Monday, March 19, 2018

As the California Democratic Party crumbles (continued)
  Some California Democrats have discovered that
  California may prevent the takeover of the House

As noted previously in As the California Democratic Party crumbles (continued): California Democrats abandon key elections to monied interests per 2010 Prop 14 voter wishes and As the California Democratic Party crumbles: California's Democrats meet to create a winning year, only being anti-Trump may not be a panacea, the biggest single problem for Democrats in California is small-d democrats.

In the LA Times article today California's free-for-all primary election rules could surprise everyone in 2018 ... again we can read that indeed there is a problem here in the most Democratic of states that literally might prevent the Democrats from taking over the U.S. House of Representatives. Regarding the upcoming open primary the article notes: "The nonpartisan California Target Book now counts 60 Democrats running in the 14 districts currently represented by Republicans."

The article discusses the fact that Katie Merrill, whose Fight Back California political action committee is betting the bank on the seven Republican districts won by Democrat Hillary Clinton in 2016, has a real fear.

    Recent polling by Merrill's PAC found significant potential for GOP candidates in Southern California's hottest races to finish first and second — even though a plurality of those surveyed said they would "definitely" vote Democratic. That includes seats being vacated by Reps. Darrell Issa (R-Vista) and Ed Royce (R-Fullerton) and the reelection effort of embattled Rep. Dana Rohrabacher (R-Costa Mesa).
    Merrill said her group prefers to spend its money solely against Republicans but may have to help at least one Democrat stand out in some of those crowded primary contests. "We're going to have to shift our focus," she said.

As I wrote previously California Democratic Party doesn't want to offend even one Democrat who has an oversized ego. So they didn't endorse anyone to end up in the top two in any Congressional district where it is important. That's the California Democratic Party I've come to know and hate.

The Democrats are likely to lose their rds majority in the one or both houses of the Legislature at least partly because of the dumb democrats (small-d) who get to vote on implementing ideas that are ...dumb... such as the open primary.

But maybe this is all good, because I'm not sure the Democrats deserve to be able to set a policy agenda anywhere until they figure out that winning elections is the only "top group" priority for a political party. After a party wins then they can worry about structuring and implementing "second level" priorities - if they don't win, it doesn't matter what those second level priorities are.

Of course, those "second level" priorities should be policy structured and implemented so they can win two, four, and six years later.

Sunday, March 18, 2018

How the maintream media just discovered old news about elections and Facebook responded meaninglessly and you "liked" it adding to the data

Yesterday's New York Times with great fanfare offers us yesterday's ...no, years old... news. It appears they spent lots of money on reporter and editorial time finding out about something they could have learned from other news sources in 2016, or even as far back as 2013. And of course the rest of the mainstream media which apparently was equally ignorant has picked it up.


A little over a year ago, I wrote the post Why you should fear Trumpism's Steve Bannon: war with China within 8 years and other reasons.

I said: "If you're interested in how the world was radically changed by a young PhD candidate Michal Kosinski beginning in 2008 read The Data That Turned the World Upside Down...." Further elaborations were include, but that linked article published in 2016 by the Millennial news site Vice Motherboard included everything Americans needed to know about the use of Facebook member data and other data sources to steal from and mislead those Facebook members.

I also referenced a post-election Forbes piece Why Big Data Wasn't Trump's Achilles Heel After All which was a mea culpa by Bernard Marr, an expert on big data, analytics, and metrics who has worked with many of the world’s leading companies and governments on how to answer their most critical business questions using data and metrics. He acknowledges that an article he'd written in June 2016 about Trump's lack of data use was based on his own lack of information.

After telling you that this experimental voter manipulation was going on in the 2014 mid-term election, the New York Times article notes:

    An examination by The New York Times and The Observer of London reveals how Cambridge Analytica’s drive to bring to market a potentially powerful new weapon put the firm — and wealthy conservative investors seeking to reshape politics — under scrutiny from investigators and lawmakers on both sides of the Atlantic.
    Christopher Wylie, who helped found Cambridge and worked there until late 2014, said of its leaders: “Rules don’t matter for them. For them, this is a war, and it’s all fair.”
    They want to fight a culture war in America,” he added. “Cambridge Analytica was supposed to be the arsenal of weapons to fight that culture war.”

What is troublesome here is that neither the government of the Obama Administration nor any of the 50 state governments including tech fumbling California had a clue after 2014.

And the big mainstream press, which the Democratic establishment relies upon, reported this as news yesterday and today.

Besides the fact that the old establishment ignores the Vice news sources because, hey, the Vice folks are just kids, the truth is the old political establishment, which still can't technically relate to the internet as more than "pipes" and still can't secure their smart phones, needed to step aside before 2014 for people who can tell the important modern technology from consumer technology like safer autos and more reliable refrigerators.

Perhaps the time has come for some people to accept the fact that timely important news is not going to appear in the mainstream media because the mainstream media relies upon "important" people in New York and Washington. If you don't check the sources to listed to the right, or some similar source not dependent upon people over 60 talking to each other, you're likely uninformed about many, many important stories that will startle the Democrats in 2020.

The fact that Michal Kosinski's work with two other Cambridge researchers - David Stillwell and Thore Graepel - has been available online in PDF format since 2013 should trouble the Democratic establishment. It was in the news in 2013. Rebecca J. Rosen, now a senior editor at The Atlantic, who oversees the Business Channel, at about age 29 in 2013 wrote:

    With remarkable accuracy, researchers from the University of Cambridge and Microsoft have been able to discern people's gender, sexuality, age, race, and political affiliation, based solely on their Facebook likes. With significantly less accuracy, they've also tried to predict certain personality traits.... It's possible to see how, with a much larger corpus, even certain subtleties of personality could be recognized deep within the idiosyncratic data of Facebook likes.
    ...Just as we humans can make judgments about another person's intelligence, sexuality, or political leanings based on a scattershot set of clues -- entertainment preferences we know them to have or opinions we know them to hold -- a computer can do much the same. Its inputs may come by way of Facebook likes, but its process is familiar.

And from The Telegraph 2013 article 'Like' curly fries on Facebook? Then you're clever written by a similarly young journalist alert Neoliberals learned:

    Now researchers at Cambridge’s Psychometric Centre have joined forces with Microsoft to analyse more than nine million ‘likes’.
    Michal Kosinski, its operations director, said ‘liking’ curly fries was a very strong predictor for high intelligence.
    Kosinski, an internet entrepreneur, said they hoped to commercialise the analytic technology they had developed.

But it did not turn out be Kosinski who made the system commercially successful.

It was the privately held firm Cambridge Analytica. The father-daughter billionaire family team of Robert and Rebekah Mercer hold a significant stake in the company. The Mercer's are "card-carrying" Neoliberals who in addition to The Mercer Family Foundation, run by Rebekah, donate to the Heritage Foundation (Rebekah is a board member), the Cato Institute, the Media Research Center, the Club for Growth, American Crossroads, Freedom Partners Action Fund, the Goldwater Institute, and numerous other Neoliberal political organizations.

They were key financial benefactors for Breitbart News and were the ones who first introduced Steve Bannon to Donald Trump. Steve Bannon, of course, was on the Cambridge Analytica Board of Directors at its founding.

The fact that the members of Neoliberal community are technologically aware and curious seems to indicate they're wise in a time when wisdom about the 21st Century should be valued, a wisdom that is lacking in other American political communities. For instance, Democrats spend their time in Hollywood with people whose skills will be replaced by computers by mid-century.

In the meantime, with a loud hurumph Facebook just suspended Cambridge Analytica and its parent company SCL Group. Outstanding! Consider this from The Data That Turned the World Upside Down:

Kosinski and his team tirelessly refined their models. In 2012, Kosinski proved that on the basis of an average of 68 Facebook "likes" by a user, it was possible to predict their skin color (with 95 percent accuracy), their sexual orientation (88 percent accuracy), and their affiliation to the Democratic or Republican party (85 percent). But it didn't stop there. Intelligence, religious affiliation, as well as alcohol, cigarette and drug use, could all be determined. From the data it was even possible to deduce whether someone's parents were divorced.

The strength of their modeling was illustrated by how well it could predict a subject's answers. Kosinski continued to work on the models incessantly: before long, he was able to evaluate a person better than the average work colleague, merely on the basis of ten Facebook "likes." Seventy "likes" were enough to outdo what a person's friends knew, 150 what their parents knew, and 300 "likes" what their partner knew. More "likes" could even surpass what a person thought they knew about themselves. On the day that Kosinski published these findings, he received two phone calls. The threat of a lawsuit and a job offer. Both from Facebook.

In other words, Facebook knew what was going on six years ago. But Facebook is quintessential American company admired by most Americans.  And six years ago Facebook held its initial public offering and, at that time, it was the largest technology IPO in U.S. history. Facebook offered 421,233,615 shares at a price of $38 per share and raised $16.007 billion through that offering. Let's see, make $16 billion or protect America? No red-blooded American would criticize the choice to take the money.

So whoopee today that Facebook suspended companies that a half a decade ago laid the groundwork for the rich to get richer with the support of foolishly stupid Americans.

The fact is that much of the current important news cannot be found in the mainstream or Alt-Right or social media. As in the past, today much of the significant news first appears in narrowly-focused or technical media. "Back then" only a few specialized professionals could read it. But since the beginning of the 21st Century it has been immediately available to us all. And those who can use that knowledge will find it more rapidly than in decades past.

The Neoliberals read about the research in 2013 and were experimenting with it in 2014. The Democratic power structure was reading movie reviews.

In other words, if unlike Hillary and her campaign staff, you actually know both how to secure and to use use your phones and computers on the internet, then you pick up news about new ways to use data to manipulate groups of people for commercial or political ends. You understand that generally the public couldn't give a crap about the details of your policy proposals.

Right now the Republican and Democratic Parties are struggling with the 2018 midterm elections. That's their jobs.

Also, the Neoliberals are planning 2020 election strategy using 2018 to experiment. I wonder what new tools they've refined.

And the group opposing them ...wait, there isn't any group working to oppose the Neoliberals in the 2020 election just like no such national group of progressive organizations existed to work in 2014 on the 2016 election. In fact, there are no center or left-of-center groups comparable, much less hundreds of them financed by billionaires.

Saturday, March 17, 2018

Economic ideologies have declared war
  Why Western Neoliberal capitalists fear socialist
  China's Xi and fear for capitalist Russia's Putin



In the Year of the Dog, as the chart below indicates there are the three largest countries. Russia is the largest in land area. China is the largest in population. The United States of America is the largest in Gross Domestic Product.

Also, in the 21st Century as indicated in the chart China has grown its Per Capita Gross Domestic Product by 969% while Russia's has fallen by 26%.

China and Russia are the two main competitors of the United States primarily because of their military strength and the shadow that casts over the rest of the world. So the leaders of those two countries are the subject of news stories, many of which are so speculative and inaccurate as to constitute fake news.

Of course, here in the United States all the press, all the pundits, are struggling to understand the thinking of President Donald Trump. Whether that's possible is up for debate.

Perhaps in this Year of the Dog Americans should better get to know the world's other two "Big Dogs", China's Xi Jinping and Russia's Vladimir Putin. Both have been the subject of some misleading news stories in the past week.

