LEAKED: Trump Threatens to Launch Trade War v. Rattled China Over IP Theft

Yves here. Trump has a pattern of big talk, then backing down in terms of what he actually does. But there is a large business constituency that is sick of China stealing their intellectual property. The possible moves that Wolf describes below are very wide ranging. While other members of the corporate classes would very much not want dealing with China to get ugly, it is possible that Trump could implement a narrower version of the policy below. Barring visas for Chinese students attending US universities, for instance, takes money from the higher ed complex, which leans heavily Democratic party. And there’s even an argument for that, since there is evidence that a lot of schools considerably relax their admission standards to let Chinese nationals in, and even in some cases charge them more than US students.

By Wolf Richter, a San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience. Originally published at Wolf Street

This is the big one. It makes steel and aluminum tariffs look like a game.

If this is true – it was leaked by a “source familiar with international trade” to the Nikkei Asian Review and isn’t based on a White House announcement – then it’s going to add a lot of fuel to the already heated trade dispute between the US and China, and may ultimately make the steel and aluminum tariffs look like a game.

To punish China for its intellectual property theft, including IP infringements such as counterfeiting, and to retaliate against Chinese investment rules that require technology transfers to Chinese partners in order to set up shop in China, the Trump administration is considering a proposal by the Office of the US Trade Representative (USTR) that would impose:

  • Tariffs on a large variety of Chinese products, including tech products and consumer goods like clothing.
  • Restrictions on investment by Chinese companies in the US, the first impact of which we have already seen by Trump’s order yesterday blocking all Chinese takeovers of large US tech companies.
  • And limits on visas for certain Chinese nationals.

The USTR also urged US allies, including Japan, to implement similar measures and synchronize their policies, according to the “source familiar with international trade,” cited by the Nikkei Asian Review.

Germany, Japan, and other countries have long fumed over the required technology transfers to Chinese partners. At the same time, Chinese companies, often state-owned, have been on a shopping spree in Germany, going after robotics know-how and other industries, which has caused a lot of soul-searching in the business community in Germany. Japan too “has long opposed China’s intellectual property practices,” as the Nikkei put it. Now the USTR has asked these countries to do something about it. 

The probe by the USTR started in August last year, invoking Section 301 of the US Trade Act of 1974. The act, because it conflicts with WTO rules against imposing trade restrictions unilaterally, hasn’t been used since 1995, when the WTO began sorting out trade disputes.

But in August 2017, the USTR announced that it had “formally initiated” an investigation of China under Section 301:

The investigation will seek to determine whether acts, policies, and practices of the Government of China related to technology transfer, intellectual property, and innovation are unreasonable or discriminatory and burden or restrict U.S. commerce.

The investigation would “look into Chinese laws, policies, and practices which may be harming American intellectual property rights, innovation, or technology development.”

Section 301 of the Trade Act of 1974, as amended, gives the U.S. Trade Representative broad authority to respond to a foreign country’s unfair trade practices. If USTR makes an affirmative determination of actionable conduct, it has the authority to take all appropriate and feasible action to obtain the elimination of the act, policy, or practice, subject to the direction of the President, if any. The statute includes authorization to take any actions that are within the President’s power with respect to trade in goods or services, or any other area of pertinent relations with the foreign country.

Trump had pledged to crack down on the causes of the huge US trade deficit. In terms of the magnitude of the trade deficit, no country comes even close to China (chart shows China and Hong Kong combined due the transshipments via Hong Kong):


The trade deficit in goods alone was $796 billion in 2017, of which the deficit with China accounted for $342 billion. China exported to the US three times as much as it imported from the US.

Though the USTR has tried to get US allies on board, at least the Japanese government rejected the proposal, saying that it would be difficult to implement since Japan lacks a law similar to Section 301, a US trade official told the Nikkei. The official said that Japan had proposed instead a joint suit against China via the WTO. That would make sense to say for Japan; it has only a small trade deficit with China/Hong Kong and in many months a trade surplus.

