mean for China? China's strategy, the distinct road to socialism which seems to take a course through various forms of state hypercapitalism. What does this mean for China? The Chinese strategy was developed in what they thought would be a liberal world order. Now it may not be that at all.

    Now joining us to discuss what the trade war means for China, and to have a broader conversation on just what is the Chinese model of state capitalism is Minqi Li, who now joins us from Utah. Minqi is the professor, is a professor of economics at the University of Utah. He's the author of The Rise of China and the Demise of the Capitalist World Economy, and the editor of Red China website. Thanks for joining us again, Minqi.

    MINQI LI: Thank you, Paul.

    PAUL JAY: So I don't think anyone, including the Chinese, was expecting President Trump to be president Trump. But once he was elected, it was pretty clear that Trump and Bannon and the various cabal around Trump, the plan was twofold. One, regime change in Iran, which also has consequences for China. And trade war with China. It was declared that they were going to take on China and change in a fundamental way the economic relationship with China and the United States. And aimed, to a large extent, trying to deal with the rise of China as an equal, or becoming equal, economy, and perhaps someday in the not-too-distant future an equal global power, certainly as seen through the eyes of not just Trumpians in Washington, but much of the Washington political and economic elites.

    So what does this mean for China's strategy now? Xi Jinping is now the leader of the party, leader of the government, put at a level virtually equal to Mao Tse-tung. But his plan for development of the Chinese economy did not, I don't think, factor in a serious trade war with the United States.

    MINQI LI: OK. As you said, Trump was not expected. Which meant that Trump in fact was not the consensus candidate of the American capitalist class back to the 2016 election. So with respect to these economic policies, especially about his trade protectionist measures, these new tariffs imposed on the Chinese goods, let's put it this way: These are not, certainly not the traditional kind of neoliberal economic policy as we know it. So some sections of the American manufacturing sector [capitalists] may be happy about this. But I would say the majority of the American capitalists probably would not approve this kind of trade war against China.

    Now, on the Chinese part, and we know that China has been on these parts, there was capitalist development, and moreover it has been based on export-led economic growth model and with exploitation of cheap labor. So on the Chinese part, ironically, China very much depends on these overall what Martin Wolf called liberal global order, which might better be called the model of global neoliberal capitalism. So China actually much more depends on that.

    And so you have, indeed there are serious trade conflicts between China and U.S. that will, of course, undermine China's economic model. And so far China has responded to these new threats of trade war by promising that China, despite whatever happened to the U.S., China would still be committed to the model of openness, committed to privatization and the financial liberalization. The Chinese government has declared new measures to open up a few economic sectors to foreign investment.

    Now, with respect to the trade itself, at the moment the U.S. has imposed tariffs on, 25 percent tariffs on the worth of $34 billion of Chinese goods. And then Trump has threatened to impose new tariffs on the additional $200 billion worth of Chinese goods. But this amount at the moment is still a small part of China's economy, about 3 percent of the Chinese GDP. So the impact at the moment is limited, but certainly has created a lot of uncertainty for the global and the Chinese business community.

    PAUL JAY: So given that this trade war could, one, get a lot bigger and a lot more serious, and/or even if they kind of patch it up for now, there's a lot of forces within the United States, both for economic and geopolitical reasons. Economic being the discussion about China taking American intellectual property rights, becoming the new tech sector hub of the world, even overpassing the American tech sector, which then has geopolitical implications; especially when it comes to the military. If China becomes more advanced the United States in artificial intelligence as applied to the military, that starts to, at least in American geopolitical eyes, threaten American hegemony around the world.

    There are a lot of reasons building up, and it's certainly not new, and it's not just Trump. For various ways, the Americans want to restrain China. Does this start to make the Chinese think that they need to speed up the process of becoming more dependent on their own domestic market and less interested in exporting cheap labor? But for that to happen Chinese wages have to go up a lot more significantly, which butts into the interests of the Chinese billionaire class.

    MINQI LI: I think you are right. And so for China to rearrange towards this kind of domestic consumption-led model of economic development, the necessary condition is that you have income, wealth redistribution towards the workers, towards poor people. And that is something that the Chinese capitalists will resist. And so that is why and so far China has not succeeded in transforming itself away from this export-led model based on exploitation of cheap labor.

    PAUL JAY: You know, there's some sections of the left in various parts of the world that do see the Chinese model as a more rational version of capitalism, and do see this because they've maintained the control of the Chinese Communist Party over the politics, and over economic planning, that do see this idea that this is somehow leading China towards a kind of socialism. If nothing else, a more rational planned kind of capitalism. Is that, is there truth to this?

    MINQI LI: Well, first of all, China is not socialist at all today. So income of economic sector, the [space] sector accounts for a small number, a small fraction of the overall economy, by various measurements.

    And then regarding the rationality of China's economic model, you might put it this way: The Chinese capitalists might be more rational than the American capitalists in the sense that they still use most of their profits for investment, instead of just financial speculation. So that might be rational from the capitalist perspective. But on the other hand, regarding the exploitation of workers- and the Chinese workers still have to work under sweatshop conditions- and regarding the damage to the environment, the Chinese model is not rational at all.

    PAUL JAY: My understanding of people that think this model works better, at least, than some of the other capitalist models is that there's a need to go through this phase of Chinese workers, yes, working in sweatshop conditions, and yes, wages relatively low. But overall, the Chinese economy has grown by leaps and bounds, and China's position in the world is more and more powerful. And this creates the situation, as more wealth accumulates, China is better positioned to address some of the critical issues facing China and the world. And then, as bad as pollution is, and such, China does appear to be out front in terms of developing green technologies, solar, sustainable technology.

    MINQI LI: OK. Now, Chinese economy has indeed been growing rapidly. It used to grow like double-digit growth rate before 2010. But now China's growth rate has slowed down just under 7 percent in recent years, according to the official statistics. And moreover, a significant part of China's growth these days derives rom the real estate sector development. And so there has been this discussion about this growing housing market bubble. And it used to be that this housing price inflation was limited to a few big cities. But for the first half of 2018, according to the latest data, the national average housing price has grown by 11 percent compared to the same period last year. And that translates into a pace of doubling every six years.

    And so that has generated lots of social resentment. And so not only the working class these days are priced out of the housing market. Moreover, even the middle class is increasingly priced out of the housing market. So that is the major concern. And in the long run, I think that China's current model of accumulation will also face the challenge of growing social conflicts. Worker protests. As well as resources constrained and environmental damage. And regarding the issue of China's investment in renewable energy, it is true. China is the largest investor in renewable energy development, in the solar panels. And although China is of all the largest investor in about everything.

    And so China is still the largest emitter of greenhouse gases in the world, accounting for almost 30 percent of the total carbon dioxide emissions in the world every year. And then China's own oil production in decline, but China's oil consumption is still rising. So as a result, China has become the world's largest oil importer. That could make the Chinese economy vulnerable to the next major oil price shock.

    PAUL JAY: And how seriously is climate change science taken in China? If one takes the science seriously, one sees the need for urgent transformation to green technology. An urgent reduction of carbon emission. Not gradual, not incremental, but urgent. Did the Chinese- I mean, it's not, it's so not taken seriously in the United States that a climate denier can get elected president. But did the Chinese take this more seriously? Because you don't get the same, any sense of urgency about their policy, either.

    MINQI LI: Well, yeah. So like many other governments, the Chinese government also pays lip service to the obligation of climate stabilization. But unfortunately, with respect to policy, with respect to mainstream media, it's not taken very seriously within China. And so although China's carbon dioxide emissions actually stabilized somewhat over the past few years, but is starting to grow again in 2017, and I expect it will continue to grow in the coming year.

    PAUL JAY: I mean, I can understand why, for example, Russia is not in any hurry to buy into climate change science. Its whole economy depends on oil. Canada also mostly pays lip service because the Alberta tar sands is so important to the Canadian economy. Shale oil is so important to the American economy, as well as the American oil companies own oil under the ground all over the world. But China is not an oil country. You know, they're not dependent on oil income. You'd think it'd be in China's interest to be far more aggressive, not only in terms of how good it looks to the world that China would be the real leader in mitigating, reducing, eliminating the use of carbon-based fuels, but still they're not. I mean, not at the rate scientists say needs to be done.

    MINQI LI: Not at all. Although China does not depend on all on oil for income, but China depends on coal a lot. And the coal is still something like 60 percent of China's overall energy consumption. And so it's still very important for China's energy.

    PAUL JAY: What- Minqi, where does the coal mostly come from? Don't they import a lot of that coal?

    MINQI LI: Mostly from China itself. Even though, you know, China is the world's largest coal producer, on top of that China is either the largest or the second-largest coal importer in the world market as well. And then on top of that, China is also consuming an increasing amount of oil and natural gas, especially natural gas. And so although natural gas is not as polluting as coal, it's still polluting. And so it's expected China will also become the world's largest importer of natural gas by the year 2019. So you are going to have China to be simultaneously the largest importer of oil, natural gas, and coal.

    PAUL JAY: The Chinese party, just to get back to the trade war issue and to end up with, the idea of this Chinese nation standing up, Chinese sovereignty, Chinese nationalism, it's a powerful theme within this new Chinese discourse. I'm not saying Chinese nationalism is new, but it's got a whole new burst of energy. How does China, if necessary to reach some kind of compromise with the United States on the trade war, how does China do that without looking like it's backing down to Trump?

    MINQI LI: Well, yes, difficult task for the Chinese party to balance. What they have been right now is that on the one hand they promise to the domestic audience they are not going to make concessions towards the U.S., while in fact they are probably making concessions. And then on the other hand the outside world, and they make announcement that they will not change from the reform and openness policy, which in practice means that they will not change from the neoliberal direction of China's development, and they will continue down the path towards financial liberalization. And so that is what they are trying to balance right now.

    PAUL JAY: I said finally, but this is finally. Do the Americans have a case? Does the Trump argument have a legitimate case that the Chinese, on the one hand, want a liberal world order in terms of trade, and open markets, and such? On the other hand are not following intellectual property law, property rights and law, the way other advanced capitalist countries supposedly do. Is there something to that case?

    MINQI LI: Well, you know, let's say the Chinese government right now, even though is led by the so-called Communist Party, is actually much more committed to the neoliberal global order that the Trump administration in the U.S. - but I don't want to make justifications for the neoliberal global order. But let's put it this way: The Trump administration of this trade protectionist policy, although not justified, it reflects fundamental social conflicts within the U.S. itself, and that probably cannot be sorted out by the Americans' current political system.

    PAUL JAY: So the crisis- you know, when you look at the American side and the Chinese side, including the deep debt bomb people talk about in China, there really is no sorting out of this crisis.

    MINQI LI: So the overall neoliberal regime has become much more unstable.

    PAUL JAY: All right. Thanks for joining us, Minqi. I hope we can pick this up again soon.

    MINQI LI: OK. Thank you.

    PAUL JAY: Thank you for joining us on The Real News Network.

    [Aug 14, 2018] Trump s Creative Vision for a New, Sensible, RealPolitik American Foreign Policy

    Notable quotes:
    "... Financial Times ..."
    "... raison d'état ..."
    "... balance of power ..."
    "... Gilbert Doctorow is an independent political analyst based in Brussels. His latest book, "Does the United States Have a Future?" was published on 12 October 2017. Both paperback and e-book versions are available for purchase on http://www.amazon.com and all affiliated Amazon websites worldwide. See the recent professional review http://theduran.com/does-the-united-states-have-a-future-a-new-book-by-gilbert-doctorow-review/ For a video of the book presentation made at the National Press Club, Washington, D.C. on 7 December 2017 see https://www.youtube.com/watch?v=ciW4yod8upg ..."
    Aug 14, 2018 | russia-insider.com

    Tharoor quotes from New York Times columnist David Brooks who concluded that Trump's behavior was that "of a man who wants the alliance to fail." He quotes extensively from Guy Verhofstadt, a former Belgian prime minister and leader of the Liberal political fraction in the European Parliament fighting for a much more integrated EU, who sees Trump as the enemy of liberal internationalism and ally of his own alt right enemies in Europe.

    Tharoor also brings into play Martin Wolf of the Financial Times , who delivered a scathing attack on Trump for his rejection of the West: " today the U.S. president appears hostile to core American values of democracy, freedom and the rule of law; he feels no loyalty to allies; he rejects open markets; and he despises international institutions."

    In the 23 July issue of "Today's World View," Tharoor takes advantage of the time gone by since Helsinki to refine the conclusions. He offers a pithy commentary from Susan Glasser of The New Yorker : "We are witnessing nothing less than the breakdown of American foreign policy."

    In the same issue, Tharoor notes that public reaction to Trump in Helsinki is less pronounced than one might suppose from reading the pundits. He offers the following remarks of colleagues on the results of a recent poll: "Most Americans do not feel Trump went 'too far' in supporting Puitn, and while more Americans say U.S. leadership has gotten weaker than stronger under Trump, his ratings on this question are slightly improved from last fall."

    If we go back in time to the days following Trump's visit to the NATO gathering in Brussels, we find in the headlines of the 11 July issue another take on what Trump is doing:

    "Trump's NATO trip shows 'America First' is 'America Alone.'"

    Here we read about Trump's insistence that America "stop footing Europe's bill" for its defense, namely his demand that all NATO allies pay up 2% of GDP at once, not in the remote future; and that they prepare to double that to 4% very quickly. By intentional abrasiveness, these moves by Trump are, Tharoor tells us, "undercutting the post-World War II order in pursuit of short-term, and likely illusory, wins."

    All of these comments address the question of what Trump opposes. However, Tharoor is unable to say what, if anything, Trump stands for. There are only hints: continued US hegemony but without the ideological cover; might makes right; nationalism and the disputes that lead to war.

    Does this make sense? Or is it just another way of saying that Trump's foreign policy stance is an inconsistent patchwork, illogical and doomed to fail while causing much pain and destruction along the way?

    I fully agree with the proposition that Donald Trump is ripping up the post-Cold War international order and is seeking to end NATO and the rest of the alliance system by which the United States has maintained its global hegemony for decades. But I believe this destructive side is guided by a creative vision of where he wants to take US foreign policy.

    This new foreign policy of Donald Trump is based on an uncompromising reading of the teachings of the Realist School of international affairs, such as we have not seen since the days of President Teddy Roosevelt, who was its greatest practitioner in US history.

    This is not isolationism, because Trump is acting to defend what he sees as US national interests in foreign trade everywhere and in geopolitics in one or another part of the world. However, it is a world in which the US is cut free from the obligations of its alliances which entail maintenance of overseas bases everywhere at the cost of more than half its defense budget. He wants to end the risks of being embroiled in regional wars that serve our proxies, not core US national interests. And he is persuaded that by a further build-up of military might at home, by adding new hi-tech materiel the US can secure its interests abroad best of all.

    I reach these conclusions from the snippets of Trump remarks which appear in the newspapers of daily record but are intentionally left as unrelated and anecdotal, whereas when slotted together they establish the rudiments of an integrated worldview and policy.

    For example, I take his isolated remark that the United States should not be prepared to go to war to defend Montenegro, which recently passed NATO accession, because Montenegro had been a trouble-maker in the past. That remark underwent virtually no analysis in the media, though it could be made only by someone who understood, remarkably, the role of Montenegro at the Russian imperial court of Nicholas II precisely as "troublemaker," whose dynastic family aided in their own small way the onset of WWI.

    Donald Trump is not a public speaker. He is not an intellectual. We cannot expect him to issue some "Trump Doctrine" setting out his Realist conception of the geopolitical landscape. All we get is Tweets. This inarticulate side of Trump has been used by his enemies to argue he has no policy.

    In fact, Trump is the only Realist on the landscape.

    Going back to 2016, I thought he was being guided by Henry Kissinger during the campaign and then in the first months of his presidency, I misjudged entirely. Trump is true to the underlying principles of Realism without compromise, whereas Henry K. made his peace with the prevailing Wilsonian Idealism of the American Establishment a couple of decades ago in order to remain welcome in the Oval Office and not to be entirely marginalized.

    Trump's vision of Realism draws from the source in the Treaty of Westphalia, 1648 with its guiding concept of sovereign nation-states that do not intervene in others' domestic affairs. It further draws on the notions of raison d'état or national interest developed by the French court of Louis XIV and then taken further by "perfidious Albion" in the eighteenth century, with temporary and ever changing combinations of states in balance of power realignments of competitors. The history of the Realist School was set out magnificently by Kissinger in his 1994 work Diplomacy . It is a pity that the master himself strayed from true and narrow.

    In all of this, you have the formula for Trump's respect, even admiration for Putin, since that also is now Vladimir Vladimirovich's concept of Russia's way forward: as a strong sovereign state that sets its own course without the constraints of alliances and based on its own military might.

    The incredible thing is how a man with such poor communication skills, a man who does not read much came to such an integrated vision that outstrips the conceptual abilities of his enemies, his friends and everyone in between.

    We are tempted to look for a mentor, and one who comes to mind is Steve Bannon, who is very articulate, razor-sharp in his intellect and who provided Trump with much of the domestic content of his 2016 campaign from the alt right playbook. And though Bannon publicly broke with Trump in their falling out over his ever diminishing role in the Administration, Bannon's ongoing project, in particular his Movement to influence European politics and shift it to the Right by coordinating activities across the Continent during the parliamentary elections of May 2019, very closely parallel what Trump's ambassador in Berlin seems to be doing in Trump's name.

    It may well be that the President and his confidantes find it prudent for him to play the hapless fool, the clueless disrupter of the global political landscape until he has the support in Congress to roll out the new foreign policy that is now in gestation.

    The logical consequence of such a Realist approach to foreign policy will be to reach an understanding with the world's other two principal military powers, Russia and China, regarding respective spheres of influence in their geographic proximity. But I do not believe we will see a G-3 succeeding America's unipolar moment. Given the predispositions of both Russia and China, we are more likely to see a broader board of governors of global policy in the form of the G-20, ushering in the multipolar age. In such a formulation, regional conflicts will be settled locally by the interested parties and with the major powers involved only as facilitators, not parties to conflict. That promises a much more stable and peaceful future, something which none of Donald Trump's detractors can begin to imagine as his legacy.


