Sunday, December 13, 2020

Debunking China-bashing myths for the good of America

First posted on Asia Times. Anticipating the forthcoming regime change in Washington, a host of academics and pundits have begun to offer suggestions and recommendations on how President-elect Joe Biden should rebuild the bilateral relations with China. Bill Overholt just gave one of the most comprehensive reviews on this subject. He was the first Western observer to see the “rise of China,” when he published a book with that title in 1993 and remained, arguably, the dean of the group of unbiased and objective China watchers in the West. Currently, he is senior research fellow at Harvard’s Kennedy School of Government. Overholt recently gave a lecture titled “Myths and Realities in Sino-American Relations” at Harvard’s Fairbank Center for Chinese Studies. The edited version of his talk is not yet ready for posting on YouTube, but he generously made a copy of original unedited recording available to me, which Asia Times readers can access by clicking on the link above. The video also includes commentary by Harvard Professor Emeritus Ezra Vogel and former World Bank chief economist Larry Summers. I firmly believe separation of myths from reality is essential to regaining a healthy bilateral relationship between the US and China. Never-ending Tiananmen protest One of the most enduring myths traces its roots to the student protest in Beijing’s Tiananmen Square that occurred in May and early June 1989. Now, on every June 4, virtually every TV screen in the West displays the image of the young man standing in front of a column of tanks as a reminder that the “fight for democracy” was short-lived. That’s how a myth was born. The students in Beijing were protesting official corruption and unfair job assignments after graduation. A gaggle of Western reporters had happened to follow Soviet leader Mikhail Gorbachev on his visit to Beijing. They saw a ragtag group of students huddled on the Square and rhapsodized that they were demanding democracy. Thus the West has not only not forgotten about the Tiananmen incident, but it has become a legendary cudgel used by political leaders and the media to attack China, alleging lack of democracy and violations of human rights. In the 30-plus years since June 1989, China has undergone a dramatic rate of economic reform unprecedented in the history of mankind. In 1989, China’s gross domestic product was barely 6% of that of the US. Since then, China’s GDP has doubled every seven years. Today, China’s economy is closing the gap and is about to surpass the US, most likely within the next five years. China has also lifted more than 800 million people out of poverty and the most recent report indicated that it has eliminated “absolute poverty.” The Wall Street Journal made the same observation. This was accomplished by building roads to remote villages, provide subsidized housing and vocational training and technical guidance to improve farming based on advances in science. Depending on local conditions, the poor improved their livelihoods by raising higher-valued crops, selling handicrafts via the Internet and hosting guesthouses for tourists. The country’s critics do not acknowledge what the Communist Party in China has done in alleviating poverty but concentrate on outlier situations and individuals that are useful to accentuate the ideological differences between the US and China. China-bashers cannot let go of the false memory that the CPC suppressed democracy at Tiananmen Square. How does Washington compare? If Beijing were to join the ideological spitting contest, it could easily point out that Food Stamps given to welfare recipients in the US cannot provide the dignity of a steadily improving livelihood. And Beijing might well ask, “By the way, Washington, how many have you taken out of poverty? And why do people of color get shot and arrested more frequently than the general population?” Another myth is that China threatens US national security, despite 800 to 1,000 American military bases surrounding the globe compared with China’s single one on the Horn of Africa. That base in Djibouti is to support People’s Liberation Army Navy ships protecting the shipping lanes from pirates. A more reasonable explanation is that the Pentagon and the weapons industry need China to justify the annual budget allocation for weapons of mass destruction. Every time a US naval flotilla visits the South China Sea, it comes home feeling less secure, because American sailors increasingly face menacing missiles and weapons of carrier destruction on atolls turned into military bases by China. For decades, American ships and planes had a free run along the coast of China, and it would appear that Beijing is fed up with the constant intrusions and now has the wherewithal to threaten unwelcome visitors. Apparently, the Pentagon’s feeling less “free” after its “freedom of navigation operations” on the South China Sea is not enough to discourage it from sending flotillas halfway around the world, but it is making it worry more and swagger less. Lose-lose trade war Rectifying unfair trade and bringing jobs back to America was the most prominent myth of President Donald Trump’s election campaign, and it failed miserably. The tariffs he levied on imports from China raised the cost of goods to the American consumer, and China’s tariffs in retaliation reduced American exports to China. The tariffs were supposed to reduce the trade imbalance; instead, the US trade deficit got bigger. The tariff war was supposed to bring American manufacturing back to the US, which never happened. Jobs were shipped to China in the first place to take advantage of the lower labor costs. If tariff barriers make it unprofitable to make the product in China, the factory may be forced to locate to lower-cost places such as Vietnam or Bangladesh – but certainly not back to the US, where the high cost base was the original reason to leave. Unfortunately, America’s organized labor vigorously perpetuated the myth that China “stole” America’s manufacturing jobs. The reality is that, as the economy evolved, most jobs were eliminated by automation. As Overholt said in his lecture, “China lost nearly 45 million manufacturing jobs while we were losing 3 million, but Chinese leaders moved most of those displaced people into services while American leaders just tried to shift the responsibility.” There are other myths big and small that get in the way of normal relations between the two largest economies of the world. As I pointed out in my last commentary, if Biden can find ways to collaborate with China, he will see a more rapid economic recovery, job creation, help in infrastructure and booming free trade. I said, “The world is entitled to exhale in relief now that the reign of error by US President Donald Trump is over.” Indeed, with a rational Biden administration headed by a veteran diplomat in Antony Blinken as secretary of state, we can expect dialogue and serious negotiations over contentious issues, but not the endless confrontations, tantrums and outrageous accusations that we witnessed from Mike Pompeo. RCEP, a 15-country free-trade bloc The most telling indication on the future of bilateral relations is the recently concluded Regional Comprehensive Economic Partnership among the 10 ASEAN countries and China, Japan, South Korea, Australia and New Zealand. According to an analysis by Brookings, “RCEP will connect about 30% of the world’s people and output and, in the right political context, will generate significant gains.” Brookings goes on the say, “RCEP could add $209 billion annually to world incomes, and $500 billion to world trade by 2030.” It is the world’s biggest trading bloc, bigger than the European Union and the United States-Mexico-Canada Agreement. As Pepe Escobar has explained, RCEP is a real deal. The agreement was driven by the Association of Southeast Asian Nations and took eight years to reach consensus. It was just as well that the US was not involved because the Americans would have lost their patience and staying power long before the end. Further, the agreement does not provide for America or anyone to be first. No ideology whatsoever, just free and open trade. With China and Japan, the world’s second- and third-largest economy respectively, as members of RCEP, it’s understandable why even Australia joined. Since Trump became president, the right-wing government in Canberra has been acting like a jackal madly attacking Beijing on all sorts of ideological issues to please its masters, Trump and Pompeo. Prime Minister Scott Morrison’s government seemed to have forgotten that 37% of Australia’s exports go to China, its most important customer, and only 4% to the US. Recently, China decided to give Morrison a bitter dose of medicine by raising tariffs on Australian exports and letting perishables rot on the dock. With the prospect of Trump no longer glowering in his corner, Morrison was not so stupid as to opt out of RCEP, most likely his last chance to repair his relationship with Beijing and save Australia’s economic future. When Joe Biden moves into the Oval Office on January 20, one hopes that his top diplomat, Tony Blinken, will be ready to deal with China based on reality, free from myths and ideological baggage. Issues of common interest such as climate change and controlling the Covid-19 pandemic would provide easy footing for the two parties to move forward. Blinken has publicly stated that China should be viewed as a competitor. Chinese stateswoman Fu Ying wrote in The New York Times this month that cooperative competition is possible between China and the US. She is former vice-minister of foreign affairs and one of China’s most visible spokespeople on international relations. Constructive competition will make both China and the US stronger and presage positive outcomes for both. The zero-sum confrontation favored by the Trump administration would not have done so. Let’s hope that under Blinken’s leadership, the two countries can move along the path of win-win outcomes.