Xi and the Chinese Communist Party are supposedly about to make Xi the new emperor ...well, lifetime ruler... of China because of a proposal to end term limits.

And Putin supposedly is longing for a return of the Soviet Union.


Vladimir Putin

Last week, Putin made headlines in a media forum question-and-answer session:

    The head of state said as much answering questions during the Truth and Justice media forum organized by the Russian Popular Front.
    When asked which of the events that happened in Russia he wanted to change, Putin answered, "The collapse of the Soviet Union," while his answer to the question what historical period he would like to live in was the following, "Today." You see, all my ancestors in the past were peasant serfs, while I am the president," the head of state explained ironically.
    When asked whether he has a dream, which has not come true, the president said that his goal is clear. "I want our country to be successful, powerful, stable, balanced and looking ahead," he stressed.

In an analysis, a Washington Post article noted:

    Though a fringe idea in the West, regret about the collapse of the Soviet Union is not unusual in Russia — in fact, it is widespread. And with Russian elections just a week away, it's a factor still worth watching.
    The polling agency Levada Center has been asking Russians about their views on the collapse of the Soviet Union since 1992. The most recent numbers, from a survey conducted in November 2017, show that 58 percent of Russians regret the U.S.S.R.'s collapse, while just over a quarter do not.

The misunderstanding is that much of the American press represented Putin's statement as a desire to "reverse" the end of the communist state when his wistfulness is about the size of the former union and the loss of a number of its constituent states. More context is needed in order to understand Putin better. In an April 2005 state of the nation address Putin stated:

    I consider the development of Russia as a free and democratic state to be our main political and ideological goal. We use these words fairly frequently, but rarely care to reveal how the deeper meaning of such values as freedom and democracy, justice and legality is translated into life.
    Meanwhile, there is a need for such an analysis. The objectively difficult processes going on in Russia are increasingly becoming the subject of heated ideological discussions. And they are all connected with talk about freedom and democracy. Sometimes you can hear that since the Russian people have been silent for centuries, they are not used to or do not need freedom. And for that reason, it is claimed our citizens need constant supervision.
    I would like to bring those who think this way back to reality, to the facts. To do so, I will recall once more Russia’s most recent history.
    Above all, we should acknowledge that the collapse of the Soviet Union was a major geopolitical disaster of the century. As for the Russian nation, it became a genuine drama. Tens of millions of our co-citizens and compatriots found themselves outside Russian territory. Moreover, the epidemic of disintegration infected Russia itself.
    Individual savings were depreciated, and old ideals destroyed. Many institutions were disbanded or reformed carelessly. Terrorist intervention and the Khasavyurt capitulation that followed damaged the country's integrity. Oligarchic groups – possessing absolute control over information channels – served exclusively their own corporate interests. Mass poverty began to be seen as the norm. And all this was happening against the backdrop of a dramatic economic downturn, unstable finances, and the paralysis of the social sphere.
    Many thought or seemed to think at the time that our young democracy was not a continuation of Russian statehood, but its ultimate collapse, the prolonged agony of the Soviet system.
    But they were mistaken.
    That was precisely the period when the significant developments took place in Russia. Our society was generating not only the energy of self-preservation, but also the will for a new and free life. In those difficult years, the people of Russia had to both uphold their state sovereignty and make an unerring choice in selecting a new vector of development in the thousand years of their history. They had to accomplish the most difficult task: how to safeguard their own values, not to squander undeniable achievements, and confirm the viability of Russian democracy. We had to find our own path in order to build a democratic, free and just society and state.
    When speaking of justice, I am not of course referring to the notorious ”take away and divide by all“ formula, but extensive and equal opportunities for everybody to develop. Success for everyone. A better life for all.

As the table above indicates, Putin is struggling with those goals. If you read the rest of that speech, you'll see he was committed to capitalism. His view does not see democracy as a possibility without a full commitment to free market capitalism. But one has to ask him: "How's that working out for you?" As explained elsewhere:

    A recent report by Credit Suisse showed that Russia is the most unequal of all the world’s major economies. The richest 10% of Russians own 87% of all the country’s wealth, according to the report, compared with 76% in the US and 66% in China. According to another measure, by VTB Capital, 1% of the Russian population holds 46% of all the personal bank deposits in the country.
    Many Russians believe such rampant inequality – at least in part caused by corruption – might cause “kitchen grumbling”, but never serious political upheaval. However, last month the biggest protests to hit Russia for several years saw an estimated 60,000 people on the streets of nearly 80 cities. While the numbers are small as a percentage of the whole population, there is a sense that anger may be stirring.
    In the late 1970s, only 0.2% of people earned more than four times the average wage in the Soviet Union, according to official statistics. Of course, many complained that the Soviet elite lived a more luxurious life than the majority of the population, relying on the “grey economy” to access luxury products and other consumer goods that were unavailable to normal citizens, even if the differences in official salaries were not that high.
    But the levels of inequality that came about in 1990s Russia were far more dramatic and shocking. Capitalism turned out to be just how the Soviets had warned, with a few people requisitioning all the ladders and the vast majority left to be devoured by snakes. In the far north and east extremities of the country, where people had settled because the Soviet system paid high salaries, the market economy sent industrial towns into ruin, making whole regions impoverished.


In viewing this inequality problem and how to deal with capitalism, Putin expressed in his 2005 speech a view that Americans have a hard time understanding: "In those difficult years, the people of Russia had to both uphold their state sovereignty and make an unerring choice in selecting a new vector of development in the thousand years of their history."

While Putin is threading his way through a complex political, economic, and societal environment built upon a thousand years of history trying to achieve the goals he believes will create a better Russia, in China an unerring choice in selecting a new vector of development in their thousands and thousands of years of history is being made.


Xi Jinping

If the American press and pundits don't understand Trump or Putin, they are even worse at interpreting Xi Jinping. The latest headline story on China in The New York Times. a classic analysis by the Europe-oriented East Coast liberal press, Xi Sets China on a Collision Course With History, begins by telling us:

    There was always something different about China’s version of authoritarianism. For decades, as other regimes collapsed or curdled into dysfunctional pretend democracies, China’s held strong, even prospered.
    Yes, China’s Communist Party has been vigorous in suppressing dissent and crushing potential challenges. But some argue that it has survived in part by developing unusually strong institutions, bound by strict rules and norms. Two of the most important have been collective leadership — rule by consensus rather than strongman — and term limits.
    When the Communist Party announced this week that it would end presidential term limits, allowing Xi Jinping to hold office indefinitely, it shattered those norms. It may also have accelerated what many scholars believe is China’s collision course with the forces of history it has so long managed to evade.
    That history suggests that Beijing’s leaders are on what former Secretary of State Hillary Clinton once called a “fool’s errand”: trying to uphold a system of government that cannot survive in the modern era. But Mr. Xi, by shifting toward a strongman style of rule, is doubling down on the idea that China is different and can refashion an authoritarianism for this age.

It is at this point that anyone familiar with China says "ah, no, the only person on a fools errand recently was Hillary Clinton and the only national government that is on a collision course with the forces of history is that of the United States."

History offers many lessons, but how to govern well or poorly in the future is not one of them.

The five posts preceding this one provide a plethora of information we need to be aware of regarding the past and future of China. For instance, the following is a quote from one of them.

Xi could also note: “No one political system should be regarded as the only choice and we should not just mechanically copy the political systems of other countries. The political system of socialism with Chinese characteristics is a great creation.”

He could say this because he and those in his administration know that with the election of Donald Trump the United States has...
  • a Republican President who by a large margin lost the popular vote (for the second time since the year 2000);
  • a Senate in which 60 of the 100 Senators with 60% of the vote in the Senate represent less than 25% of the population, while 18 of the 100 Senators with only 18% of the vote in the Senate represent the majority of Americans, and despite the fact that more votes were cast for Democratic candidates than Republican candidates in the last three Senate elections, Republicans control the Senate;
  • a House of Representatives in which Democratic candidates received a nationwide plurality but the Republican candidates won a majority of the House seats; and
  • a nationwide justice system that randomly injures, kills, or imprisons large numbers of non-white American citizens without a trial, creating the highest incarceration rate in the world with about 22 percent of the world's prisoners in a nation that has about 4.4 percent of the world's population.
...leaving Americans with no ability at all to respond to Xi's "political system" challenge by claiming their government is a democracy - assuming democracy in any sense means majority rule based on the popular vote.

In other words, the Executive and Legislative branches of government of the United States of America are not run by officials who represent the majority of the popular vote. Further the American justice system clearly jails or kills citizens who are out of favor with the dominant minority running the government, imprisoning far more such persons than China.

So it is bemusing to those of us who don't hang around in high priced coffee houses on the East Coast to read interpretations of China's Xi by those who cannot wean themselves from their addiction to the morning apoplexy brought about by Trump tweeting.

A typical headline reflects how they think: Leader For Life: Xi Jinping Strengthens Hold On Power As China Communist Party Ends Term Limits. That headline is wrong, even based on the details of the story under it. And worse, it reinforces America's recent love affair with term limits.

We residents of the United States are the passengers on a Ship of Fools. Most of those passengers don't view their country in any real light - historically, economically, or politically.

Consider this discussion:

    With global markets shaken by President Donald Trump's surprise decision to impose strict tariffs on steel and aluminum imports, the president went into battle mode on Friday: "Trade wars are good, and easy to win," he wrote on Twitter.
    But the public show of confidence belies the fact that Trump's policy maneuver, which may ultimately harm U.S. companies and American consumers, was announced without any internal review by government lawyers or his own staff, according to a review of an internal White House document.
    According to two officials, Trump's decision to launch a potential trade war was born out of anger at other simmering issues and the result of a broken internal process that has failed to deliver him consensus views that represent the best advice of his team.
    On Wednesday evening, the president became "unglued," in the words of one official familiar with the president's state of mind.
    A trifecta of events had set him off in a way that two officials said they had not seen before: Hope Hicks' testimony to lawmakers investigating Russia's interference in the 2016 election, conduct by his embattled attorney general and the treatment of his son-in-law by his chief of staff.
    Trump, the two officials said, was angry and gunning for a fight, and he chose a trade war, spurred on by Commerce Secretary Wilbur Ross and Peter Navarro, the White House director for trade.

This style of petulant policy implementation is common in dictatorships and that it can happen in the United States is because Congress - you know, the branch of government closest to the electorate - turned the power over to the President simply because when needed they can't make complex quick decisions common to the 21st Century.

Wikipedia offers a characterization of authoritarian political systems by qualities which by striking out their words and adding new ones in italics we can make a point:
  • Limited political pluralism, that is such regimes place constraints on political institutions and groups like legislatures, political parties and interest, racial, ethnic, religious, and gender groups;
  • A basis for legitimacy based on emotion, especially the identification of the regime as a necessary evil to combat "easily recognizable societal problems" such as underdevelopment or insurgency anti-Americanism or immoral behavior;
  • Minimal social mobilization most often caused by constraints on the public such as suppression of political opponents and the press, and anti-regime activity;
  • Informally defined executive power with often vague and shifting powers, resulting in significant executive orders creating policy shifts not intended by the legislative branch;
  • Limiting economic and social mobility by favoring the wealthy and large corporations.
The obvious reality is that authoritarian qualities within the governments of the United States and China differ in types and degrees, but authoritarian qualities exist in both. (Most Americans believe that "authoritarian" refers only to some kind of "autocracy" which means "ruler of one" when, in fact, the terms are not synonyms both theoretically and in practice.)