    Gilbert Doctorow is an independent political analyst based in Brussels. His latest book, "Does the United States Have a Future?" was published on 12 October 2017. Both paperback and e-book versions are available for purchase on http://www.amazon.com and all affiliated Amazon websites worldwide. See the recent professional review http://theduran.com/does-the-united-states-have-a-future-a-new-book-by-gilbert-doctorow-review/ For a video of the book presentation made at the National Press Club, Washington, D.C. on 7 December 2017 see https://www.youtube.com/watch?v=ciW4yod8upg

    [Aug 08, 2018] US corps have bought out UK and EU corps and then outsource the work to India and China. US Corps = Globalisation.

    Aug 08, 2018 | discussion.theguardian.com

    DancehallStyle -> AgainstDarkness , 6 Aug 2018 20:02

    US corps have bought out UK and EU corps and then outsource the work to India and China. US Corps = Globalisation.
    DancehallStyle -> AnthonyFlack , 6 Aug 2018 19:57
    IT tech and even intricate clothing are too fiddly for automata.

    Americans view is if other countries like China make too much money and will overtake them then they will take it all back.

    They did that with Japan. They also destroyed Soviet's economy.

    ID4355982 , 6 Aug 2018 19:52
    trump has wrecked environmental policy, trade policy and domestic social policy....the upshots will be: 1- a much more toxic environment & much higher level of respiratory disease and cancerous related ailments; overall poorer health & health care for the average citizen 2- higher prices for imported goods, lower level of trade exports, fewer US based jobs and more off-shoring of US jobs 3- a substantial increase in the homeless population in the urban areas of this country; increased rates of poverty for the poor, lower economic prosperity for the lower and lower middle class income brackets; wage stagnation for the middle & upper middle income brackets; less advanced education & lower worker productivity and innovation to name just a few of the impacts created by this idiot....in simple in English, Trump and his so-called initiatives are shafting this country in almost every way possible
    Ilya Grushevskiy -> RepaTea , 6 Aug 2018 19:17
    What part of international law is not just pissed on toiler paper strewn over the floors of a urinal? Which post WWII president respected this law?

    None.

    International law, since WWII failed. It failed in '47 when no referendum was held in Palestine - against Chapter 1, Article 1 paragraph 2 of the UN Charter. It failed in Crimea, when the results of such a referendum was spat on by the previous war criminal to sit in the Oval Office. It fails now as sanctions are used unilaterally - being equivalent to the use of force in result, they should be

    But then let's not stop at after the war. The US is the only country to nuke civilians. 6/7 US four star generals at the time said the action had no strategic or tactical purpose whatsoever.

    The US is what ISIS dreams to be, the sooner it falls into obscurity the better.

    Brian Black -> bobthebuilder2017 , 6 Aug 2018 19:13
    Pure nonsense. The Great Depression began on October 29, 1929. FDR was inaugurated on March 4, 1933 nearly 4 years after it began. Hoover had actually only been in office for just over 6 months before Black Tuesday. GDP began growing and unemployment began falling in 1933 shortly after FDR took office. The Depression officially came to an end in 1939 when GDP returned to pre-Depression levels.
    Ilya Grushevskiy , 6 Aug 2018 19:09
    There is no long term US growth. There is a debt default after people realize the fact that the top of the whole US government is incompetent. That it has chained itself to such astronomic liabilities for useless wars (as the Empire has not succeeded in world hegemony), is even sadder. It coould have spent the $5tn of Iraq and Afghanistan on building shit, but instead it bombed shit.

    Trump doesn't matter for US long run - in 5-10 years time the country will be only found in history books.

    gmiklashek950 , 6 Aug 2018 17:59
    Remember Kruschev's (sp?) last words on leaving office, and I'm paraphrasing: "Don't worry about America, they'll spend themselves to death (just like we have)". Continued economic growth is a wet dream of Wall Street origin. We are massively overpopulated and rapidly using up earth's natural resources at an increasingly unsustainable rate. We must begin to reduce our growth, not keep increasing it. Population density stress is killing us now and only increasing every day along with the 220,000 new mouths to feed that we are turning out into a world that has no room for 28,000,000 homeless migrants already. Just how crazy are we really. If this article is to be believed, we are nuts. E.F. Schumacher is rolling in his grave! Stress R Us
    AgainstDarkness , 6 Aug 2018 16:56
    Trump/the US is attempting to renegotiate globalisation.

    It is time for the rest of the western world to follow suit.

    Levente Tanka -> plakias , 6 Aug 2018 16:34
    The contribution of a president to the national debt depends a bit on how you calculate it. You could simply look at rhe dates of inauguration or go a step further and look at the fiscal years. For the latter see :

    https://www.thebalance.com/us-debt-by-president-by-dollar-and-percent-3306296

    In absolute terms Obama is indeed at the top of the list, percentagewise his predecessor played a larger part. No matter how you look at it or what the causes were, under Bush and Obama the U.S. debt seems to have spiralled out of of control and Trump is doing bugger all to stop that trend.

    [Aug 07, 2018] Pat Buchanan Are Globalists Plotting A Counter-Revolution

    Aug 07, 2018 | www.zerohedge.com

    For consider the fruits of free trade policy during the last 25 years : the frozen wages of U.S. workers, $12 trillion in U.S. trade deficits, 55,000 factories lost, 6 million manufacturing jobs gone, China surpassing the U.S in manufacturing, all causing a backlash that pushed a political novice to the Republican nomination and into the presidency.

    To maintain a belief in the superiority of free trade to economic patriotism, in the face of such results, is to recognize that this belief system is impervious to contradictory proof.


    Brazen Heist II -> brushhog Tue, 08/07/2018 - 09:51 Permalink

    The sad reality that I see all around is that Western civilization has been hijacked by degenerate hyenas like Rome was sacked from within first before being sacked externally. The institutions that once made the West a leader and a model, have been corrupted, tainted and filled with anti-humanists and crony corporatists. Greed is out of control and "popular culture" is spreading decay. The hollowing out will continue until these parasites find another host to leech off. Will it be China? Will it be a global government? Will it be another planet? Who knows.

    Once upon a time figures like Rosenstein, Mueller, Brennan, Browder, Clapper, Clinton etc would be just fucking taken out or punished. Instead of that, they get to wander their toxic asses around like protected peacocks, all on tax payers dime, with their shitty agendas, and their shitty handlers cheering on the degeneracy and assault on the truth and the people.

    If this is what "civilization" has boiled down to, count me the fuck out of it. The 5000 year old human farming experiment is merely switching straight jackets. Its the same old story that ever was, ever since we gave up the nomadic lifestyle. In a way, its probably an inevitability, given our flawed human nature, and the size of the population....and average intellect. The desire to be 'lead' by some ruling class, no matter what flavour of 'ism' it is, eventually all turns to the same end result....shit. Unless this global awakening can muster into a force to be reckoned with, and not be swayed by divide and conquer tactics, nothing will change. So far with the toxic Left vs Right divide, and countless other divides, the only beneficiaries of this are the ones at the top of the pyramid.

    sarcrilege -> Brazen Heist II Tue, 08/07/2018 - 10:12 Permalink

    nature will take care of all this in due time...we just may not like the outcome

    HopefulCynical -> sarcrilege Tue, 08/07/2018 - 10:28 Permalink

    Pat Buchanan: Are Globalists Plotting A Counter-Revolution?

    HopefulCynical : Is the sky blue? Is water wet? Is fire hot?

    FFS, look at the goddamn purge on (((Social media))). Of COURSE the (((globalists))) are attempting a counter-revolution.

    We all need to move to alt-tech: Minds , Gab , Bitchute . Even if you don't have a (((social media))) presence, consider getting an alt-media presence. We've been wondering when the next phase would begin, whewn it would be time to take further action. Well, it's here.

    First step in this next phase is to set up multiple lines of communication not under (((establishment))) control. Even if you seldom use them, set up accounts; advise those you know to do likewise. Wanna see the establishment panic? If they see the subscriber count for the alt-tech sites suddenly quadruple (or more) in response to their purge, they'll shit themselves. They'll probably attempt to pull domain registrars and financial processing services from those sites.

    Then - the motherfucking games begin, bitchez.

    [EDIT:] According to Styx, the alt-tech sites are already seeing a surge in membership. https://www.youtube.com/watch?v=hZP1fwkdupg Let the (((establishment))) diaper-filling begin!

    Endgame Napoleon -> Big Creek Rising Tue, 08/07/2018 - 12:14 Permalink

    But will "negotiations" and regulatory loosening on issues like the environment and worker safety, which have gotten out of hand in the US to the disadvantage of underemployed citizens, offset the extremely low wages offered to Asian and Latin American workers in the countries where American-owned companies shipped over 6 million jobs, canceling out the SS-retirement fund contributions that would have been made by American workers [and] employers if the jobs had been kept here?

    Cheap labor seems to TRUMP everything with US employers.

    Running from the SS trust fund might be another reason for their abandonment of America.

    Cheap labor Trumps everything here in the USA, too, and the cheap-labor pool is aided and abetted by the welfare system. That is why US employers prefer an often extremely absentee welfare and progressive-tax-code-subsidized labor market, receiving .gov-financed monthly bills and up to $6,431 in refundable child-tax-credit cash for US-born instant-citizen kids.

    Contrary to myth, hard work, daily and all-day attendance and even work productivity, like every-month quota meeting, is NOT preferred by American employers for most of the jobs left here in the USA.

    The welfare-eligible 42 million are (on the books) not hard workers, but part-time workers, staying under the income limits for welfare programs. I KNOW that from working at the Department of Human Services, where single moms and the womb-productive girlfriends of illegal and legal immigrants MUST submit proof of a single-breadwinner's part-time, traceable earnings to get the free stuff.

    The earnings must fall below the income limits for welfare programs that ALWAYS reward part-time work in womb-productive single-breadwinner households of citizens and noncitizens. You cannot work full time in a minimum-wage job while meeting the income limits. When I worked at DHS, both the EBT and monthly cash assistance income limits were BELOW $900 per month......

    Even if Trump eventually lures US corporations back here with looser regulations and tax cuts, rather than just unleashing a stock buy-back spree, it will not matter to the 101 million American citizens of working age who are out of the labor force and the 78 million gig pieceworkers, not if this welfare-rigged labor market of citizens and noncitizens continues to be the norm.

    You cannot compete with a bigly labor market full of welfare-fetching citizens & noncitizens who do not need pay sufficient to cover rent due to their womb production.

    Only a Deplorables First immigration reform would address that issue, including a big reduction in the number of welfare-eligible legal immigrants let in each year. The number 1.5 million is too many. This -- no more and no less than illegal immigration -- keeps wages down, but the illegal immigration has the added bonus of making America more dangerous.

    The impasse on the immigration issue is the reason why I am skeptical of the value of current trade-war maneuvering, even though I am glad that Trump is addressing that general issue.

    The other thing that complicates this trade war is the way that globalist elites have sold America out over the years, not just destroying the middle class with all of this offshoring and welfare-supported illegal labor, but also getting the US economy 1) waist-deep in debt, 2) dependent on foreign investment and 3) subject to getting jerked around by Machiavellian currency manipulation that non-math people, like me, really don't understand.

    http://www.alt-market.com/articles/3463-trade-war-provides-perfect-cover-for-the-elitist-engineered-global-reset

    It sounds kind of dangerous, though, even just the argument that Stockman makes about China being a house of cards that, if it came down, could have unintended consequences for the US.

    I have no idea. But I do know that many of the people who voted for Trump are pretty adamant about the immigration issue, first and foremost, regarding it as an easier and less risky thing to get done as well.

    Maybe, the children-at-the-border Movie of the Week has convinced most Trump voters to stay on the train, thinking something permanent has been done to contain the flow of welfare-rewarded illegal immigration.

    I think many of the teenagers, released into the country to live with extended family or in foster care, will, in a few years, be entering the labor force as part-time workers, producing instant-citizen kids and getting free monthly bills and refundable child-tax-credit cash from .gov, while citizens like me will still face rent that eats up over half of our monthly, earned-only income from low-wage churn jobs.

    As much of an enthusiastic Trump voter as I have been, going back a long way, I am not sure that I am going to vote in the mid-term general election. I am not going to vote for this Tammany Hall II Democratic Party, but I may just stay home.

    There are many populists out there, not just on the right either, who are disgruntled for very real reasons, like this interesting article explains, so there will likely be wave after wave of non-centrist populism until globalism's shoreline has been redefined.

    https://libertyblitzkrieg.com/2018/07/26/centrism-is-dead-and-it-never-really-existed/

    Hmmm, weird, when I loaded the other link, it conformed to the format of this text box, but then when I loaded the link above this last paragraph, it reverted to cutting off the text on the side. Until I post it, I cannot see the full text after links are added.

    Chupacabra-322 -> Brazen Heist II Tue, 08/07/2018 - 12:36 Permalink

    @ Brazen,

    "The few who understand the system, will either be so interested in its profits, or so dependent on it favors that there will be no opposition from that class, while on the other hand, the great body of people mentally incapable of comprehending the tremendous advantages...will bear its burden without complaint and perhaps without suspecting that the system is inimical to their best interests."

    -Rothschild Brothers of London communique' to associates in New York June 25th, 1863.

    The Difference.

    J. Speer-Willams

    June 16, 2010.

    New-Cons. Love War & torture, increased regulations, tyranny and taxes; with our taxes going to the plutocrats of the private banking community. They support governmental destruction of our environment, under the pretender of protecting it. They, also, overtly support corporatism (Fascism for Oligarchs) and any measures supported by the Republican Party that enrich the private International Monetary / Banking Cartel at the expensive of the. American People.

    New- Libs. Love War & torture, increased regulations, tyranny and taxes; with our taxes going to the plutocrats of the private banking community. They support governmental destruction of our environment, under the pretender of protecting it. They, also, overtly support corporatism (Socialism for Oligarchs) and any measures supported by the Democratic Party that enrich the private International Monetary / Banking Cartel at the expensive of the. American People.

    Batman11 Tue, 08/07/2018 - 09:08 Permalink

    Neoliberalism was just one huge debt fuelled boom, which was replicated across the UK, the US, the Euro-zone, Japan and China.

    At 25.30 mins we can see the super imposed the debt-to-GDP ratios.

    https://www.youtube.com/watch?v=vAStZJCKmbU&list=PLmtuEaMvhDZZQLxg24CAiFgZYldtoCR-R&index=6

    The damage is done.

    The economics of the neoliberal era had a fundamental flaw.

    The 1920s roared with debt based consumption and speculation until it all tipped over into the debt deflation of the Great Depression. No one realised the problems that were building up in the economy as they used an economics that doesn't look at private debt, neoclassical economics.

    Same economics, same problem, globally.

    TeethVillage88s -> Batman11 Tue, 08/07/2018 - 09:55 Permalink

    I think Pat also gets this sentence wrong and if so I say he misses details we would like to see

    This is truly economics uber alles, economy before country.

    The University Economist programs/studies were more oriented toward people in the old days. Economics today is used to justify Wall Street type finance and ideology. Economic study was hijacked to serve only those looking to get rich any way they can. CFR agenda comes to mind. Globalism comes to mind also and is an attack on all nations constitutions.

    Batman11 -> TeethVillage88s Tue, 08/07/2018 - 10:04 Permalink

    The Americans have been discovering the problems of running an economy with bad economics.

    Economics was always far too dangerous to be allowed to reveal the truth about the economy.

    The Classical economist, Adam Smith, observed the world of small state, unregulated capitalism around him.

    "The labour and time of the poor is in civilised countries sacrificed to the maintaining of the rich in ease and luxury. The Landlord is maintained in idleness and luxury by the labour of his tenants. The moneyed man is supported by his extractions from the industrious merchant and the needy who are obliged to support him in ease by a return for the use of his money. But every savage has the full fruits of his own labours; there are no landlords, no usurers and no tax gatherers."

    How does this tie in with the trickledown view we have today?

    Somehow everything has been turned upside down.

    The workers that did the work to produce the surplus lived a bare subsistence existence.

    Those with land and money used it to live a life of luxury and leisure.

    The bankers (usurers) created money out of nothing and charged interest on it. The bankers got rich, and everyone else got into debt and over time lost what they had through defaults on loans, and repossession of assets.

    Capitalism had two sides, the productive side where people earned their income and the parasitic side where the rentiers lived off unearned income. The Classical Economists had shown that most at the top of society were just parasites feeding off the productive activity of everyone else.

    Economics was always far too dangerous to be allowed to reveal the truth about the economy.

    How can we protect those powerful vested interests at the top of society?

    The early neoclassical economists hid the problems of rentier activity in the economy by removing the difference between "earned" and "unearned" income and they conflated "land" with "capital". They took the focus off the cost of living that had been so important to the Classical Economists to hide the effects of rentier activity in the economy.

    The landowners, landlords and usurers were now just productive members of society again.

    It they left banks and debt out of economics no one would know the bankers created the money supply out of nothing. Otherwise, everyone would see how dangerous it was to let bankers do what they wanted if they knew the bankers created the money supply through their loans.

    https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy.pdf

    The powerful vested interests held sway and economics was corrupted.

    Now we know what's wrong with neoclassical economics we can put the cost of living back in.

    Disposable income = wages – (taxes + the cost of living)

    Employees want more disposable income (discretionary spending)

    Employers want to pay lower wages for higher profits

    The cost of living = housing costs + healthcare costs + student loan costs + food + other costs of living

    The neoliberals obsessed about reducing taxes, but let the cost of living soar.

    The economists also ignore the debt that is papering over the cracks and maintaining demand in the economy. This can never work in the longer term as you max. out on debt.

    Felix da Kat Tue, 08/07/2018 - 09:12 Permalink

    The problem is the US has lost citizenry-control. A shadow-government along with media operatives work unseen to manipulate sentiment and events in-line with an overall globalist, world-government objective (Neo-Marxism). The so-called elites behind the curtain are after total control which is why we will continue toward totalitarian dictatorship. It will not be a one-man show nor will it be readily recognizable as such, rather there will be a secretive Cabal of select ultra-wealthy liberals who will negotiate with each other as to which levers to pull and valves to turn in order to "guide" culture and civilization. But the tightknit Cabal has more work to do to infiltrate deeper into US (and world) government. The EU's Parliament is a proto-type test to tweak how they must proceed. As the Cabal coalesces their power, more draconian rulership will become apparent. The noose will tighten slowly so as to be un-noticeable and unstoppable. Certain events are planned that will cause citizenry to demand totalitarianism (for safety reasons). For the Cabal, it'll be like taking candy from a baby. This, in a nutshell, is the outline of how the US (and Western civilization) loses its democracy.