That the Trump administration invoked Section 301 rattled the Chinese government. In February, it sent its top diplomat, Yang Jiechi, to Washington on a fence-mending mission. This resolved nothing. At the beginning of March, it sent President Xi Jinping’s top economic adviser, Liu He, for a bigger five-day fence-mending mission.

It was doomed from the beginning. China had planned to send a delegation of about 40 people along with Liu He, sources told the SCMP, but the US government objected, and in the end the delegation was cut to about 10.

Liu met with Treasury Secretary Steven Mnuchin, US Trade Representative Robert Lighthizer, and White House economic adviser Gary Cohn, and afterward announced China’s intention to reduce its trade surplus with the US. According to the SCMP, Chinese state media portrayed Liu’s mission positively.

But on March 7, after the mission was over, Trump tweeted: “The U.S. is acting swiftly on Intellectual Property theft. We cannot allow this to happen as it has for many years!” It seems to have been an apt suggestion that the USTR’s proposal was on the way. The proposal’s drastic remedies and the chance that Trump would support them might have been the real reason why Cohn quit, rather than the now softened steel and aluminum tariffs that seemed to be hitting the wrong targets.

Trump’s Executive Order blocked not only the $117-billion hostile takeover of Qualcomm, but any “substantially equivalent” foreign takeover in the future. Read…  Trump’s Order Stops ALL Foreign Takeovers of Large US Tech Companies

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  1. ebbflows

    Oh you mean all the IPs that anglophone company’s gave China for some cheap labour…. and a short term bump to equity prices, flows of which accrue in some tax haven for a rainy day thingy.

    We will arise and with moral imperative make all right…. it was written…

    1. Self Affine

      Yes, that IP and more that was just stolen.

      There is a great Seymour Melman book about all of this written in 1983 called “Profits without Production”.

      This has been going on for over 40 years.

  2. Jim Haygood

    ‘Section 301, because it conflicts with WTO rules against imposing trade restrictions unilaterally, hasn’t been used since 1995.’

    A sea change is underway. In the wreckage of WW II, the US — representing half of global GDP at the time — stepped up to the plate to sponsor new rules-based monetary and trade regimes.

    Now the US has gone rogue with its contemptuous unilateralism, leaving little doubt that it will simply walk if confronted by the WTO for its arbitrary, willful violations.

    As ol’ Hank Thoreau aptly quipped, “I saw that the State was half-witted, that it was timid as a lone woman with her silver spoons, and that it did not know its friends from its foes, and I lost all my remaining respect for it, and pitied it.”

    1. rc

      The US has run chronic deficits for decades with massive benefits for the Chinese while the manufacturing base of the US has been hit dramatically. The rules that you assert are so important were designed to help the world recover from WWII. In the last three or four decades, the rules have been used to create social losses and concentrated, private gains.

      This is the first administration that actually may make a true effort to restore balance.

      1. lyman alpha blob

        Yeah but what about poor Amazon – how will they stay in business if they can’t keep selling cheap Chinese knockoffs?

        Kidding aside, I’m torn a little on this issue. In one regard, selling cheap imitations of certain products can be quite dangerous and IP should be stringently enforced.

        But I also have an inlaw who did quite well for themself by patenting some sort of spigot for water coolers designed to prevent leakage and save water. He had it manufactured and sold primarily in developing countries where water is often scarce. Years later he found out the Chinese were selling knockoffs of his invention. I always thought it a little strange that one is able to patent something like a faucet in the first place, my point being that US IP laws are probably too strong to begin with and certain things ought to be in the public domain at this point. I really don’t give a rat’s (or a mouse’s) ass if China wants to sell Mickey T-shirts and don’t see why Disney should have at this point the exclusive right to legally sell anything drawn up by a long dead racist with his head in a jar. The company has already made plenty of $$$ and time to let it go. That’s what my inlaw did – he figured his invention had allowed him to collect royalties and not to actually work for the majority of his adult life so he never tried to retaliate. Maybe he thought the same as I do – it’s only a faucet, not some civilization-changing invention.

        The difficult part is where do you draw the line?

    2. a different chris

      Yeah but it’s like pitying a famished bear when you are the nearest food-like object. You can feel sorry for it, but you don’t get to just turn your attention elsewhere.

