Saturday, 5 October 2019

China: scapegoat and diversion from what ails western capitalism

We all know the United States of America was built on an ancient Native American burial ground, courtesy of European immigrants. Another original sin was slavery; kidnapping men, women and children from Africa for the brute workforce that built so much of America's wealth.

Then there's the 1 per cent ripping off the American people for decades, failing to invest in infrastructure, education, housing, healthcare while the richest 26 individuals took as much as the bottom half of humanity.

And now the US teeters on the edge of the worst economic recession since 1929. The national debt increased to $22 trillion with Trump adding over $2 trillion so far and China's new wealth is expected to pick up the declining superpower's tab as a result of Trump's trade war shakedown.

The next recession will have no China in shock absorber mode as the world's growth engine the way there was in 2008. By allowing other nations to devalue their currencies next to the yuan while China took a massive hit, they helped float the global economy out of the bankers' crash. The next time we hit the buffers, China can't keep us out of trouble because someone sawed off the branch we're all sitting on.

How can it be that in three years the whims and caprice of one man has brought us to the brink of a major recession against which we have no more ammo? Trump and his billionaire friends have the reckless assurance of men with access to luxurious nuclear shelters as far away as New Zealand who assume they can flit off and leave us to face the mess they created if this goes to a hot war. They probably think the planet is overpopulated anyway, so what's a population cull to them? Having tried to short China and Europe into the ground, they'll buy up everything at firesale prices in the wreckage they've made of our human society.

A whole new Orwellian narrative has been shaped to justify the coming grand larceny: Trump's US and its supporters at home and abroad accusing their mark of exactly the same crimes and misdemeanours of which they themselves are guilty.

Manipulating the currency? China spent vast amounts of its reserves propping up the yuan even under assault from Trump's trade war and resulting negative market forces. Trump's real demand isn't that China should stop manipulation (which isn't happening) but that it should start manipulating its currency upwards in favour of the dollar.

Theft of intellectual property? Hawkish commentators conflate actual theft (against which there are laws) with the agreed exchange of assets between one side that had cash (Edit: and access to their huge 1.4 billion market, a fifth of humanity) and one that had know-how. The Art of the Deal, remember? Besides which, the tech ship has sailed.

China has caught up and now outpaces the previous pack leader. America's security forces aren't that worried about Huawei spying on them. That's America's own trademark schtick as we know from a blizzard of information: Edward Snowden whistleblowing on the NSA, US tech's own back doors (hello, Cisco) and that pesky bug that sat on Angela Merkel's personal mobile for ages. No, America is alarmed because Huawei's new technology has overtaken the US with unhackable quantum cryptography at the core of 5G, which means they will no longer be able to spy on their friends, enemies and their own people. (See Crypto AG)

Cruelty? That good ol' Yellow Peril trope always comes in handy. China may be heavy-handed in dealing with murderous terrorist attacks and trying to avoid its own 9/11 but so far it hasn't bombed a string of third countries leaving depleted uranium, land-mines and cluster bombs to continue their destruction.

A manic energy has gone into turning China into America's dark mirror, eclipsing and absolving the US of its Abu Ghraib and Guantanamo horrors in the public eye. Reading claims about three million Uyghurs supposedly being tortured to death by nazis, I'm reminded of New Labour's dodgy dossier insisting on the presence of Weapons of Mass Destruction, and Chalabi's role banging the wardrum for the Iraq War.

In 2002, the year following the 9/11 attacks, the United Nations Security Council declared an official terrorist threat in a region of Stans that's been named "East Turkistan" [EDIT that's territory within China]:

'The Eastern Turkistan Islamic Movement (ETIM) is an organization which has used violence to further its aim of setting up an independent so-called “East Turkistan” within China. Since its establishment, ETIM has maintained close ties with the Taliban, Al-Qaida (QDe.004) and the Islamic Movement of Uzbekistan (QDe.010). It was founded by Hasan Mahsum from Xinjiang, China, who was killed by Pakistani troops in October 2003. ETIM is currently led by Abdul Haq (QDi.268), who was also a member of Al-Qaida’s Shura Council as of 2005. ... In recent years, ETIM has set up bases outside China to train terrorists and has dispatched its members to China to plot and execute terrorist acts including bombing buses, cinemas, department stores, markets and hotels. ETIM has also undertaken assassinations and arson attacks and has carried out terrorist attacks against Chinese targets abroad. Among the violent acts committed by ETIM members were the blowing up of the warehouse of the Urumqi Train Station on 23 May 1998, the armed looting of 247,000 RMB Yuan in Urumqi on 4 February 1999, an explosion in Hetian City, Xinjiang, on 25 March 1999 and violent resistance against arrest in Xinhe County, Xinjiang, on 18 June 1999. These incidents resulted in the deaths of 140 people and injuries to 371.'