    Winston Smith 2009 Tue, 08/07/2018 - 09:22 Permalink

    "...consider the fruits of free trade policy during the last 25 years..."

    The point is that THAT is not "free trade," you idiot. Globalists just incorrectly call it that intentionally. HERE is what it is:

    The Myth of Modern "Global Markets"

    https://theconservativetreehouse.com/2017/08/16/the-myth-of-modern-glob

    Understanding how trillions of trade dollars influence geopolitical policy we begin to understand the three-decade global financial construct they seek to protect.

    That is, global financial exploitation of national markets. FOUR BASIC ELEMENTS :

    ♦Multinational corporations purchase controlling interests in various national outputs and industries of developed industrial western nations.

    ♦The Multinational Corporations making the purchases are underwritten by massive global financial institutions, multinational banks.

    ♦The Multinational Banks and the Multinational Corporations then utilize lobbying interests to manipulate the internal political policy of the targeted nation state(s).

    ♦With control over the targeted national industry or interest, the multinationals then leverage export of the national asset (exfiltration) through trade agreements structured to the benefit of lesser developed nation states – where they have previously established a proactive financial footprint.

    SJ158 Tue, 08/07/2018 - 09:34 Permalink

    Pat must suffer from some kind of cognitive dissonance. There is no free trade, nor there was before Trump. In a world of flexible exchange rates and central banking backed-inflationary credit trade wars are the status quo. He willfully ignores all the effects of credit inflation, unsound money, tax structures, subsidies, regulatory burdens created internally and by those "trade deals" and last but not least the reserve status of the fiat dollar which basically turned the US in a huge nothing-for-something economy relative to its imports.

    [Aug 07, 2018] Trump To Slap $16 Billion In New Tariffs On Chinese Imports Starting August 23

    Aug 07, 2018 | www.zerohedge.com

    Completing the latest round of tariffs pledged against China, the US Trade Representative announced on Tuesday (after the close of course) it will impose 25% tariffs on $16 billion-worth of Chinese imports starting August 23. The new round of tariffs completes Trump's previously disclosed threat to impose $50 billion of import taxes on Chinese goods. The first $34 billion-worth went into effect on July 6th.

    According to the USTR statement, customs will collect duties on 279 product lines, down from 284 items on the initial list; as Bloomberg notes, this will be the second time the U.S. slaps duties on Chinese goods in about the past month, overruling complaints by American companies that such moves will raise business costs, tax US consumers and raise prices.

    On July 6, the U.S. levied 25% duties on $34 billion in Chinese goods prompting swift in-kind retaliation from Beijing.

    Of course, China will immediately retaliate, having vowed before to strike back again, dollar-for-dollar, on the $16 billion tranche.

    The biggest question is whether there will be a far bigger tariff in the near future: as a reminder, the USTR is currently also reviewing 10% tariffs on a further $200 billion in Chinese imports, and may even raise the rate to 25%. Those tariffs could be implemented after a comment period ends on Sept. 5. President Donald Trump has suggested he may tax effectively all imports of Chinese goods, which reached more than $500 billion last year.

    Over the weekend, Trump boasted that he has the upper hand in the trade war, while Beijing responded through state media by saying it was ready to endure the economic fallout. Judging by the US stock market, which has risen by $1.3 trillion since Trump launched his trade war with China, which has crushed the Shanghai Composite, whose recent drop into a bear market has been duly noted by Trump, the US president is certainly ahead now, even if the market's inability, or unwillingness, to push US stocks lower has led many traders and analysts to scratch their heads.

    [Jul 19, 2018] This is the end of classic neoliberalism, no question about it, and the collapse of neoliberal globalization is just one aspect of it

    Jul 19, 2018 | www.nakedcapitalism.com

    likbez , July 19, 2018 at 4:44 am

    Globalization is not a one-dimensional phenomenon, and some of its aspects are still intact. Hollywood dominance, Internet, English language dominance, West technological dominance, will not reverse any time soon.

    What is under attack by Trump, Brexit, etc. is neoliberal globalization, and, especially financial globalization, free movement of labor and outsourcing of manufacturing and services (offshoring).

    Neoliberal globalization was also based on the dollar as world reserve currency (and oil trading in dollars exclusively). But this role of dollar recently is under attack due to the rise of China. Several "anti-dollar" blocks emerged.

    Trump tariffs are also anathema for "classic neoliberalism" and essentially convert "classic neoliberalism" into "national neoliberalism" on the state level. BTW it looks like Russia switched to "national neoliberalism" earlier than the USA. No surprise that Trump feels some affinity to Putin ;-)

    Attacks against free labor movement also on the rise and this is another nail in the coffin of classic neoliberalism. In several countries, including the USA the neoliberal elite (especially financial elite after 2008, despite that no banksters were killed by crowds) does not feel safe given animosity caused by the promotion of immigration and resorts of conversion of the state into national security state and neo-McCarthyism to suppress dissent.

    I think those attacks will continue, immigration will be curtailed, and "classic neoliberalism" will be transformed into something different. Not necessarily better.

    Several trends are also connected with the gradual slipping of the power of the USA as the chief enforcer of the neoliberal globalization. Which is partially happened due to the stupidity and arrogance of the USA neoliberal elite and neocons.

    Another factor in play is the total, catastrophic loss of power of neoliberal propaganda -- people started asking questions, and neoliberal myths no longer hold any spell on population (or at least much less spell). The success of Bernie Sanders during the last election (DNC was forced to resort to dirty tricks to derail him) is one indication of this trend. This "collapse of ideology" spells great troubles for the USA, as previously it spells great troubles for the USSR.

    "Trumpism" as I understand it tried to patch the situation by two major strategies:

    (1) splitting Russia from China

    (2) Attempt to acquire dominant position in regions rick in hydrocarbons (Iraq, Iran, Libya, Venezuela, etc)

    But so far the decline of neoliberalism looks like Irreversible. It never fully recovered from the deep crisis of 2008 and there is no light at the end of the tunnel.

    Another powerful factor that works against neoliberal globalization is the end of cheap oil. How it will play out is unclear, Much depends whether we will have a Seneca cliff in oil production or not. And if yes, how soon.

    This is the end of classic neoliberalism, no question about it, and the collapse of neoliberal globalization is just one aspect of it

    [Jul 16, 2018] Donald Trump s Trade Wars Could Lead to the Next Great Depression by Nomi Prins

    Jun 22, 2018 | thenation.com

    EDITOR'S NOTE: This article originally appeared at TomDispatch.com .

    Leaders are routinely confronted with philosophical dilemmas. Here's a classic one for our Trumptopian times: If you make enemies out of your friends and friends out of your enemies, where does that leave you? What does winning (or losing) really look like? Is a world in which walls of every sort encircle America's borders a goal worth seeking? And what would be left in a future fragmented international economic system marked by tit-for-tat tariffs, travel restrictions, and hyper-nationalism? Ultimately, how will such a world affect regular people? Let's cut through all of this for the moment and ask one crucial question about our present cult-of-personality era in American politics: Other than accumulating more wealth and influence for himself, his children , and the Trump family empire , what's Donald J. Trump's end game as president? If his goal is to keep this country from being, as he likes to complain, " the world's piggy bank ," then his words, threats, and actions are concerning. However bombastic and disdainful of a history he appears to know little about, he is already making the world a less stable, less affordable, and more fear-driven place. In the end, it's even possible that, despite the upbeat economic news of the moment, he could almost single-handedly smash that piggy bank himself, as he has many of his own business ventures . Still, give him credit for one thing: Donald Trump has lent remarkable new meaning to the old phrase "the imperial presidency." The members of his administration, largely a set of aging white men, either conform to his erratic wishes or get fired. In other words, he's running domestic politics in much the same fashion as he oversaw the boardroom on his reality-TV show The Apprentice . Now, he's begun running the country's foreign policy in the same personalized, take-no-prisoners, you're-fired style. From the moment he hit the Oval Office, he's made it clear at home and abroad that it's his way or the highway. If only, of course, it really was that simple. What he will learn, if "learning process" and "President Trump" can even occupy the same sentence, is that "firing" Canada, the European Union (EU), or for that matter China has a cost. What the American working and the middle classes will see (sooner than anyone imagines) is that actions of his sort have unexpected global consequences. They could cost the United States and the rest of the world big-time. If he were indeed emperor and his subjects (that would be us) grasped where his policies might be leading, they would be preparing a revolt. In the end, they -- again, that's us -- will be the ones paying the price in this global chess match.

    The Art of Trump's Deals

    So far, President Trump has only taken America out of trade deals or threatened to do so if other countries don't behave in a way that satisfies him. On his third day in the White House, he honored his campaign promise to remove the United States from the Trans-Pacific Partnership, a decision that opened space for our allies and competitors, China in particular, to negotiate deals without us. Since that grand exit, there has, in fact, been a boom in side deals involving China and other Pacific Rim countries that has weakened, not strengthened, Washington's global bargaining position. Meanwhile, closer to home, the Trump administration has engaged in a barrage of NAFTA-baiting that is isolating us from our regional partners, Canada and Mexico.

    Conversely, the art-of-the-deal aficionado has yet to sign a single new bilateral trade deal. Despite steadfast claims that he would serve up the best deals ever, we have been left with little so far but various tariffs and an onslaught against American trading partners. His one claim to bilateral-trade-deal fame was the renegotiation of a six-year-old deal with South Korea in March that doubled the number of cars each US manufacturer could export to South Korea (without having to pass as many safety standards).

    As White House Press Secretary Sarah Sanders put it , when speaking of Kim Jong-un's North Korea, "The President is, I think, the ultimate negotiator and dealmaker when it comes to any type of conversation." She left out the obvious footnote, however: any type that doesn't involve international trade.

    In the past four months, Trump has imposed tariffs, exempting certain countries, only to reimpose them at his whim. If trust were a coveted commodity, when it came to the present White House, it would now be trading at zero. His supporters undoubtedly see this approach as the fulfillment of his many campaign promises and part of his classic method of keeping both friends and enemies guessing until he's ready to go in for the kill. At the heart of this approach, however, lies a certain global madness, for he now is sparking a set of trade wars that could, in the end, cost millions of American jobs.

    The Allies

    On May 31st, Commerce Secretary Wilbur Ross confirmed that Canada, Mexico, and the EU would all be hit with 10 percent aluminum and 25 percent steel tariffs that had first made headlines in March. When it came to those two products, at least, the new tariffs bore no relation to the previous average 3 percent tariff on US-EU traded goods.

    In that way, Trump's tariffs, initially supposed to be aimed at China (a country whose president he's praised to the skies and whose trade policies he's lashed out at endlessly), went global. And not surprisingly, America's closest allies weren't taking his maneuver lightly. As the verbal-abuse level rose and what looked like a possible race to the bottom of international etiquette intensified, they threatened to strike back.

    In June, President Trump ordered that a promised 25 percent tariff on $50 billion worth of imported goods from China also be imposed. In response, the Chinese, like the Europeans, the Canadians, and the Mexicans, immediately promised a massive response in kind. Trump countered by threatening another $200 billion in tariffs against China. In the meantime, the White House is targeting its initial moves largely against products related to that country's " Made in China 2025 " initiative, the Chinese government's strategic plan aimed at making the country a major competitor in advanced industries and manufacturing.

    Meanwhile, Mexico began adopting retaliatory tariffs on American imports. Although it has a far smaller economy than the United States, it's still the second-largest importer of US products, buying a whopping $277 billion of them last year. Only Canada buys more. In a mood of defiance stoked by the president's hostility to its people, Mexico executed its own trade gambit, imposing $3 billion in 15 percent–25 percent tariffs against US exports, including pork, apples, potatoes, bourbon, and cheese.

    While those Mexican revenge tariffs still remain limited, covering just 1 percent of all exports from north of the border, they do target particular industries hard, especially ones that seem connected to President Trump's voting "base." Mexico, for instance, is by far the largest buyer of US pork exports, 25 percent of which were sold there last year. What its 20 percent tariff on pork means, then, is that many US producers will now find themselves unable to compete in the Mexican market. Other countries may follow suit. The result: a possible loss of up to 110,000 jobs in the pork industry.

    Our second North American Free Trade Agreement (NAFTA) partner (for whose prime minister, Justin Trudeau, there is " a special place in hell ," according to a key Trumpian trade negotiator) plans to invoke tariffs of up to 25 percent on about $13 billion in US products beginning on July 1st. Items impacted range "from ballpoint pens and dishwasher detergent to toilet paper and playing cards sailboats, washing machines, dish washers, and lawn mowers." Across the Atlantic, the EU has similarly announced retaliatory tariffs of 25 percent on 200 US products, including such American-made classics as Harley-Davidson motorcycles, blue jeans, and bourbon.

    Trump Disses the Former G7

    As the explosive Group of Seven, or G7, summit in Quebec showed, the Trump administration is increasingly isolating itself from its allies in palpable ways and, in the process, significantly impairing the country's negotiating power. If you combine the economies of what might now be thought of as the G6 and add in the rest of the EU, its economic power is collectively larger than that of the United States. Under the circumstances, even a small diversion of trade thanks to Trump-induced tariff wars could have costly consequences.

    President Trump did try one "all-in" poker move at that summit. With his game face on, he first suggested the possibility of wiping out all tariffs and trade restrictions between the United States and the rest of the G7, a bluff met with a healthy dose of skepticism. Before he left for his meeting with North Korean leader Kim Jong-un in Singapore, he even suggested that the G7 leaders "consider removing every single tariff or trade barrier on American goods." In return, he claimed he would do the same "for products from their countries." As it turned out, however, that wasn't actually a venture into economic diplomacy, just the carrot before the stick, and even it was tied to lingering threats of severe penalties.

    The current incipient trade war was actually launched by the Trump administration in March in the name of American " national security ." What should have been highlighted, however, was the possible "national insecurity" in which it placed the country's (and the world's) future. After all, a similar isolationist stance in the 1920s and the subsequent market crash of 1929 sparked the global Great Depression, opening the way for the utter devastation of World War II.

    European Union countries were incredulous when Trump insisted, as he had many times before, that the "U.S. is a victim of unfair trade practices," citing the country's trade deficits, especially with Germany and China. At the G7 summit, European leaders did their best to explain to him that his country isn't actually being treated unfairly. As French President Emmanuel Macron explained , "France runs trade deficits with Germany and the United Kingdom on manufactured goods, even though all three countries are part of the EU single market and have zero tariffs between them."

    [Jul 15, 2018] Trump doctrine: "Permanent destabilization creates American advantage"

    Notable quotes:
    "... The official who described this to me said Trump believes that keeping allies and adversaries alike perpetually off-balance necessarily benefits the United States, which is still the most powerful country on Earth. ..."
    "... "No," the official said. "There's definitely a Trump Doctrine." "What is it?" I asked. Here is the answer I received: "The Trump Doctrine is 'We're America, Bitch.' That's the Trump Doctrine." ..."
    Jul 15, 2018 | www.moonofalabama.org

    Trump today added to turmoil he caused in Europe:

    In an interview with "CBS Evening News" anchor Jeff Glor in Scotland on Saturday, President Trump named the European Union -- comprising some of America's oldest allies -- when asked to identify his "biggest foe globally right now."
    "Well, I think we have a lot of foes. I think the European Union is a foe, what they do to us in trade. Now, you wouldn't think of the European Union, but they're a foe. ..."

    Bashing allies is an essential component of the Trump doctrine :

    The second-best self-description of the Trump Doctrine I heard was this, from a senior national-security official: "Permanent destabilization creates American advantage." The official who described this to me said Trump believes that keeping allies and adversaries alike perpetually off-balance necessarily benefits the United States, which is still the most powerful country on Earth.

    ...

    The best distillation of the Trump Doctrine I heard, though, came from a senior White House official with direct access to the president and his thinking. I was talking to this person several weeks ago, and I said, by way of introduction, that I thought it might perhaps be too early to discern a definitive Trump Doctrine. "No," the official said. "There's definitely a Trump Doctrine." "What is it?" I asked. Here is the answer I received: "The Trump Doctrine is 'We're America, Bitch.' That's the Trump Doctrine."


    vk , Jul 15, 2018 1:23:01 PM | 6

    I think Trump simply has a very prosaic, very sincere even, view about the world: he treats his equals equally (e.g. Putin, Xi, Kim) and his unequals unequally (NATO countries' leaders, Abe etc.).

    That is, he simply views his allies for what they really are: clients. And when you go visit clients, you expect them to stop, lower their heads, listen and obey you: that's why he probably found strange the fact that the Europeans were insulted by his behavior during the NATO summit and the individual countries official visits. He must have been particularly thunderstruck over the popular protests in Scotland: from his point of view, Scotland owes everything they have now to the USA (NATO), so he, as chief of State of the USA, has every right to go there and play golf whenever he pleases to do so. And the fact is he's right to think so: the European peninsula is an American protectorate, a "subState", inhabited by second-class citizens (like the peoples of Latin status of the Roman Republic).

    As for the destabilization doctrine (Trump Doctrine), it's absolutely correct: peace, right now, is nocive to the USA. That's why Russia and China are trying to descalate: peace (and time) is on their side. If the USA doesn't manage to trigger WWIII soon, it will start to eat itself up, because the world didn't recover from the 2008 meltdown. The clock is ticking for the Americans (and, by extension, for the Europeans and the Japanese).

    Last, I agree completely with the theory that May is a remainer who's trying to implode brexit without appearing to do so. She was a remainer during the camapaign, that's the reason she was elected as Cameron's successor (it was she or Leadsom or Johnson, both hardcore brexiters). The British elite is holding her while it can, and she is only in office right now because she has the elite's full weight behind her: if it was a Labour MP, he/she would've already fallen.

    Bart Hansen , Jul 15, 2018 1:26:12 PM | 7
    Re: Haass - It says a lot that a member of the Deep State can through out such a statement without embarrassment.

    His Twitter feed is getting some sass, but he knows none of that will be included when the stenos quote him.