Saturday, November 28, 2020

Kamala Harris, a role model for all generations

This was written for Asia Pacific Islander American Public Affairs and posted on the APAPA website. By becoming the Vice President elect of the United States of America, Kamala Harris has achieved three historic firsts. She will be America’s first woman Vice President, and she will be the first woman of African descent and first woman of Indian descent to serve in that second highest office in the land. She praised President elect Joe Biden for the audacity to pick a female of color to be his running mate, breaking all traditions and precedents. In turn, Kamala deserves our admiration and thanks for accepting the role and subjecting herself to abusive attacks from racists that would reject her just because of her ethnicity. She is clearly comfortable in her own skin. In one of her interviews, she said, “My point was: I am who I am. I’m good with it. You might need to figure it out, but I’m fine with it.” It’s obvious that her self-confidence and sense of self comes from her upbringing by her mother, Shyamala Gopalan Harris, who was Kamala’s single parent since Kamala was 7. At every public remark, Kamala never failed to evoke the memory of her mother and talked about her impact as Kamala’s mentor. Sadly, Shyamala lived only long enough to witness Kamala’s first election to public office as San Francisco District Attorney in 2003. Kamala’s mother died of colon cancer in 2009. Kamala went on to become the Attorney General of California is 2010 and junior Senator from California in 2016. Kamala won every election she ran for and made history in every case as the first woman of color to hold that office. Not just a capable campaigner for public office, she discharged the duties and responsibilities of her office most admirably. When she first began her political career by running for the district attorney, her good friend Julie D. Soo, attorney for California Department of Insurance and community activist, brought her around to introduce her to the large Chinese community in San Francisco. Julie’s father gave Kamala a Chinese name that implied Kamala and Julie are honorary siblings. Kamala promptly learned to say her name in Cantonese, the dialect popular with the community in Chinatown. The Asian side of Kamala came from her mother who came to study at UC Berkeley at the age of 19. Shyamala was not your typical student from India. She fitted right in the Berkeley scene and participated in the civil rights movement. Her father, P.V. Gopalan, was progressive and unconventional enough to encourage his oldest daughter and helped her financially. A career civil servant of limited means, he nonetheless saw his four offspring graduate from college with advanced degrees. Shyamala earned her PhD in endocrinology from UC Berkeley. Kamala said that her grandfather’s progressive views of democracy and women’s rights, especially their right to education, made a strong impression on her. She kept in touch with her relatives in the Chennai area with periodic visits. Her Asian values came from her upbringing and the influence of a close-knit family. The people of San Francisco Bay area are rightly proud of their native daughter. As Vice President, Kamala is one heartbeat from the Oval Office and has made it possible for Asian Americans to feel that they have seats at the table. As Asian Americans we share her values, admire her assertiveness, and proud of her accomplishments. Because of her, we can hope to regain our place in America and not worry about random accusation of spy charges and sudden questions of our loyalty. Now we can say to our children and grandchildren, especially the daughters, “Look at what a daughter of first-generation immigrant parents can accomplish. Kamala has broken through the highest glass ceiling for you. If you study hard in school and take pride in your Asian American legacy, the opportunities can be limitless.”