    3. Dave D'Rave

      Ah, no, not really. The political purpose of the WTO (and the other Breton Woods institutions) was to help the US win the Cold War. Specifically, we subsidized West Germany, Taiwan, South Korea and other places so that they would not join the Commies.

      Trade agreements like the WTO are a relic of the Cold War: It is no longer necessary for the United States to tolerate endless trade deficits, because the Cold War ended 30 years ago.

  3. none

    Is OPEC dead or what now? I remember there used to be huge trade deficits because of oil imports. But they don’t even show up on that chart.

    1. johnnygl

      Not entirely sure, but probably a combo of pruce declines of recent years and the frackers going buck wild on the production front. There’s been a race to build pipelines for export in the last 5 or so years. Remember obama lifted the ban on crude exports.

    2. David

      Top five countries for US petroleum imports, 2016, from USEIA:
      Net imports, million barrels per day:
      Canada – 2.93
      Saudia Arabia – 1.10
      Venezuela – 0.72
      Mexico – (0.21)
      Columbia – 0.34

      At $50 per barrel, Canada would be around $55B in net imports. Include all the stuff that the US sends back to Canada and the number in the graph should make sense.

  4. allan

    Yves writes, “Barring visas for Chinese students attending US universities …”

    Interesting speculation – seriously cutting down on visas for Chinese undergraduate and Masters students would seriously harm many US universities and colleges, private and public (as well as the real estate developers who have built all those fancy off-campus apartments that are frequently referred to in the comments).

    But those students are irrelevant to IP concerns – going after them would be pure spite.

    Any possible IP threat would come from Ph.D. students (and postdocs), who typically don’t pay tuition and even get stipends. Going after them would throw many STEM graduate programs and labs into chaos, and maybe hurt university finances down the road in terms of lower external funding for research.

    1. Yves Smith Post author

      Agreed, but the argument could be somehow that having students develop connections and language skills in the US helps facilitate misconduct. There are enough Chinese former students that some sort of example could be found and presented as if it were part of a big pattern.

      The real drive of course is to have something with headline value that won’t muss the hair of big US multinationals.

      1. johnnygl

        Reducing competition from immigrant skilled labor would likely play well with the republican base which is still disproportionately comprised of college educated whites.

        Attacking low skilled immigrants plays well with the white working class…trump’s swing voters.

      2. Alex Cox

        “and even in some cases charge them more than US students.”

        As far as I know ALL universities in the US and the UK charge foreign students more than domestic students (just as all state schools in the US charge more to out-of-state students). Foreign students are a huge revenue stream, and pay a great deal more than domestic ones.

    2. David Carl Grimes

      There are over 300,000 Chinese students in US universities. Most, if not all, pay full freight and do not need financial aid. In effect, they subsidize US students who pay much lower tuition costs. Tuition costs for US students could go up substantially given that many universities have high fixed costs (like buildings and stadiums) to pay for.

      1. hunkerdown

        Then they need to fire their bloated administrative staffs and put their money where their mission is. If that fails, they need to be properly subsidized by their owners, whether that be the people or their hedge funds. Not one tear shed by me!

        You can place the boundary of inside and outside wherever you like, because the whole idea of that boundary is a lie.

      2. lyman alpha blob

        Or these universities could dip into their massive hedge funds (aka endowments) and make up the difference.

        I don’t necessarily think barring the Chinese from US universities is a good idea, but maybe there’s a happy medium between banning everyone and letting anyone and everyone who can pay in full through the door. I’ve seen quite a few articles about rampant cheating among Chinese applicants (not that their US counterparts are little angels either) so there probably should be more oversight even if it does cost East Western State U a new admin building or two down the road.

      3. Collins

        The students from abroad (mostly China) also limit the seats available for in-state students- big problem & a sore spot in Red & Blue states alike. Restricting them would irritate the Ruling/Wealthy Class in China (in search of the ‘prestige’ degree for sonny) but not be an economic blow.

      4. sgt_doom

        Nice try — but consider ALL those jobs offshored to China, all that technology offshored to China, and all that investment offshored to China, and consider all the IP theft from China, not to mention their hacking/penetration of the Pentagon and gov’t contractors and the theft of the plans for ALL major US weapons systems.