    Hoarsewhisperer , Jul 15, 2018 1:48:15 PM | 11
    There is one significant weakness to Putin's patient, restrained and reasonable response to US/NATO aggression and intimidation...
    ...
    Posted by: les7 | Jul 15, 2018 12:17:17 PM | 2

    Huh?!
    If you watch the last 8 minutes of Episode 3 of Oliver Stone's Putin Interviews it'll cure you of the habit of confusing Putin's "Our Partners" diplo-speak with the hair-raising reality experienced by the crew of the Donald Cook in the Black Sea a couple of years ago. It'll also dissuade you from imagining that Putin/Russia has a 'weak' or 'reasonable' attitude toward NATO military provocations.

    Imo Trump would have either watched them himself or been briefed on their contents by someone who has.

    There are many links to the series on the www. Here's one to Ep 3...
    https://www.sbs.com.au/ondemand/video/965043267630/the-putin-interviews

    Zanon , Jul 15, 2018 1:53:20 PM | 12
    Even if I get Moscow as 'retribution,' critics will say it's not good enough - Trump
    https://www.rt.com/usa/433263-trump-putin-summit-expectations/
    dltravers , Jul 15, 2018 2:51:52 PM | 14
    Trump is acting out the good cop bad cop role all in one. He comes in with slashing attacks and praise. The media only prints the slashing attacks. By placing his adversaries off balance he seeks to gain something. I would say that he is operating like a corporate raider. The weak kneed euro leaders just do not know how to handle this stuff.

    He will not try that with Putin because he respects him. Putin is operating with a weak hand and he cannot and will not take on the Europe on his borders conventionally when he can possibly get what he wants in time with no bloodshed. Libya is his next target.

    Putin and his family are from Stalingrad and Putin will cut off the head of the Snake (US) before he lets that happen again. How? Think bright glowing mushroom clouds. It is that serious.

    Trump wants to bring Russia back into Europe. The Anglo Europeans want more control over Russia's vast resources and companies that control them. Offering then a role in NATO would be genius.

    Putin is being conflated into an enemy of the world by a mass propaganda campaign. Crimea and Ukraine was NATO pushing to hard to make Putin act with aggression. Crimea fell without a shot being fired. As an independent republic full of Russians it can choose who it wants to affiliate with.

    All in all this can be solved diplomatically but not by the current crop of deep state diplomats.

    [Jul 15, 2018] Donald Trump told Theresa May how to do Brexit 'but she wrecked it' and says the US trade deal is off

    Jul 15, 2018 | thesun.co.uk

    THERESA May's new soft Brexit blueprint would "kill" any future trade deal with the United States, Donald Trump warns today.

    Mounting an extraordinary attack on the PM's exit negotiation, the President also reveals she has ignored his advice on how to toughen up the troubled talks.

    Instead he believes Mrs May has gone "the opposite way", and he thinks the results have been "very unfortunate".

    His fiercest criticism came over the centrepiece of the PM's new Brexit plan -- which was unveiled in full yesterday.

    It would stick to a common ­rulebook with Brussels on goods and agricultural produce in a bid to keep customs borders open with the EU.

    But Mr Trump told The Sun: "If they do a deal like that, we would be dealing with the European Union instead of dealing with the UK, so it will probably kill the deal.

    [Jul 13, 2018] Opinion How to Lose a Trade War

    Jul 13, 2018 | www.nytimes.com

    Trump's declaration that "trade wars are good, and easy to win" is an instant classic, right up there with Herbert Hoover's "prosperity is just around the corner."

    Trump obviously believes that trade is a game in which he who runs the biggest surplus wins, and that America, which imports more than it exports, therefore has the upper hand in any conflict. That's also why Peter Navarro predicted that nobody would retaliate against Trump's tariffs. Since that's actually not how trade works, we're already facing plenty of retaliation and the strong prospect of escalation.

    But here's the thing: Trump's tariffs are badly designed even from the point of view of someone who shares his crude mercantilist view of trade. In fact, the structure of his tariffs so far is designed to inflict maximum damage on the U.S. economy, for minimal gain. Foreign retaliation, by contrast, is far more sophisticated: unlike Trump, the Chinese and other targets of his trade wrath seem to have a clear idea of what they're trying to accomplish.

    The key point is that the Navarro/Trump view, aside from its fixation on trade balances, also seems to imagine that the world still looks the way it did in the 1960s, when trade was overwhelmingly in final goods like wheat and cars. In that world, putting a tariff on imported cars would cause consumers to switch to domestic cars, adding auto industry jobs, end of story (except for the foreign retaliation.)

    In the modern world economy, however, a large part of trade is in intermediate goods – not cars but car parts. Put a tariff on car parts, and even the first-round effect on jobs is uncertain: maybe domestic parts producers will add workers, but you've raised costs and reduced competitiveness for downstream producers, who will shrink their operations.

    You have 4 free articles remaining.

    Subscribe to The Times

    So in today's world, smart trade warriors – if such people exist – would focus their tariffs on final goods, so as to avoid raising costs for downstream producers of domestic goods. True, this would amount to a more or less direct tax on consumers; but if you're afraid to impose any burden on consumers, you really shouldn't be getting into a trade war in the first place.

    But almost none of the Trump tariffs are on consumer goods. Chad Bown and colleagues have a remarkable chart showing the distribution of the Trump China tariffs: an amazing 95 percent are either on intermediate goods or on capital goods like machinery that are also used in domestic production: KS

    Is there a strategy here? It's hard to see one. There's certainly no hint that the tariffs were designed to pressure China into accepting U.S. demands, since nobody can even figure out what, exactly, Trump wants from China in the first place.

    China's retaliation looks very different. It doesn't completely eschew tariffs on intermediate goods, but it's mostly on final goods. And it's also driven by a clear political strategy of hurting Trump voters; the Chinese, unlike the Trumpies, know what they're trying to accomplish:

    Image

    What about others? Canada's picture is complicated by its direct response to aluminum and steel tariffs, but those industries aside it, too, is following a far more sophisticated strategy than the U.S.:

    Except for steel and aluminum, Canada's retaliation seemingly attempts to avoid messing up its engagement in North American supply chains. In broad terms, Canada is not targeting imports of American capital equipment or intermediate inputs, focusing instead on final goods.

    And like China, Canada is clearly trying to inflict maximum political damage.

    Trade wars aren't good or easy to win even if you know what you're trying to accomplish and have a clear strategy for getting there. What's notable about the Trump tariffs, however, is that they're so self-destructive.

    And we can already see hints of the economic fallout. From the Fed's most recent minutes :

    [M]any District contacts expressed concern about the possible adverse effects of tariffs and other proposed trade restrictions, both domestically and abroad, on future investment activity; contacts in some Districts indicated that plans for capital spending had been scaled back or postponed as a result of uncertainty over trade policy. Contacts in the steel and aluminum industries expected higher prices as a result of the tariffs on these products but had not planned any new investments to increase capacity.

    So Trump and company don't actually have a plan to win this trade war. They may, however, have stumbled onto a strategy that will lose it even more decisively than one might have expected.

    [Jul 13, 2018] Trump Regime 10% Tariffs on $200 Billion Worth of Chinese Goods Global Research - Centre for Research on Globalization

    Notable quotes:
    "... On Tuesday, his trade representative Robert Lighthizer released a list of $10% tariffs to be imposed on $200 billion worth of Chinese goods. ..."
    "... A senior Trump regime official falsely said it's "roughly equal to their exports to" the US. It's around 40% of the 2017 total. ..."
    "... Stephen Lendman is a Research Associate of the CRG, Correspondent of Global Research based in Chicago. ..."
    Jul 13, 2018 | www.globalresearch.ca

    Trump Regime 10% Tariffs on $200 Billion Worth of Chinese Goods By Stephen Lendman Global Research, July 13, 2018 Region: Asia , USA Theme: Global Economy , Law and Justice

    Note to readers: please click the share buttons above

    On Tuesday, his trade representative Robert Lighthizer released a list of $10% tariffs to be imposed on $200 billion worth of Chinese goods.

    A senior Trump regime official falsely said it's "roughly equal to their exports to" the US. It's around 40% of the 2017 total.

    Newly announced tariffs won't take effect before completion of a two-month review process, concluding at end of August. Trump warned he may order tariffs on $500 billion worth of Chinese goods.

    In 2017, imports from China were $506 billion, US exports to the country $130 billion. The trade deficit was $375 billion last year.

    It's because so much of industrial America was offshored to China and other low-wage countries, millions of US jobs lost, Washington under Republicans and undemocratic Dems permitting what demands opposition.

    The Investment-State Dispute Settlement (ISDS) system incorporated into US trade deals like NAFTA and others, letting a corporate controlled extrajudicial tribunal resolve disputes, promotes offshoring of US jobs.

    China called the latest announced tariffs "totally unacceptable" bullying, urging other countries to unite against Trump's trade policy, promising to retaliate in kind.

    Along with earlier duties on $50 billion worth of Chinese goods, newly announced ones raise the total to half of Chinese imports – maybe all of them to be targeted ahead if China retaliates in kind as expected.

    China Association of International Trade senior fellow Li Yong believes one Beijing retaliatory measure may be a greater push to attract foreign investment other than from the US, adding:

    Trump "closed the door for negotiations. It's up to (him) to open the door again."

    Trade policy expert Eswar Prasad believes

    "(t)he internal political dynamics in both countries make it unlikely that either side will stand down and offer conciliatory measures that could deescalate tensions and lead to a resumption of negotiations."

    Economist Stephen Roach called trade wars "not easy to win easy to lose, and the US is on track to lose (its) trade war" with China, adding:

    "This is live ammunition. This is not just rhetorical discussion anymore. We're in the early stages of fighting skirmishes in a real, live trade war."

    "The question is, how far does it go? And how significant will the ammunition be in the future?"

    Roach believe China has lots of ammunition to hold firm and fight back with.

    "The US is hugely dependent on China as a source for low-cost goods to make ends meet for American consumers. We're hugely dependent on China to buy our Treasuries to fund our budget deficits," he explained.

    Beijing has lots of ways to retaliate against Washington besides imposing duties on US goods.

    On Thursday, China's People's Daily slammed the Trump regime, saying

    Beijing "will never back down when faced with threats and blackmail, neither will it waver its resolution in safeguarding the global free trade and multilateral trade system," adding:

    "The US is undermining global trade rules and causing problems for the global economy. (Its) mentality not only brings negative impacts to both parties directly involved, but also to every country on the global industrial chain."

    China's Global Times called Trump's trade policy "extortion," stressing "countermeasures" will be taken.

    Markets believe both sides eventually will show restraint. There's no sign of it so far – just the opposite.

    *

    Stephen Lendman is a Research Associate of the CRG, Correspondent of Global Research based in Chicago.

    [Jul 11, 2018] Opinion How to Lose a Trade War - The New York Times

    Jul 11, 2018 | www.nytimes.com

    Trump's declaration that "trade wars are good, and easy to win" is an instant classic, right up there with Herbert Hoover's "prosperity is just around the corner."

    Trump obviously believes that trade is a game in which he who runs the biggest surplus wins, and that America, which imports more than it exports, therefore has the upper hand in any conflict. That's also why Peter Navarro predicted that nobody would retaliate against Trump's tariffs. Since that's actually not how trade works, we're already facing plenty of retaliation and the strong prospect of escalation.

    But here's the thing: Trump's tariffs are badly designed even from the point of view of someone who shares his crude mercantilist view of trade. In fact, the structure of his tariffs so far is designed to inflict maximum damage on the U.S. economy, for minimal gain. Foreign retaliation, by contrast, is far more sophisticated: unlike Trump, the Chinese and other targets of his trade wrath seem to have a clear idea of what they're trying to accomplish.

    The key point is that the Navarro/Trump view, aside from its fixation on trade balances, also seems to imagine that the world still looks the way it did in the 1960s, when trade was overwhelmingly in final goods like wheat and cars. In that world, putting a tariff on imported cars would cause consumers to switch to domestic cars, adding auto industry jobs, end of story (except for the foreign retaliation.)

    In the modern world economy, however, a large part of trade is in intermediate goods – not cars but car parts. Put a tariff on car parts, and even the first-round effect on jobs is uncertain: maybe domestic parts producers will add workers, but you've raised costs and reduced competitiveness for downstream producers, who will shrink their operations.

    You have 4 free articles remaining.

    Subscribe to The Times

    So in today's world, smart trade warriors – if such people exist – would focus their tariffs on final goods, so as to avoid raising costs for downstream producers of domestic goods. True, this would amount to a more or less direct tax on consumers; but if you're afraid to impose any burden on consumers, you really shouldn't be getting into a trade war in the first place.

    But almost none of the Trump tariffs are on consumer goods. Chad Bown and colleagues have a remarkable chart showing the distribution of the Trump China tariffs: an amazing 95 percent are either on intermediate goods or on capital goods like machinery that are also used in domestic production:

    Image

    Is there a strategy here? It's hard to see one. There's certainly no hint that the tariffs were designed to pressure China into accepting U.S. demands, since nobody can even figure out what, exactly, Trump wants from China in the first place.

    Advertisement

    China's retaliation looks very different. It doesn't completely eschew tariffs on intermediate goods, but it's mostly on final goods. And it's also driven by a clear political strategy of hurting Trump voters; the Chinese, unlike the Trumpies, know what they're trying to accomplish:

    Image

    What about others? Canada's picture is complicated by its direct response to aluminum and steel tariffs, but those industries aside it, too, is following a far more sophisticated strategy than the U.S.:

    Except for steel and aluminum, Canada's retaliation seemingly attempts to avoid messing up its engagement in North American supply chains. In broad terms, Canada is not targeting imports of American capital equipment or intermediate inputs, focusing instead on final goods.

    And like China, Canada is clearly trying to inflict maximum political damage.

    Trade wars aren't good or easy to win even if you know what you're trying to accomplish and have a clear strategy for getting there. What's notable about the Trump tariffs, however, is that they're so self-destructive.

    And we can already see hints of the economic fallout. From the Fed's most recent minutes :

    [M]any District contacts expressed concern about the possible adverse effects of tariffs and other proposed trade restrictions, both domestically and abroad, on future investment activity; contacts in some Districts indicated that plans for capital spending had been scaled back or postponed as a result of uncertainty over trade policy. Contacts in the steel and aluminum industries expected higher prices as a result of the tariffs on these products but had not planned any new investments to increase capacity.

    So Trump and company don't actually have a plan to win this trade war. They may, however, have stumbled onto a strategy that will lose it even more decisively than one might have expected.

    [Jul 08, 2018] Europe Isolates China Trade Cheat naked capitalism

    Notable quotes:
    "... By David Llewellyn-Smith, founding publisher and former editor-in-chief of The Diplomat magazine, now the Asia Pacific's leading geo-politics website. Cross posted from MacroBusiness ..."
    "... Captains of the German auto industry kowtowing to US ambassador Grenell make a remarkable scene, not unlike the Chinese capitulating to the British and handing over Hong Kong in the opium wars. ..."
    "... circle the wagons ..."
    "... tempered expectations ..."
    Jul 08, 2018 | www.nakedcapitalism.com

    Europe Isolates China Trade Cheat Posted on July 7, 2018 by Yves Smith Yves here. I'm faithfully replicating the MacroBusiness headline as an indicator of unhappiness in some circles in Australia about the degree to which the government has opened the floodgates since I was there to investment from China, particularly in real estate. When I lived in Sydney in 2002 to 2004, property struck me as awfully fully priced by global standards, and it's been on a moon shot trajectory since then, in part due to Australia also liberalizing immigration. When I was there, the intent of policy was to have immigration in certain skilled categories, and then with an eye to maintaining population levels, not goosing them. Since then, the population in Australia has grown from 20 million to over 24 million.

    But in addition, even though imposing tariffs on cars and car parts would hurt quite a few US employers, it would also hurt European multinationals (many of whom happen to be US employers), to the degree that they've pushed the European officialdom to see if they can cut a deal with Trump. If that happens, Trump gets a win he can brandish for the midterms and the tariff brinksmanship presumably eases off a bit, potentially a lot.

    By David Llewellyn-Smith, founding publisher and former editor-in-chief of The Diplomat magazine, now the Asia Pacific's leading geo-politics website. Cross posted from MacroBusiness

    Recall that China has tried to play Europe for the chump, via Reuters :

    China is putting pressure on the European Union to issue a strong joint statement against President Donald Trump's trade policies at a summit later this month but is facing resistance, European officials said.

    In meetings in Brussels, Berlin and Beijing, senior Chinese officials, including Vice Premier Liu He and the Chinese government's top diplomat, State Councillor Wang Yi, have proposed an alliance between the two economic powers and offered to open more of the Chinese market in a gesture of goodwill.

    One proposal has been for China and the European Union to launch joint action against the United States at the World Trade Organization.

    But the European Union, the world's largest trading bloc, has rejected the idea of allying with Beijing against Washington, five EU officials and diplomats told Reuters, ahead of a Sino-European summit in Beijing on July 16-17.

    Instead, the summit is expected to produce a modest communique, which affirms the commitment of both sides to the multilateral trading system and promises to set up a working group on modernizing the WTO, EU officials said.

    "China wants the European Union to stand with Beijing against Washington, to take sides," said one European diplomat. "We won't do it and we have told them that."

    Despite Trump's tariffs on European metals exports and threats to hit the EU's automobile industry, Brussels shares Washington's concern about China's closed markets and what Western governments say is Beijing's manipulation of trade to dominate global markets.

    "We agree with almost all the complaints the U.S. has against China, it's just we don't agree with how the United States is handling it," another diplomat said.

    But it's China that looking more isolated today, via Quartz :

    The US may have been accused by China of "opening fire on the world" with its punitive trade tariffs, but it looks like officials may be making more progress in Europe's largest economy Germany.

    Richard Grenell, the US ambassador to Germany, has caused quite a stir since he arrived in Berlin in May, lecturing German companies to stop trading with Iran, and saying he planned to "empower" anti-establishment conservatives in Europe. However, with the threat of punitive US tariffs on its cars looming, Grenell certainly has the attention of Germany's powerful car bosses.