So China is considering the repeal the two-terms term-limit rule for its leader and Westerners, particularly American and British "experts", bring up the specter of Mussolini, Stalin, and, of course, Chairman Mao.

Yeah...no, that's not the way government works in China. It's complicated because it's complex. It begins with the fact that we're talking about 1.4 billion people in a 21st Century environment.

Below is a graphic that attempts to explain "How the Chinese government works" from Xi Jinping as president beyond 2023 may be good for China – though the West won’t believe it by Tom Plate:


When something like a "two term limit" rule is evaluated, one has to puzzle over what is so magical about that rule that enamors American pundits. From George Washington through Harry S. Truman, American Presidents could serve as many terms as they could win. After Democratic President Franklin D. Roosevelt won four consecutive presidential elections, (Republican?) politicians decided limits might be a good idea.

Many of the Founding Fathers, including Hamilton and Madison, supported a lifetime appointment for Presidents selected by Congress, not some cobbled-together system involving an electoral college. And it was never proposed at the Constitutional Convention that Presidents be elected by the most unreliable, ignorant group in the system, the voters.

The Great Depression and World War II help explain why FDR served for so long. Facing a true national and international crises, a country might actually need to keep the same government in power for longer than usual. But logic never enters into the political debates in the United States.

Considering context is always important.

So consider the fact that U.S. Senator Joseph McCarthy came to national prominence in February 1950 after giving a speech in Wheeling, West Virginia, in which he claimed to have a list of 205 State Department employees who were members of the Communist Party.  McCarthy claimed the list was provided to and dismissed by then-Secretary of State Dean Acheson, saying that the "State Department harbors a nest of Communists and Communist sympathizers who are helping to shape our foreign policy".

And so in the midst of that silly anti-communist hysteria which constituted an attack on free speech and freedom of association guaranteed by the Constution, on February 27, 1951, the 22nd  Amendment, was ratified establishing a two-term limit for Presidents.

However, it didn’t completely end the debate over term limits. In 1987, The New York Times reported that President Ronald Reagan “‘would like to start a movement’ to repeal the constitutional amendment that limits Presidents to two terms.”

But let's return to the situation in China.

In reviewing the move to eliminate term limits we first need recognize the words of the man around whom the issue is focused. In the blog entry Xi Jinping's strategy for a 21st Century China: With thoughtful Chinese characteristics a President tends his plan for 1.4 billion people for 2020 ...and 2035 ...and 2049  posted October 23, 2017, (and reposted below in this blog) it was explained:

This past week's 19th National Congress of the Communist Party of China sets the agenda for the future of China beginning with that all-important three-hour “work report” speech by Xi.

To provide insight into President Xi's zeal to assure a strong future for his country, it is important to remember that on February 11, 2009, while visiting Mexico, then Vice-President Xi spoke in front of a group of overseas Chinese noting that China's task was to keep "its 1.3 billion people from hunger."

And regarding the 2008 financial crisis affecting the Atlantic oriented world filled with complaints about Chinese foreign trade: "There are some bored foreigners, with full stomachs, who have nothing better to do than point fingers at us. First, China doesn't export revolution; second, China doesn't export hunger and poverty; third, China doesn't come and cause you headaches. What more is there to be said?"

This week President Xi Jinping reaffirmed that Beijing will never seek hegemony or engage in expansion "no matter what stage of development it reaches" and that "China will never pursue development at the expense of others' interests and its development does not pose a threat to any other country."

Since the 18th CPC Congress in 2012, in which Xi assumed his current position, China's "two centenary goals" were to
  1. build a moderately prosperous society by 2020, one year before the Party's 100th anniversary in 2021, and 
  2. develop China into a "fully modernized, socialist nation" by the 100th anniversary of the People's Republic of China in 2049.
To accomplish the goals, the "Four Comprehensives" came into being:
  1. comprehensively build a moderately prosperous society (put forward at the November 2012 18th Party Congress),
  2. comprehensively deepen reform (put forward at the November 2013 3rd Central Committee Plenum),
  3. comprehensively and strictly govern the Party (put forward at the early October 2014 summary meeting of the Mass Line Campaign), and
  4. comprehensively advance the rule of law (put forward during the late October 2014 4th Central Committee Plenum).
Additionally,  the "Five Development Concepts" from the 13th Five Year Plan (2016-2020) of innovation, coordination, green, openness and shared development were to be implemented.

This week Xi offered in his report a plan to "build on the foundation created by the moderately prosperous society" by implementing "a further 15 years of hard work to see that socialist modernization is basically realized" from 2020 to 2035, and then from 2035 to the middle of the 21st century "work hard for a further 15 years and develop China into a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious, and beautiful."

But Xi warned that it would be "no walk in the park. It will take more than drum beating and gong clanging to get there." He noted how China had "taken a driving seat in international cooperation to respond to climate change," additionally noting: "Only by observing the laws of nature can mankind avoid costly blunders in its exploitation. Any harm we inflict on nature will eventually return to haunt us. This is a reality we have to face!"

Also noted about those in Xi's government in that same post:

China is facing challenges which if covered by balanced reporting in the U.S. would seem familiar to Americans. Today, nearing the end of the 19th Congress, the Minister of Education Chen Baosheng, Minister of Civil Affairs Huang Shuxian, Minister of Human Resources and Social Security Yin Weimin, Minister of Housing and Urban-Rural Development Wang Menghui, and Minister of National Health and Family Planning Commission Li Bin held a joint news briefing.

Minister of Human Resources and Social Security Yin Weimin noted that despite the 3.95% registered unemployment rate in China's urban areas at the end of September "raising the capacity to employ workers overall still faces large pressures."

"We need to create 15 million jobs per year," Yin said, singling out China’s more than 8 million new university graduates that enter the job market each year as one group in need of additional employment.

Yin also said the low unemployment rate in the face of an overall slowdown in the economy was largely due to the new internet economy and entrepreneurship, adding that the ministry would actively support startups to help them “thrive”.

He reported "We've helped 8.8 million people in strained circumstances find jobs," adding that the total number of rural migrant workers increased from 263 million in 2012 to 282 million in 2016.

Now that you have a general sense of the basic challenges that have been embraced by Xi and his team - keep the now 1.4 billion Chinese people from facing hunger by having a decent economy which produces 15 million jobs a year - it is important to understand one piece of the historical experience of Xi and his team as explained in the post Xi's team to lead a 21st Century China: They want for their grandchildren a prosperous, strong, democratic, culturally advanced, harmonious, and beautiful life posted October 27, 2017, (and reposted below in this blog):

For the first time at the end of a National Congress of the Communist Party of China (CPC), all seven Standing Committee members of the Political Bureau were born after the founding of the People's Republic of China in 1949.

All were born and raised in the People's Republic of China. That means that none of them were WWII veterans and none were part of the Revolution. Instead, all were impacted as children from 1958 to 1962 by Chairman Mao's Great Leap Forward and as teens by Chairman Mao's Cultural Revolution from 1966 until 1976....

To understand the meaning of this history to these seven men, one only need to look at the experience of President Xi Jinping.

After the founding of the Communist state in 1949, Xi's father held a series of posts, including propaganda chief, vice-premier, and vice-chairman of the National People's Congress. Xi was born June 15, 1953. Based on normal expectations, Xi's future looked bright.

But when Xi was age 10, his father was purged from the Party and sent to work in a factory in Luoyang, Henan. In May 1966, Xi's "high school years" were cut short by the Cultural Revolution, when all secondary classes were halted for students to criticise and fight their teachers. Xi was age 15 when his father was jailed in 1968.

In 1969, lacking the protection of his father, Xi was sent to work in Yanchuan County, Shaanxi, in Mao Zedong's Down to the Countryside Movement. After a few months, unable to stand rural life, he ran away to Beijing. He was arrested during a crackdown on deserters from the countryside and sent to a work camp to dig ditches.

In 1981, the Party declared that the Cultural Revolution was "responsible for the most severe setback and the heaviest losses suffered by the Party, the country, and the people since the founding of the People's Republic" Welcome to adolescence.

Read the Wikipedia entry on Xi for more details (and the Wikipedia entry on Peng Liyuan his folksinger wife who until 2007 was more well-known). Also, in 2007 when it became evident that Xi was being groomed to assume the duties of his current job, an article appeared in The Guardian which helps provide some perspective from a British point of view: Most corrupt officials are from poor families but Chinese royals have a spirit that is not dominated by money.

In my TIME magazine dated March 12, there is an article "China steps closer to despotism as Xi becomes leader for life" by Charlie Campbell. First of all, even the article doesn't report Xi became "leader for life." He is in the same situation that American Presidents George Washington through Harry S. Truman were and which Ronald Reagan sought - the political clout of having no two-term limit.

But the article does assert the charge of current autocratic rule and future possible despotism. And it relate a similar assertion in The Economist How the West got China wrong, a long article which begins "Last weekend China stepped from autocracy into dictatorship." The problem is The Economist is a unbridled advocate of Neoliberal economics. "Greed is good" could be its motto.


What Does 21st Century History Tell Us About Capitalism

To begin a discussion about the results of capitalism, we need to be clear about one thing. Capitalism is an ideology.

Ideology is a comprehensive set of normative beliefs, conscious and unconscious ideas, that an individual, group or society has. In societies that distinguish between public and private life, every political or economic tendency entails ideology, whether or not it is propounded as an explicit system of thought.  In those societies an ideology is narrower in scope than the ideas expressed in concepts such as worldview, imaginary, ontology, and religion.

An ideology is a coherent system of ideas, relying upon a few basic assumptions about reality that may or may not have any factual basis. Ideas become ideologies (that is, become coherent, repeated patterns) through the subjective ongoing choices that people make, serving as the seed around which further thought grows. Ideologies are neither necessarily right nor wrong. Believers in ideology range from passive acceptance through fervent advocacy to true belief.

An excessive need for certitude lurks at fundamentalist levels in politics and religions. Thus an ideologue is comparable to a religious fanatic. And abusers can hide in ideological garb.

Capitalism is an ideology. Neoliberals are fanatics. And abusers use the nearly religious appeal of capitalism to suppress those who would have society prohibit their theft from others or their abuse of employees.

Reconsider this quote:

    The richest 10% of Russians own 87% of all the country’s wealth, according to the report, compared with 76% in the US and 66% in China. According to another measure, by VTB Capital, 1% of the Russian population holds 46% of all the personal bank deposits in the country.

The first truth is that in the 1990's capitalism was given unregulated freedom in Russia. Naturally that resulted in the all too familiar corruption that we have yet to eliminate in the United States when the government did not jail the bankers. In Russia no regulations were put in place and the natural result of unregulated capitalism - rampant inequality - is worse there than in the United States.

The second truth is that in the 21st Century capitalism was given a opportunity in China and that resulted in the kind of corruption that we have yet to eliminate in the United States when the government did not jail the bankers.

China under Xi, on the other hand, has started jailing corrupt capitalists. And China defines that corruption at least partly on how far away the behavior of a capitalist is from that of Bill Gates' efforts to do good in the world , as well as partly on how company money is misused to the personal benefit of the capitalist in question.