        Also, many of those students (at least a few years back) attended under the Foreign Scholars program, which was originally part of US foreign aid!

  5. MisterMr

    I have a problem with this logic: IP rights exist only because they are created with law, so if chinese law is different than USA law then obviously IP rights will be different in China.

    To say that China has to respect USA IP rights on its own territory is like to say that the USA can write the laws for the Chinese government.

    I think that the Chinese might cave in because the USA market is too much an important market for them, but still it sounds very much like bullying.

    1. Oregoncharles

      Requiring technology transfers has long been advocated by social justice types as a way to help the 3rd World catch up. It’s a perfectly reasonable price to pay for their cheap labor and lousy environmental standards.

      But now there’s a countervailing, equally left objection to corporate globalization and exporting jobs. It conflicts directly with the above logic, making the point that 1st World companies operating in places like China is a form of colonization. China seems to have noticed that and taken measures long advocated by the Western anti-imperial movement.

      I’d say they’re perfectly justified; our problem is with the impact on American workers.

      Wouldn’t it be ironic if it takes someone like Trump to finally break corporate globalization – the issue that dragged me back into politics?

    2. todde

      China can do what it wants.

      America can introduce tariffs and capital controls on American capital.

  6. divadab

    The corporate leadership class has made a conscious decision over the past 25 years to profit by shipping manufacturing jobs to China and integrate Chinese companies into their supply chain. The price they paid was in transferred technology.

    It’s the worst kind of short-term profiteering at the expense of long-term viability and of course manufacturing labor was sold out and discarded.

    Here’s the problem – the corporatist ideology places zero value on the nation’s interest, meaning traditional responsibility to society by its leadership. It’s the ideology of a treasonous parasite.

    Undoing this mess will not be pretty. Trump has tapped into the motive power but his competence to get anything done is in question.

    1. Self Affine

      It also need to be clear that a lot of the transferred IP came from fundamental research funded by US taxpayers. Almost any modern technology can be cited – the most prominent current example is the Internet.

      Naturally we weren’t asked because this IP was given free to corporations who just used it for their own short term interests.

  7. Watt4Bob

    This strikes me as a bit like closing the barn door after the cows have been reported missing.

    Over the last few decades, our brilliant masters off-shored to China, everything but the kitchen sink in the interest of short term profits. In that process, many companies lost control of their IP and found themselves competing with the very Chinese interests that they had been ‘partnering’ with.

    It was an oft repeated scenario that after immense struggles to perfect their relationship with their Chinese ‘contractors’, and them failing for to deliver a product that meets market standards, the American company gives up, only to find their Chinese ‘partners’ marketing a more or less perfect version of the product only a few months later.

    This process existed at every level of American technical expertise, from waste-paper recycling to telecommunications.

    Who remembers James Baker going to congress during the reign of G. H. W. Bush to get them to relax the rules about technology transfer in order to allow transfer of US space technology to the Chinese so they could launch ‘our’ telecom satellites because we had grounded our space shuttles and their were a back-log of satellites sitting on the dock with no way into space?

    Baker went to congress and carefully explained that;

    “…after all, rockets are just trucks…”

    Now, a couple decades on, after the transfer of space tech paid for by American tax-payers we’re facing a China determined to be a space super-power, tripling the budget for their space program as NASA deals with austerity, and America finds itself relying on Russia to deliver supplies to the International space station.

    Now, at long last, after the successful occupation of our country by the Chinese via Walmart, and after the Chinese have carted off nearly everything bit of our technical advantage in the marketplace all the while being cheered on by the neoliberal geniuses who demanded our corporations embrace outsourcing as a condition of financing, those same ‘very smart’ guys have decided that the Chinese are cheating us, and Trump says he’s going to do something about it.

    I’ve got some news for Trump, time to leave to table is the first sign that the game is rigged, not after you loose all your money.

    I should mention that much of the motivation for out-sourcing the American dream to China was to avoid environmental regulations and hatred of the organized American worker?