    German business daily Handelsblatt reports (link in German) that Grenell met Daimler CEO Dieter Zetsche, BMW CEO Harald Krüger, and VW CEO Herbert Diess on Wednesday evening to discuss both sides abolishing all tariffs on each others car imports. Right now, the European Union adds a 10% tax on imported US cars, and the US puts 2.5% on EU car imports, and is threatening to ramp that up to 25%. As part of the deal, president Donald Trump would reportedly want German carmakers to invest more in the US.

    Last night's meeting was not the first time the carmakers and Grenell have talked about abolishing two-way tariffs. The Wall Street Journal (paywall) reported on June 20 that the ambassador had been meeting with all Germany's most important car companies, and that they were already behind the idea.

    Chancellor Angela Merkel is worried about the damage a car trade war could do to one of Germany's core industries. "We now have tariffs on aluminum and steel and we have a discussion that is far more serious," she told parliament, referring to auto tariffs. "It's worth every effort to try to defuse this conflict so it doesn't turn into a war."

    More from Yahoo :

    German Chancellor Angela Merkel said Thursday she would back opening talks with trading partners on lowering automobile tariffs, in what appeared to be an olive branch to US President Donald Trump as the EU battles to dissuade him from imposing hefty levies on European cars.

    But Merkel said that any negotiations on lowering tariffs in one area could only be conducted with "all the countries with which we have trade in cars," rather than just with the United States.

    A deal with the US alone "would not conform with WTO" rules, she said.

    "We can either have negotiations about a wide range of tariffs, for 90 percent of goods," Merkel said in a reference to the stalled talks for a transatlantic free-trade deal known as TTIP.

    "Or we can talk about one type of goods, but then we must accord the same treatment to all trading partners of the world. That's an option I could imagine," she added.

    Interestingly, Nomura sees it all as deflationary:

    US pursuit of beggar thy neighbor policies: is it leading to a whole new world for global automakers?

    Automakers have set up an intricate web of suppliers and assembly plants globally to leverage the benefits of trade agreements, while keeping FX risks at acceptable levels. The pursuit of beggar thy neighbour policies by a large, connected, and heretofore open Now 3 mths 12 mths US Europe Japan Korea Brazil Russia India China Thailand Indonesia Nomura | Global Autos Outlook 4 June 2018 4 economy such as the US threatens to upend this structure.

    In this edition of the Global Autos Outlook, we therefore look at trade-related challenges (and opportunities) facing global automakers, possible strategies they could adopt to cope, and potential winners and losers over the near-to-medium term. Risk of "No NAFTA" has risen, although our base case remains NAFTA 2.0 Trump's openly protectionist policies have increased the risk of a "No NAFTA" outcome, although our base case still remains that NAFTA will be renegotiated.

    Nearly 25 years of NAFTA have integrated the North American auto industry very tightly. If NAFTA is dissolved, it will impact all automakers operating in North America. In particular, we think GM and FCA could be hit the hardest (higher import tariffs cut 40% of GM's FY2018E EBIT, 23% of that for FCA). In our opinion, it increasingly appears that the US President's decision-making is centered on autoworkers, even if that is to the detriment of the automakers. Thus, US automakers getting hurt might not hold back Trump from making such a move.

    Auto industry staring at global excess capacity, no matter what the outcome of the Section 232 drama

    The US Department of Commerce has started a Section 232 investigation into US imports of autos and auto parts. Under the worst case scenario, this may result in broadbased import tariffs slapped on US automotive imports after the investigation concludes and reports back to the President in several months. US imports of new passenger vehicles and auto parts totaled $333bn in 2017. Import duties on such a large volume of goods would be highly disruptive and impact all the major car exporting countries/regions such as Mexico, Canada, Japan, the EU, and South Korea.

    While we think that the threat of tariffs is largely Trump's negotiation tactic to get a better NAFTA deal, we caution investors to pay attention, as the tail risk (of import tariffs materializing) is not negligible. Furthermore, no matter whether new auto tariffs are imposed or not, global carmakers, irrespective of nationality, are feeling pressured to build plants and increase employment in the US. This is likely to lead to increased capacity in the US, where car demand is no longer growing.

    On the other hand, non-US carmakers are unlikely to cut capacity at home or elsewhere, leading to excess capacity globally. This will impact most markets except for relatively closed ones such as China, India, and Southeast Asia, due to their existing high import tariffs. For global automakers, we therefore see a binary outcome from a growing list of protectionist measures being deployed by the US. Neither outcome is good news, with automakers staring at excess global capacity in either case:

     If Section 232 tariffs are imposed, it (largely) cuts off imports into the domestic US market. However, that would mean that there is excess capacity outside the US, as existing foreign plants supplying to the US (7.88mn/$192bn new PVs, 8.2% of global volume, and $141bn auto parts in 2017) have to find markets elsewhere.

     If new tariffs are not imposed, we still have additional capacity coming up in the US as automakers are goaded into doing so to avoid political pressure. This also leads to a global supply-demand imbalance in the auto industry.

    Silver linings: China's import tariff cut, forthcoming JEEPA

    Although US protectionism is a real threat, we see a couple of silver linings. China announced an import tariff cut for autos, from 25% currently to 15% beginning 1st July 2018. The Japan-EU Economic Partnership Agreement (JEEPA) was agreed upon last December and is likely to become effective in spring 2019, benefiting Japanese car exporters. One of the biggest beneficiaries from both China and the EU's tariff cuts would be Toyota Motor.

    Full report here .


    EMHO , July 7, 2018 at 2:35 am

    "US lure carmakers with tariff offer – but the proposal is illegal"

    That's the title in WirtschaftsWoche. A premier german language trade and economics magazine. It had an interview(in German) with Ewald Pum attorney at internal law firm Wirtschaftskanzlei Rödl & Partner.

    He states that what Ambassador Grenell proposed is illegal under international WTO law, and the EU could therefore not support it. Also, the EU had historically supported rules based free trade, and this could only be accomplished via an bilateral trade deal in goods, what he called TTIP on a diet.

    Here is the article(in German):

    https://www.wiwo.de/politik/ausland/wirtschaftsanwalt-erklaert-usa-locken-autobauer-mit-zollangebot-doch-der-vorschlag-ist-rechtswidrig/22771780.html

    Jim Haygood , July 7, 2018 at 3:02 am

    ' Nomura sees it all as deflationary: the pursuit of beggar thy neighbour policies by a large, connected, and heretofore open economy such as the US threatens to upend this structure. '

    So does UK-based Russell Napier, who sees the US obsession with shrinking its trade deficit provoking a seismic shift in China:

    Investors need to prepare for a formal widening of the trading bands for the RMB relative to its basket and the problems such a move will create for all emerging markets. That first move in the RMB is inherently deflationary. This is no counter-punch in a trade war; it is the beginning of the creation of a new global monetary system.

    The ability of China to extend the cycle has come to an end as its current account surplus has all but evaporated. It has also come to an end because Jay Powell has warned China, and other emerging markets, that he will not alter the course of US monetary policy to assist with any credit disturbances outside his own jurisdiction.

    Who can run the current account deficits necessary to make their currency an attractive anchor for smaller countries seeking to run current account surpluses?

    It seems well nigh impossible to believe, following almost 40 years of mercantilism, that China would opt to become a country running large current account deficits. Such a change in mindset may seem revolutionary, but it is just another necessary shift in the long game in the attempt to make China the pre-eminent global economy.

    The initial shift to a more flexible Chinese exchange rate is deflationary and dangerous. The USD selling price of Chinese exports will likely fall, putting pressure on all those who compete with China – EMs [Emerging Markets] but also Japan. The USD will rise, putting pressure on all those, particularly EMs, who have borrowed USD without having USD cash flows to service those debts. With world debt-to-GDP at a record high, such a major deflationary dislocation can easily trigger another credit crisis.

    Following the great dislocation, China will be free to reflate the world.

    https://tinyurl.com/y8yfyqwx

    ' Free to reflate the world ' much as the US did post-WW II with its Great Inflation that flooded the world with dollars.

    But getting from here to there is the tricky bit. As Napier insists, a deflationary ditch lies between. Combine Llewellyn-Smith's comments on the auto industry's overcapacity and supply-chain disruption with a deflationary break in the global economy, and you've got the recipe for a nasty little crisis and perhaps a second bankruptcy in GM, whose long-term debt is rising rapidly.

    Flake-o-nomics may be creative destruction, but folks are not going to like the interim results. The purblind Hoover-Trump will be blamed, rightly.

    The Rev Kev , July 7, 2018 at 4:19 am

    This whole tariff fight really seems to be about derailing China's plans to be a world leader with its 'Made in China 2025' plan. Maybe Trump and his advisers reckon that if this fight is not carried to the Chinese soon, then it will be too late. Europe, though under attack by Trump, is also seeing the dangers where the EU will be eclipsed by a single country.

    It may be that Europe is giving Trump a message that if he plays nice with Europe's tariffs, then the EU will cooperate with the US against China. I hope that the calculation is not to push China into financial chaos as serving Europe's and Trump's interests. Supply chains are far too meshed to make that a good option and I can easily see a recession in the making which will hit the world hard.

    China may have a long term advantage in that it has invested in infrastructure, transport, education and training whereas the west has been devaluing these things due to neoliberal policies for decades now. They may start pulling their money back which will hit places like Australia, Canada and the US hard as to my eye Chinese money keeps things like property values high in those places. We'll find out soon enough.

    Damson , July 7, 2018 at 5:52 am

    Exactly.

    I've been following CGTN on the tariff war, and it looks like China is going to go the 'proportional reciprocity' route, just as Russia has with sanctions.

    The latter has benefited from sanctions, while Europe has lost billions in trade.

    As for the 'five EU officials' – all anonymous – cited in Reuters' report, I would take their statements with a large dose of salt.

    EU is in ferment, and Merkel is not doing well in the polls.

    There is strong anti-US sentiment in Germany, albeit not reported in the media. A combination of Trump's policies and the perpetual wars – now implicated in the greatest mass migrantion crisis since WWII – has led to a disenchantment with US.

    Then there is OBOR, with various interest groups – particularly in European industry – beginning to look East rather than West.

    Thus there is no real unified resolve at EU level to warrant such claims.

    Dedollarization is continuing apace too, and new alliances are emerging like the SCO and the reported deals between the major oil producing countries like Russia and Saudi.

    China plays a much longer game than the US, so it is hard to estimate what the consequence will be within the short – tern assessment models used by the Western powers.

    Thuto , July 7, 2018 at 8:51 am

    I've gotten into the habit of rolling my eyes whenever an establishment media outlet quotes "anonymous sources". Looking at the prospects in the global automotive sector, surely the smart money is on the east (and other emerging markets) being where the long term growth is going to emerge, so why the EU would bet on a jockey riding a horse that's falling behind the pace would be rather difficult to fathom. One assumes that CEOs of the big three German automakers play as long a game as anyone, so being brow beaten into an anti-china stance by a US ambassador would be incredibly shortsighted, to say nothing of raising investor ire

    Jim Haygood , July 7, 2018 at 12:38 pm

    Captains of the German auto industry kowtowing to US ambassador Grenell make a remarkable scene, not unlike the Chinese capitulating to the British and handing over Hong Kong in the opium wars.

    But Germany is an occupied and humbled nation, with tens of thousands of US troops garrisoned on its soil for three generations now. And Grenell, a product of the John F Kennedy School of Gubmint at Hahhhhhvid, was born to rule.

    It's good to be king ambassador.

    *summons his liveried steward to fetch oysters and mimosas for brunch*

    Susan the other , July 7, 2018 at 10:28 am

    I agree that this is looking like creative destruction -- but more like intentional creative destruction. Bringing down the dinosaur auto industry – now that's definitely a step in the right direction, imo. So it's curious that Trump has such a strategic focus, no? And he just started Space Force.

    So clearly that is where the technology is. I do not agree that this is hyper-nationalism (that's just the cover) and it seems absurd for anyone to suggest that Trump is actually doing anything to benefit domestic auto workers he's just not that dumb. And of course Merkel is in a tizzy. She's going to do everything she can to soften the impact of the inevitable.

    Ignacio , July 7, 2018 at 11:01 am

    So, is the EU, particularly Germany, accusing China for market manipulation? The hypocritie game is in gaining track.

    ChrisAtRU , July 7, 2018 at 12:50 pm

    Ha! As discussed and promised 'round the table at D4 last night ;-) #ChicagoNCMeetup

    Thanks again Yves!

    Part of me wants to believe that the capitalist nations were always destined to circle the wagons against communist China, despite all the hand wringing about Trump. The political aspect of this is more interesting to me at the moment. Given all we know about the loyalty Trump still enjoys from those who put him in office, a yuge trade "win" this year will play to the theme of tempered expectations of a "Blue Wave".

    [May 28, 2018] Neoliberal globalization is collapsing in various way in different countries

    Notable quotes:
    "... Back to Turkey. The largest net backstabbing of Turkish economy could be the slowdown of investments from the Gulf, where Erdogan bravely sided with Qatar. Erdogan engineered de facto confiscation of media assets owned by tycoons sympathetic to the opposition, to be purchased by Qataris, now Qatar is to Turkey what Adelson is to Israel. ..."
    "... Add the effect of Iran sanctions -- it increased prices of oil and gas, but no associated increase the demand from the Gulf, on the northern shore there is a prospect of tightened belts, on the southern shore anti-Turkish policies, and Qatar alone is too small ..."
    May 24, 2018 | www.moonofalabama.org

    ...Rusal, the dominant aluminum maker in Russia recently was sanctioned by USA, while a while ago it gained control of a large portion of alumina production -- aluminum ore, bauxite, has to be processed into more pure feedstock for smelting factories, called alumina. Now aluminum producers in many areas, notably, Europe, have a shortage of alumina that may lead to mothballing of some smelters; the largest alumina facility in Europe is in Ireland and it is owned by Rusal. Perhaps great for American smelter owners, but there has to be some teeth gnashing in Europe.

    Back to Turkey. The largest net backstabbing of Turkish economy could be the slowdown of investments from the Gulf, where Erdogan bravely sided with Qatar. Erdogan engineered de facto confiscation of media assets owned by tycoons sympathetic to the opposition, to be purchased by Qataris, now Qatar is to Turkey what Adelson is to Israel.

    Siding with Qatar would eliminate investments from KSA and UAE, and draconian treatment of Saudi princes and other tycoons probably led to their assets being under the control of the Crown Prince.

    This is not particularly recent, but financial markets tend to have delayed fuse. Add the effect of Iran sanctions -- it increased prices of oil and gas, but no associated increase the demand from the Gulf, on the northern shore there is a prospect of tightened belts, on the southern shore anti-Turkish policies, and Qatar alone is too small.

    Plus Erdogan himself promised to "pay more attention to Turkish central bank", and justifiably or not, that is a very strong sell signal for the currency.

    [Apr 25, 2018] How The Globalism Con Game Leads To A 'New World Order' by Brandon Smith

    Notable quotes:
    "... The ultimate goal of the new world order as an ideology is total centralization of economic and governmental power into the hands of a select and unaccountable bureaucracy made up of international financiers. This is governance according the the dictates of Plato's Republic; a delusional fantasy world in which benevolent philosopher kings, supposedly smarter and more objective than the rest of us, rule from on high with scientific precision and wisdom. It is a world where administrators become gods. ..."
    "... Large corporations receive unfair legal protection under limited liability as well as outright legislative protection from civil consequences (Monsanto is a perfect example of this). They also receive immense taxpayer funded welfare through bailouts and other sources when they fail to manage their business responsibly. All this while small businesses and entrepreneurs are impeded at every turn by taxation and legal obstacles. ..."
    "... Only massive corporations supported by governments are able to exploit the advantages of international manufacturing and labor sources in a way that ensures long term success. Meanwhile economic models that promote true decentralization and localism become impractical because real competition is never allowed. The world has not enjoyed free markets in at least a century. What we have today is something entirely different. ..."
    "... The fact is, globalist institutions and central banks permeate almost every corner of the world. Nations like Russia and China are just as heavily tied to the IMF and the Bank for International Settlements and international financial centers like Goldman Sachs as any western government. ..."
    "... The first inclination of human beings is to discriminate against ideas and people they see as destructive and counter to their prosperity. Globalists therefore have to convince a majority of people that the very tribalism that has fueled our social evolution and some of the greatest ideas in history is actually the source of our eventual doom. ..."
    "... As mentioned earlier, globalists cannot have their "new world order" unless they can convince the masses to ask for it. Trying to implement such a system by force alone would end in failure, because revolution is the natural end result of tyranny. Therefore, the new world order has to be introduced as if it had been formed by coincidence or by providence. Any hint that the public is being conned into accepting global centralization would trigger widespread resistance. ..."
    "... This is why globalism is always presented in the mainstream media as a natural extension of civilization's higher achievement. Even though it was the dangerous interdependency of globalism that helped fuel the economic crisis of 2008 and continues to escalate that crisis to this day, more globalism is continually promoted as the solution to the problem. It is spoken of with reverence in mainstream economic publications and political discussions. It receives almost religious praise in the halls of academia. Globalism is socioeconomic ambrosia -- the food of deities. It is the fountain of youth. It is a new Eden. ..."
    "... Obviously, this adoration for globalism is nonsense. There is no evidence whatsoever that globalism is a positive force for humanity, let alone a natural one. There is far more evidence that globalism is a poisonous ideology that can only ever gain a foothold through trickery and through false flags. ..."
    Apr 25, 2018 | www.zerohedge.com

    Authored by Brandon Smith via Alt-Market.com,

    When globalists speak publicly about a "new world order" they are speaking about something very specific and rather sacred in their little cult of elitism. It is not simply the notion that civilization shifts or changes abruptly on its own; rather, it is their name for a directed and engineered vision - a world built according to their rules, not a world that evolved naturally according to necessity.

    There are other names for this engineered vision, including the "global economic reset," or the more general and innocuous term "globalism," but the intention is the same.

    The ultimate goal of the new world order as an ideology is total centralization of economic and governmental power into the hands of a select and unaccountable bureaucracy made up of international financiers. This is governance according the the dictates of Plato's Republic; a delusional fantasy world in which benevolent philosopher kings, supposedly smarter and more objective than the rest of us, rule from on high with scientific precision and wisdom. It is a world where administrators become gods.