There have been many more since then.

Friendly advice on how to deal with jihadiism humanely and allowing Uyghur cultural integrity (the vast majority lead normal lives), should be welcomed, only not from the nation that's used two nuclear bombs on civilian populations, waged a vicious war in Indo-China, destroyed Iraq and Libya, and destabilised so much of the world while ripping off its own workers for decades. If peace could be achieved for Northern Ireland and South Africa, then maybe some sort of peace and reconciliation could be had here if Certain Parties stopped stirring it up.

Meanwhile, it's a year since Jamal Khashoggi was butchered in a Saudi consulate in Turkey but Trump rewards the regime behind the killing with more weapons, and now even plans to provide nuclear technology despite US bombs still killing citizens in Yemen.

At home, baby prisons, child death and disappearances; a president in thrall to the National Rifle Association (NRA) while mass shootings at schools and public places proliferate; deaths of African Americans by cops; a president expressing a raging tyrant's desire to maim, hurt, kill, destroy with dark age punishments such as snakes and alligators, flesh-piercing spikes and shooting migrants in the legs. Climate change, the environment, fossil fuels ...

Perhaps Trump is only clumsily trying to finish what Obama started with his pivot to Asia and setting up the National Endowment for Democracy (NED) in 2014, since when the US has poured $29 million into Hong Kong. I'm curious to see how Britain and America will deal with street protests when similar eruptions occur at home.

The Hong Kong protesters had me at democracy. There's an unpleasant authoritarianism in Chinese society (and increasingly out in the open in Britain and the US) that should be challenged from below. That's healthy. But they lost me at "Democracy" when that word is used as a Stars 'n' Stripes and Union Jack-waving euphemism for bringing back the old colonial oppressors ... as if Trump and Boris Johnson are really defending the principle of free speech. How much actual democracy did Hong Kong Chinese enjoy under British rule?

It is hardly a class war for liberation when HK protesters, who are not prospering under this vestigial British imperial system, refuse to take on the property tycoons who manipulated some of the most expensive real estate in the world. For a potted history and illuminating overview, read this:

'British imperialism, in the 155 years it ruled Hong Kong, denied rights to millions of workers. There was no elected government, no right to a minimum wage, unions, decent housing or health care, and certainly no freedom of the press or freedom of speech. These basic democratic rights were not even on the books in colonial Hong Kong.

For the past 25 years, including this year, Hong Kong has been ranked No. 1 in the right-wing Heritage Foundation’s list of countries with the “greatest economic freedom”—​meaning the least restraints on capitalist profit taking. Hong Kong’s ranking is based on low taxes and light regulations, the strongest property rights and business freedom, and “openness to global commerce and vibrant entrepreneurial climate … no restrictions on foreign banks.” For this Hong Kong is the “freest society in the world.”

This “freedom” means the world’s highest rents and the greatest gap between the super-rich and the desperately poor and homeless. This is what Hong Kong youth face today. But the youth are consciously being misdirected to blame the city administration for the conditions Hong Kong is locked into under the “One Country, Two Systems agreement.”'

Like Trump and Brexit, the Hong Kong protest is a revolution from the right. Trump just threatened to mention Hong Kong, but do us a favour and investigate the Bidens. All of this happening now just as America is hitting the buffers and China's economy and 1.4 billion-strong market presents a juicy prize.

As the late Hugo Young told me when we were concerned that his newspaper, the Guardian among several others, was blaming the UK Chinese for starting the 2000 Foot and Mouth Disease outbreak (and for which Chinese Brits were vindicated) in a diversion for Tony Blair: "There are wheels within wheels." He had to tell the staff to knock it off around the same time that even more examples of anti-Asian bias emerged after a Readers' Editor's investigation.

As far as the bourgeois liberal commentariat goes ... now, him I miss.

Winston Churchill on the partition of China: "I believe in the ultimate partition of China—I mean ultimate. I hope we shall not have to do it in our day. The Aryan stock is bound to triumph."

New York Times Xinjiang papers "Absolutely no mercy" ... but for who? 

Saturday, 11 May 2019

Donald Trump's hostile takeover of the Chinese economy continues

Eternity in a grain of sand, heaven in a wild flower ... and revelation of character in a golf ball.

"People who cheat at golf also cheat at life."

Donald Trump cheats and Vladimir Putin stumbles. If you think playing hockey against Vladimir Putin is taking your life into your own hands, try playing golf with Donald Trump. MSNBC

Donald Trump's attempted hostile takeover of China's economy continues apace. The Chinese walked into an ambush when they presented their latest round of changes last week thinking they were still negotiating. Kicked off by Reuters' "exclusive" briefing by "three U.S. government sources and three private sector sources", the media then fell in with Trump and trade representative Lighthizer's narrative that the Chinese "reneged" on a deal that was already sewn up.