    1. sgt_doom

      I agree with your excellent comments — and let’s also recall that the international lobbyist group for the super-rich, the Bretton Woods Committee (brettonwoods.org), which ONLY deals with the Speaker of the House and the Senate Majority Leader, mailed both of them to lobby them to drop the “buy American” clause in the Federal Stimulus package during the early part of the Obama Administration which, although not completely dropped, was watered down considerably.

      There’s a definite neocon/neolib continuum here . . .

    2. Waking Up

      Don’t forget Bill Clinton’s role in trade with China. In 2000, President Clinton signed a China – WTO trade agreement after which he stated, “creates a win-win result for both countries”. As stated in the article linked below by Robert E. Scott at the Economic Policy Institute back in 2000, Bill Clinton stated that exports to China “now support hundreds of thousands of American jobs,” and that “these figures can grow substantially with the new access to the Chinese market the WTO agreement creates”. See following link:


      Then see the real outcome with 2 million jobs lost in the United States with the follow-up article in 2008:


  8. Arizona Slim

    I find myself agreeing with Trump’s March 7 tweet. Does that make me a Backward Deplorable?

  9. DJG

    Wow. The outlier in that bar chart is Ireland. So the U.S. runs a $38 billion trade deficit with Eire? That’s an enormous trade surplus for a country of some six million inhabitants. What is the cause? Somehow, I doubt that it is dairy exports.

    1. Jim Haygood

      It’s companies such as Apple Sales International, collecting royalties from their US parent to book them at Ireland’s low tax rate.

      The Emerald Isle has positioned itself over the past two decades as an attractive place for international companies, especially those in the technology sector, to set up their European headquarters, largely due to its low corporate tax rate.

      Intel and Apple were some of the first American behemoths to set up shop in the country. Since then, Google, Facebook, Airbnb, and others have followed suit.


      As FDR used to quip jovially, “We owe it to ourselves.” ;-)

      1. Katsue

        For many a long year, it wasn’t even taxable at Ireland’s low corporate tax rate, given that under Irish tax law most of that profit would have been taxable in the US, having been generated by companies that were centrally managed and controlled in the US.

    2. Tom

      Trade deficits and trade surpluses go under the general definition of Trade Balances. Trade Balance includes Capital Accounts ie. Outside currency in the form of cash, stocks, bonds going or coming into/out of the country being measured.

    3. PlutoniumKun

      Those figures can be safely ignored, mostly its just bookable profits by US companies with subsidiaries in Ireland. That said, Ireland does export a lot of high value products to the US such as medical devices and Intel chips. It used to be that the only Viagra plant was in Ireland, so that particular product alone had a hugely distorting effect on trade imbalances.

    4. sgt_doom

      Beginning back around 1977/1978, Prudential (and other insurance companies) began offshoring their administration jobs to Ireland.

  10. Chauncey Gardiner

    As other readers have observed, the transfer of intellectual property and massive trade deficits with China have been going on for decades at the behest of our so called “elite”. So what has changed that might have caused this corporate and political leadership class to change their policies? Don’t really know, but I suspect it is more than coincidental that the tariffs are scheduled to take effect around the time when the PetroYuan is scheduled to begin trading on the Shanghai International Energy Exchange on the morning of March 26, 2018.


  11. The Rev Kev

    This is really getting into dangerous territory here. It may be that this whole fracas is simply to get China to agree to some deal on imports and exports into the US using these measures as a threat. It is certainly not the first time that Trump has used this tactic nor is it the first time that the US has attempted to use US law on the international stage and tried to get the world to go a long with it.
    Apparently Section 301 ‘authorizes the President to take all appropriate action, including retaliation, to obtain the removal of any act, policy, or practice of a foreign government that violates an international trade agreement or is unjustified, unreasonable, or discriminatory, and that burdens or restricts U.S. commerce’. However, this could be simply used when they are losing trade against another country and can pull this rabbit out of a hat to tilt the field their way.
    You would think that the WTO would have the superior law here. The WTO tries to have a settlement dispute done and dusted within a 15 month time period (https://en.wikipedia.org/wiki/Dispute_settlement_in_the_World_Trade_Organization) which may go against Trump’s habit of spinning legal matters out to infinity. Unless Trump wants to threaten to pull the US out of the WTO if he doesn’t get his way.
    The US, Germany, Japan, and other countries may fume over the issue of technological transfers to China but the solution here is pretty simple. Don’t do trade with China. No-one is putting a gun to their heads and saying that they have to go into China. When its the other kid’s bat and ball, you play by their rules. Likewise, if you don’t want China to buy up your technological companies and the like, the solution is also simple here. Don’t put them up on the market for sale. Problem solved.
    Hard to say what the long term effects might be here. Chinese capital may start to withdraw from the US which might be missed. The Chinese may start to slow down their purchase of Treasury Bills but they would do this slowly so as not to spook the market. My guess is that they will redouble their efforts to developing their own technological industries so as not to be dependent on the west. Worst case scenario, China could instruct all those Chinese-manufacture microprocessors in US military equipment to shut down the computers that they are part of in 3,2,1..