    Such precision and objectivity within human systems is not possible, of course . Human beings are far too susceptible to their own biases and personal desires to be given totalitarian power over others. The results will always be destruction and disaster. Then, add to this the fact that the kinds of people who often pursue such power are predominantly narcissistic sociopaths and psychopaths. If a governmental structure of high level centralization is allowed to form, it opens a door for these mentally and spiritually broken people to play out their twisted motives on a global stage.

    It is important to remember that sociopaths are prone to fabricating all kinds of high minded ideals to provide cover for their actions. That is to say, they will adopt a host of seemingly noble causes to rationalize their scramble for power, but in the end these "humanitarians" only care about imposing their will on as many people as possible while feeding off them for as long as time allows.

    There are many false promises, misrepresentations and fraudulent conceptions surrounding the narrative of globalism. Some of them are rather clever and subversive and are difficult to pick out in the deliberately created fog. The schemes involved in implementing globalism are designed to confuse the masses with crisis until they end up ASKING for more centralization and less freedom.

    Let's examine some of the most common propaganda methods and arguments behind the push for globalization and a "new world order"

    Con #1: Globalism Is About "Free Markets"

    A common pro-globalism meme is the idea that globalization is not really centralization, but decentralization. This plays primarily to the economic side of global governance, which in my view is the most important because without economic centralization political centralization is not possible.

    Free markets according to Adam Smith, a pioneer of the philosophy, are supposed to provide open paths for anyone with superior ideas and ingenuity to pursue those ideas without interference from government or government aided institutions. What we have today under globalism are NOT free markets. Instead, globalism has supplied unfettered power to international corporations which cannot exist without government charter and government financial aid.

    The corporate model is completely counter to Adam Smith's original premise of free market trade. Large corporations receive unfair legal protection under limited liability as well as outright legislative protection from civil consequences (Monsanto is a perfect example of this). They also receive immense taxpayer funded welfare through bailouts and other sources when they fail to manage their business responsibly. All this while small businesses and entrepreneurs are impeded at every turn by taxation and legal obstacles.

    In terms of international trade being "free trade," this is not really the case either. Only massive corporations supported by governments are able to exploit the advantages of international manufacturing and labor sources in a way that ensures long term success. Meanwhile economic models that promote true decentralization and localism become impractical because real competition is never allowed. The world has not enjoyed free markets in at least a century. What we have today is something entirely different.

    Con #2: Globalism Is About A "Multipolar World"

    This is a relatively new disinformation tactic that I attribute directly to the success of the liberty movement and alternative economists. As the public becomes more educated on the dangers of economic centralization and more specifically the dangers of central banks, the globalists are attempting to shift the narrative to muddy the waters.

    For example, the liberty movement has railed against the existence of the Federal Reserve and fiat dollar hegemony to the point that our information campaign has been breaking into mainstream thought. The problem is that globalism is not about the dollar, U.S. hegemony or the so-called "deep state," which in my view is a distraction from the bigger issue at hand.

    The fact is, globalist institutions and central banks permeate almost every corner of the world. Nations like Russia and China are just as heavily tied to the IMF and the Bank for International Settlements and international financial centers like Goldman Sachs as any western government.

    Part of the plan for the new world order, as has been openly admitted by globalists and globalist publications, is the decline of the U.S. and the dollar system to make way for one world financial governance through the IMF as well as the Special Drawing Rights basket as a mechanism for the world reserve currency. The globalists WANT a less dominant U.S. and a more involved East, while the East continues to call for more control of the global economy by the IMF. This concept unfortunately flies over the heads of most economists, even in the liberty movement.

    So, the great lie being promoted now is that the fall of the U.S. and the dollar is a "good thing" because it will result in "decentralization," a "multi-polar" world order and the "death" of globalism. However, what is really happening is that as the U.S. falls globalist edifices like the IMF and the BIS rise. We are moving from centralization to super-centralization. Globalists have pulled a bait and switch in order to trick the liberty movement into supporting the success of the East (which is actually also globalist controlled) and a philosophy which basically amounts to a re-branding of the new world order as some kind of decentralized paradise.

    Con #3: Nationalism Is The Source Of War, And Globalism Will End It

    If there's one thing globalists have a love/hate relationship with, it's humanity's natural tribal instincts. On the one hand, they like tribalism because in some cases tribalism can be turned into zealotry, and zealots are easy to exploit and manipulate. Wars between nations (tribes) can be instigated if the tribal instinct is weighted with artificial fears and threats.

    On the other hand, tribalism lends itself to natural decentralization of societies because tribalism in its best form is the development of many groups organized around a variety of ideas and principles and projects. This makes the establishment of a "one world ideology" very difficult, if not impossible. The first inclination of human beings is to discriminate against ideas and people they see as destructive and counter to their prosperity. Globalists therefore have to convince a majority of people that the very tribalism that has fueled our social evolution and some of the greatest ideas in history is actually the source of our eventual doom.

    Nationalism served the globalists to a point, but now they need to get rid of it entirely. This requires considerable crisis blamed on nationalism and "populist" ideals. Engineered war, whether kinetic or economic, is the best method to scapegoat tribalism. Every tragedy from now on must eventually be attributed to ideas of separation and logical discrimination against negative ideologies. The solution of globalism will then be offered; a one world system in which all separation is deemed "evil."

    Con #4: Globalism Is Natural And Inevitable

    As mentioned earlier, globalists cannot have their "new world order" unless they can convince the masses to ask for it. Trying to implement such a system by force alone would end in failure, because revolution is the natural end result of tyranny. Therefore, the new world order has to be introduced as if it had been formed by coincidence or by providence. Any hint that the public is being conned into accepting global centralization would trigger widespread resistance.

    This is why globalism is always presented in the mainstream media as a natural extension of civilization's higher achievement. Even though it was the dangerous interdependency of globalism that helped fuel the economic crisis of 2008 and continues to escalate that crisis to this day, more globalism is continually promoted as the solution to the problem. It is spoken of with reverence in mainstream economic publications and political discussions. It receives almost religious praise in the halls of academia. Globalism is socioeconomic ambrosia -- the food of deities. It is the fountain of youth. It is a new Eden.

    Obviously, this adoration for globalism is nonsense. There is no evidence whatsoever that globalism is a positive force for humanity, let alone a natural one. There is far more evidence that globalism is a poisonous ideology that can only ever gain a foothold through trickery and through false flags.

    We live in an era that represents an ultimate crossroads for civilization; a time of great uncertainty. Will we seek truth in the trials we face, and thus the ability to create our own solutions? Or, will we take a seemingly easier road by embracing whatever solutions are handed to us by the establishment? Make no mistake -- the globalists already have a solution prepackaged for us. They have been acclimating and conditioning the public to accept it for decades now. That solution will not bring what it promises. It will not bring peace, but eternal war. It will not bring togetherness, but isolation. It will not bring understanding, but ignorance.

    When globalists eventually try to sell us on a full-blown new world order, they will pull out every conceivable image of heaven on Earth, but they will do this only after creating a tangible and ever present hell.

    * * *

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    [Apr 08, 2018] China Gets Trumped

    Trump trade war depends of the status of Dollar and China can attack the dollar status instead.
    Apr 08, 2018 | nationalinterest.org

    John Browna day ago ,

    While the U.S. has intentionally kept it trade wide open with China, China has stolen trillions over the last 20 years in intellectual property, including military technology. It has kept its markets tightly controlled and/or closed while the U.S. has made China rich. Today China has a 1/2 Trillion trade surplus, is still stealing our intellectual property, and still keeps its markets tightly controlled and mostly closed and under Chinese control. That might be ok if the goal of making China richer, a member of the world community, and peaceful had worked, but it has not.
    China is a hegemon using its wealth to grow its military, build up military forces in international sea lanes like the South China sea, and bullying its neighbors like India, Vietnam, Taiwan, Japan, and others while also supporting the Ballistic Nuclear missile program of NK. Its time for the USA to realize that China is an adversary, not because we want it that way, but because China sees itself that way. And its time to stop letting an adversary use us, and steal from us, to further its imperial/hegemonic aggressive ambitions. Apple can make iPhones in Vietnam, the Philippines, and India as cheaply as in China. Let's stop the theft, and shift the flow of our money to the countries China is bullying like the Philippines, India, Vietnam, as well as more modern allies like Taiwan and Japan. Let's make India rich, rather than let China continue to steal from us. Let China figure out how to keep hundreds of millions of Chinese employed from that 1/2 Trillion surplus employed. Keep in mind a richer Vietnam and India with improved ties with the USA and increasing wealth helped by the USA both border China. China still has time to play fair and leave the path of hegemony and aggression, but everything point to the fact that they would rather be our adversary than our friend. So we have to wake up and smell the coffee of that reality and move forward with our eyes open. Thank God Trump isn't sticking his head in the sand like Bush, and especially weak, worthless, appeasing Obama.

    il duce John Brown11 hours ago ,

    typical trump supporter, can't even do simple arithmetic. on paper the US calculates the trade deficit to be $347 billion not the half a trillion figure your lying president so often vomits out.
    btw if moving production line to another country is so easy you people would've done it ages ago. but they're still in China, why is that I wonder, since south east asia and india has much much lower wage than China, why dont the brilliant accountants at Apple tell their CEO to move their production lines? =)

    IssacNewton il ducean hour ago ,

    US Trade Deficit with China (2017) is $375.2B/year. https://www.census.gov/fore... Moving a Production is easy. Moving a production line while improving productivity is very hard. The US elites found it easier to move production lines overseas to take advantage of low-cost labor. In the alternative they could have improve productivity so the US could produce the goods in question at competitive prices. That was the US history from 1935 to 1985. Changing production processes entails risks, you could create competitors who might displace you. Moving a standard process overseas gave you a cost advantage and increased the US elite 1% share of income from 10% GDP to 22% of GDP. The benefits of competive destruction now flow to the Chinese. They Globalized Labor to reduce the power of the US working and middle classes. See Blyth: https://www.youtube.com/wat... (around 3:00 Min).

    Lookbeyondtheobvious John Brown2 hours ago ,

    What stops China from IP rights violation now? In fact, this is an incentive to go to town with it. China has excess capacity there is no way to halt production. China's challenge is to find markets. For instance, if they sell a product to a US owner at $40 a piece where the US owner sells it to consumers at $900, China can sell it direct to consumers at $500 (or even $50) and be better off. This is what will happen. Consumers outside USA will be able to buy US goods at a fraction of the price and with time there will be importers in USA who will use third parties to import these to USA clandestinely. Why should US consumers pay more anyway!

    CaseKL John Brown9 hours ago ,

    Talking about stealing who can compete with the whites in this game.
    Pls go visit museums and galleries in London, Paris and other European capitals to see how much had been looted and stolen from China, Asia, Arab world and Africa in the last 500.

    Jerome Barry disqusdamnuserid14 hours ago ,

    The essentials of what Mr Brown wrote are that China got rich trading, got richer stealing IP, and spends riches on militarily expanding with the stated goal of excluding the U.S. Navy west or south of Guam. From the perspective of an American of any political variety, would you rather the U.S. observe this trend continuing or act to stop the IP theft and military challenge?

    IssacNewton disqusdamnuseridan hour ago ,

    The best approach is go with fully reciprocal tariffs and restructure international trade around Warren Buffet's idea of a market for Import Certificates based on US exports. This would automatically balance trade (an Import Certificate based on exports is needed for any Import), provide a rules-based approach (vs. bureaucratic), and thus block massive rent-seeking around Trade Policy. It would dampen potential trade wars because the focus is on reciprocity, balancing trade and not on tariffs to constantly reduce imports. See: https://en.wikipedia.org/wi... and http://thehill.com/blogs/co... We can (perhaps) back off reciprocal trade when we better understand free-markets and can identify nations who practice this freedom.

    Lookbeyondtheobvious BigMike2 days ago ,

    There is a reason why China carries a huge trade surplus against USA - Americans have benefitted Chinese cheaper goods and services (than trying to procure them from other sources). They will pay more for the same service. This will reduce their savings and increase borrowings. China progressively dumps the US dollar in petroleum purchases which will devalue the USD. This will make imports even more expensive for Americans. China will devalue its currency again to overcome the tarrif impact.

    grumpy_carpenter BigMike2 days ago ,

    The worlds largest market for commercial aircraft and Trump just put Boeing out of contention. Betcha Trump gets a yuuuugh campaign contribution from Airbus on the condition he starts a trade war with the second biggest market of airliners, India, as well.

    China has been preparing for a trade war with the USA for some time. The belt/road project and petroyuan are 2 such projects looking to build trade relations that bypass the USA altogether. It won't be that difficult for China to find markets for TV's, dollar store plastic and consumer appliances. I'm sure it will hurt but there are other markets for their products.

    Try finding another market for Boeing Dreamliners .... all those high paying specialized jobs. The good news is that with this trade war markets open up for consumer appliances which Boeing can fill ..... the bad news is the stealth toasters they make will cost $250,000, will only be operational one day a week as long as it isn't raining and you won't be able to find it on that day because it's a stealth toaster.

    RayB grumpy_carpentera day ago ,

    Doesn't matter about finding another market for Dreamliners .. So your implying its ok for China to rip us off and we just take it. Boeing has done well these last few years.. Boeing plans to increase 737 production to 57 aircraft a month not counting the 767, 777 and 787. China drops their orders there are customers right behind them to take their slot on the line.

    The worse part is the requirement to turn over your intellectual property to the state. Why should they spend the billions in R&D when they can just wait it out, crack their market open a small bit, then take or steal the property with no recourse from the owner. Once they have that IP they set up another business putting the original business into bankruptcy.

    China is playing an economic war to win. Trump plans to win...

    grumpy_carpenter RayBa day ago ,

    "The worse part is the requirement to turn over your intellectual property to the state."

    If that's a condition of the contract why do US companies agree to the contract?

    I have a lot of experience negotiating contracts with US firms. The US businesses I've dealt with have always sought favourable terms to the extent that I really don't like doing business with them.

    When I see terms in a contract I can't live with I walk away ..... and I've done it a lot. Now you're trying to tell me US businesses were coerced into signing contracts that forced them to give away intellectual property?

    I don't believe that for a moment.

    I have a dozen stories of guys getting screwed over because they didn't bother with the details of a contract. If you are that naive you take your lumps and if you're smart you learn from it.

    What you don't do is keep signing the same agreements that has technology transfers in the terms then cry foul after doing it for thirty or forty years.

    The way I see it technology transfer was likely seen by the Chinese as part of the overall compensation. You got the product made for a killer price on the condition you tell them how to make it themselves.

    You should know that no one works for nothing. If you're getting an unbelievably good price look at the fine print.

    Given who your president is, the business he's in and his reputation as a business man I have a pretty good idea what he's really up to with this tactic and it might play well to the peanut gallery but the Chinese are not going to be played so easily

    ken_lov grumpy_carpentera day ago ,

    Most developing countries require some level of technology transfer before they permit foreign firms to operate inside their borders. It's their only way of avoiding becoming commercial colonies of countries like the US. If firms don't like it, the solution is as you suggest: they can decline to set up in foreign countries and simply export finished products made in their home country.

    Lots of multinational firms have legitimate grievances against the Chinese government for being lax in policing and prosecuting copyright laws. Fake prestige brand fashion, handbags, cell phones and the like, made in China, are openly sold throughout Asia. But the crap about 'intellectual property theft' is nonsense.

    Jasper_in_Boston grumpy_carpenter16 hours ago ,

    If that's a condition of the contract why do US companies agree to the contract?

    Excellent point.

    The government of the United States shouldn't be in the business of protecting huge American multinationals from their own stupidity.

    Airbrush20202 days ago ,

    There is no such thing as FAIR trade among vastly unequal economies. China has a billion citizens (an endless supply of cheap labor). China is a major polluter (not limited like the US is with it's EPA). The laws concerning wages, working-hours, over-time, workman's compensation, safety, pensions don't compare between economies. Thus, the US is at a severe competitive disadvantage. China plays dirty on top of their already significant economic advantages. FAIR trade between China and the US is a fairy-tale. I support Trump. China is not our friend.

    smasko smasko Airbrush20202 days ago ,

    Industrial revolution and consequently polution lasted for decades in west before China jumped into the game. So your "carbon footprint" is much higher cumulatevely than China's. Also you don't complain about countries like Bangladesh where USA companies exploit people like modern day slaves. Drop that moralising please! Globalisation is 2 way street, in begining when you "oppened" 3. World markets and flooded them with your superior technologies and products and practically plundered them, it wasn't a problem. Now when things changed you whine like babies.

    chris_zzz14 hours ago ,

    Even if U.S. exports to China went to zero, that'd be way less than 1% of our GDP. If China's exports to the U.S. went to zero, that be about 5% of its GDP.

    When one reads Chinese propaganda, Xi is banking heavily on U.S. politics to stop the U.S. from getting tough on China's trade cheating. He thinks that farmers and other business people will stop the Trump admin from enacting tariffs and other measures because of fear of Chinese retaliation. Xi faces no similar domestic political pressure because China is an authoritarian state.

    The only thing that can mess-up gaining a U.S. trade victory is self-defeat. People here in the U.S. should stop overreacting and playing into the hands of Xi. Let's get some backbone people!

    Cjones1a day ago ,

    Given that the U.S. has severely reduced our industrial metal production and manufacturing by failing to modernize years ago, we do need China. The same goes for several other industrial and manufacturing products. China's pork production is currently battling a corona virus from bats that is killing off their young swine. Our food products are important to the Chinese given the high levels of pollution in their country. The U.S. is most vulnerable because China provides nearly all of the Rare Earth Elements (REEs) that are essential for our high tech industries and defense equipment.
    The U.S. would face a real problem anyway if the shipping lanes were closed down because of conflicts or natural catastrophes...better to prepare for the worst now and get China to open up trade barriers or follow fairer trade policy.
    The worst Chinese import is the Marxist-Leninist ideology that slaughtered over 100 million Chinese...blame the Russians!
    U.S. free market ideological imports lifted a billion plus Chinese out of poverty.
    For anyone travelling in China, being labelled a Laowei or foreignor is commonplace. The current government is pushing a defensive, Han Chinese based, zenophobic system that seeks to monopolize ideas and keep the imported Marxist-Leninist ideology in total control of the thoughts and minds of the average Chinese citizen.
    The U.S. can't change that, but we can look out for our own sovereign interests in better trade deals, re-establishing vital mining, industrial and/or manufacturing capabilities, and maintaining strategic reserves of essential elements.