Now Neoliberals have no quarrel with Gates. But in their minds evil is epitomized by China's or any government preventing a capitalist from using any money he/she can grasp for their own personal benefit no matter what the rules are. Government rules are unacceptable. Theft is merely frowned upon if it gets too obvious.


The Neoliberal Attack on China's Xi

Those Western Neoliberals have geared up the spin machine (the one that has allowed them to take over American government) to attack China's less than enamored view of inadequately regulated capitalists. They launched a direct attack on Xi who understands that "terming out" means his objectives could be ignored through stalling. (If you think this isn't true, keep in mind that those same Western Neoliberals found no need to attack Putin's messing with elections in the West. They'll leave that up to fuming Democrats.)

There are also the not-so-obvious Neoliberal attacks on Chinese lack of enthusiasm for capitalists that are harder to see. For instance, there is a broad attack by U.S. security officials on three companies involved in telecom and cloud computing technologies - ZTE, Huawei Technologies, and Broadcom Limited.

Of course there should be concern about the fact that most of our technology is manufactured by foreign companies, mostly in China. But that barn door was left open many years ago. As will be discussed below, you can't buy a phone that The recent attack from within secret U.S. government agencies raises suspicions.

Consider the attack on Huawei. From July to September 2017, Huawei surpassed Apple and became the second largest smartphone manufacturer in the world after Samsung. The attack came about when AT&T agreed to start marketing their phones along with all the other phones they offer.

The problem for Neoliberals is that Huawei classifies itself as a "collective" and does not refer to itself as a private company. Huawei is an employee-owned company.  But a report by Georgetown's Center for Strategic and International Studies, an arm of the U.S. government defense and security organization, says "Huawei emphasizes its employee-ownership to distance itself from allegations of government control."

Unfortunately, that exact wording and much more in the report came from a 2010 article that appeared in an Australian publication ITnews. And in the article that statement is actually a quote from a Hong Kong activist/banker capitalist, not from independent research. The report on other pages of the report seemingly contradicts much of that ITnews opinion.

What's additionally troubling here is that no objections have been raised regarding Lenovo products, including their Motorola Mobility cell phone products, despite its founding and ownership ties to the Chinese Academy of Sciences, the national academy for the natural sciences of the People's Republic of China (PRC). No one seems to care that its founder was a delegate to the 16th National Congress of Communist Party of China and a deputy to the 9th and 10th sessions of the National People's Congress, China's highest legislative body.

And, of course, no problems exist with the iPhone and other Apple products manufactured by Foxconn which also manufactures  BlackBerry, Kindle, Nintendo, Nokia, PlayStation, Wii, and Xbox products.

Foxconn is the world's largest contract manufacturer of electronics, with factories in several countries, mostly in mainland China where it employs 1.2 million people and is its largest private employer and exporter.

Foxconn is a stock exchange listed company with a regularly reported record of employee mistreatment, apparently making it the ideal company in the eyes of Neoliberal dominated American government security organizations.

The world's largest mobile phone maker by unit sales, Samsung, handles it's own manufacturing. Samsung Electronics has mobile phone manufacturing facilities in the six countries of Vietnam, China, India, Brazil, Indonesia, and Korea. The two plants in Vietnam, a country run by the Communist Party of Vietnam, produce nearly 300 million units. Reportedly Samsung was looking to cut their production in the two factories in China with a capacity of 150 million phones because of high labor costs while expanding their production in India.

This past year Taiwan-based Wistron Corporation started to manufacture the iPhone SE in India for sales in India but have poor sales. Apple's plans to get special government treatment and tax concessions in India have failed so far.

The world's four remaining one-party socialist states officially espousing communism are China, Vietnam, Cuba, and Loas. The fact is most phones used in the United States are made in China and Vietnam.

What will make the U.S. government security attack more suspect is that Chinese smart phone and electronics manufacture Xiaomi is also entering the U.S. market through various carriers' marketing. So far, it has not run afoul of the U.S. government security apparatus.

Of course, it is a new company with Founder, Chairman and CEO Lei Jun, who is also Chairman of Kingsoft, Chairman of UCWeb Inc., and Chairman of YY.com and is worth $6.8 billion.

Xiaomi 's most recent round of funding generated $1.4 billion. The company's  11 Investors include Ratan Tata, Morningside Group, DST Global, IDG Capital Partners, Qualcomm Ventures, Temasek Holdings and a few others.

That included an additional investment from Russian physicist and financial guru Yuri Milner’s investment group DST Global. Through DST Global, Milner is also an investor in Facebook, Zynga, Twitter, Flipkart, Spotify, Zocdoc, Groupon, JD.com, OlaCabs, Alibaba, AirBnB, WhatsApp, NuBank, Wish and many others. Milner's personal investments also include a stake in 23andMe, Habito, Planet Labs and others.

Milner is a darling of the American capitalist establishment. In September 2017 Forbes included Milner to the list of 100 greatest living business minds. Milner was named one of the World's Greatest Leaders by Fortune magazine in March 2017, was listed in the "Titans" category of Time magazine's 2016 Time 100. Foreign Policy magazine included Milner on its "Power List" – an inaugural list of the 500 most powerful people on the planet in May 2013. Milner was included in Bloomberg Markets' 2012 50 Most Influential list. In Fortune's 2010 list of the world's fifty most prominent businessmen, Milner was ranked 46th. That same year Russian business magazine Vedomosti recognized him as "Businessman of the Year".

When he was a doctoral candidate in particle physics in Russia he became interested in venture investment strategy. He subsequently received an MBA at the Wharton School of the University of Pennsylvania, Donald Trump's alma mater. In 2011, Milner bought a $100 million home in Los Altos Hills, California which, The Wall Street Journal reported, was the most ever paid for a single-family home in the United States.

But back to Xiaomi's CEO Lei Jun, a delegate of the National People's Congress, who was named Businessman of the Year by Forbes in 2014. Not only is his Xiaomi not employee owned, it is everything a Neoliberal could admire. In a 2015 interview with the BBC, Xiaomi's Vice President of International, Hugo Barra, Google's former product spokesperson for the Android team, noted that the company working hours are 9.30 in the morning to 9.30 in the evening, and that's just the regular working hours, plus one hour for lunch.

Yeah, let's worry about those phones made by employee-owned Huawei and start promoting phones made by Chinese and Russian billionaire capitalist-owned employee abuser Xiaomi. What could go wrong?

The problem is there are no smartphones manufactured in the U.S.A. for American companies. Yeah, we've got a potential security problem.

Wednesday, February 28, 2018

Xi's team to lead a 21st Century China
 They want for their grandchildren a prosperous, democratic,
 strong, culturally advanced, harmonious, and beautiful life

The Standing Committee of the Political Bureau of the 19th CPC Central Committee from left, Han Zheng, 63, the Communist Party Secretary of Shanghai; Wang Huning, 62, Director of the Central Policy Research Office; Li Zhanshu, 67, Director of the General Office of the Communist Party of China; President Xi Jinping, 64, General Secretary of the Communist Party of China ; Premier Li Keqiang, 62, Premier of the People's Republic of China; Wang Yang, 62, Vice Premier of the People's Republic of China; and Zhao Leji, 60, Secretary of the Central Commission for Discipline Inspection.

For the first time at the end of a National Congress of the Communist Party of China (CPC), all seven Standing Committee members of the Political Bureau were born after the founding of the People's Republic of China in 1949.

All were born and raised in the People's Republic of China. That means that none of them were WWII veterans and none were part of the Revolution. Instead, all were impacted as children from 1958 to 1962 by Chairman Mao's Great Leap Forward and as teens by Chairman Mao's Cultural Revolution from 1966 until 1976.

The Great Leap Forward was intended through the use of persuasion and force to rapidly transform the country from an agrarian economy into a socialist society through rapid industrialization and collectivization but instead caused economic regression, the Great Chinese Famine, and tens of millions of deaths. Welcome to childhood.

The goal of the Cultural Revolution was to preserve 'true' Communist ideology in the country by purging remnants of capitalist and traditional elements from Chinese society, and to re-impose Maoist thought as the dominant ideology within the Party. Millions of people were persecuted in the violent struggles that ensued across the country, and suffered a wide range of abuses including public humiliation, arbitrary imprisonment, torture, hard labor, sustained harassment, seizure of property and sometimes execution. A large segment of the population was forcibly displaced, most notably the transfer of urban youth to rural regions during the Down to the Countryside Movement. Historical relics and artifacts were destroyed. Cultural and religious sites were ransacked.

To understand the meaning of this history to these seven men, one only need to look at the experience of President Xi Jinping.

After the founding of the Communist state in 1949, Xi's father held a series of posts, including propaganda chief, vice-premier, and vice-chairman of the National People's Congress. Xi was born June 15, 1953. Based on normal expectations, Xi's future looked bright.

But when Xi was age 10, his father was purged from the Party and sent to work in a factory in Luoyang, Henan. In May 1966, Xi's "high school years" were cut short by the Cultural Revolution, when all secondary classes were halted for students to criticise and fight their teachers. Xi was age 15 when his father was jailed in 1968.

In 1969, lacking the protection of his father, Xi was sent to work in Yanchuan County, Shaanxi, in Mao Zedong's Down to the Countryside Movement. After a few months, unable to stand rural life, he ran away to Beijing. He was arrested during a crackdown on deserters from the countryside and sent to a work camp to dig ditches.

In 1981, the Party declared that the Cultural Revolution was "responsible for the most severe setback and the heaviest losses suffered by the Party, the country, and the people since the founding of the People's Republic" Welcome to adolescence.

Read the Wikipedia entry on Xi for more details (and the Wikipedia entry on Peng Liyuan his folksinger wife who until 2007 was more well-known). Also, in 2007 when it became evident that Xi was being groomed to assume the duties of his current job, an article appeared in The Guardian which helps provide some perspective from a British point of view: Most corrupt officials are from poor families but Chinese royals have a spirit that is not dominated by money.

The following graphic indicates the Party organization.

The seven-member Political Bureau Standing Committee is the center of political power in China. While certainly this year the generational factor is important, it is also important to know that five of the seven are new to the Standing Committee.


It is also true that none are in their fifties, a fact troubling to some American pundits. In more recent times being in that 50's age group would have indicated a Standing Committee member was being prepared to replace President Xi five years from now in 2022.

Of course, in 2022 only one of the Standing Committee members will be as old as Donald Trump was when he became U.S. President this year. In fact, in 2022 President Xi will be 69, two years younger than Trump is right now!

For more about these seven men, Hong Kong's South China Morning Post offers this: China's Leadership Reshuffle: Profiles.

More troubling to many is that none of these guys are women. In fact, at the next level down, in the 25 member Political Bureau (aka Politburo), the number of from two women members to one after the 19th National Congress.

Of the delegates to the Party Congress, only 24.1% were women. When comparing ruling parties, that is about the same ratio as the delegates to the 2016 Republican Party National Convention. (The 2016 National Convention of the losing Democratic Party had about 60% women.)

China's two most senior female politicians a month ago were vice premier Liu Yandong, 71, a scion of a political dynasty -- her father was a close ally of former Chinese President Jiang Zemin -- and Sun Chunlan, a rising Party chief.