Friday, November 13, 2020

Biden must avoid lose-lose confrontation with China

The failures of Trump's China policies are obvious, and the way out for his Oval Office successor is just as clear. Subhad posted in Asia Times. Whew, the world is entitled to exhale in relief now that the reign of error by US President Donald Trump is over. His dismal record of endless deception and disruption can be discarded into the dustbin of history. One of President-elect Joe Biden’s highest priorities once he takes office will be to restore the integrity of the US constitution and reaffirm that America remains a democracy. The constitution is the sacred document that the soon to be ex-president and his sidekick and co-conspirator, Attorney General Bill Barr, have sent to the shredder. But that narrative needs to be written by someone more qualified. He or she should consult the daily YouTube series by Glenn Kirschner for a rich repository of evidence that could put Trump and Barr in jail. Biden needs China I would like to address a high-priority repair that is of urgent immediacy for the sake of the future of not only Biden’s term of office but for America. I am referring to the need to turn the bilateral relations between the US and China around. This will not be easy for Biden because demonizing China has had bipartisan support in Washington. Yet failing to do so would cost the US dearly in terms of lives and well-being. It’s literally the difference between prosperity and economic depression, and more importantly between war or peace. Secretary of State Mike Pompeo has made a shambles of US relations with the rest of the world. If Biden were to take an opposite approach on virtually any of Pompeo’s policies, it would be the correct course of action. This logic surely applies to China. One particularly dangerous situation that the Trump administration, with Pompeo in the lead, has created is regarding Taiwan. They have deliberately flirted with the third rail in US-China relations by sending ranking officials to visit Taipei and by selling a bounty of arms including offensive weapons to Taiwan. Until Trump took over the White House, every American president since Richard Nixon had agreed to the Shanghai Communiqué, and had abided by the principle that there is one China and Taiwan is part of China. To recognize Taiwan as a sovereign nation is to risk war, as Trump has edged close to doing, abetted by some of the more rabid Republican senators. What’s worse, the Taipei government led by President Tsai Ing-wen and the independence-minded Democratic Progressive Party has been deluded by Pompeo et al. Tsai is under the impression that if she were to declare independence and provoke an invasion by the People’s Liberation Army, the US military would come to her aid. Therefore, Biden’s first action in the Oval Office must be to tell the Pentagon to stand down and back off from the Taiwan Strait while he sends a message to Tsai that Washington is no longer interested in provoking death and destruction on the island of Taiwan. The military leaders in the Pentagon will be relieved that they won’t have to send young American men and women – yes, the ones Trump calls “losers” and “suckers” – into harm’s way on the other side of the world. Next on the agenda is for the incoming Biden administration to figure out how to reboot relations with China and embark on a path of collaboration and mutual beneficial development. America’s economic health and well-being depend on it. Throw out the ‘blame China’ playbook The determined rendering of China as America’s enemy has been “one hand clapping.” “Blame everything on China” was the Republican playbook for the 2020 election campaign. The disastrous outcome – for the Republicans – on November 3 should be enough incentive for Biden to toss that playbook straight into the trashcan. The Democrats have been as hostile to China as the Republicans have, but on the grounds of accusing Beijing of rampant violations of human rights. This point of view is based on nothing but xenophobia and ignorance. Through decades of concerted efforts, the Beijing leadership working with the local governments has lifted more than 800 million citizens out of poverty. To Beijing, all lives matter, and this is the Chinese leadership’s way of respecting the basics of human rights. In contrast, the US speaks loudly as the self-anointed standard bearer of democracy and upholder of human rights. All the while, people of color in America are discouraged from casting their ballots, are subject to police harassment including being shot for no cause, and find no government helping hand to get them out of poverty. The Ash Center, part of the Kennedy School of Government at Harvard University, recently released a study tracking Chinese people’s approval of their government for over a decade. The survey result shows an approval rate of more than 93%, or roughly twice that for Americans of their own government. Hardly the sentiment of an oppressed populace. The bipartisan desire to put down China has been based on racial bias or holier-than-thou-ideology. But continuing this hostile zero-sum game with China will not help Biden reverse the downward spiral of the US economy. Distributing checks in the name of economic stimulus cannot go on indefinitely. Sooner or later, the checks will bounce. Biden can create jobs with China The only way Biden can create real jobs, as he promised in his election campaign, is to boost the economy on Main Street, not Wall Street. It’s no exaggeration that he can’t do it without working with China. Trump tried to decouple from China and the outcome has been a total disaster. Biden and Chinese President Xi Jinping see eye to eye on the need to deal with climate change. Together, they can reinvigorate the Paris Accord and lead a global effort to halt and then reverse the emission of greenhouse gases. That’s an easy starter to rebuilding US-China relations. China has made advances in solar and wind energy, and the companies in those industries are ready to serve the American market by putting manufacturing plants in the US. All the Biden administration has to do is the change the regulations that are biased against investments from China. Most countries welcome foreign investment for manufacturing, whether from China or any other nation, because such investments create jobs. But imbeciles in Washington have taken a twisted view that Chinese investments are for the purpose of stealing from America. As I reported last year, China’s CRRC Corporation has established two assembly plants to assemble subway cars for major US cities. The cars are state-of-the-art, cost 20% less than any competition, have more than 60% local content, and created 150 jobs at each of the two locations. So far, the company has contracts with Boston, Chicago, Los Angeles and Philadelphia. CRRC was hoping to enter deals with New York and Washington until paranoia in Congress stopped the development on the grounds that subway cars could be used for spying. Really? Better to let wild accusations dominate the conversation than for cities to replace rickety old coaches with new ones at bargain prices? China’s experience and expertise can also help Biden fulfill the need to restore America’s infrastructure. One example is New Jersey-based China Construction America. CCA has been operating in the US for 35 years. About 10 years ago, CCA rebuilt the Alexander Hamilton Bridge in northern Manhattan, doubling the four lanes to eight, and completed the project ahead of schedule and on budget. It was the largest single contract construction project, at US$407 million, ever awarded by the State of New York. When Trump came into office, he talked – a lot – about public/private partnership for renewing infrastructure in America. Just talk, nothing ever got done during his term in office. On the other hand, there are a lot of Chinese companies like the CCA just waiting for the opportunity to participate in the US. They can bid for projects that will mean cost savings for state and federal governments while creating construction-related jobs for American workers. China has a demonstrated record of infrastructure building and has taken its proven expertise around the world as part of the Belt and Road Initiative. There is no reason China could not bring that managerial and planning ability to the US. All it would take is to treat the Chinese as partners without racial bias. China’s economy can give the US a lift Another important reason to want to work with Beijing is that China will be the economic engine to drive the global economy for the foreseeable future. China has already recovered from the Covid-19 epidemic and is showing economic growth while the economies of all other countries, including the US, are still shrinking. China has the world’s largest middle class, with a population of more than 400 million. China’s import market is more than $2 trillion annually. Biden’s top priority for his new secretary of commerce should be to help American businesses sell to China and establish bases inside China. Participating in China’s expanding economy is the best and perhaps only way for the US to accelerate its recovery. American companies already in China can tell you that their sales there are making up for their losses elsewhere in the world. To bring Covid-19 under control, another of Biden’s major campaign promises, will require China and the US to work together. Both are working feverishly to develop vaccines to combat the coronavirus. Being the first country or company to develop an effective vaccine is not the key. What is important is how the vaccines will be distributed so as to eliminate the coronavirus around the world in a most expeditious manner. Pompeo’s idea of “me first” and “me only” for the US is idiocy. Even if America breaks free from the virus while the rest of world is still suffering from the contagion, the US will not be able to keep other parts of world from re-infecting the US. It’s a global pandemic and needs a global solution that the US along with China and World Health Organization can devise together. The current zero-sum game requires constant demonizing of China until the rhetoric reaches fever pitch. A recent example is the hysterical lamentation by US Secretary of the Navy Kenneth Braithwaite. He takes an orientation trip to the Asia-Pacific region and comes back terrorized by what his overactive imagination tells him of China, but his nightmare has no relation to the reality of what China is actually doing. There is no evidence that China is about to become a military adversary of the US. China can be a formidable economic adversary but only if the US wants it that way. K J Noh and I have outlined a course of action for the Biden administration in Asia Times. The overall strategy is really simple. He just needs to find the many collaborative ways for both countries to win.