    [Apr 05, 2018] Resurgence of nationalism put neoliberal globalism

    This Guardian pressitute can't even mentions the term neoliberalism, to day noting to accept that neoliberalism now experience a crisis (which actually started in 2008)
    Globalization blowback will not totally bury neoliberal globalization, but it puts some limits on transnational corporations racket...
    Apr 05, 2018 | www.theguardian.com

    Originally from The demise of the nation state By Rana Dasgupta

    hat is happening to national politics? Every day in the US, events further exceed the imaginations of absurdist novelists and comedians; politics in the UK still shows few signs of recovery after the " national nervous breakdown " of Brexit. France " narrowly escaped a heart attack " in last year's elections, but the country's leading daily feels this has done little to alter the " accelerated decomposition " of the political system. In neighbouring Spain, El País goes so far as to say that "the rule of law, the democratic system and even the market economy are in doubt"; in Italy, "the collapse of the establishment" in the March elections has even brought talk of a "barbarian arrival", as if Rome were falling once again. In Germany, meanwhile, neo-fascists are preparing to take up their role as official opposition , introducing anxious volatility into the bastion of European stability.

    But the convulsions in national politics are not confined to the west. Exhaustion, hopelessness, the dwindling effectiveness of old ways: these are the themes of politics all across the world. This is why energetic authoritarian "solutions" are currently so popular: distraction by war (Russia, Turkey); ethno-religious "purification" (India, Hungary, Myanmar); the magnification of presidential powers and the corresponding abandonment of civil rights and the rule of law (China, Rwanda, Venezuela, Thailand, the Philippines and many more).

    What is the relationship between these various upheavals? We tend to regard them as entirely separate – for, in political life, national solipsism is the rule. In each country, the tendency is to blame "our" history, "our" populists, "our" media, "our" institutions, "our" lousy politicians. And this is understandable, since the organs of modern political consciousness – public education and mass media – emerged in the 19th century from a globe-conquering ideology of unique national destinies. When we discuss "politics", we refer to what goes on inside sovereign states; everything else is "foreign affairs" or "international relations" – even in this era of global financial and technological integration. We may buy the same products in every country of the world, we may all use Google and Facebook, but political life, curiously, is made of separate stuff and keeps the antique faith of borders.

    Yes, there is awareness that similar varieties of populism are erupting in many countries. Several have noted the parallels in style and substance between leaders such as Donald Trump, Vladimir Putin, Narendra Modi, Viktor Orbán and Recep Tayyip Erdoğan. There is a sense that something is in the air – some coincidence of feeling between places. But this does not get close enough. For there is no coincidence. All countries are today embedded in the same system, which subjects them all to the same pressures: and it is these that are squeezing and warping national political life everywhere. And their effect is quite the opposite – despite the desperate flag-waving – of the oft-remarked " resurgence of the nation state ".

    [Apr 05, 2018] The Globalisation: the rise and fall of an idea that swept the world

    Apr 05, 2018 | www.theguardian.com

    The future of economic globalisation, for which the Davos men and women see themselves as caretakers, had been shaken by a series of political earthquakes. "Globalisation" can mean many things, but what lay in particular doubt was the long-advanced project of increasing free trade in goods across borders. The previous summer, Britain had voted to leave the largest trading bloc in the world. In November, the unexpected victory of Donald Trump , who vowed to withdraw from major trade deals, appeared to jeopardise the trading relationships of the world's richest country. Forthcoming elections in France and Germany suddenly seemed to bear the possibility of anti-globalisation parties garnering better results than ever before. The barbarians weren't at the gates to the ski-lifts yet – but they weren't very far.

    In a panel titled Governing Globalisation , the economist Dambisa Moyo , otherwise a well-known supporter of free trade, forthrightly asked the audience to accept that "there have been significant losses" from globalisation. "It is not clear to me that we are going to be able to remedy them under the current infrastructure," she added. Christine Lagarde, the head of the International Monetary Fund, called for a policy hitherto foreign to the World Economic Forum : "more redistribution". After years of hedging or discounting the malign effects of free trade, it was time to face facts: globalisation caused job losses and depressed wages, and the usual Davos proposals – such as instructing affected populations to accept the new reality – weren't going to work. Unless something changed, the political consequences were likely to get worse.

    The backlash to globalisation has helped fuel the extraordinary political shifts of the past 18 months. During the close race to become the Democratic party candidate, senator Bernie Sanders relentlessly attacked Hillary Clinton on her support for free trade . On the campaign trail, Donald Trump openly proposed tilting the terms of trade in favour of American industry. "Americanism, not globalism, shall be our creed," he bellowed at the Republican national convention last July. The vote for Brexit was strongest in the regions of the UK devastated by the flight of manufacturing. At Davos in January, British prime minister Theresa May, the leader of the party of capital and inherited wealth, improbably picked up the theme, warning that, for many, "talk of greater globalisation means their jobs being outsourced and wages undercut." Meanwhile, the European far right has been warning against free movement of people as well as goods. Following her qualifying victory in the first round of France's presidential election, Marine Le Pen warned darkly that "the main thing at stake in this election is the rampant globalisation that is endangering our civilisation."

    It was only a few decades ago that globalisation was held by many, even by some critics, to be an inevitable, unstoppable force. "Rejecting globalisation," the American journalist George Packer has written, "was like rejecting the sunrise." Globalisation could take place in services, capital and ideas, making it a notoriously imprecise term; but what it meant most often was making it cheaper to trade across borders – something that seemed to many at the time to be an unquestionable good. In practice, this often meant that industry would move from rich countries, where labour was expensive, to poor countries, where labour was cheaper. People in the rich countries would either have to accept lower wages to compete, or lose their jobs. But no matter what, the goods they formerly produced would now be imported, and be even cheaper. And the unemployed could get new, higher-skilled jobs (if they got the requisite training). Mainstream economists and politicians upheld the consensus about the merits of globalisation, with little concern that there might be political consequences.

    Back then, economists could calmly chalk up anti-globalisation sentiment to a marginal group of delusional protesters, or disgruntled stragglers still toiling uselessly in "sunset industries". These days, as sizable constituencies have voted in country after country for anti-free-trade policies, or candidates that promise to limit them, the old self-assurance is gone. Millions have rejected, with uncertain results, the punishing logic that globalisation could not be stopped. The backlash has swelled a wave of soul-searching among economists, one that had already begun to roll ashore with the financial crisis. How did they fail to foresee the repercussions?

    [Apr 01, 2018] Globalization by Dan Crawford

    Mar 30, 2018 | angrybearblog.com
    The story of globalization from a US point of view continues. Here AB reader Denis Drew is highlighted at DeLong's website:

    Comment of the Day : Dennis Drew : GLOBALIZATION: WHAT DID PAUL KRUGMAN MISS? : "I'm always the first to say that if today's 10 dollars an hour jobs paid 20 dollars an hour

    (Walgreen's, Target, fast food less w/much high labor costs) that would solve most social problems caused by loss of manufacturing (to out sourcing or automation). The money's there. Bottom 40% income take about 10% of overall income. "Mid" take about 67.5%. Top 1%, 22.5%. The instrument of moving 10% more from "mid" to the bottom is higher consumer prices arriving with the sudden reappearance of nationwide, high union density (see below for the easy application). The instrument of retrieving the "mid's" lost 10% is Eisenhower level confiscatory taxes for the top 1%.

    Jack Kennedy lowered max income tax rate from 92% to 70% to improve incentives (other cuts followed). But with the top 1% wages now 20X (!) what they were in the 60s while per capita only doubled since, there will be all the incentive in the world left over while we relieve them of the burden of stultifying wealth. ;-)

    [Apr 01, 2018] On What We Missed About Globalization

    Apr 01, 2018 | angrybearblog.com

    ... ... ...

    Brad argues that globalization is as good for the USA as Krugman thought in the 1990s. He has three key arguments. One is that the manufacturing employment which has been off shored is unskilled assembly and such boring jobs are not good jobs. The second is that the problems faced by US manufacturing workers are mostly due to electing Reagan and W Bush and not trade. Finally he notes that local economic decline is not new at all and that trade with South Carolina did it to Massachusetts long before China entered the picture. The third point works against his general argument and is partly personal. I won't discuss it except to note that Brad is right.

    I have criticisms of Brad's first two arguments. The first is that the boring easy manufacturing jobs were well paid. They are bad jobs in that thinking of doing them terrifies me even more than work in general terrifies me, but they are (or mostly were) well paid jobs. There are still strong forces that make wages paid to people who work near each other at the same firm similar. As very much noted by Dennis Drew, unions used to be very strong and used that strenth to help all employees of unionized firms (and employess of non-union firms whose managers were afraid of unions). I think that, like Krugman, Brad assumes that wages are based on skills importantly including ones acquired on the job. I think this leaves a lot out.

    ... ... ...

    Kaleberg , April 1, 2018 4:03 pm

    An argument no one mentions is about comparative advantage. The US had a comparative advantage in manufacturing. It had the engineers, the technicians, the labor, the venture capital and so on. When transportation costs are low and barriers minimal, comparative advantage is something a nation creates, not some natural attribute. The US sacrificed that comparative advantage on the altar of ideological purity. Manufacturing advantage is an especially useful type of advantage since it can permeate the remaining economy. We sacrificed it, and we have been paying for it. Odds are, we will continue to pay.

    likbez , April 1, 2018 6:38 pm

    The problem here is that neoliberalism and globalization are two sides of the same coin.

    If you reject globalization, you need to reject neoliberalism as a social system. You just can't sit between two chairs (as Trump attempts to do propagating "bastard neoliberalism" -- neoliberal doctrine is still fully applicable within the country, but neoliberal globalization is rejected)

    Rejection of neoliberal globalization also implicitly suggests that Reagan "quiet coup" that restored the power of financial oligarchy and subsequent dismantling of the New Deal Capitalism was a disaster for common people in the USA.

    While this is true, that's a very tough call. That explains DeLong behavior.

    [Mar 30, 2018] The Death Of The Liberal World Order by Leonid Savin

    Highly recommended!
    Notable quotes:
    "... And, quoting his colleague Archon Fung from the Harvard Kennedy School, " American politics is no longer characterized by the rule of the median voter, if it ever was. Instead, in contemporary America the median capitalist rules as both the Democratic and Republican parties adjust their policies to attract monied interests." And finally Mr. Ringen adds, "American politicians are aware of having sunk into a murky bog of moral corruption but are trapped." ..."
    "... Trump merely reflects the dysfunctionality and internal contradictions of American politics. He is the American Gorbachev, who kicked off perestroika at the wrong time. ..."
    "... Global financial services exercise monopolistic power over national policies, unchecked by any semblance of global political power. Trust is haemorrhaging. The European Union, the greatest ever experiment in super-national democracy, is imploding ..."
    "... Probably this is because the Western model of neoliberalism does not provide any real freedom of commerce, speech, or political activity, but rather imposes a regime of submission within a clearly defined framework. ..."
    "... america is going through withdraw from 30 years of trickledown crap. the young are realizing that the shithole they inherit does not have to be a shithole, and the old pathetic white old men who run the show will be dead soon. ..."
    "... The liberal order is dying because it is led by criminally depraved Predators who have pauperized the labor force and created political strife, though the populists don't pose much threat to the liberal-order Predators. ..."
    "... However by shipping the productive Western economies overseas to Asia, the US in particular cannot finance and physically support a military empire or the required R&D to stay competitive on the commercial and military front. ..."
    "... So the US Imperialists are being eclipsed by the Sino-Russo Alliance and wants us to believe this is a great tragedy. Meanwhile the same crew of Liberal -neoCon Deep Staters presses on with wars and tensions that are slipping out of control. ..."
    Mar 30, 2018 | www.zerohedge.com

    Authored Leonid Savin via Oriental Review,

    A few days ago the president of the Council on Foreign Relations, Richard Haass, published an article, titled "Liberal World Order, R.I.P." In it, he states that the current threat to the liberal world order is coming not from rogue states, totalitarian regimes, religious fanatics, or obscurantist governments (special terms used by liberals when referring to other nations and countries that have not pursued the Western capitalist path of development), but from its primary architect -- the United States of America.

    Haass writes: " Liberalism is in retreat. Democracies are feeling the effects of growing populism. Parties of the political extremes have gained ground in Europe. The vote in the United Kingdom in favor of leaving the EU attested to the loss of elite influence. Even the US is experiencing unprecedented attacks from its own president on the country's media, courts, and law-enforcement institutions. Authoritarian systems, including China, Russia, and Turkey, have become even more top-heavy. Countries such as Hungary and Poland seem uninterested in the fate of their young democracies

    "We are seeing the emergence of regional orders. Attempts to build global frameworks are failing."

    Haass has previously made alarmist statements , but this time he is employing his rhetoric to point to the global nature of this phenomenon. Although between the lines one can easily read, first of all, a certain degree of arrogance -- the idea that only we liberals and globalists really know how to administer foreign policy -- and second, the motifs of conspiracy.

    "Today's other major powers, including the EU, Russia, China, India, and Japan, could be criticized for what they are doing, not doing, or both."

    Probably this list could be expanded by adding a number of Latin American countries, plus Egypt, which signs arms deals with North Korea while denying any violation of UN sanctions, and the burgeoning Shiite axis of Iran-Iraq-Syria-Lebanon.

    But Haass is crestfallen over the fact that it is Washington itself that is changing the rules of the game and seems completely uninterested in what its allies, partners, and clients in various corners of the world will do.

    " America's decision to abandon the role it has played for more than seven decades thus marks a turning point. The liberal world order cannot survive on its own, because others lack either the interest or the means to sustain it. The result will be a world that is less free, less prosperous, and less peaceful, for Americans and others alike."

    Richard Haass's colleague at the CFR, Stewart Patrick, quite agrees with the claim that it is the US itself that is burying the liberal world order . However, it's not doing it on its own, but alongside China. If the US had previously been hoping that the process of globalization would gradually transform China (and possibly destroy it, as happened to the Soviet Union earlier), then the Americans must have been quite surprised by how it has actually played out. That country modernized without being Westernized, an idea that had once been endorsed by the leader of the Islamic revolution in Iran, Ayatollah Khomeini.

    Now China is expanding its influence in Eurasia in its own way, and this is for the most part welcomed by its partner countries.

    But this has been a painful process for the US, as it is steadily and irrevocably undermining its hegemony.

    "Its long-term ambition is to dismantle the U.S. alliance system in Asia, replacing it with a more benign (from Beijing's perspective) regional security order in which it enjoys pride of place, and ideally a sphere of influence commensurate with its power.

    China's Belt and Road initiative is part and parcel of this effort, offering not only (much-needed) infrastructure investments in neighboring countries but also the promise of greater political influence in Southeast, South, and Central Asia. More aggressively, China continues to advance outrageous jurisdictional claims over almost the entirety of the South China Sea , where it continues its island-building activities, as well as engaging in provocative actions against Japan in the East China Sea," writes Patrick.

    And as for the US:

    "The United States, for its part, is a weary titan, no longer willing to bear the burdens of global leadership, either economically or geopolitically.

    Trump treats alliances as a protection racket, and the world economy as an arena of zero-sum competition. The result is a fraying liberal international order without a champion willing to invest in the system itself. "

    One can agree with both authors' assessments of the changed behavior of one sector of the US establishment, but this is about more than just Donald Trump (who is so unpredictable that he has staffed his own team with a member of the very swamp he was preparing to drain) and North American populism. One needs to look much deeper.

    In his book, Nation of Devils: Democratic Leadership and the Problem of Obedience , Stein Ringen, a Norwegian statesman with a history of service in international institutions, notes:

    "Today, American democratic exceptionalism is defined by a system that is dysfunctional in all the conditions that are needed for settlement and loyalty...

    Capitalism has collapsed into crisis in an orgy of deregulation. Money is transgressing into politics and undermining democracy itself ."

    And, quoting his colleague Archon Fung from the Harvard Kennedy School, " American politics is no longer characterized by the rule of the median voter, if it ever was. Instead, in contemporary America the median capitalist rules as both the Democratic and Republican parties adjust their policies to attract monied interests." And finally Mr. Ringen adds, "American politicians are aware of having sunk into a murky bog of moral corruption but are trapped."

    Trump merely reflects the dysfunctionality and internal contradictions of American politics. He is the American Gorbachev, who kicked off perestroika at the wrong time. Although it must be conceded that if Hillary Clinton had become president, the US collapse would have been far more painful, particularly for the citizens of that country. We would have seen yet more calamitous reforms, a swelling influx of migrants, a further decline in the nation's manufacturing base, and the incitement of new conflicts. Trump is trying to keep the body of US national policy somewhat alive through hospice care, but what's really needed is a major restructuring, including far-reaching political reforms that would allow the country's citizens to feel that they can actually play a role in its destiny.

    These developments have spread to many countries in Europe, a continent that, due to its transatlantic involvement, was already vulnerable and susceptible to the current geopolitical turbulence. The emergence of which, by the way, was largely a consequence of that very policy of neoliberalism.

    Stein Ringen continues on that score:

    "Global financial services exercise monopolistic power over national policies, unchecked by any semblance of global political power. Trust is haemorrhaging. The European Union, the greatest ever experiment in super-national democracy, is imploding "

    It is interesting that panic has seized Western Europe and the US -- the home of transatlanticism, although different versions of this recipe for liberalism have been employed in other regions -- suffice it to recall the experience of Singapore or Brazil. But they don't seem as panicked there as in the West.

    Probably this is because the Western model of neoliberalism does not provide any real freedom of commerce, speech, or political activity, but rather imposes a regime of submission within a clearly defined framework. Therefore, the destruction of the current system entails the loss of all those dividends previously enjoyed by the liberal political elites of the West that were obtained by speculating in the stock market, from the mechanisms of international foreign-exchange payments (the dollar system), and through the instruments of supranational organizations (the UN, WTO, and World Bank). And, of course, there are the fundamental differences in the cultural varieties of societies.