    1. ChrisPacific

      Likewise, if you don’t want China to buy up your technological companies and the like, the solution is also simple here. Don’t put them up on the market for sale. Problem solved.

      Every company listed on the public exchanges is for sale. Are you proposing shutting down the NYSE and the Nasdaq? If so, I would not describe that as simple.

      1. The Rev Kev

        Actually that idea came from something that happened in America in the 80s. Japan was a powerhouse back then and they were buying up stuff left, right and center. If I remember right, a major studio block came up for sale and the Japanese started to put bids on it. There was a lot of agonizing and hand-wringing about letting the Japanese buying this iconic studio and it got so bad that the Japanese guy buying the studio said that if you don’t want people like the Japanese buying it, maybe that they shouldn’t be selling it.

  12. Punxsutawney

    I know of highly complex technology that was sent to China to be manufactured instead of here in Oregon. What’s interesting is that when that company’s products showed up in Iran, a rather large team of FBI agents ended up at the corporate headquarters to investigate how the instruments got there.

    But outsource the technology to China, not a problem when corporate profits are concerned. Heck let’s give a tax break to help out. Doesn’t hurt that one of the parent organization’s offices was across the street from the White House. That would have been the Obama White House at the time.

    1. sgt_doom

      Nicely put — and multiply that example you gave by 100,000 and the situation should become much clearer to readers here.

  13. divadab

    Something to note: The United States is a net exporter of both food and hydrocarbon energy; China is a net importer of both. They need our corn, soybeans, and oil a whole lot more than we need their trinkets and geegaws. Especially trinkets and geegaws that we invented and told them how to make.

    All this breastbeating about the rise of China is just hot air. We hold the cards – we need to clean house of the traitors who sold us out.

  14. Off The Street

    China plays a long game, and the US can, too. Think of the IP action as the latest step in the integration of China into the modern world. The initial step was the Nixon Trip To China, initial caps for emphasis in later history books. Next, allow IP transfer, manufacturing outsourcing, trade imbalances and the like as part of a clever web of economic detente. I say allow because those were not idle gestures when they occurred.

    IOW, make China so tightly linked to the West that it can not but help playing along. Given the Chinese demographic imbalances (e.g., M/F, rural/urban) their problems are gigantic and will not go away soon. Rapid industrialization, if one may call it that, was Mao’s and especially Deng’s Golden Ticket to avoid implosion. (Backyard steel furnaces and roaming gangs of disaffected young males were recognized as suboptimal). Some of that industrialization is recycled in domestic overdevelopment, essentially make-work or waste through excess debt build-up, and some is a candidate for eventual Western benefit, think super-computing and high-speed rail technology.

    1. Off The Street

      US owes China 1 million, US problem.
      US owes China 1 billion, US problem.
      US owes China 1 trillion, China problem.
      That web of detente is also a web of debt.

    2. Synoia

      China plays a long game, and the US can, too

      The US could play the long game. It would require a cultural shift away from “the next quarter.”

  15. visitor

    Smack in the middle of the article, I have a picture of a car with the following title in Spanish: Nueva York, aumenta el nivel de tu conducción con el atractivo diseño del Mazda3 del 2017. Explora el modelo aquí by Mazda Latino.