Wednesday, November 4, 2020

The strange saga of Meng Wanzhou

First posted in Asia Times The next extradition hearing in Canada for the Huawei CFO is set for Monday; it is time to end this sad story Until she was detained by the Royal Canadian Mounted Police while transiting Vancouver International Airport, the world had not heard of Meng Wanzhou. Now everybody knows that Meng, 48, is the chief financial officer of Huawei and the daughter of Ren Zhengfei, chief executive officer and founder of China’s leading technology giant. The RCMP arrested Meng in respond to a warrant from the US District Court in Brooklyn, New York. The warrant was actually drafted on August 22, 2018, but not delivered to the Canadians until November 30, urging immediate action because Meng was expected to transit Vancouver on December 1 en route to Mexico City. The message from US officials implied that if she was not arrested this time, the next opportunity might not come again for an indeterminate period. Unfortunately for the Canadians, they fell for the story. The Americans had been monitoring Meng’s movements for some time. Between August 22 and December 1, 2018, they noted that she had visited six other countries with extradition treaties with the US, namely Britain, Ireland, Japan, France, Poland and Belgium. Had she been allowed to leave Vancouver, she would have visited Mexico, Costa Rica and Argentina. They too have extradition treaties with the US. Canada the designated patsy With 10 countries to choose from, then US deputy attorney general Rod Rosenstein, directing this operation, concluded that Canada would be the easiest patsy and most willing to act as a vassal state to run this errand for Uncle Sam. Selecting a willing collaborator was important because extradition hearings are almost always complicated, subject to challenges and appeals, and can consume a lot of time. Most countries would prefer not to get involved with such proceedings, since as a disinterested third parties, they have no skin in the game. Indeed, Meng has languished under house arrest at the home she owns in Vancouver since her arrest nearly two years ago. Her next hearing is scheduled for this Monday, October 26. Lawyers familiar with extradition cases have opined that this case could drag on for another five years before all the issues and challenges can be resolved. Much has already been reported about this cause célèbre, but I have seen very few discussions that examine the rotten underpinnings of the case, which I now propose to do in this article. The origin of this case was probably more than 10 years ago as Washington watched the growth and development of Huawei with increasing dismay. Huawei had grown into a major supplier of telecommunication technology, and then threatened to become the world’s leader in that sector. By the time Donald Trump became US president, Huawei had indeed become the leader in 5G, the fifth-generation wireless communication protocol and a leading maker of telecommunication hardware and mobile phones. The Trump administration decided that the way to deal with the rise of Huawei was to use brute force – suppression, harassment and active campaigns with other nations not to buy from Huawei. Two news articles in 2012 and 2013 gave the ad hoc task force the idea to consider accusing the company of violating the US sanctions on Iran. On further reflection, they must have concluded that charging a company in China with violating a US sanction on doing business with another country, in this case Iran, had a low probability of sticking. But another article in 2013 reported that Meng had given HSBC a PowerPoint presentation about Huawei and Skycom. Meng was quoted as saying, “Huawei’s engagement with Skycom is normal and controllable business operation,” and that “as a business partner of Huawei, Skycom works with Huawei in sales and service in Iran.” The “aha” moment for the Trump team was the fact that Skycom had attempted to sell Hewlett-Packard (HP) personal computers to Iran. The sale was never consummated but the intent to sell US technology to Iran was evidently sufficient to charge Skycom with violating the sanctions. So far in the story, it seems to be a slam-dunk for the Trump team. All they did was read some old news articles and found a way to link the printed evidence to the CFO of Huawei. Now bear with me, dear readers, and you will see that the story starts to smell fishy. The most damaging “evidence” offered as part of the charges filed by the US Justice Department with the Canadian courts was the aforementioned PowerPoint Meng had prepared for HSBC. The US prosecutors claimed that the presentation showed Meng had lied to the bank and cause it to violate the sanctions against Iran unknowingly. So it would seem that HSBC had turned state’s evidence to help the US federal court. However, the bank did not necessarily have clean hands in this matter. It issued a press release in 2012 that read in part: “HSBC has reached agreement with United States authorities in relation to investigations regarding inadequate compliance with anti-money-laundering and sanctions laws. “Under these agreements, HSBC will make payments totaling US$1.921 billion, continue to cooperate fully with regulatory and law-enforcement authorities, and take further action to strengthen its compliance policies and procedures.” Even for a major international bank, $1.9 billion is not chump change. But the interesting question not answered is whether “cooperate fully” included giving the PowerPoint slides to the Justice Department. Did the US government agree to deduct some amount from the fine as quid pro quo? US prosecutors not playing with a full deck The legal counsel for Meng were quick to point out to the presiding judge that the PowerPoint deck presented by the US prosecutors was incomplete. Slides that would have portrayed a different position for Meng in this decade-old affair and indicate that she had been transparent with HSBC were left out. As The Globe and Mail observed, it’s highly unusual to go after individual executives carrying out company business rather than indicting the corporation for illegal offenses; indeed, one such example was the case against HSBC. Obviously, the special circumstance for going after Meng was that she was the daughter of the founder of Huawei. The age of this case in the Canadian court is nearing two years. The original hare-brained idea was to hold Meng hostage to put pressure on her father, Ren Zhengfei. It didn’t work. Huawei has grown stronger and increased worldwide sales in the interim. The latest Trump-team move was to deny Huawei access to critical semiconductor technology, which will temporarily set the company back, but at great cost to American high-tech industries – read David Goldman’s forecasts in Asia Times here and here. With the current attention on denying American technology to Huawei, the US may have lost interest in Meng’s incarceration, but Canada is left holding the bag of a stinky mess not of its making. The Big Brother south of the border has skillfully set up Canada to take the fall, and there is no nice way to put the gloss on this little piggy. Washington deliberately gave Vancouver authorities just one day to plan and make the arrest. They did not have time to look at the broader picture, consider the international consequences, or consult with Ottawa. Let’s face it, they were played for suckers – OK, if not suckers at least country bumpkins. Not Justin Trudeau’s brightest moment However, the prime minister of Canada, Justin Trudeau, has not exactly been a smart national leader and avoided the sinkhole laid out before him. He had plenty of opportunities to tamp down this sordid affair. Instead he lost control of the situation. Five days after Meng was detained, her arrest was finally made public, and the Chinese Embassy in Canada was furious and demanded her immediate release. Ottawa did not respond. Ten days later, two Canadians were detained in China, heretofore referred to in the media as the “two Michaels.” Beijing denied that the arrests were related to Meng’s arrest, which of course Trudeau wouldn’t buy. But Trudeau also did not acknowledge the reciprocal nature of China’s action. Instead, he accused China of using arbitrary detention to achieve political goals and said that to give in to Beijing would put more Canadians at risk. His reasoning is a real head-scratcher. Urging Canada to release Meng is hardly politics but humanitarian, and it’s hard to see how arranging a prisoner swap would endanger more Canadians – unless Ottawa is planning to intercept more Chinese business executives transiting Canadian airports in the future. There are plenty of voices within Canada telling Trudeau that he can cut off the extradition process if he wants to. One summary reads: “The Extradition Act in 1999 gives the justice minister ‘unfettered discretion to withdraw an extradition at any time during the judicial phase of extradition,’ which offers the federal government a very clear option.” Even though China has significantly reduced its imports from Canada, Trudeau appears undeterred. He apparently treats placating the irascible Donald Trump as more important than Canada’s sovereignty and national interest. He even fired his ambassador to China, a historic first, for publicly suggesting that Trump’s public comments provided grounds to stop the extradition. Too bad Justin is just not a chip of the old block that was his father, Pierre Trudeau. Fifty years ago, Pierre led Canada to establish one of the first diplomatic relations between a Western country and People’s Republic of China, two years ahead of US president Richard Nixon’s visit to Beijing and nine years before formal normalization between the US and China. Now, it appears unlikely that any surprising turnabout development is likely to take place at the court hearing on Monday. Meng’s fate will have to wait for the outcome of the US presidential election on November 3. K J Noh and I have outlined the messy legacy created by US Secretary of State Mike Pompeo and a long list of actions that former vice-president Joe Biden will have to take to right the ship of statecraft if he wins the election. Assuming that he wins, upon taking over the Oval Office, he will have many things to tend to, but one of his easiest tasks will be to drop the extradition process for Meng promptly. It’s long overdue and the decent humanitarian thing to do.

Friday, October 30, 2020

Should Biden adopt Pompeo’s style of diplomacy?