    In his book The Hidden God, Lucien Goldmann draws some interesting conclusions, suggesting that the foundations of Western culture have rationalistic and tragic origins, and that a society immersed in these concepts that have "abolish[ed] both God and the community [soon sees] the disappearance of any external norm which might guide the individual in his life and actions." And because by its very nature liberalism must carry on, in its mechanical fashion, "liberating" the individual from any form of structure (social classes, the Church, family, society, and gender, ultimately liberating man from his very self), in the absence of any standards of deterrence, it is quite logical that the Western world was destined to eventually find itself in crisis. And the surge of populist movements, protectionist measures, and conservative policies of which Haass and other liberal globalists speak are nothing more than examples of those nations' instinct for self-preservation. One need not concoct conspiracy theories about Russia or Putin interfering in the US election (which Donald Trump has also denied, noting only that support was seen for Hillary Clinton, and it is entirely true that a portion of her financial backing did come from Russia). The baseline political decisions being made in the West are in step with the current crisis that is evident on so many levels. It's just that, like always, the Western elites need their ritual whipping boy(although it would be more accurate to call it a human sacrifice). This geopolitical shake-up began in the West as a result of the implicit nature of the very project of the West itself.

    But since alternative development scenarios exist, the current system is eroding away. And other political projects are starting to fill the resultant ideological void -- in both form as well as content.

    Thus it's fairly likely that the current crisis of liberalism will definitively bury the unipolar Western system of hegemony.

    And the budding movements of populism and regional protectionism can serve as the basis for a new, multipolar world order.

    J S Bach Fri, 03/30/2018 - 22:48 Permalink

    Oh, Wicked Witch of the West Wing, the cleansing fire awaits thy demise! Those meds can only keep you standing for so long. Keep tripping. Keep stumbling. Satan calls you to him. The day approacheth. Tick tock tick tock. 👹😂

    beepbop -> TeamDepends Fri, 03/30/2018 - 23:01 Permalink

    The Death Of The Liberal World Order

    The Re-Birth Of the Neocon World Disorder

    Neocons=Bolsheviks=Zionists. Over 100 years of bloodshed and mayhem.

    dogsandhoney2 -> J S Bach Fri, 03/30/2018 - 23:05 Permalink

    hillery-cfr neoliberalism is a right-wing politic, actually.

    HedgeJunkie -> carbonmutant Fri, 03/30/2018 - 23:04 Permalink

    Democracy ultimately melts down into chaos. We have a perfectly good US Constitution, why don't we go back to using it as written? That said, I am for anything that makes the elites become common.

    curbjob -> carbonmutant Fri, 03/30/2018 - 23:26 Permalink

    Democracy is a form of government. Populism is a movement. Populist movements come about when the current form of government is failing ... historically it seems they seldom choose wisely.

    Dilluminati Fri, 03/30/2018 - 22:58 Permalink

    Ridiculous cunt Hillary thinks after getting REJECTED by the voters in the USA that somehow being asked to "go the fuck away and shut the fuck up" makes her a women's leader. The cocksucker Soros and some of these other non-elected globalist should keep in mind that while everybody has a right to an opinion: it took the Clinton Crime Family and lots of corruption to create the scandals that sets a Clinton Crime Family member aside, and why Soros was given a free pass on election meddling and not others requires congressional investigation and a special prosecutor. And then there is that special kind of legal and ignorant opinion like David Hogg who I just disagree with, making him in my opinion and many fellow NRA members a cocksucker and a cunt. I'd wish shingles on David Hogg, Hillary Clinton, and Soros.

    Theos Fri, 03/30/2018 - 23:02 Permalink

    bullshit

    america is going through withdraw from 30 years of trickledown crap. the young are realizing that the shithole they inherit does not have to be a shithole, and the old pathetic white old men who run the show will be dead soon.

    all i see is a bunch of fleeting old people who found facebook 10 years late are temporarily empowered since they can now connect with other equally impotent old people.

    Posa Fri, 03/30/2018 - 23:10 Permalink

    The usual self-serving swill from the Best and the Brightest of the Predator Class out of the CFR via Haas.

    The liberal order aka the New British Empire, was born 70 years ago by firebombing and nuking undefended civilian targets. It proceeded to launch serial genocidal rampages in the Koreas, SE Asia, Latin America until finally burning down a large portion of the Middle East.

    The fact that there has not been a catastrophic nuclear war is pure dumb luck. The Deep State came within seconds of engineering a nuclear cataclysm off the waters of Cuba in 1962. When JFK started dismantling the CIA Deep State and ending the Cold War with the USSR, Dulles dispatched a CIA hit-squad to gun down the President. (RFK and Nixon immediately understood the assassination was a CIA-led wet-works operation since they chaired the assassination committees themselves in the past).

    The liberal order is dying because it is led by criminally depraved Predators who have pauperized the labor force and created political strife, though the populists don't pose much threat to the liberal-order Predators.

    However by shipping the productive Western economies overseas to Asia, the US in particular cannot finance and physically support a military empire or the required R&D to stay competitive on the commercial and military front.

    So the US Imperialists are being eclipsed by the Sino-Russo Alliance and wants us to believe this is a great tragedy. Meanwhile the same crew of Liberal -neoCon Deep Staters presses on with wars and tensions that are slipping out of control.

    Yen Cross Fri, 03/30/2018 - 23:17 Permalink

    I'll pay extra for a ticket to the George Soros funeral. That's like Game-7 at the Libtard world series!

    devnickle Fri, 03/30/2018 - 23:22 Permalink

    Death to globalism. It is the Satan World Order.

    Grandad Grumps Fri, 03/30/2018 - 23:30 Permalink

    Liberalism is anything but liberal... and I suppose that is the problem with it. It aims to do to the western world what Mao did to China and Stalin did to Russia. Many people were murdered or imprisoned and people had no rights, just obligations to dictators and their cronies.

    I think this world is past the point where any benefit is gained from having "owners of the people", benevolent or otherwise. And we certainly do not benefit from perverted demonic entities even if they come bearing technology. The price is too high.

    Populism goes along with essential freedoms for the human race.-

    Yogizuna Fri, 03/30/2018 - 23:30 Permalink

    As I told the idiotic retards who argued with me on Prodigy fucking 27 years ago, China will not change because of increased trading and the West making them wealthier. In fact, just the opposite. I wonder if they have caught on yet?

    SuzerainGreyMole Fri, 03/30/2018 - 23:40 Permalink

    One can understand the demise of the West of many levels. Downfall and then Renewal!

    ... ... ...

    [Mar 27, 2018] Globalists Admit Defeat, Russia and China Facilitate Rise of Multipolar World by by Dmitry Kosyrev

    Notable quotes:
    "... The views and opinions expressed by Dmitry Kosyrev are those of the contributor and do not necessarily reflect those of Sputnik. ..."
    Mar 27, 2018 | sputniknews.com

    The recent German Marshall Fund's Brussels Forum, which brought together influential American neocons and trans-Atlantic leaders from Europe, marked the failure of the Western-centered globalist idea, Sputnik political observer Dmitry Kosyrev notes, adding that meanwhile, Russia and China continue to facilitate the emergence of a multi-polar world. Globalists have admitted their defeat by recognizing that neither Russia nor China will dance to their tune, Sputnik political observer Dmitry Kosyrev writes .

    "It seems that work has begun to revive the half-dead 'liberal world order'," the observer noted. "It will take quite some time, and it is not necessary that the United States will be its epicenter. However, this 'order' will not be global -- goodbye, illusions. It will involve only part of the countries while China, Russia and some other states won't be affected [by the project]."

    The observer referred to the 2018 German Marshall Fund's (GMF) Brussels Forum , citing Josh Rogin of The Washington Post. The Brussels Forum is an annual high-level meeting of influential politicians, corporate leaders and scholars from North America and Europe. The event had the eloquent title "Revise, Rebuild, Reboot: Strategies for a Time of Distrust." The organizers of the forum raised the alarm over "a decline in trust, both in domestic and international spheres."

    "We lost sight of what it took to create this international order and what an act of defiance of history and even defiance of human nature this order has been. We have the capacity to push back -- we just need to understand the pushback needs to start occurring," Robert Kagan, neoconservative American historian and husband of former US Assistant Secretary of State for European and Eurasian Affairs Victoria Nuland told the forum, as quoted by Rogin.

    For his part, Senator Chris Murphy bemoaned the fact that US President Donald Trump is not interested in "projecting liberal values" into other countries, let alone trade liberalization. The White House's recent initiative to introduce additional tariffs on aluminum and steel imports has prompted a wave of criticism from the US' global partners and allies.

    Furthermore, the US president made it clear that the US will not support numerous international institutions and withdrew from the United Nations Educational, Scientific and Cultural Organization (UNESCO).

    Murphy called upon the defenders of the liberal world order to team up and "build new alliances within their societies."

    On the other hand, the transatlantic bloc has seemingly recognized its failure to impose a Western-style political order on Russia and China.

    "We can no longer expect that the principles of liberal democracy will expand across the globe," Rogin wrote. "We can no longer assume the United States will carry the bulk of the burden."

    Following Trump's win in 2016, The New York Times called Germany's Angela Merkel the last defender of the trans-Atlantic alliance and liberal values.

    However, not everything is rosy in the European garden, Kosyrev noted referring to the rise of right-wing forces in Austria, Italy, Hungary, Poland and other EU member states. Although Merkel still remains at the helm of German politics, the right-wing Alternative for Germany (AfD) entered the Bundestag in September 2017 as the third-largest party.

    Given all of the above, the rebuilding of the liberal international order will take years, Kosyrev presumed.

    According to the political observer, Russia and China could benefit from the inner struggle in the trans-Atlantic camp. On the other hand, he does not exclude that the West will continue its overseas operations to maintain the status quo. To illustrate his point, Kosyrev referred to Syria: While Washington has virtually no leverage to oust Syrian President Bashar al-Assad, it continues its saber-rattling, threatening Damascus with a massive strike.

    The failure of globalism means the further rise of a multi-polar order based on the principles of equality and sovereignty with its own norms and regulations, the political observer concluded.

    The views and opinions expressed by Dmitry Kosyrev are those of the contributor and do not necessarily reflect those of Sputnik.

    [Mar 26, 2018] The Real Reason for Trump's Steel and Aluminum Tariffs by Martin Feldstein

    Mar 15, 2018 | www.project-syndicate.org

    The Trump administration's proposed tariffs on steel and aluminum imports will target China, but not the way most observers believe. For the US, the most important bilateral trade issue has nothing to do with the Chinese authorities' failure to reduce excess steel capacity, as promised, and stop subsidizing exports.

    CAMBRIDGE – Like almost all economists and most policy analysts, I prefer low trade tariffs or no tariffs at all. How, then, can US President Donald Trump's decision to impose substantial tariffs on imports of steel and aluminum be justified? 3

    Trump no doubt sees potential political gains in steel- and aluminum-producing districts and in increasing the pressure on Canada and Mexico as his administration renegotiates the North American Free Trade Agreement. The European Union has announced plans to retaliate against US exports, but in the end the EU may negotiate – and agree to reduce current tariffs on US products that exceed US tariffs on European products.

    But the real target of the steel and aluminum tariffs is China. The Chinese government has promised for years to reduce excess steel capacity, thereby cutting the surplus output that is sold to the United States at subsidized prices. Chinese policymakers have postponed doing so as a result of domestic pressure to protect China's own steel and aluminum jobs. The US tariffs will balance those domestic pressures and increase the likelihood that China will accelerate the reduction in subsidized excess capacity.

    Because the tariffs are being levied under a provision of US trade law that applies to national security, rather than dumping or import surges, it will be possible to exempt imports from military allies in NATO, as well as Japan and South Korea, focusing the tariffs on China and avoiding the risk of a broader trade war. The administration has not yet said that it will focus the tariffs in this way; but, given that they are being introduced with a phase-in period, during which trade partners may seek exemptions, such targeting seems to be the likeliest scenario.

    For the US, the most important trade issue with China concerns technology transfers, not Chinese exports of subsidized steel and aluminum. Although such subsidies hurt US producers of steel and aluminum, the resulting low prices also help US firms that use steel and aluminum, as well as US consumers that buy those products. But China unambiguously hurts US interests when it steals technology developed by US firms.

    Until a few years ago, the Chinese government was using the Peoples Liberation Army's (PLA) sophisticated cyber skills to infiltrate American companies and steal technology. Chinese officials denied all wrongdoing until President Barack Obama and President Xi Jinping met in California in June 2013. Obama showed Xi detailed proof that the US had obtained through its own cyber espionage. Xi then agreed that the Chinese government would no longer use the PLA or other government agencies to steal US technology. Although it is difficult to know with certainty, it appears that such cyber theft has been reduced dramatically.

    The current technology theft takes a different form. American firms that want to do business in China are often required to transfer their technology to Chinese firms as a condition of market entry. These firms "voluntarily" transfer production knowhow because they want access to a market of 1.3 billion people and an economy as large as that of the US.

    These firms complain that the requirement of technology transfer is a form of extortion. Moreover, they worry that the Chinese government often delays their market access long enough for domestic firms to use their newly acquired technology to gain market share. 1

    The US cannot use traditional remedies for trade disputes or World Trade Organization procedures to stop China's behavior. Nor can the US threaten to take Chinese technology or require Chinese firms to transfer it to American firms, because the Chinese do not have the kind of leading-edge technology that US firms have.

    So, what can US policymakers do to help level the playing field?

    This brings us back to the proposed tariffs on steel and aluminum. In my view, US negotiators will use the threat of imposing the tariffs on Chinese producers as a way to persuade China's government to abandon the policy of "voluntary" technology transfers. If that happens, and US firms can do business in China without being compelled to pay such a steep competitive price, the threat of tariffs will have been a very successful tool of trade policy.

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    Groupthink : Two Party System as Polyarchy : Corruption of Regulators : Bureaucracies : Understanding Micromanagers and Control Freaks : Toxic Managers :   Harvard Mafia : Diplomatic Communication : Surviving a Bad Performance Review : Insufficient Retirement Funds as Immanent Problem of Neoliberal Regime : PseudoScience : Who Rules America : Neoliberalism  : The Iron Law of Oligarchy : Libertarian Philosophy

    Quotes

    War and Peace : Skeptical Finance : John Kenneth Galbraith :Talleyrand : Oscar Wilde : Otto Von Bismarck : Keynes : George Carlin : Skeptics : Propaganda  : SE quotes : Language Design and Programming Quotes : Random IT-related quotesSomerset Maugham : Marcus Aurelius : Kurt Vonnegut : Eric Hoffer : Winston Churchill : Napoleon Bonaparte : Ambrose BierceBernard Shaw : Mark Twain Quotes

    Bulletin:

    Vol 25, No.12 (December, 2013) Rational Fools vs. Efficient Crooks The efficient markets hypothesis : Political Skeptic Bulletin, 2013 : Unemployment Bulletin, 2010 :  Vol 23, No.10 (October, 2011) An observation about corporate security departments : Slightly Skeptical Euromaydan Chronicles, June 2014 : Greenspan legacy bulletin, 2008 : Vol 25, No.10 (October, 2013) Cryptolocker Trojan (Win32/Crilock.A) : Vol 25, No.08 (August, 2013) Cloud providers as intelligence collection hubs : Financial Humor Bulletin, 2010 : Inequality Bulletin, 2009 : Financial Humor Bulletin, 2008 : Copyleft Problems Bulletin, 2004 : Financial Humor Bulletin, 2011 : Energy Bulletin, 2010 : Malware Protection Bulletin, 2010 : Vol 26, No.1 (January, 2013) Object-Oriented Cult : Political Skeptic Bulletin, 2011 : Vol 23, No.11 (November, 2011) Softpanorama classification of sysadmin horror stories : Vol 25, No.05 (May, 2013) Corporate bullshit as a communication method  : Vol 25, No.06 (June, 2013) A Note on the Relationship of Brooks Law and Conway Law

    History:

    Fifty glorious years (1950-2000): the triumph of the US computer engineering : Donald Knuth : TAoCP and its Influence of Computer Science : Richard Stallman : Linus Torvalds  : Larry Wall  : John K. Ousterhout : CTSS : Multix OS Unix History : Unix shell history : VI editor : History of pipes concept : Solaris : MS DOSProgramming Languages History : PL/1 : Simula 67 : C : History of GCC developmentScripting Languages : Perl history   : OS History : Mail : DNS : SSH : CPU Instruction Sets : SPARC systems 1987-2006 : Norton Commander : Norton Utilities : Norton Ghost : Frontpage history : Malware Defense History : GNU Screen : OSS early history

    Classic books:

    The Peter Principle : Parkinson Law : 1984 : The Mythical Man-MonthHow to Solve It by George Polya : The Art of Computer Programming : The Elements of Programming Style : The Unix Hater’s Handbook : The Jargon file : The True Believer : Programming Pearls : The Good Soldier Svejk : The Power Elite

    Most popular humor pages:

    Manifest of the Softpanorama IT Slacker Society : Ten Commandments of the IT Slackers Society : Computer Humor Collection : BSD Logo Story : The Cuckoo's Egg : IT Slang : C++ Humor : ARE YOU A BBS ADDICT? : The Perl Purity Test : Object oriented programmers of all nations : Financial Humor : Financial Humor Bulletin, 2008 : Financial Humor Bulletin, 2010 : The Most Comprehensive Collection of Editor-related Humor : Programming Language Humor : Goldman Sachs related humor : Greenspan humor : C Humor : Scripting Humor : Real Programmers Humor : Web Humor : GPL-related Humor : OFM Humor : Politically Incorrect Humor : IDS Humor : "Linux Sucks" Humor : Russian Musical Humor : Best Russian Programmer Humor : Microsoft plans to buy Catholic Church : Richard Stallman Related Humor : Admin Humor : Perl-related Humor : Linus Torvalds Related humor : PseudoScience Related Humor : Networking Humor : Shell Humor : Financial Humor Bulletin, 2011 : Financial Humor Bulletin, 2012 : Financial Humor Bulletin, 2013 : Java Humor : Software Engineering Humor : Sun Solaris Related Humor : Education Humor : IBM Humor : Assembler-related Humor : VIM Humor : Computer Viruses Humor : Bright tomorrow is rescheduled to a day after tomorrow : Classic Computer Humor

    The Last but not Least Technology is dominated by two types of people: those who understand what they do not manage and those who manage what they do not understand ~Archibald Putt. Ph.D


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    Last modified: August, 25, 2020