In this week's leadership reshuffle, Liu retired from the Politburo, leaving Sun as the only female member. Sun Chunlan, 67, is head of the party’s United Front Work Department, the agency that serves as the Party's interface with individuals and organizations that are not Party members that have social, commercial, or academic influence, or who represent important interest groups, both inside and outside China.

Another woman politician better known to the West, Fu Ying, 64, an ethnic Mongol born in the Inner Mongolia Autonomous Region of China, is not a member of the Politburo, although she has held Ambassador posts to Australia and the Philippines and currently holds the position of vice foreign minister after a long career in the Chinese diplomatic service. In 2010 the Financial Times offered an extensive article Lunch with the FT: Madam Fu Ying which included this giving us an insight into her formative years:
    Fu Ying was born in 1953 in Hohhot, the capital of Inner Mongolia, an “autonomous region” of China. Her parents were bilingual, speaking Mandarin and Mongolian. Her father wrote poetry. She can, she tells me, still remember the day that a tall, ethnically Chinese man arrived at the family home to take her father away. It was 1967 and the height of the Cultural Revolution, the bloody chaos unleashed by Mao to purge the party and consolidate power.
    “The [tall] man looked into my eyes and said, ‘Democracy is great. Do you know what is democracy?’ I shook my head; I didn’t know. And he said, ‘That’s the change of history. You will be swept away by the change of history.’” (Democracy, during the Cultural Revolution, was equivalent to anarchy. No wonder, I muse to myself, it does not carry the same positive connotations in China as in the west.)
    A tear appears in Madam Fu’s eye. She recounts how school was shut down and she was taken away, aged 17, to a remote town in the mountains, Wulashan, five hours distant by train. There she worked in the fields – “very, very physical, really stressful and extreme for a young girl” – before helping to build a new factory where she was employed as an announcer, broadcasting information to her co-workers about the weather and the like through a loudspeaker.
    But then, in 1973, she had her first break. The Cultural Revolution was in its last throes and previously frowned-upon practices such as examinations to test pupil ability were revived. Fu Ying excelled, having squirrelled away first Russian and then French classics from a library in Wulashan. She also excelled in English, having picked up the basics on Chinese radio. She gained a place to study for four years at Beijing Foreign Studies University.
    After the death of Chairman Mao in 1976, China started to open to the rest of the world. Suddenly, interpreters were in heavy demand. Madam Fu joined the elite translation department of the diplomatic service.
It is clear that the generation now leading China had a less than enchanting experience with Mao's brand of authoritarianism under the name communism. On the other hand, for these and most Chinese people, China has a 7,000 year history, most of which has been as a moderately successful single autocratic state under an emperor. [To learn more about China, its history and culture, watch the six episode Story of China at PBS.org.]

While most of us who live in the Progressive Pacific states have some awareness of China, it is important to understand how the current Chinese leadership generation sees the world. Among others, Fu Ying has been tasked with assisting us. In 2016 in Foreign Affairs her article How China Sees Russia she provides clear insight into information we should understand:
    ...China has no interest in a formal alliance with Russia, nor in forming an anti-U.S. or anti-Western bloc of any kind. Rather, Beijing hopes that China and Russia can maintain their relationship in a way that will provide a safe environment for the two big neighbors to achieve their development goals and to support each other through mutually beneficial cooperation, offering a model for how major countries can manage their differences and cooperate in ways that strengthen the international system.
    On several occasions between the end of the nineteenth century and the middle of the twentieth century, China entered into an alliance with the Russian empire and its successor, the Soviet Union. But every time, the arrangement proved short-lived, as each amounted to nothing more than an expediency between countries of unequal strength. In the decades that followed, the two powerful communist-led countries muddled through, occasionally cooperating but often riven by rivalry and mistrust. In 1989, in the waning years of Soviet rule, they finally restored normalcy to their relations. They jointly declared that they would develop bilateral relations based on “mutual respect for sovereignty and territorial integrity, mutual nonaggression, noninterference in each other’s internal affairs, equality and mutual benefit, and peaceful coexistence.” Two years later, the Soviet Union disintegrated, but Chinese-Russian relations carried on with the principle of “no alliance, no conflict, and no targeting any third country.”
    Soon thereafter, the newborn Russian Federation embraced the so-called Atlanticist approach. To win the trust and help of the West, Russia not only followed Western prescriptions for economic reform but also made concessions on major security issues, including reducing its stockpile of strategic nuclear weapons. However, things didn’t turn out the way the Russians had hoped, as the country’s economy tanked and its regional influence waned. In 1992, disappointed with what they saw as unfulfilled pledges of American and European assistance and irritated by talk of NATO’s eastward expansion, the Russians began to pay more attention to Asia. That year, China and Russia announced that each would regard the other as a “friendly country” and issued a joint political statement stipulating that “the freedom of people to choose their own development paths should be respected, while differences in social systems and ideologies should not hamper the normal progress of relations.”
    Ever since, Chinese-Russian relations have gradually improved and deepened. During the past 20 years or so, bilateral trade and investment have expanded on a massive scale. In 2011, China became Russia’s largest trading partner. In 2014 alone, China’s investment in Russia grew by 80 percent—and the trend toward more investment remains strong. To get a sense of the growth in economic ties, consider that in the early 1990s, annual bilateral trade between China and Russia amounted to around $5 billion; by 2014, it came close to $100 billion. That year, Beijing and Moscow signed a landmark agreement to construct a pipeline that, by 2018, will bring as much as 38 billion cubic meters of Russian natural gas to China every year. The two countries are also planning significant deals involving nuclear power generation, aerospace manufacturing, high-speed rail, and infrastructure development. Furthermore, they are cooperating on new multinational financial institutions, such as the Asian Infrastructure Investment Bank, the New Development Bank BRICS, and the BRICS foreign exchange reserve pool.
In the middle of the 2008 financial crisis Xi said: "First, China doesn't export revolution; second, China doesn't export hunger and poverty; third, China doesn't come and cause you headaches. What more is there to be said?"

This past week Xi reaffirmed that Beijing will never seek hegemony or engage in expansion "no matter what stage of development it reaches" and that "China will never pursue development at the expense of others' interests and its development does not pose a threat to any other country."

In her 2010 article Fu Ying noted:
    In remarks during [his visit to the United States in 2009], Xi directly addressed the idea that China’s development presents a challenge to the United States’ global leadership. “The path China follows is one of peaceful development, and China does not pose a threat to other countries,” Xi said. Later, he added, “People should give up the old concepts of ‘you lose, I win,’ or zero-sum game, and establish a new concept of peaceful development and win-win cooperation. If China develops well, it will benefit the whole world and benefit the United States. If the United States develops well, it will also benefit the world and China.”
If one pays attention to what this new generation of Chinese leadership communicates, we can create a consistent set of China-centered goals that evolve from this 2008 statement:


In 2012 Xi's goal for 2020 was made clear:


And now, in 2017, Xi set forth for 2049 the goal of achieving "a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious, and beautiful."

We need to know and understand these people.


First published Friday, October 27, 2017, in my California First blog, this post is part of a series on the 21st Century political, economic and cultural objectives that have been set by China. It is being republished here for continuity as that series will continue here.

The Art of the Pro-Communist Deal 
  President Trump enlists the United States in
  Xi Jinping's 21st Century World Vision as U.S.
  Pacific allies reject him, and by necessity us

Forty-five years ago, in 1972, President Richard Nixon made a historic trip to open a diplomatic relationship between the United States and the People's Republic of China (PRC).

Over the past two weeks, President Donald Trump also made a historic visit to Asia to:
  1. Bestow the U.S. government's endorsement upon Chinese President and General Secretary of the Communist Party of China Xi Jinping's Silk Road Economic Belt and the 21st-century Maritime Silk Road Initiative by encouraging American companies to make billions of dollars in investments in the economy of the People's Republic of China, some directly funding the Initiative, some not so transparent.
  2. Grant the U.S. government's approval of People's Republic of China government-affiliated companies and banks making
    1. investments in a natural gas project in Alaska;
    2. investments in shale gas development and chemical manufacturing projects in West Virginia; and
    3. investments to be managed by Goldman Sachs in American companies across the manufacturing, industrial, consumer and healthcare industries.
  3. Incite the remaining 11 Trans-Pacific Partnership (TPP) nations in Asia and the Americas to achieve agreement on the “core elements” of what is to be known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), an agreement that prior to Trump's insulting speeches was thought impossible after the U.S. withdrawal from the original TPP.
  4. Abide a polite but firm statement from Vietnam President Tran Dai Quang and a blunt statement from Philippine President Rodrigo Duterte telling the U.S. to stay out of their dispute with China over the South China Sea as they wanted to avoid any chance of war, a position affirmed by President Xi.
These results, which are as surprising as was Nixon's 1972 trip, represent major reversals in American trade policy, foreign policy, and foreign investment policy. These "achievements" are considered below under the headings:


Trump's Surprising Endorsement of China's Belt and Road Initiative


As reported in the Chinese press this week, Trump and Chinese President and General Secretary of the Communist Party of China Xi Jinping "witnessed the signing of deals worth US$253 billion on Thursday, making the US head of state’s visit to China one of the most fruitful for Chinese and US businesses in terms of the value of agreements struck."

Perhaps we need to back up here and make clear what really happened during this China visit. Sure, Secretary of State Rex W. Tillerson, National Security Adviser Lt. Gen. H. R. McMaster, Commerce Secretary Wilbur Ross, United States trade representative Robert E. Lighthizer and Jared Kushner were there. And sure the American media did not provide boring in-depth economic explanations focusing instead on the personalities, in this case Trump and Xi, and in Vietnam Putin.