With two tweets on Sunday (provocatively, the 20th anniversary of the US bombing the Chinese embassy in Belgrade which killed three journalists) stating he was raising current tariffs on China from 10% to 25%, and planning the same for an additional $300 billion of Chinese trade, the President snapped his fingers and wiped $1.36 trillion from the world economy.
The Economist gives a more nuanced analysis, suggesting that there's more democracy in China's system than you'd think with a politburo that has to sign off on the final agreement. It may be Trump's Thanos dream to snap his fingers and make half the world disappear, but Xi can't do that. He has his own domestic audience to please.
Complicating matters, negotiations have been conducted in English, with the draft agreement (reportedly seven chapters and 150 pages) also in English. As it is translated into Chinese and circulated among more officials, changes are inevitable. “You can’t really renege on something that is a non-binding work in progress,” says James Zimmerman, a partner in the Beijing office of Perkins Coie, a law firm.
So why would China baulk at signing the deal as dictated by the US? They have been making rapid (for China) inroads on outright theft and copyright issues, as they should. But, having once been awash with dosh and not needing foreign capital, they used a barter practise of allowing American firms access in exchange for knowledge in the form of intellectual property (IP) transfer  – which is completely different and smeared as "theft" when these were terms negotiated by the companies in the course of business, and not a government requirement. Looks like The Art of the Deal only goes in one direction.

A major sticking point seems to be the demand that China should undermine its own economic model and no longer subsidise some of its industries, in the same way that, say, the US subsidises its own military or farming industries, for example. What do we think Trump's tax breaks did in allowing US companies to buy back their own stock?

So, double standards aside, China's economic basis is a matter of sovereignty on which China is not going to budge. Trump's China hawks know that. Trump now says he gave US business in China a year's notice to get out, so he knows where this is going and that it was never going to be sincerely resolved. The objective: smash open China's economy, a variant on the "kick their ass and take their gas" that destroyed Iraq and threatens Venezuela, Iran and others.

And do you really want your national wealth subject to a takeover by the same chancers who brought you the 1MDB scandal?

Perhaps this is why we need a World Trade Organisation with teeth so that the rule of law applies to all parties without the biggest one acting as plaintiff, judge, jury and executioner. No wonder he hobbled the WTO; a rule of law that applies to all may not be the kind of level playing field (or golf course) that Donald wants. How can China trust Trump, with his decades-long history of reneging on deals both private and public? Not even Mexico and Canada have escaped the Donald treatment and all his broken promises to remove tariffs.

Trump's subsequent twitterstorm of socialist pledges to use the hundreds of billions that China would pay through his new 'n' improved tariffs to make farmers rich as Croesus and give their produce to the poor was met with 360 degree incredulity. Americans know China doesn't pay Trump's tariffs and this means effectively a tax on their purchases, pushing up the cost for middle America by an estimated $767 per household. That's on top of the swelling national debt burden, up $9 TRILLION to $29 trillion since he took office.

Meanwhile, although an estimated 2% drop in China's GDP from 6 to 4% due to maximised tariffs will hurt, China has the resilience and scale to withstand the assault. It raised 800 million out of poverty and created a huge growing middle class of over 500 million, bigger than the entire population of the USA. No wonder some desperados want it all.

Now all the populists are getting in on the act. Not only Democrat Chuck Schumer, who originally signed off on Trump's trade war tariffs, but, disappointingly, Senator Bernie Sanders. Sanders wants China named as a currency manipulator. This may have been apt a decade or more ago, but anyone who's been paying attention knows that for years China has been depleting its own currency reserves in order to prop UP the yuan. Slipping to 7 or more renminbi to the dollar would lead to capital flight, and is not very sensible for an economy trying to shift to domestic sales and imports rather than exports. If you want to discuss currency manipulation, what do you think Quantitive Easing is? Market forces?

The Democrats have to play ball (but not golf!) in order to stay in the game at the 2020 elections. You'd better get onside, Bernie, because if you challenge Don Caligula's right to China's wealth like Joe Biden has, you too might find Rudy Giuliani travelling to Ukraine to dig up the dirt. Or, even worse, he might sic Attorney General William Barr onto you.

Good golfing.

[Edit: Collective amnesia alert ... For decades we've known that the 1% and 0.1% sucked the wealth out of the US and failed to re-invest, hollowing out vast swathes of the country. The top 1% in America own as much as the bottom 90% with the 42 richest individuals in the world owning as much as the bottom 50% of humanity, but you never hear about the 1% any more. China represents a juicy prize as well as a handy scapegoat and a political diversion, all reminiscent of the 19th century Opium Wars and the American downturn in the 1870s which led to the US Exclusion Act of 1882.]

[A final thought ... Motivation, m'lud? China will account for 21% of global trade this year while the US is 7%. China owns $1.13 trillion of America's $6 trillion foreign-owned debt.]