The concluding article of a two-part report offers recommendations on what a Biden administration's China policy should be. Co-written with K J Noh and first posted in Asia Times. US Secretary of State Mike Pompeo is not known to be a particularly original thinker. Every time he attacks China, alleging misbehavior, theft of intellectual property (IP) is always on top of his list of accusations. This is an American complaint about China that dates back to the 1990s and is regularly dusted off for reuse. Lacking literacy in technology, Pompeo does not appear to understand that the nature of IP in technology evolves and changes rapidly. The leader of a particular discipline today can quickly become a follower tomorrow. To compete, companies in Silicon Valley regularly steal, infringe, copy or share by cross-licensing technology to keep up. Chinese technology companies are not averse to using the same strategy. They nick IP when they can, they copy – euphemistically called “reverse engineering” – when they can, and they enter licensing agreements when necessary. The only difference is that the Chinese companies didn’t just stop there but went on to invest in their own research and develop their own proprietary IP. One example is Huawei. Huawei employed 96,000 researchers and spent US$17 billion on research and development in 2019 alone. Not surprisingly, it holds 85,000 patents, including 19% of all standard-essential patents in fifth-generation (5G) telecom technology. Because Chinese engineers are generally better trained, are more motivated and work harder than their American counterparts – and there are many more graduates in this field every year – some Chinese companies have introduced products and technology not seen in the US. Indeed, Pompeo doesn’t appreciate that in some technical disciplines, China has already surpassed the US, and the gap will only increase with time. To suppress China’s technological advances, Pompeo’s approach is to harass Chinese executives, threaten sanctions to restrict their international travel, and bring about sudden unannounced arrests in transit lounges. By denying access to technologies and products where the US is more advanced, such as semiconductor manufacturing, he expects the Chinese to stop dead in their tracks. Unfortunately for the US, the blowback to his approach has near and long-term consequences. An immediate consequence is a significant drop in sales of semiconductor chips to China. Previously, almost 40% of the US output was sold to China. Now, it’s possible that unsold chips will be keeping company with sacks of unsold soybeans. Sadly, American companies can only watch their former advantages get washed down to the sewer by the actions of their own government. Once China has overcome the shock of doing without advanced US technology, companies such as Huawei will press all the harder to develop their own indigenous replacements for the American products. At some point, Silicon Valley will permanently lose a customer and gain a formidable competitor. Pompeo’s simple-minded technology war with China extends to cutting off enrollment of Chinese students in American universities, especially at the graduate-school level. His thinking, shared by many of his Republican colleagues, is that the best and brightest from China come to the country for the express purpose of stealing from the US. In actual fact, first-tier graduate schools such as the Massachusetts Institute of Technology (MIT) or University of California at Berkeley would be reduced to a mere shadow of their former robustness if they only had US-born-and-educated students to staff their research labs. China annually generates roughly 10 times as many graduates in science, technology, engineering and mathematics (STEM) as the US. Skimming the best from a population 10 times as large is bound to yield candidates with more impressive credentials. Furthermore, colleges and universities in China demand and expect more from their students before allowing them to graduate. If President Donald Trump’s administration really cared about “making America great,” it should have actively welcomed students from China and found ways to entice them to stay and work in the US. Instead, Pompeo and his State Department have introduced deliberate ambiguity on approval of their visa applications, raising doubts on whether they can attend and can count on completing their studies. When Chinese students stop coming Pompeo’s tactics have succeeded. A significant number of Chinese students are changing their plans and deciding against going to the US. About 6,000 Chinese nationals used to obtain their doctoral degrees in science and engineering from American institutions annually. That number will surely decline. Thanks to Trump’s persistent show of xenophobia insisting that China is to blame for the Covid-19 epidemic in the US, the frequency of physical violence against Asians in America has risen drastically. Pompeo’s wish is thus being fulfilled as increasing number of Chinese are going back to China. They are not sticking around to “steal” high-paying jobs from Americans. The case of Cao Yuan comes to mind. He was a physics doctoral candidate at MIT who went home to China for the summer. Then he found out that US Immigration might not allow him to return. His suspension was lifted only after MIT interceded on his behalf. After getting his degree this year, Cao immediately announced his intention to go back to China. America may come to rue this development. For his discovery of room-temperature superconductivity, the journal Nature recognized Cao as first among the top 10 who mattered in science in 2018. When superconductivity becomes common in daily use, China will be massively ahead of the US. Trump and Pompeo may be remembered for their ignorance of what superconductivity was all about. As we can see from this brief survey, Secretary Pompeo is like that overeager player on a soccer team who not only messes up all the plays, but actually scores errant own-goals. There has rarely been such a continuous string of diplomatic defeats and faux pas: If this were a game, he would have been fouled out, traded, or sold long ago. Yet he continues to lead the US into a diplomatic abyss. Pompeo’s boss is also doing his utmost to shake the American people’s confidence in democracy. When Trump asks voters to break the law and cast their ballot twice, he is challenging the legitimacy of mail-in ballots and making it difficult to vote as an absentee or in person. He can then cry foul over the very voter suppression that he has created. Small wonder that three of the world’s oldest and most prestigious scientific publications, Scientific American, New England Journal of Medicine and Nature, could no longer stand idle while Trump made a mockery of democracy. They broke a historic precedent to remain apolitical and publicly endorsed his Democratic challenger, Joe Biden, for president. Assuming that Trump does not succeed in stealing the coming election, what would a Biden presidency do? Should the Biden administration go down the same self-destructive rabbit hole? “Dying is easy, comedy is hard,” say performers, but Pompeo’s diplomatic comedy is actually deadly and destructive to the world and the US. Will Biden continue the same dying and deadly stand-up routine in front of a global public that has already left the theater? Will he double down on the lies and the farce? Biden has apparently adopted the China policy statements from the Center for a New American Security (CNAS), the reconstituted neocon think-tank from the George W Bush years, as his template for foreign policy on China. This is not encouraging. They have grandfathered in all of Trump’s Sinophobic policies and worked out in obsessive detail to further acts of confrontation and escalation. How Biden can save America To avoid hurtling over the precipice and turning America away from economic and military disaster, we recommend that the Biden presidency take the following actions: Drop CNAS from the foreign-policy advisory committee. The Project for the New American Century (PNAC) led us to the disastrous Middle East quagmire. In a similar fashion, CNAS will lead us into catastrophic war with China. Drop Michèle Flournoy and the old “blue team” neocon or “Pacific pivot” holdovers. They have no business doing politics, given their atrocious records. Facilitate the release of Meng Wanzhou from Canadian custody immediately, and apologize for her kidnapping. Her only crime is being the daughter of the chief executive of a Chinese company the US wants to destroy. Apologize for Biden calling President Xi Jinping a “thug.” The only justification for insulting a head of state in that manner is if you intend to go to war. Stop the “freedom of navigation operations“ (FONOPs) and other belligerent military maneuvers in the South China Sea. Halfway around the world is not your back yard, and besides, the Chinese have no reason to interfere in any of the shipping – it’s all headed for or leaving China. Stop the harassment of Huawei and its supply chain. Compete properly or cede the field, but don’t kidnap its executives. Same for TikTok, Tencent, and Ant Financial. Stop militarizing Taiwan. Stop building an embassy there. Stop using airbases there. Don’t mislead Taiwan into thinking that if it provokes a conflict, the US will come to its aid. Taiwan is part of China, and Taipei and Beijing need to resolve their differences without Uncle Sam in the room. Shut up about Xinjiang. It’s all lies, and the longer you keep up the lies, the more embarrassing when you get found out. Uighur terrorists who fought for al-Qaeda do not become “freedom fighters” when they go back to Xinjiang. Shut up about Hong Kong. Hong Kong is part of China, and it has no capacity or desire to be independent (it gets its food, water, and electricity from mainland China). Funding black-shirted fascists will only result in catastrophe. Shut up about Covid-19. Get your house in order. Implement real public health measures, and a people-centered medical-insurance program. Stop the harassment of scholars and students. The US without Chinese scholars and engineers is a country of MBAs, JDs and gun-toting survivalists – an unproductive failed state heading for a surreal apocalypse. Stop trying to derail the Belt and Road Initiative, and for God’s sake, stop waging wars, coups, assassinations, and explosions in its key nodes. Imagine what it could be like, collaborating in peace, open trade based on relative advantages, and exchange of ideas and people in friendship. America cannot win and China cannot win in a zero-sum game. But China is no threat to the US, and it is no pushover either. Biden can and should make the bold move to the northeast quadrant of game theory where both can win and prosper. This is the concluding article of a two-part report. Read Part 1 here. George Koo is a retired international business adviser and frequent contributor to Asia Times. K J Noh is a journalist, political analyst, writer, and teacher specializing in the geopolitics of the Asia-Pacific region.