But the important policy fact about the China visit was that 29 other persons were specifically included to accompany Trump in China in order to further what appears to be the Trump Deplorable Trade Policy (TDTP) including in order of their business or organization name:
  1.  Mr. Seifollah Ghasemi, Chairman, President & CEO, Air Products of Allentown, Pennsylvania
  2.  Mr. Keith Meyer, President, Alaska Gasline Development Corporation (AGDC) of Anchorage, Alaska
  3.  Governor Bill Walker, State of Alaska
  4.  Mr. Donald Chen, President, Asia-Pacific, Archer Daniels Midland Company of Chicago
  5.  Mr. Daniel Revers, Managing Partner, Arclight Capital Partners, LLC, of Boston
  6.  Mr. Mitch Snyder, President & CEO, Bell Helicopter of Fort Worth
  7.  Mr. Kevin McAllister, President and Chief Executive Officer, Boeing Commercial Airplanes, Renton, Washington
  8.  Mr. Jack Fusco, President and Chief Executive Officer, Cheniere Energy, Inc., of Houston
  9.  Mr. Timothy Tangredi, President & CEO, Dais Analytic Corporation of Odessa, Florida
  10.  Mr. Frederick Jones, Chairman and Chief Executive Officer, Delfin Midstream, LLC, of Houston
  11.  Mr. Andrew Liveris, Executive Chairman, DowDuPont of Midland, Michigan
  12.  Mr. Luka Erceg, President & CEO, Drylet, LLC, of Houston
  13.  Mr. David Messer, CEO, Freepoint Commodities LLC, of Stamford, Connecticut
  14.  Mr. John Rice, President & CEO, GE Global Growth Organization, General Electric, of Boston
  15.  Mr. Shane Tedjarati, President, High Global Growth, Honeywell of Morris Plains, New Jersey
  16.   Mr. Lloyd Blankfein, Chief Executive Officer, Goldman Sachs of New York City
  17.  Mr. Vance Hum, President and Chief Executive Officer, I.M. Systems Group, Inc., of Rockville, Maryland
  18.  Mr. Theodore Walker, CEO, Worldwide Property & Casualty, Partner Reinsurance Company of the United States of Greenwich, Connecticut
  19.  Mr. Steve Mollenkopf, CEO, Qualcomm, Inc. of San Diego
  20.  Mr. Nick Lisi, Executive Vice President , SAS of Cary, North Carolina
  21.  Mr. Kevin Smith, CEO, SolarReserve of Santa Monica, California
  22.  Ms. Li Zhao, Country Representative, Stine Seed Company of Adel, Iowa
  23.  Mr. John Garrison, President & CEO, Terex Corporation of Westport, Connecticut
  24.  Mr. Langtry Meyer, Founder & Chief Operating Officer, Texas LNG Brownsville, LLC, of Brownsville, Texas
  25.  Mr. Paul Doherty, President and CEO, The Digit Group, Inc., of Memphis, Tennessee
  26.  Mr. Gianluca Pettiti, President, Thermo Fisher Scientific of Waltham, Massachusetts
  27.  Mr. Jim Miller, Chairman, U.S. Soybean Export Council of Chesterfield, Missouri
  28.  Mr. Paul Koenig, CEO, Viroment of Minneapolis, Minnesota
  29.  Mr. Jose Emeterio Gutierrez Elso, President & CEO, Westinghouse Electric Company, LLC, of Cranberry Township, Pennsylvania
Speaking alongside Trump in Beijing as the deals were announced, General Secretary of the Communist Party of China Xi reportedly welcomed U.S. companies to participate in his ambitious “Belt and Road” infrastructure-led initiative. In one deal reported, China’s Silk Road Fund and General Electric signed an agreement specifically to cooperate in investments under China’s “Belt and Road Initiative” as it was defined prior to Trump's visit.

But other "deals" appear to be an expansion of the “Belt and Road Initiative” into the United States. Perhaps we need to back up again and provide a description of the Initiative from the Wikipedia entry:
    The Silk Road Economic Belt and the 21st-century Maritime Silk Road, better known as the One Belt and One Road Initiative (OBOR), The Belt and Road (B&R) and The Belt and Road Initiative (BRI) is a development strategy proposed by China's paramount leader Xi Jinping that focuses on connectivity and cooperation between Eurasian countries, primarily the People's Republic of China (PRC), the land-based Silk Road Economic Belt (SREB) and the oceangoing Maritime Silk Road (MSR). The strategy underlines China's push to take a larger role in global affairs with a China-centered trading network.

   The Belt and Road initiative is geographically structured along 6 corridors, and the maritime silk road.
  • New Eurasian Land Bridge, running from Western China to Western Russia through Kazakhstan.
  • China–Mongolia–Russia Corridor, running from Northern China to Eastern Russia
  • China–Central Asia–West Asia Corridor, running from Western China to Turkey
  • China–Indochina Peninsula Corridor, running from Southern China to Singapore
  • China–Myanmar–Bangladesh–India Corridor, running from Southern China to Myanmar
  • China–Pakistan Corridor, running from South-Western China to Pakistan
  • Maritime Silk Road, running from the Chinese Coast through Singapore to the Mediterranean
    The area of the initiative is primarily Asia and Europe, encompassing around 60 countries. Oceania and East Africa are also included. Anticipated cumulative investment over an indefinite timescale is variously put at US$4 trillion or US$8 trillion. The initiative has been contrasted with the two US-centric trading arrangements, the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership.

    The Belt and Road Initiative is expected to bridge the 'infrastructure gap' and thus accelerate economic growth across the Asia Pacific area and Central and Eastern Europe: World Pensions Council (WPC) experts estimate that Asia excluding China will need up to $900 billion of infrastructure investments per year during the next 10 years, mostly in debt instruments. They conclude that current infrastructure spending on the continent is insufficient by 50%. "The gaping need for long term capital explains why many Asian and Eastern European heads of state "gladly expressed their interest to join this new international ļ¬nancial institution focusing solely on ‘real assets’ and infrastructure-driven economic growth".

    The Global Times hosts a news desk dedicated to the Belt and Road Initiative.
The GE deal is the only one transparently constituting an investment in the Eurasian-Africa elements of the Initiative. As explained by Chinese State Administration of Foreign Exchange (SAFE),  the Silk Road Fund and GE established a joint energy infrastructure investment platform. The Silk Road Fund was founded in December 2014 and is jointly backed by China's foreign exchange reserves, China Investment Corp, the Export-Import Bank of China and China Development Bank.

The SAFE statement said: "The two sides will make joint investment in infrastructure projects in the fields of power grid, new energy, and oil and gas, in countries and regions along the Belt and Road. The cooperation between the Silk Road Fund and GE will not only boost cooperation between high-end manufacturing companies from China and the US, but also promote economic development of the regions where their investment goes."

What is surprising about three of the other "deals" is that they constitute PRC capital investments in the United States when the Eurasian-Africa elements need substantial capital as described above. Let's look at those three "deals."

Perhaps the deal stirring the most interest in America's Rust Belt is the world’s largest power company by asset value, China Energy Investment Corp. owned by the PRC, signed a memorandum of understanding (MOU) with the West Virginia Dept. of Commerce on an $83.7 billion plan to invest in shale gas development and chemical manufacturing projects in West Virginia, with some possible benefit to Ohio and Kentucky

"This investment by China Energy is the culmination of years of relationship building, both by West Virginia University and the state,” WVU President Gordon Gee said. “It is also an excellent example of the possibilities that we have been discussing within the West Virginia Forward initiative with our partners at the state Department of Commerce and Marshall University.

“As I have traveled the state talking about West Virginia Forward, I have frequently said we need a ‘quick win.’ In the economic development world, this is a nearly unprecedented big win. The agreement, and the ramifications from it, will help move West Virginia forward for years to come.”

In another "deal", China’s top state-owned oil company Sinopec, Bank Of China,  and China Investment Corp (which reports to the State Council of the People's Republic of China) agreed to help the State of Alaska develop a $43-billion natural gas project in Alaska.

Alaska Governor Bill Walker and others participate in a an agreement signing ceremony while Presidents Trump and General Secretary Xi observe

In a news release issued by the state-owned Alaska Gasline Development Corporation created by the Alaska Legislature in 2010, Alaska Governor Bill Walker states: “This is an agreement that will provide Alaska with an economic boom comparable to the development of the Trans-Alaska Pipeline System in the 1970s.”

From the news release we learn:
    Alaska Gasline Development Corporation (AGDC), the State of Alaska, China Petrochemical Corporation (Sinopec), CIC Capital Corporation (CIC Capital), and Bank of China (BOC), today announced a joint development agreement to advance Alaska LNG, Alaska’s strategic gas infrastructure project.
    The agreement was signed in the presence of United States President Donald Trump and China President Xi Jinping, and expresses the common interests in the preparatory work of Alaska LNG.
    Alaska LNG is designed as a 20 million tonnes per annum (MTPA) integrated LNG system comprised of a three train liquefaction plant in Southcentral Alaska at Nikiski; an approximately 800 mile, 1.1 meter diameter gas pipeline; a gas treatment plant on the North Slope of Alaska; and various interconnecting facilities to connect the Prudhoe Bay gas complex to the gas treatment plant.
    Under the agreement, the parties have agreed to work cooperatively on LNG marketing, financing, investment model and China content in Alaska LNG, and get a periodic result by 2018.
    “Today’s agreement brings the potential customer, lender, equity investor, and developer together with a common objective of crafting mutually beneficial agreements leading to increased LNG trade between Alaska and China,” said Keith Meyer, president, AGDC.
    “Sinopec is interested in the possibility of LNG purchase on a stable basis from Alaska LNG,” said Sinopec.
    “CIC Capital is an experienced financial investor in the energy and infrastructure sectors and has long been interested in investing in American LNG infrastructure. CIC Capital is pleased to work with fellow industry and financial partners on this project,” said CIC Capital.
    “As the most internationalized bank in China, Bank of China is willing to facilitate the China-U.S. energy cooperation and provide financial solutions for this transaction by taking advantage of its vast experiences and expertise in international mega-project financing,” said Bank of China.
    Sinopec is a huge, state-owned, fully integrated energy and chemical company. Based in Beijing, Sinopec is the largest oil and gas company in the world by revenue with annual revenue of USD 455.49 billion.
    CIC Capital is China’s direct investment arm, which is mandated to make direct investments and manage bilateral and multilateral fund investments in order to pursue long-term financial returns and promote international investment cooperation. CIC Capital is a market-oriented commercial entity with a specialized mandate and global reach. As a long-term financial investor, CIC invests on a commercial basis.
    Bank of China is a state-owned commercial bank. Bank of China ranks top 10 largest banks in the world by market capitalization value and provides a comprehensive range of financial services to clients in 52 countries and regions around the world.
    The Alaska Gasline Development Corporation (AGDC) is an independent, public corporation of the State of Alaska, empowered to maximize the benefit of Alaska’s vast North Slope natural gas resources through the development of infrastructure necessary to move the gas into local and international markets. Visit www.agdc.us for up to date information.
The purpose of the agreement is to develop natural resources located in the National Petroleum Reserve in Alaska (NPRA), an area of land owned by the federal government and managed by the Bureau of Land Management (BLM) which is located to the west of the Arctic National Wildlife Refuge.

The State of Alaska entered into an agreement with Sinopec - a PRC-owned "energy and chemical company," CIC Capital - a sovereign wealth fund responsible for managing part of the People's Republic of China's foreign exchange reserves, "China's direct investment arm," and the Bank of China - a PRC "state-owned commercial bank."

At a minimum it is curious that the Republican President of the United States Donald Trump oversaw the signing of the agreement while sitting with the General Secretary of the Communist Party of China Xi Jinping.

The third "deal" which for all intents and purposes looks like the expansion of the Initiative into the United States occurred despite earlier opposition to Chinese investment in U.S. companies by the Trump Administration, Congress, and the Pentagon.

Goldman Sachs and China Investment Corp (CIC) signed a strategic agreement to establish a China and United States industrial cooperation fund. The Cooperation Fund will target $5 billion in commitments with a broad mandate to invest in American companies in the manufacturing, industrial, consumer and healthcare industries, among others, that have or can develop a material business connection to China. The Cooperation Fund is designed to enhance commercial linkages and promote market access for US firms in China and will seek to improve the balance of the US-China trade relationship.

“The China-United States relationship is one of the most important in the world and strengthening economic and trade cooperation is vital to the economies of both countries,” said Lloyd Blankfein, Chairman and CEO of Goldman Sachs. “The Cooperation Fund will increase Chinese investment in the United States, creating more opportunities for American workers and contributing to China’s economic transition and growth.”

“CIC has invested in the US for ten years and is committed to be both an investor and facilitator to develop a stronger China-US investment relationship,” said Tu Guangshao, Vice Chairman and President of CIC. “The partnership will help promote China’s supply-side structural reform and economic transition, and by investing in the US, it will act as a multiplier for business growth throughout the country.”