Trump rumoured to be love-child of Captain Queeg and Thanos ... More news as it comes in ...

CNBC Ex-Reagan advisor John Rutledge: Trying to get China to change its economic policy in trade deal is ‘just nuts’. ... "This is not China reneging on the trade deal the last week. This is the hawks taking control, getting Trump’s ear and pushing the trade war off the edge of a table. This is not going to go away.”

China finally gets to defend itself in the FT. "Beijing says Washington changed terms on deal to buy more goods midway through discussions."

BUSINESS INSIDER China made 3 demands to end the trade war, only one of them is legit (sic): Mafia Don's shakedown. Exactly same set up as the 19thC Opium Wars. The US demands China buys stuff they don't need or can't afford, demands to smash open China market for US takeovers. There was no meaningful negotiation. This is why we need a World Trade Organisation to adjudicate.

FT Why China’s role as the world’s shock absorber is changing: How China put the brakes on the 2008 crash. "... despite softening exports, Beijing tolerated continuous currency appreciation. In effect, the rest of the world devalued against the renminbi. Put another way, the combination of an ever-strengthening renminbi and, by international standards, a relatively high inflation rate left China nursing significant competitiveness losses even as others made competitive gains. Had China not performed this role, the world would have faced a far greater crisis. ... China has been the shock absorber for the global economy, a punch bag seemingly able to soak up the recessionary blows that would otherwise have derailed global growth."

TALKING POLITICS PODCAST: Adam Tooze ( ) and Helen Thompson () on the US vs China. Calm and insightful but still buys in to the narrative that China changed a done deal at the last minute, which I think The Economist has put to bed. The question remains - Cui bono?

GUARDIAN editorial 10th May 2019: The Guardian view on US-China trade wars: don’t let them get started. The time has come to rewrite the rules so that the world’s largest economies are able to trade peacefully

Sunday, 3 February 2019

How's it hanging in Brexitland? Politicians fiddle while Brits stare catastrophe in the face

With mere weeks to go before Britain crashes deal-less out of the European Union, where are we now?

Britain is leaving the EU just as Japan's ground-breaking trade pact with the EU kicks in, making those combined forces the world's largest trading body and one in which we still (for a nanosecond or two) have a major say.

The rest of the world's trade is blowing up under US tariffs, trade wars and imminent hot wars, while the WTO, which is supposed to be our life-raft after Brexit, has been marked for death by Trump.

Theresa May's principle-free efforts to push through Brexit at all costs are so unpopular that there were suggestions she might even have to call upon the Queen to overrule Parliament and force it through by royal decree ... until 25 Labour rebels helped her out by abstaining or voting against Yvette Cooper's attempt to extend Article 50. If the Queen had done so, it would have been the first use of the royal prerogative of prorogation (shutting down Parliament) in 300 years.

Someone's taking back control, but it isn't us.

Meanwhile, facial recognition technology is forced on UK citizens in expectation of riots on a No Deal Brexit, with one guy in Romford fined on the spot £90 for not complying. Cold War plans are being revived to evacuate the Queen and the royals to "safety" and away from the civil unrest (in other words, legitimate protest) that the rest of us will be coping with.

Goodbye NHS, already eyed up by Farage et al for privatisation, the 80 per cent of our fresh food that comes from Europe, libraries, anything that gave some bare bones to the nation's infrastructure for working class people.  It was already being clawed back. Brexit accelerates the process.

Perhaps Jeremy Corbyn's Brexit-supporting coterie is co-operating with the Tories because they hope that in the ensuing chaos, they will win power. Triggering Article 50 and then doing the bare minimum in the Remain campaign to the extent that swathes of the population have no idea where Labour stands on Brexit, against a legally questionable Leave campaign, may have seemed like a good idea to Lexiteers stuck in the 1970s. However, I have news for them: this is the right's revolution. Not the left's.

Despite John McDonnell's touching faith that Labour MPs will never accept Theresa May's bribes, there are some like John Mann ("Show me the money!") willing to take the Tory shilling when much of the problem was created by Tory austerity in the first place. I am even more doubtful about good faith on offer after Corbyn took no disciplinary action against the 25 pro-Brexit Labour MPs — including 8 front-benchers — who refrained from voting or voted against Yvette Cooper's attempt to extend Article 50, a chance for a second referendum. As every good tailor knows, you have to measure twice and cut once to make sure. So what gives?

How will Labour play the post-Brexit unrest when the state rolls out its repression? Will Corbyn weep for the youth protesting against the very measures he helped usher in? If he gets voted in, he'll be the one wielding the power of the state. The squirmy squaring of that contradiction will be fascinating to watch.