Monday, October 26, 2020

Pompeo’s record a litany of failure

In the first article of a two-part report, we examine the damage the US secretary of state has done at home and abroad. Co-written with K.J. Noh and posted on Asia Times Mike Pompeo, otherwise known as the international man of catastrophe, by wide acclaim, has earned a label as the worst secretary of state in the history of the United States, while appropriately enough serving under its worst president. That president, Donald Trump, has torn the US constitution to shreds, and he has an absolutely corrupt chief law-enforcement officer, Attorney General Bill Barr, to provide him a temporary Get out of Jail Free card. Until and unless regime change takes place after the November election, Pompeo is safe under the same protective custody. As the US top diplomat, Pompeo’s mission is to persuade nations to take positions aligned with the US and in opposition to China. If a nation fails to be persuaded, especially when it’s against that nation’s self-interest, Pompeo’s technique is to compel it to comply with the threat of sanctions. Levying sanctions hasn’t been limited to the usual wide-angle shotgun blasts at Cuba, Iran, North Korea and Venezuela, but the US has also targeted the chief prosecutor and other officials of the International Criminal Court for investigating Pompeo for possible war crimes while he was head of the Central Intelligence Agency. Just as his boss, Trump, sees himself as above the laws of the United States, Pompeo, who sees the United Nations, World Health Organization and other international bodies as subordinates to the US, certainly would not allow the possibility of being subject to international laws. The sanction is his way of saying we’re not going to allow you to travel freely to continue your investigation and we’re not going to take you seriously. He lied, cheated and stole In a moment of braggadocio and indiscretion – and poor judgment – he chortled before a group of students and boasted how as head of the CIA, he lied, cheated and stole. All in the CIA training manual, he said. The students were not amused. Neither was the public. Since becoming the head of the State Department, his actions confirm that his modus operandi has not changed. Pompeo has remained true to his character in his campaign against China. With no sense of irony, a typical preamble to his speeches on China goes: “Communists always lie, but the biggest lie is that the Chinese Communist Party speaks for 1.4 billion people who are surveilled, oppressed, and scared to speak out.” He failed to note that annually, 170 million of these deceived Chinese people travel as tourists abroad, and then choose voluntarily to return to this “open-air prison” of surveillance, oppression and terror. It probably did not occur to him that this allegation may be more projection than anything resembling truth, given the fact that the US has the largest prison population of any country – five times as great on a per capita basis as China’s – and the surveillance and harassment of whistleblowers and dissidents is routine. On October 6, Pompeo lashed out against China and exhorted the Quad – the US-Japan-Australia-India military-strategic formation that the US is trying to consolidate against China – to stand against China and its evil, corrupt actions: “I also look forward to … renewing our resolve to protect our precious freedoms and the sovereignty of the diverse nations of the region. “As partners … it is more critical now than ever that we collaborate to protect our people and partners from the CCP’s exploitation, corruption, and coercion.” The silence from the Quad members was deafening – no agreement or statement was issued after their ministerial meeting in Tokyo. The Japanese government, in particular, in a mind-bending act of diplomatic insouciance, insisted flat out, “This Quad meeting is not being held with any particular country in mind.” Sorry, His Holiness is not in On September 30, the Vatican rebuffed a request from Mike Pompeo for an audience with Pope Francis, and accused the secretary of state of trying to drag the Catholic Church into the US presidential election by denouncing its relations with China. On September 9, in a speech to member states of the Association of Southeast Asian Nations encouraging them to gang up against China, he stated, “Don’t let the Chinese Communist Party walk over us and our people. You should have confidence and the American will be here in friendship to help you.” The good secretary seemed to have forgotten that if anyone has posed a historical threat to Southeast Asian countries, it is the United States. Unsurprisingly, there were no takers. On July 23, at the Nixon Library, Secretary Pompeo in a warmed-over version of Ronald Reagan’s “Evil Empire” speech declared the end of US-China détente, and announced a new cold war: “Washington is seeking to change Beijing’s behavior, [against] a generational threat, a totalitarian and hegemonic regime.… Free nations … can successfully force a change of China.” To make this argument, Pompeo listed a litany of imagined, projected, and concocted wrongs committed by the Chinese: spreading Covid-19, stealing jobs and intellectual property, trade abuses, violations of international law, and of course, the catchall, being “Marxist-Leninist.” After all this hyperventilating about China’s menace “to our economy and way of life,” he called for all nations to come together to fight China, to “triumph over this new tyranny.” “We, the freedom-loving nations of the world, must induce China to change … because Beijing’s actions threaten our people and our prosperity…. It’s time for a new grouping of like-minded nations, a new alliance of democracies.” Pompeo acted as if he was the visionary to lead the 1.4 billion Chinese out of the wilderness and overthrow the Beijing regime. Lies about China can be very profitable To make his case for demonizing China, Pompeo will use any source of questionable legitimacy. One example was a paper written by Li-Meng Yan, a virologist and at the time of publication a postdoctoral student at Hong Kong University. Her paper claimed that the Covid-19 virus was created in a Wuhan lab. Her finding was sensational as it seemed to authenticate Trump’s and Pompeo’s accusation that China should be held accountable for the pandemic. The popular media went wild with the story, even though those in scientific circles criticized the non-peer-reviewed paper as weak on science. Rapid Reviews: COVID-19, a collaboration between the University of California at Berkeley and the Massachusetts Institute of Technology, quickly solicited reviews of the Yan paper by four renowned scientists in the field and their conclusion was: “This manuscript does not demonstrate sufficient scientific evidence to support its claims. Claims are at times baseless and are not supported by the data and methods used. Decision-makers should consider the author’s claims in this study misleading.” Those reviews followed the publication of the Yan paper by about two weeks. It’s a safe bet that the refutation is unlikely to attract the attention of the mainstream media. An added side note in the comment section was the observation that the co-authors listed in Yan’s paper did not exist but were fictitious – in other words, a blatant lie. So what could have motivated Yan? By now, it has become quite clear that providing material for China-bashing can be very lucrative business. Gordon Chang showed that he could publish a book on China that totally missed the mark – instead of economic collapse, China is about to become the largest economy in the world – and instead of striking out, he became an anti-China media star for the last 20 years. Peter Navarro did even better. He wrote a book and a documentary titled Death by China, a complete work of fiction, with imaginary “expert” “Ron Varra,” who