The deals endorsed by Trump and Xi could be valued as much as $250 billion. Sure Boeing won orders and commitments worth $37 billion at list prices for 300 jets, including 260 narrow-body Boeing 737s and a total of 40 wide-body 787s and 777s from state purchasing agency China Aviation Supplies Holding Co. Other "deal" signings overseen by Trump and Xi include:
  • Delfin Midstream has reached a preliminary 15-year sales deal to supply 3 million tonnes a year of liquefied natural gas (LNG) to city gas distributor China Gas Holdings (0384.HK) from 2021.
  • Air Products and Chemicals (APD.N)  signed an agreement with Yankuang Group for a $3.5-bln coal-to-syngas production facility in China and signed an agreement to form a $1.3 billion joint venture (JV) with Lu’An Clean Energy Company, which will significantly expand Air Products’ scope of supply serving Lu’An Mining (Group) Co., Ltd.’s syngas-to-liquids production in Changzhi City, Shanxi Province, China..
  • Cheniere Energy Inc (LNG.A) signed a memorandum of understanding (MOU) with China National Petroleum Corp [CNPET.UL] for long-term LNG sales and purchase cooperation.
  • Westinghouse Electric Co. signed contracts with China’s State Nuclear Power Technology Co. to build six AP1000 nuclear power plants in China.
  • Bell Helicopter, part of Textron Inc (TXT.N), reached a deal to sell 50 additional Bell 505 helicopters to Reignwood International, with Reignwood also being named the craft’s exclusive reseller in China.
  • Terex Utilities Inc. and Xuzhou Handler Special Vehicle (300201.SZ) signed a strategic letter of intent for Xuzhou Handler to buy 5,000 insulated aerial devices from Terex over five years worth $250 million.
  • Qualcomm (QCOM.O) signed three non-binding agreements to sell $12 billion of semiconductors to Xiaomi, Oppo and Vivo over the next three years.
  • Ford Motor (F.N) and China’s Anhui Zotye Automobile (000980.SZ) have agreed to invest a combined $756 million to set up a 50-50 joint venture in China to build electric passenger vehicles. 
  • The United States soybean industry including Archer Daniels Midland Company has signed letters of intent worth more than $5 billion – a $1 billion bump from similar contracts signed a year ago - with Chinese importers covering the purchase of an additional 12 million tonnes of soybeans in the 2017/18 marketing year.
  • JD.Com Inc (JD.O) said it would purchase more than $2 billion of U.S. agriculture and food products over the next three years, including at least $1.2 billion of beef from Montana Stock Growers Association and pork from Smithfield Foods Inc. [SFII.UL].
  • Drylet LLC agreed to form a joint venture with Nanjing Hoyo Municipal Utilities Investment and Administration for wastewater treatment in China. Hoyo Municipal Utilities Investment and Administration will also become an equity investor in Drylet.
  • Software company SAS signed a cooperation agreement with Shenzhen Zhenghong Technology to establish the Big Data Innovation Center for Smart Manufacturing in Shenzhen. 
  • Caterpillar, Inc. (CAT.N) and China Energy Investment Corporation signed a five-year strategic cooperative framework agreement covering future agreements for mining equipment sales and rentals, technology applications and product support.
And looking at a cross-section of other industries represented at the signing is interesting.

For instance, Minneapolis waste water treatment company Viroment signed an agreement with Hangzhou Iron and Steel worth $800 million addressing textile and sewage sludges for over 800 plants. Viroment also signed a $100-million agreement with Guangye Guangdong Environmental Protection Group to address sewage sludge solids disposal requirements in South China.

The agreements will allow more than 800 textile companies in eastern China’s Zhejiang province and 80 waste water treatment plants in southern Guangdong province to install Viroment technology to help them comply with China’s environmental regulations.

“Right now we have no footprint in China, so this is our kick-off,” Viroment’s chief executive Paul Koenig said. “If Trump wasn’t coming, I don’t think we would have pushed to have [such] large deals in writing.”

“Everyone’s excited and everyone’s motivated … you can pretty much always add one or more zeroes when you’re dealing with China,” Koenig said.

Koenig will attend three more trade missions to China later this year, with ongoing plans to work with companies in Hebei province and major port city Tianjin, and eventually “tackle all of China”.

Smart city developer The Digit Group of Memphis, already having a presence in China, signed three contracts worth a combined $1.9 billion, including one to build a 200-hectare virtual reality theme part in the eastern city of Qingdao.

DowDuPont signed a tire contract with bicycle-sharing startup Beijing Mobike Technology Co. to develop lighter, more durable materials for tires and saddles, as well as coatings, adhesives and synthetic rubber. The U.S. company said the agreement creates incentives for U.S. exports of polyurethane and other products. DowDuPont began working with Mobike last year, and about 2 million bicycles already use their tires.

Honeywell International Inc. inked a memorandum of understanding with China’s Oriental Energy to cooperate on an ethane dehydrogenation project of 600,000 tons a year. Like DowDuPont, its deal also involves an existing Chinese partner. Honeywell announced in May that two Oriental Energy subsidiaries had licensed its technology to begin producing propylene. Honeywell also signed a service contract with Spring Airlines Co., China’s biggest budget carrier that flies over 130 routes with a fleet of Airbus A320 planes. The deal would further develop Honeywell’s ties to China’s aviation industry. The U.S. company is a supplier for the C919, a new single-aisle plane being produced by state-owned Commercial Aircraft Corp. of China Ltd.

Sure, this seems like good economic opportunities for American companies. Still, creating a positive focus on trade with the People's Republic of China and having open public discussion of PRC Communist Party General Secretary Xi Jinping's 21st Century Silk Economic Belt and Road during Trump's visit is bit of a surprise. China's "Belt and Road" initiative is its economic centerpiece for the future of international trade.

From a policy standpoint, a U.S. President endorsing
  • a U.S. private company's involvement in the "Belt and Road" and 
  • Communist-PRC-owned companies investing in U.S. natural resources and businesses 
represents a significant pro-China turn-around from the Trans-Pacific Partnership goal of resisting China's effort to dominate world trade in the future.

Not that the Trump Administration has backed down from U.S. imports trade issues. Disputes over such imports such as hardwood plywood continue where it has been determined that the Communist government is subsidizing product production costs.

But in light of that, it seems like a questionable move to have Communist-PRC-owned companies directly involved in the U.S. economy, obtaining ownership interests in U.S. corporations.

As noted in the prior post With thoughtful Chinese characteristics a President tends his plan for 1.4 billion  people for 2020 ...and 2035 ...and 2049 President Xi heads a 7000-year-old autocratic nation and clearly with regard to economics and business thinks in time frames far longer than the next quarterly report.

In his three hour and 23 minutes speech at the 19th Congress of the Communist Party of China (CPC) Party General Secretary Xi Jinping under the title Thought on Socialism with Chinese Characteristics for a New Era laid out his vision for the Chinese people. “The Chinese nation … has stood up, grown rich, and become strong – and it now embraces the brilliant prospects of rejuvenation … It will be an era that sees China moving closer to center stage and making greater contributions to mankind.”

How Trump Incited the TPP Deal's Anti-American Pacific Trade Wall


In contrast to how Trump helped the "deals" in China, Trump's first stop on his trip was in Japan where he went on the attack.

For the U.S., the Japanese trade deficit is second only to that with China and to Trump that means the other side is somehow breaking the rules.  He said the U.S. has "suffered massive trade deficits at the hands of Japan for many, many years".

"We want free and reciprocal trade but right now our trade with Japan is not free and it's not reciprocal and I know it will be and we've started the process," Mr Trump told the group of US and Japanese executives. He took aim at Japanese carmakers in Tokyo.

"Try building your cars in the United States instead of shipping them over. That's not too much to ask," the US president said at the briefing, adding, "is that rude to ask"?

Rude? Yes. But also downright ignorant of some troublesome facts - you know, facts that Trump's Deplorables won't accept - about Japanese automakers, the ignorance of which allows him to create the Trump Deplorable Trade Policy.

Data shows that in 2016, three-quarters of Japanese branded cars sold in the US were manufactured in North America. Last year, those carmakers built nearly 4 million vehicles and 4.7 million engines in the US and contributed $45.6bn in total investment through 24 manufacturing plants, and 43 research and development and design centers in the U.S.

The problem isn't the Japanese. The problem is Americans who are still buying cars from Japan, along with agricultural goods, electronic components and pharmaceutical products.

American-made cars can be sold in Japan. But in a country where people cram onto mass-transit, there is no demand for American cars. Only a delusional person or an ignorant President would think otherwise.

While listening to Trump's misinformation and insults, Japanese Prime Minister Shinzo Abe hadn’t forgotten that it was Trump who pulled out of the 12-nation Trans-Pacific Partnership trade pact, a move the U.S. president once again defended Monday.

Abe spent significant political capital to back the deal, particularly among farmers who don’t want to see tariffs on agriculture lowered. Japanese officials also say the TPP would’ve helped narrow the trade gap.

So Prime Minister Abe and other Japanese officials spent most of their energy during Trump's China visit on a process known as “TPP 11” -- an attempt to keep the Trans-Pacific Partnership framework intact with 11 nations and definitely without the U.S.

Trump left Japan with no changes in trade policy, went to China and seemingly embraced China's trade leadership, then moved on from China to Vietnam.

In Vietnam, the Asia-Pacific Economic Cooperation (APEC) forum was meeting, a forum for 21 Pacific Rim member economies that promotes free trade throughout the Asia-Pacific region. The annual APEC Economic Leaders' Meeting is attended by the heads of government of all APEC members.

In 2014 Xi was pushing APEC members to create a Free Trade Area of the Asia-Pacific (FTAAP) saying that it is a "strategic initiative critical for the long-term prosperity of the Asia-Pacific". He touts it as as "an institutional mechanism for ensuring an open economy in the Asia-Pacific." It has been China's offer of an alternative to what was the American-led  TPP until Trump rejected it.

This year the APEC meeting was held in Danang, Vietnam. In contrast to endorsing the "Belt and Road", according to the New York Times:
    President Trump on Friday vowed to protect American interests against foreign exploitation, preaching a starkly unilateralist approach to a group of leaders who once pinned their economic hopes on a regional trade pact led by the United States.
    “We are not going to let the United States be taken advantage of anymore,” Mr. Trump told business leaders at the Asia-Pacific Economic Cooperation forum in Danang, Vietnam. “I am always going to put America first, the same way that I expect all of you in this room to put your countries first.”
    But taking the stage at the same meeting immediately after Mr. Trump, President Xi Jinping of China delivered a sharply contrasting message, championing more robust engagement with the world. Mr. Xi used his own speech to make a spirited defense of globalization, saying relations among countries should be “more open, more inclusive, more balanced, more equitable and more beneficial to all.”
    Mr. Trump’s remarks were strikingly hostile for an audience that included leaders who had supported the Trans-Pacific Partnership, a sweeping 12-nation accord that was to be led by the United States, from which Mr. Trump withdrew immediately after taking office.
Trump's logical fallacy is clear to Vietnam. Vietnam is the source of smart phones (Samsung), clothing and shoes (such as Walmart, Zara, and North Face brands) for Americans as well as the rest of the world. Like those Japanese cars, ordinary Americans are buying Vietnamese imports, mostly because alternatives are unaffordable.