The three-quarters of the population who did NOT vote for the permanent Brexit change to the constitution in the ADVISORY referendum, including the youth generation who weren't allowed to vote in 2016, have had their future ripped from them by charlatans who have already moved their money offshore, and applied for French/Irish/other European passports for themselves and their children. At least the wealthy will avoid the EU tax avoidance laws and get to buy up UK assets at firesale prices. After all, it's an ill wind that blows nobody any good.

Monday, 24 December 2018

Happy New Year: Will Donald Trump's tiny hand press the Big Red Button in 2019?

It's fascinating (in a horror-show kind of way) to watch the United States of America write itself a new narrative. Not the one where it dominated the post-World War II liberal global order and made itself the wealthiest economy on the planet by a long chalk, but a victim narrative in which poor little America is bullied and ripped off by China, formerly one of the poorest countries in the world but which now happens to be looming in America's rear-view mirror.

For several years, we've been told by the experts that China is the exciting new economy in which the world's investors were parking their money, while the US was in decline with failing demographics and dim long-term prospects. With China's population of 1.4 billion, a growing middle class of over 500 million, 800 million raised out of poverty, an internet penetration rate of only 55 percent (against US 83 percent), and American companies making money hand over fist with a lot more to come, you can see how some might cast an enviable eye over such a fat, juicy market and think: I'll have that.

According to the China hawks' tortuous retrospective logic, goods bought cheap by middle- and low-income earners, allowing them to live beyond their means and consume to their hearts' content, was some sort of conspiracy draining the nation's precious essences. Trump sees the phoney deficit of $300-500bn as money owed to them, in the same way that a Mafia Don might eye some successful business and persuade himself (by an assortment of mental, moral and factual gymnastics) that this treasure somehow belongs to him. It always did. We were always at war with Eastasia. I hope all those poor cheated consumers descend on Walmart (whose fortune was founded on buying cheap Chinese goods made in often dreadful conditions) with decades of receipts in hand to demand their money back.

The unpalatable fact for Trump is that – taking into account in-country Chinese sales of US goods and services such as those of Starbucks, Apple, MacDonalds, Coke etc – the US has a $24bn SURPLUS with China. And as even Gary Cohn pointed out, the "deficit" represents $300bn of goods that Americans could buy cheaply and thereby feel richer than they actually were.

And how about all that US debt bought up by China after the 2008 crash which allowed US citizens to avoid the full brunt of the crisis and continue to buy stuff despite the US being broke? Having been punched in the face for their help, I doubt they'll do the same next time America's in trouble. Furthermore, some pundits are considering the possibility that Trump simply defaults on US debt. Don't forget that "Trump ran for office on his background as a captain of industry, touting his companies’ four bankruptcies as shrewd business maneuvers."

So far we've been fed ad infinitum the myth of forced technology transfer, accusations of spying, and claims that China is manipulating its currency downwards when it has actually been spending vast amounts of its reserves to prop up the yuan. And now we have everything but the kitchen sink thrown at China in order to whip up war fever and justify the unthinkable: war with a nuclear power. Casting itself as lily-white ingenue on the world stage, taken advantage of by Sinister Forners, this indulgence of paranoid wingnut Peter Navarro means conveniently forgetting American spychips – including one on Angela Merkel's phone – and all the spying that the west is so good at. We've all forgotten western pride in its espionage capabilities, from fictional James Bond to the actual School of the Americas. It's like Edward Snowden's revelations about the NSA's global surveillance have been wiped from the media's collective memory.

This is not, incidentally, to give China a free pass for its own abuses. Advances in gay and women's rights have been clawed back; trade union rights are a site of struggle; emulating America's cruel mistakes — from locking up its Japanese citizens following the Pearl Harbor attack to incarceration without end at Guantanamo — by shoving Uighurs into "re-education" camps is surely storing up trouble. But ... worse than Saudi Arabia? Deserving of being bombed back into the stone age? It wasn't China that nearly started World War III with a war on Iraq that killed 450,000 people or created the current humanitarian crisis in Yemen. All most Chinese want to do is drink Starbucks coffee and wear Nike trainers as part of a life that's lived decently. The new Chinese society saves pandas and tigers, campaigns against animal cruelty, condemns the racism of rogue Chinese business in Africa, and debates where they are headed as a nation. We are more alike than not.

The wealthiest nation on earth knows its decline has a variety of causes: under-investment; spending and not saving; the 1 percent and 0.1 percent creaming off the profits until, according to Wikipedia, "Currently, the richest 1% hold about 38% of all privately held wealth in the United States while the bottom 90% held 73.2% of all debt. According to The New York Times, the richest 1 percent in the United States now own more wealth than the bottom 90 percent." The political scapegoating of China for America's woes looks more and more like a diversion from who ate all the pies.

All of which brings me to my big prediction for 2019. I truly and sincerely hope events will prove me wrong. All signposts point towards a global calamity, but that doesn't mean that human ingenuity can't avoid it.