turned out to be the anagrammatic alter ego of Navarro himself. This China-bashing turned him from being a failed politician and outcast academic into the holder of a seat in the inner circle at the Trump White House. The latest to follow this career trajectory is Adrian Zenz. In just two years, out of nowhere, he became known as an expert on Uighurs in Xinjiang by claiming that between a million and 1.8 million Uighurs were being held in concentration camps. No one really questioned the accuracy of the report nor the veracity of this so-called expert, a millenarian Christian theologian who claims that Jews will be exterminated in the Rapture, that women should not pursue careers outside the home, that children should be physically abused “according to scripture,” and that homosexuality is the work of the Antichrist. With those impeccable credentials, Zenz was instantly embraced by the media, the Trump administration and the US Congress. Zenz visited Xinjiang 13 years ago, but it is not likely that he was drawing any substance from that visit. One million people is a lot to be held and would be difficult to hide: The US has more than 6,000 such facilities to house its inmate population. Satellite photos offered as evidence of such camps turned out to be schools and office buildings. These compounds all have fences and walls on their perimeter. Apparently, that is all it takes to qualify as evidence for prison camps. Foreign visitors to Xinjiang of more recent vintage have found no evidence of large numbers of locals incarcerated. If the numbers claimed by Zenz are correct, it would imply that a very large percentage of working Uighur adults are incarcerated. However, life on the streets and markets appears relaxed and normal. Indeed, most people living in Xinjiang, of any ethnicity, seem to be beneficiaries of China’s campaign to lift everyone out of poverty. About 9% of China’s population belong to an ethnic minority, of which 55 are recognized. Where any given ethnic group dominates a geographical region, an autonomous government is established to allow some degree of local governance. Ethnic minorities are encouraged to preserve their own culture and attend bilingual schools where Mandarin is taught alongside their own native tongue. During the draconian era of one child per family throughout China, ethnic minorities were permitted to have two or three children. Remote, hard-to-reach areas of China were understandably the last to feel the benefits of Beijing’s poverty-alleviation program, regardless of the ethnicity of the people living there. Local governments’ mandate is to strive to improve the welfare of the people under their care. But all lives matter in China In China, voting occurs at the local level for representatives to the local people’s congresses. Members of the local congress then elect from within that body those who will become members of the provincial congress, who then elect those to represent their province at the National People’s Congress. Thus each tier of representation becomes more selective, rigorous, and professional. While this differs from the direct suffrage practiced in the West, it promotes competence and dedication, and a government where all lives truly matter, and none are kept in ghettoes by design. Poverty alleviation follows a general pattern. The local governments with the support of the central government build roads to connect the remote village to the economically upscale towns and cities to facilitate the sale of their produce and local goods. This policy accords with studies that show the single most important factor in alleviating and escaping the cycle of poverty is good transportation access. Where transportation infrastructure was too difficult to build, the local government would provide the option of heavily subsidized housing with electricity and water to encourage poor villagers living in remote places to relocate to nearby urban centers with easier access to schools and health care. Vocational training along with relocation provides the farmers with new skills and chance to raise their income. One example was presented here. Technical experts would visit the poor village and appraise the potential to raise incomes and provide guidance. Sometimes the recommendation is to switch to higher-valued crops, other times just introduce ways to improve yield. With the popularity of streaming over the Internet to promote sales and with greatly improved roads and rail, and rapid payment and delivery systems, it is now possible to sell exotic fruits, local goods, and medicinal herbs available in one remote region to consumers all over China. Attractive handicrafts unique to a particular ethnic group can be introduced and popularized via streaming. As a consequence of being a huge and fast-growing economy, China has a burgeoning middle class. Relatively new to consumption, the appetite of the middle-class Chinese for goods is a huge market not remotely near saturation. By dedicated and determined efforts, Beijing can proudly proclaim that hundreds of millions have been lifted out of subsistence living. Yet the West with its comfortable standard of living continues to accuse China of human-rights abuses. Third World countries make no such accusations, just express admiration for China and hope that China will help them to attain higher standards of living through its experience and expertise and via the Belt and Road Initiative (BRI). Pompeo has been busy telling African countries that China’s BRI is nothing more than a debt trap. Of course, drawing from his own personal background, it’s easy for him to project what he would do and imagine that China is pulling off a con. By and large, African nations welcome the opportunity to collaborate with China and take advantage of its infrastructure expertise and willing investment. These nations react to Pompeo with disdain and affront. Privately, they say to themselves, “Do you think we’re so dumb and easily swindled, or what?” A port and airport project in Sri Lanka has been frequently cited by Pompeo and others as the “see, I told you so” example. The truth of the matter was that the Sri Lankan government was too ambitious and overestimated the expected revenue stream to be derived upon completion of the port and airport. When Sri Lanka could not meet the repayment schedule, China took over the management of the port and airport. In experienced hands, the Chinese operator has raised efficiency and increased utilization so that profitability is now within reach. Once revenue is sufficient to service the loan, the projects will revert to Sri Lanka. Just this month, Pompeo went to Croatia to tell the country to stay away from China’s BRI. In a press conference in front of the Dubrovnik harbor, Pompeo and Croatian Prime Minister Andrej Plenković stood side by side, and Plenković was asked by the media his thoughts about the BRI. The reporter prefaced her question by saying that Pompeo had denounced the BRI as a predatory scheme to buy a Chinese empire. In response, Plenković said China was very smart to use the BRI to build its relationship with Central and Eastern European countries. He said he had met with Chinese Premier Li Keqiang five of six times since coming into office, is fully aware of all aspects of China’s deal, and believes Beijing will be fair and behave in accordance with international norms. Plenković looked over at Pompeo as he praised Croatia’s relationship with China. Apparently, he did not feel the need to be diplomatic before the emissary from the US. This is the first article in a two-part report. Part 2 will look at what to expect from US diplomacy under a Joe Biden presidency. George Koo is a retired international business adviser and frequent contributor to Asia Times. K J Noh is a journalist, political analyst, writer, and teacher specializing in the geopolitics of the Asia-Pacific region.