Before and after Trump's speech, TPP-11 members continued negotiations. Key decisions were made by the TPP-11 countries indicated in green on the map below including Japan fuming over the new insults, plus Canada and Mexico recently insulted regarding the NAFTA talks.


As we learned from the Financial Times article TPP deal ignites criticism of US isolation on trade the United States will likely be isolated in terms of Pacific trade, ironically except for China:
    A weekend move by Japan and 10 other Pacific nations to press ahead with a vast regional trade agreement without the US has prompted fresh criticism that Donald Trump’s “America First” trade policy is leaving Washington increasingly isolated.
    The 11 remaining members of the Trans-Pacific Partnership, which the Obama administration spent years negotiating and Mr Trump pulled out of on his third day in office, announced on Saturday that they had reached agreement on the “core elements” of a deal to proceed without the US.
    The group still has work to do, as Canada, Malaysia and Vietnam seek changes to an agreement they have rebadged — at Canada’s request — as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
    But officials said the plan was to sign a final agreement early next year, in a deal that would eliminate the tariffs on 95 per cent of goods traded in a bloc covering some 500m people and more than $10tn in economic output.
    “This will send out a very strong message to the US and to other Asia-Pacific countries,” said Toshimitsu Motegi, the Japanese economy minister.
It is not a coincidence that the Japanese economy minister spoke for the group, but that wouldn't be noticed by those embracing the Trump Deplorable Trade Policy as they would never believe how much damage is being done to their grandchildren's economic future.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership is different from that achieved at the end of Barack Obama’s presidency.

About 20 provisions that were once part of the TPP talks have been "suspended," according to a joint statement by the agreement’s member countries. And there are still four sticking points — including a commitment on coal that affects Brunei — to solve, but experts say a final deal could be announced as early as next year.

But of real interest because it would preclude future American participation, most of the provisions in the chapter on intellectual property have been “suspended,” meaning they likely will be excluded from future negotiations. This includes the proposed 20 year increase in copyright term and the introduction of criminal penalties for circumventing technological protection measures.

The effect will be to put differing trade walls between the United States and every one of those countries on the map above between now and 2020. What Trump is putting at risk with his nationalistic "America First" speeches are the exports from the Pacific States as explained in the Progressive Pacific Message website which includes this information:

Note that all but one of the largest markets listed for exports from these states are countries on that map above and none are in Europe or a country on the Atlantic Ocean.

Based upon Trump's tacit endorsement of "Belt and Road" funding by American companies, it seems the Trump Deplorable Trade Policy (TDTP) has a great big gap in the direction of China. In the tables above, China is the largest export market for Washington and Oregon, and second behind Mexico if you combine China and Hong Kong for California.

But based on Trump's attacks in Japan and Vietnam, plus his prior attacks on NAFTA countries Canada and Mexico, the  Trump Deplorable Trade Policy (TDTP) is a threat to the economic well-being of the Pacific States, China notwithstanding.

In 2015 the LA Times ran an Infographic piece West Coast ports: What comes in, what goes out and what it's worth providing look at the volume and variety of both imports and exports at the 28 ports along the West Coast totaling over $630 billion in 2014 including smaller ones like the Port of Kalama, Washington (total 2014 trade $3.0 billion, top export Soybeans, top import Rolled iron and steel).

Consider this from The Daily News Local ports worry over Trump’s possible steel tariffs:
    At Steelscape and its subsidiaries, steel imports support about 800 jobs in the U.S., including 270 jobs at the Port of Kalama. The company imports hot rolled steel coils, which are processed into cold-rolled, flat steel for building materials such as siding and roofing.
    Although the company gets a small amount of steel from domestic sources, imports are the bedrock of its business model. Steelscape says it can save about $60 to $100 per a ton of steel by importing it through the Columbia River docks rather than shipping it in over the Rocky Mountain.
It might be tempting to say that this discussion represents a typical West Coast State versus the rest of America dispute and that Steelscape should bite the bullet and buy American steel or get out of business. But actually, should lernin' be a goal, as one could learn from Pittsburg: Steelmaker USS-POSCO in international trade dispute bind the assumption that somehow buying "American-made" steel will improve net employment in the Rust Belt is a foolish fallacious thought process.

The Choice: War or The Pacific Americas Prosperity Neighborhood

Trump left Vietnam for a visit to the Philippines. Both the Philippines and Vietnam have recently seen China disrupt oil and gas exploration in disputed areas of the South China Sea. While the U.S. ordinarily doesn’t take a position on territorial disputes, it has aggressively challenged China for moves to assert control over areas also claimed in part by Southeast Asian countries.

In early September the headline was US Navy to conduct regular naval patrols in South China Sea. In early October the headline was US Navy destroyer sails near disputed islands in South China Sea. Now the headline is Trump Offers to Broker Peace in South China Sea as Trip Wraps Up.

Trump's association with the Alt-Right spokesman Steve Bannon creates fear in the Asia-Pacific region. It is likely that on his trip Trump doesn't remember this statement Bannon made on his radio show in a March 2016 discussion with Neoliberal Lee Edwards of the Heritage Foundation:
    We’re going to war in the South China Sea. I was a sailor there. We’re going to war in the South China Sea in five to 10 years. There’s no doubt about that. They’re taking their sandbars and making basically stationary aircraft carriers and putting missiles on those. They come here to the United States in front of our face – and you understand how important face is – and say it’s an ancient territorial sea. That's a throwdown, is it not sir.
Yes, Bannon is no longer a part of the Trump Administration. But China, Vietnam, and Philippine officials aren't foolish and ignorant - they study everything said about the South China Sea associated with the Trump Administration. They know there is considerable evidence that Bannon is respected by Trump. One can imagine how eyes might glaze over when Trump offers to mediate the dispute at least partly because of Trump's ignorance about what's actually going on.


Vietnam President Tran Dai Quang at a joint press briefing in Hanoi in response to questions about Trump's offer to mediate said “I have shared my thoughts with President Donald Trump on the recent developments in this area,” adding that Vietnam wanted to settle disputes through “peaceful negotiations” in accordance with international law.

The Philippines' overlapping claims with Chinese claims which expand beyond the Philippines to Vietnam, Malaysia, Brunei and Taiwan, was not part of the 40-minute discussions in the South China Sea when Trump sat down with Philippine President Rodrigo Duterte for their first formal bilateral talks in Manila.

Regarding Trump's offer to mediate, Duterte said: “The South China Sea is better left untouched. Nobody can afford to go to war.” Duterte, who turned towards China since taking office last year,  noted that Chinese President Xi Jinping told him on Saturday that he also didn’t want to “waste the lives of my countrymen for a useless war that cannot be won by anyone.”

Robespierre Bolivar, spokesman of the Philippines Department of Foreign Affairs, announced Monday that the Association of Southeast Asian Nations (Thailand, Vietnam, Indonesia, Malaysia, Philippines, Singapore, Myanmar, Cambodia, Laos, Brunei) will "commence the negotiations on a substantive and effective code of conduct" based on a framework established with China last August.

A draft copy of the announcement released previously to the media said, "While the situation is calmer now, we cannot take the current progress for granted." The statement said it is "important that we cooperate to maintain peace, stability, freedom of navigation in and over-flight above the SCS [South China Sea], in accordance with international law. It is in our collective interest to avoid miscalculations that could lead to escalation of tensions."

China claims most of the South China Sea, one of the busiest shipping routes in the world. ASEAN member nations Malaysia, Vietnam, the Philippines, and Brunei, as well as Taiwan also claim overlapping parts of the area.

A code of conduct would serve as a guideline for the competing claimants on how their sea vessels and aircraft can pass through the territory without any dispute.

In other words, as Trump runs around the world announcing the Trump Deplorable Trade Policy (TDTP) of forcing negotiated bilateral arrangements - a laborious one-by-one process with other nations - the other nations are continuing to move forward with multilateral agreements.

The TDTP is popular in parts of the United States where book lernin' is detested.But the rest of the world realizes that bilateral ultimately equates with war because factually in the 20th Century bilateral resulted in the killing 160± million people in wars.

The leadership of the rest of the world understands that the Trump Deplorable Trade Policy cannot even achieve the goal of more jobs sought by the Deplorables because it has no teeth. The only way to significantly alter the trade deficit is to get Americans to quit buying stuff made elsewhere or to put up tariff walls both of which would disrupt the ability of the poor and middle-class to afford things they purchase, most significantly things like clothing, toys, appliances, electronics, even food.

The question Americans have to ask is the Trump Administration aggressively pursuing Bannon's war or a Pacific Americas Prosperity Neighborhood. An Asia Times headline recently asked Are US naval assertions in the South China Sea necessary? noting "US freedom of navigation operations in the Spratly Islands are pre-emptive challenges to China's potential claims and thus are beyond normal international practice." The article clearly explains why the awareness of  Bannon's "let's get into a war with China over the South China Sea" policy makes Asian's nervous.

It should be making all Americans nervous also. The multilateral free trade movement which could create a Pacific Americas Prosperity Neighborhood is an alternative to bilateral aggression and war. Smart trade economics is an alternative to war. The Trump Deplorable Trade Policy (TDTP) is not only not smart trade economics, it is a previously abandoned 20th Century formula for causing wars.

Remembering The Nixon China Surprise


As mentioned at the beginning of this post, forty-five years ago, in 1972, President Richard Nixon made a historic trip to China.

For 23 years, Americans had been isolated from China by the U.S. government. As explained in the Wikipedia entry on Nixon's trip: "The American ruling class was concerned that communists might dominate schools or labor unions."

At the time, Nixon's trip seemed almost shocking because as the 1952 vice-presidential candidate on the Eisenhower ticket his strong anti-communist stance was important in garnering votes.

As noted in another Wikipedia entry on the trip: "Because Nixon had an undisputed reputation of being a staunch anti-Communist, he was largely immune to any criticism of being 'soft on Communism' by figures on the right of American politics."

Per Wikipedia: "'Nixon going to China' has since become a metaphor for an unexpected or uncharacteristic action by a politician."

When one considers Trump's campaign bluster against trade with China, the actual details of his trip to China seem almost as surprising as Nixon's, except the surprise is the level of Trump's failure to protect the interest of Americans other than corporation executives like those who went on to China with him.

What was troubling during the 2016 campaign was Trump's opposition to the Trans-Pacific Partnership (TPP) trade agreement which resulted in what was to be its defeat.

The TPP was intended to counter China's growing dominance in trade among Pacific nations. Trump further bolstered that Chinese dominance on his trip and is isolating the United States from some of its most important allies in the Pacific.

Of course, in 1972 Nixon had Henry Kissinger as his National Security Adviser organizing his China trip. Prior to becoming National Security Advisor Kissinger was director of the Harvard Defense Studies Program and the Harvard International Seminar starting in 1951.

As reported in September, Trump had Rex Tillerson as his Secretary of State organizing his China trip. Prior to becoming Secretary of State Tillerson was Exxon/Mobil chairman and CEO. Tillerson joined Exxon Company USA in 1975 as a production engineer.


First published Wednesday, February 28, 2017, in my California First blog, this post is part of a series on the 21st Century political, economic and cultural objectives that have been set by China. It is being republished here for continuity as that series will continue here.