Now that General Mattis ("the last adult in the room") is leaving, Trump can remove the remaining troops from Syria and Afghanistan — notionally a good thing if you are anti-war (which I am). However, an abrupt and unplanned withdrawal without peace negotiations means, for instance, abandoning the Kurds, who fought valiantly to defeat Isis, to be slaughtered. But I don't believe that Trump's withdrawal is entirely without purpose.

Similar to Obama's pivot to China — when Barack took his military out of the Middle East and moved them to Asia, stockpiling missiles around the South China Sea aimed at the Middle Kingdom, and then acted surprised when they built defences — I think there's a chance that Trump will pile his forces into the South China Sea, engineer a conflict and get to use his big red button. Either that or some slip-up with North Korea putting Seoul at immediate risk. Or Iran. You just know he's itching to do it: "What's the point of having nuclear weapons if you're afraid to use them?"

His friends will all take to their nuclear bunkers in New Zealand, assuming that simply existing as a mobile meat sack in a post-nuclear apocalyptic world, even in material luxury perhaps, is preferable to preserving peace for the whole of the human race on this extraordinary planet. That's if their security squads haven't mutinied, slaughtered their masters and taken over the asylum.

Ho, ho, ho. A merry Christmas and a happy new year to all. Let's hope it's not our last.

Tuesday, 13 November 2018

What's Donald Trump's trade war with China REALLY about?

History repeats itself: Trump's fantasy trade-deficit is an excuse for carving up China

So the west is at it again, carving up the juicy market of 1.4 billion (EDIT 1.386bn in 2017) human beings that is China. I suspect most people have twigged by now that US President Donald Trump's trade war on the upcoming nation has little to do with the purported goods deficit of over $300bn. As Gary Cohn, former Goldman Sachs supremo and Trump's ousted top economic advisor (replaced by Fox News commentator Larry Kudlow), pointed out at the recent Bloomberg conference in Singapore, the sum does not, as claimed by Trump, represent a loss of money. It actually means over $300bn of goods that Americans were able to buy cheaply, as if you'd spent at Walmart or T K Maxx, or if you'd bought groceries from the supermarket. Having consumed the goods they sold you, you wouldn't then demand your money back with menaces. Presumably.

I’d been hoping for the press to fact-check the issue of Trump’s trade war on China, which threatens to tip parts of the world (including America) into recession. I am disappointed to see the figures of $376bn and $500bn US trade deficit with China regurgitated in the British and American media with few corrections, or any attempts to cut through the hawks’ spin.

The figures of a $376bn and $500bn trade deficit for the US excludes in-country sales and services in China by enormously lucrative US companies such as Apple, Starbucks, Coca Cola and McDonalds, which generate vast profits out east. When that’s taken into account, the actual trade balance is more like a $24bn surplus for the US, but this fact doesn't serve the narrative and therefore gets left out, thanks to laziness or connivance in the press.

These elevated figures are further distorted by the fact that China is still mainly a base for assembly of goods which the nation is hoping to leave far behind in favour of high-end tech. So, for example, a thousand-buck iPhone X costs around $500 to make, out of which the high-end components are made elsewhere (Taiwan and South Korea), while China's costs amount to about 10 per cent, or around $47. And yet the entire wholesale cost of $500 is counted in the purported deficit with China — a ten-fold distortion.

The richer country should always have the surplus, as they can afford to buy the goods in the first place. Americans do not save. Chinese do.

Trump’s tax cuts have pushed their overall deficit to well over a trillion and rising. This will bite them on the bum, but we can guess who’ll be blamed.

Far from manipulating the yuan down, which even smart critics such as John Oliver repeat ad infinitum, China used large amounts of its reserves propping it up. Under Trump’s attacks, the yuan is buckling and if China does what the US wants they could easily burn through all of their cash. There’s both irony and cynicism in the fact that the very measures that Trump is taking will, according to HSBC and others, weaken the yuan against the dollar. Not to mention that the dollar is powering up against a whole basket of currencies, not just China. However, Trump likes to have his beautiful chocolate cake and eat it ... greedy boy! He was disappointed to be told on entry to the White House that, no, he wasn't allowed to print money; manipulation of the currency not being a point of principle for our orange overlord, just a means to an advantage. Besides, what does Trump think Quantitive Easing is if not wholesale manipulation which saved America and others from the 2008 financial meltdown?

China has raised about 800 million of its people out of poverty by making our stuff in cruel, unhealthy conditions in suicide factories such as the Taiwan-owned Foxconn, for low wages. This has facilitated higher living standards for western consumers, and huge profits for American companies. During the bankers’ crash of 2008, China picked up the debt slack and allowed Americans to live beyond their means. Now that western capitalism is in decline and facing crisis, China is being politically scapegoated. This is not only unfair on a nation only recently getting up off its knees after nearly two centuries of western abuses, it also muddies the waters so the global economy can’t advance. The IMF's Christine Lagarde noted earlier this year that the global economy was in sync, floating itself out of the economic devastation of the 2008 crash together. After Trump's trade tariffs, not so much.