Saturday, October 3, 2020

America’s global prestige on life support

First posted in Asia Times Recently, on the occasion of commemorating the United Nations’ 75th anniversary, world leaders took turns addressing the General Assembly via video feed. US President Donald Trump’s surprisingly short seven-and-a-half-minute address can be summarized in three words: “Chia-nah, Chia-nah, Chia-nah,” with a sneer and a snarl for emphasis. Trump blamed China for covering up the Covid-19 outbreak, and for spreading it to the rest of world. He also congratulated himself for his great job in bringing the pandemic under control – despite the fact that the America he has supposedly made great, with slightly over 4% of world’s population, has accounted for more than 20% of the world’s Covid infections. In his address, Chinese President Xi Jinping reported that China has several vaccines undergoing final stages of clinical trials. When the vaccines become available, he promised that they would be a public good available to the world. “Covid-19 will not be the last crisis to confront humanity, so we must join hands and be prepared to meet even more global challenges,” Xi said. In short, China considers itself a member of the world community of nations and wishes to collaborate within the UN framework. Trump’s America wants to go it alone and other nations are expected dutifully to follow along. The US is only a member of the UN when the international body gives Trump what he wants. For the purpose of ensuring his re-election, Trump is acting on the premise that he needs to make an adversary of China every which way possible. Trump’s anti-China team seems to believe in the economic law of comparative disadvantage – a novel idea that no matter how much hurt America suffers, China will hurt more. So far, the “mutual hurt” idea, rather than being revolutionary, has turned out revoltingly for the American people. Levying tariffs on imports from China has backfired. The trade imbalance with China has not changed but continues to favor China – not an unexpected outcome according to the law of comparative advantage – simply because the country that can make a product cheaper and better sells more. Bloomberg Businessweek has already declared China the winner of the trade war. American businesses cry uncle As Reuters reported, 3,500 US companies have joined in a legal suit against the Trump administration for “unlawful escalation of the US trade war with China.” In other words, American businesses are saying the waterboarding they have endured from the trade war has gone on long enough. China has effectively brought Covid-19 under control and is resuming its economic growth. The US, unsurprisingly given its failure to bring the pandemic under control, is experiencing drastic economic shrinkage; the backsliding of its economy is likely to persist for the rest of this year and beyond. An important consequence is that foreign direct investments are pouring into China from all directions as investors make sure they do not miss out on the world’s most significant booming consumer economy. Former US vice-president Joe Biden appears to be winning the race to the White House. As I stated in my last commentary, it will be in Biden’s interest to drop the zero-sum confrontation and find ways to collaborate with China, because America’s economic recovery will depend on a mutually beneficial relationship going forward. But getting along with China will be only one of many challenges a Biden administration will face. The current secretary of state, Mike Pompeo, has made a mess of America’s relations with the world community of nations, alienating friend and foe alike. The wreckage he is leaving behind will take a Herculean effort and reassurance to restore the US position as a trusted leader of the world. For example, as Asia Times has noted, somehow Pompeo has pressured Australia into leading an attack on China repeating baseless accusations from Washington, despite China being Australia’s most important customer and most vital contributor to its economy. The author of that op-ed can’t understand why Australia is willingly digging its own grave, except possibly that their leaders are not too bright. Canada is in a somewhat similar position as Australia, but its reluctant slitting of its own throat is more explicable. The United States is too big and powerful of a neighbor and has a stranglehold on Ottawa. Arresting Meng Wanzhou, Huawei’s chief financial officer and daughter of founder Ren Zhengfei, with no legal justification in an act tantamount to kidnapping was apparently necessary to placate Trump at the expense of angering Beijing. Too bad Canadian Prime Minister Justin Trudeau has been too weak-kneed to stand up to Washington. Huawei customers wait and see Pompeo has apparently strong-armed many countries into rejecting Huawei’s 5G technology, the fifth-generation mobile telecommunication protocol, by alleging the Chinese company is a security threat. In many cases, these countries have been using Huawei equipment for 3G and 4G without incident. To break away will mean having to rip out pre-existing Huawei installations and facing months of delay waiting for one of its competitors, Ericsson or Nokia, to catch up with its version of 5G. In the case of the UK, banning and removing all Huawei equipment would take until 2027, delay the rollout of 5G by three years, and cost the economy an estimated £18.2 billion (US$23.25 billion). Britain would also be giving up its competitive leadership in 5G and billions of pounds in associated opportunity costs. It’s most likely that 10 Downing Street will watch the outcome of the US election with keen interest to see if it really has to abandon Huawei. Indeed, many countries in a similar pickle will be watching for a regime change in Washington that would allow them to proceed with business as usual and not cause such disruption in their telecommunication plans. The carriers in Canada, for example, want C$1 billion (US$747,000) in compensation from Ottawa if they are forced to switch away from Huawei. In his ham-fisted style, Pompeo has managed to charm no one and pissed off many, including heretofore allies such France, Germany and the European Union itself. The latest example was Pompeo demanding the signatories of the Iran nuclear deal to reinstate sanctions as provided in the agreement, an agreement that Trump walked away from shortly after he became president. The EU countries, Russia and China merely laughed and told Pompeo that he has no say in the matter. China, Russia are tight Crucially by threatening Russia and China at different times by different means, Pompeo has managed to forge a tight alliance between Moscow and Beijing. China will buy oil and gas from Russia in a long-term contract. The two countries will jointly develop agriculture and natural resources in the vast Siberia region and Russia has offered to install an anti-missile defense system for China. These are just for starters. As M K Bhadrakumar, a veteran diplomat and writer, has observed, “The US is increasingly resorting to unilateral sanctions against both Russia and China that are not supported by international legal foundations, and is stepping up pressure through the extraterritorial application of national legislation to compel other countries to fall in line with its sanctions regimes and domestic laws, often in contravention of international law and the UN Charter.” The shining citadel on top of the hill that was once America is no more. “America First via my way or the highway” has washed the citadel down into the gully. The challenge for Biden, should he win the election, is to figure out how to pick up the pieces and restore America to where it should be, namely by regaining the trust and respect of the world. The world is keenly watching whether a change in the US administration will lead to the restoration of sanity and order. If the American people allow Trump to keep his job in November, then the hope is that he, not having to run for another election, can do an about-face and start to get along with everybody, including China. But consistency has never been much of a deal for Trump, and so it would not be much of a surprise. The signal for an about-face would be a Pompeo replacement.

Tuesday, September 1, 2020

Regime change in US could mean reset for China relations?

First posted in Asia Times

Two recent developments presage a forthcoming regime change in Washington – a change that needs no help from the National Endowment of Democracy, whose mandate to incite change of governments does not include the US, in any event. 

The surprise arrest of Steve Bannon last week could signify the loosening of another cotter pin in the Donald Trump machine. Bannon, former campaign strategist and intimate adviser for Trump, has been charged with embezzlement and money-laundering. If convicted, he will become the latest to join President Trump’s inner circle of crooks.

Will Bannon squeal?

US federal prosecutors charged Bannon and three others with skimming millions from a fund raised to build a private version of the border wall facing Mexico. If convicted, Bannon could be in for 10 to 20 years in the slammer.

According to one version of their relationship, Trump is estranged from Bannon for not sharing a “license fee” for stealing his idea of the wall and for taking the limelight away from The Donald. Trump called the private wall project “showboating.” Thus Bannon may not be able to count on a presidential pardon to get out of jail. 

His other option is to sing vigorously to the federal prosecutors in exchange for a lighter prison sentence. By telling them all he knows about the nefarious shenanigans of Trump and his inner circle of crooks, the wheels of the Trump campaign could be coming off even before the November election.

Wednesday, August 19, 2020

How far will Pompeo drive the war with China

 First posted in Asia Times.


Secretary of State Mike Pompeo has taken charge of orchestrating the US attack on China. As President Donald Trump’s popularity drops further behind his rival, former vice-president Joe Biden, the more outlandish and outrageous have Pompeo’s provocations become.

The most recent is to accuse TikTok of being a threat to America’s national security. TikTok is a social-media platform introduced from China that has quickly attracted more than 100 million users in the US.

Pompeo offered no evidence or explanation of how TikTok can be a threat to national security, but the actual reason is envy. Pompeo is suffering from technology envy and market-share envy. He can’t conceive of anything from China that’s better than anything from America, such as Huawei before TikTok.

Pompous Pompeo is supposed to be a smart guy, but he doesn’t understand technology. He was upset when the CEOs of three of the four high-tech giants – Apple, Amazon and Google – at a recent congressional hearing, would not confirm being victims of intellectual-property theft by China. 

Pompeo was offended that three of the most valuable American companies would not support his demonizing of China.