There’s plenty for China to negotiate. Although it was the US that persuaded China to join the World Trade Organisation and abide by the rules made by the US, perhaps they are at a point where they do need to shift on some points as they are no longer an ingenue economy. Indeed, China is already moving on intellectual property issues and gradually opening up its markets to foreign investment. We thought everyone had seen sense in May when the meetings between Steve Mnuchin and China’s Liu He produced an agreement. However, under the influence of arch China hawks John Bolton and Peter Navarro (a vicious wingnut on China despite no expertise who is overreaching badly), Trump capriciously changed his mind and now we may be staring something much worse in the face if he doesn’t get his “utter capitulation”.

In order to bring China to heel, Trump would have to break the European Union first. That affects Britain, too. Once we’re out of the EU, it’s unlikely that Trump will allow Britain to trade with China, as per the new clause in the rejigged NAFTA deal between the US, Canada and Mexico. What was that about Brexit "taking back control"? So we’d be totally dependent on an irrational, brutish regime, eating their chlorinated chicken and Monsanto death seed produce. Wilbur Ross has already advised US business to take full advantage of a vulnerable post-Brexit Britain, calling our hour of need "a God-given opportunity".

Right now, it looks like America has given itself a heavenly mandate to go stomping the world's economies into dust because it is unable and unwilling to sort out its own problems of underinvestment, changing demographics and basic flaws in the ageing capitalism that served it so well in the past.

A closer look at those accusations of IP theft: Why US accusations of IP theft by China don’t add up
'In 2005, when the US government was pressing China to allow the renminbi to appreciate, Phillip Swagel, a former member of president George W. Bush’s Council of Economic Advisers, wrote: “If China’s currency is undervalued by 27 per cent, as some have claimed, US consumers have been getting a 27 per cent discount on everything made in China, while the Chinese have been paying 27 per cent too much for Treasury bonds.”' Donald Trump misread the US-China trade relationship.
History repeats itself: The Steampunk Opium Wars
China-bashing exercises by the establishment: The Opium War by Julia Lovell, and two from Niall Ferguson: The Triumph and Turmoil of Niall Ferguson's obsession with China and Working for the Clampdown: Niall Ferguson's testosterone theory of history
FT: How China's role as "shock absorber" and world's growth engine helped pull the global economy out of America's 2008 crash.
(Delighted to have written this piece without recourse to the cliché of the Thucydides Trap ... D'oh!)

Wednesday, 3 October 2018

The Windrush Generation: British citizens here before 1962 told "Prove it!" - by George Lee

The Tories are depriving British citizens of their rightful status established under law

Today in my inbox I found this tweet from George Lee who tweets as RightIsMight, twitter handle @7_jamdown.

It's addressed to several parties as well as myself, including Jeremy Corbyn: @jeremycorbyn @sajidjavid @EmilyThornberry @HarrietHarman @UKLabour @Yvettecoop @CarolineLucas @carolinenokes. A small but perfectly formed list, some of whom I hope will respond at least adequately and meaningfully.

The entire Windrush generation should be welcome here. They were invited to Britain to rebuild the country after the devastation of World War II and 1950s austerity. In return for running our NHS and transport they were promised indefinite leave to remain. However, there is an extra toxic twist affecting Commonwealth and Colonies citizens who entered the UK before the 1962 Commonwealth Immigrants Act and who were already guaranteed citizenship by the 1948 British Nationality Act.

As George Lee points out in his article which I've reposted below, 'How does one downgrade someone’s citizenship without it being a retrospective abrogation of their rights? ... if the Real Windrush Generation attempted to claim their rights, they were to be told to “prove it”. ... This action has led to countless unlawful deportations and exclusions and, even worse, the confiscation and wilful destruction of perfectly legitimate and legally obtained passports ...'

In Theresa May's officially sanctioned 'really hostile environment' the Tory government has been destroying passports, the one vital piece of evidence that proves citizenship. When the state itself abandons the rule of law they send out a dangerous message. And that message is being hear loud and clear.


by George Lee

It has become necessitous to coin a new maxim, the “Real Windrush Generation”. There needs to be a clear distinction made between pre-1962 Citizens of the United Kingdom and Colonies (pre-1962 CUKCs) and those New Commonwealth citizens who entered the UK after the point in time marked by the entry into force of the Commonwealth Immigrants Act 1962. Without this distinction it is not possible to see that we are considering two separate issues.

Perhaps the Guardian should produce an article which explains the distinction between the Real Windrush Generation (the pre-1962 CUKCS) and the definition given by the government for the “Windrush Generation”, which is in fact a misnomer. The reason for this suggestion is elucidated in what follows.

Quotations used are from the following article:

Four people describe ordeal of having their British citizenship questioned and downgraded

How does one downgrade someone’s citizenship without it being a retrospective abrogation of their rights? Of the four people mentioned in this article, it can be stated with certainty that at least two of them are Real Windrush Generation and British citizens. When it concerns the Real Windrush Generation, everyone seems to forget that the law exists for all citizens and must be obeyed, even by Her Majesty’s Government. At this point, it ought to be clearly stated that the legislation passed by parliament which establishes the right of all pre-1962 CUKCs to British citizenship is the British Nationality Act 1948.

What is said to be the Windrush Scheme has nothing whatsoever to do with the revocation of the rights of the Real Windrush Generation. I have now made six different attempts to communicate with those responsible for this Scheme, but to no avail. The reason for this situation is clear. One thing has nothing to do with the other.

The Windrush Scheme was set up to deal with persons entitled to Indefinite Leave to Remain, which does not apply to pre-1962 CUKCs. As far as can be ascertained, no authority has been given to deal with matters concerning pre-1962 CUKCs. I have been directed and redirected until I have arrived at a dead end. Moreover, I have been informed that the Windrush Scheme is only for the purpose of assisting the “Windrush Generation”. Is it not ironic that the Home Office should introduce a Scheme called “Windrush” which excludes the Real Windrush Generation? Has it anything to do with the fact that the Real Windrush Generation are British citizens and acceptance is being denied?

The Real Windrush Generation have been making representations to the United Kingdom government for more than 40 (forty) years. Every application has fallen on deaf ears as per the wishes of the legislators, clearly stated in the Immigration Act 1971, as amended by the British Nationality Act 1981. Decisions on this matter have been made in secret and without recourse to the relevant legislation since 1973. This has occurred without any form of accountability since the entry into force of the Immigration Act 1971. The legislation instructed those who were to enforce it, that if the Real Windrush Generation attempted to claim their rights, they were to be told to “prove it”. I use the expression “prove it” because it has been used to me so many times by the Home Office and every UK embassy I have visited over the years since 1988. No matter where the application was made the responses were almost always identical.

This action has led to countless unlawful deportations and exclusions and, even worse, the confiscation and wilful destruction of perfectly legitimate and legally obtained passports, which is another reason it is transparently deliberate action on the part of the UK authorities in order to abrogate the rights of the Real Windrush Generation.

With reference to passports, Lydden Lewis needs to be careful as the UK government do not usually return such passports, once confiscated. In fact, as stated, they are usually destroyed. The evidence is destroyed enabling one to be told, “Prove it!” Every time such decision was taken with regard to pre-1962 CUKCs, was the law broken? Incidentally, the point to note is this. The only passports confiscated and destroyed were the ones which confirmed the rights of the Real Windrush Generation. Thereafter, the legitimate owners of said passports were told they were not citizens, even though the passport seized and destroyed demonstrated their right to citizenship.

To demonstrate the point with another example from the above-named Guardian article. Tony Perry was told, “We are sorry to inform you that you are not a British citizen”. Due to the fact that he arrived in Britain, from Jamaica, in 1959, there is no basis in law for him to be given that information. Furthermore, magnanimously awarding anyone in this situation with a visa giving him or her Indefinite Leave to Remain is an abrogation of rights established under the British Nationality Act 1948. Thus, the actions taken in this case is not just ultra vires, it is unlawful. The assumption is that the Home Office know immigration law, but do they?

Why has the Home Office been permitted to operate outside the law for so many years, with such action being taken in secret and without oversight from those responsible for so doing?

One only asks the reader to consider the number of people from the New Commonwealth who lawfully entered the United Kingdom between 1948 and 1962. That is the number of people caught in this limbo, and the number who have been denied their lawfully acquired rights by the United Kingdom government since 1973.

Surely it can be seen that what has taken place is a grave abuse of power which has affected a large number of people? How many? It is impossible to calculate because the number is greatly affected by the date of Independence of each New Commonwealth state.

Most of the people affected are dead, that is the only known factor. It would appear, probably much to the joy of the UK government, as it seems the method by which the “Windrush Generation” may be denied their rights to compensation is a current preoccupation.

This purgatory, which is in effect worse than slavery, must be ended. It is even more important that the condition in which the people referred to above died, becomes public knowledge.

If the government of the United Kingdom wishes to disavow any statement made in this communication, I respectfully request that they state upon which legislation they rely.

No more decisions about the Real Windrush Generation made in secret by people who know us not, and who have been instructed to deny rights given in legislation by the parliament of the United Kingdom.

Just one last question! Is it because we are black?

Twitter for George Lee: RightIsMight @7_jamdown