    I preferred not to follow the link.

    It is the first time it ever happens to me on NC. Has anybody noticed the same thing?

    1. Synoia

      Yes, but I ignored it.

      My prejudice is that I require advertisments be presented to me in proper English, or I will dismiss the product and the company from consideration.

      Few pass that test.

    2. Oregoncharles

      Yes, it’s an example of how stupid the advertising algos are. I get quite a bit of spam in spanish, too.

      The other oddity is that after you buy something online, ads for the company you bought it from follow you around. This seems like pure waste from the company’s point of view. But it is amusing to see ads for Upton Tea on NC.

    3. Yves Smith Post author

      It came over from the original post at Wolf Richter’s site. I failed to strip it out.

      This is labeled as sponsored content and is harmless if a bit intrusive. Even the Financial Times and Bloomberg now run sponsored ads.

      If you had clicked on it, it would have helped him. The ads don’t pay on clickthroughs like the old Google ads, but the advertisers want to see a certain (and it’s not high) % of readers looking at the article.

  16. Ian Perkins

    “China exported to the US three times as much as it imported from the US.”
    The Brits had the same problem in the nineteenth century, so they smuggled opium into China, seized Hong Kong, and looted and destroyed the Summer Palace, among other things.
    Which of these options is the US regime contemplating?

    1. Tony Wright

      The Chinese are already ahead on one of those tactics – where do you think the crystal meth precursors come from? Unofficially of course. And crystal meth is way more socially destructive than opium, or even its pervasive modern equivalents, many of which are domestically produced by corporates and legally pushed/ prescribed by the medical profession. So US ,and to some degree other western societies , are being hollowed out from within.
      Then you have the socially corrosive effects of gambling, both online and domestic, and the craziness of US gun laws, which are a massive source of domestic terrorism, although nobody seems to call it out as such, probably because some of it is perpetrated by your trigger happy police.
      Any objective long term historical analysis would conclude that this is a society in decline, and I dread to think what will replace it given the massive and destructive impacts the ever increasing human population is having on our finite life support system.
      And the Donald reckons he has already made America great again. The King of Fake News.

  17. P.M. Ludd

    From my own experience at state universities, and from reports of a couple friends in PhD STEM programs at similar institutions, Chinese grad students are used as research slaves. They work the 14 hour lab days without complaint, where their American peers deal with competing interests like trying to start an adult life. Of course, they don’t have much choice do they? I imagine their research advisors have as much power over their visas as any other employer has over their imported labor.

    I’ve never witnessed how “elite” institutions function, but a little disruption might help second and third tier universities get their houses in order. Perhaps cutting the supply of compliant research slaves will force them to refocus on providing advance education to the American population, and on preparing their own undergraduates for advanced degree programs.

    Not that those are the Donald’s intentions, but is it a possibility?

    This is my first comment. Don’t be too mean!

    1. Waking Up

      A problem is corporate influence, wealthy donors, and short term profit making have taken over academia at all levels. Hustling for dollars is just as important, if not more so, than providing an actual education for students. Unfortunately, when wealth accumulation becomes the top priority in a country by both those with the wealth AND those in positions of power to change the dynamic, it is likely to degrade everything else in society.

  18. larry silber

    I think this globalization trend is fraught with disinformation, confusion, and an inability to be consistently regulated until countries figure out socially what work, money , and trade relationships really mean to them. Are exports costs and imports benefits, which seems counterintuitively quite logical to me, or are exports benefits and imports costs, Im sure peolpe can make all kinds of arguements for many different goods and services, but at the end of the day is back breaking manufacturing labor the besy productive activity for people to engage in? How do we reconcile technologies ability to displace many laboring jobs that are also redundant , unstimulating, and repetitive. If people work less how does society get away from laissez-faire hyper capitaist trends. Maybe we need more endeavors in the public sector, with less emphasis on profit and more on interest and abiliity. Maybe allowing people to find purposeful engagement with their passions, so life is less stressful and anxiety ridden. Does allowing more of society to enjoy life and the benefits of thousands of years of knowledge, with less difficult and stressful lives, ultimately cause society to colapse? What happens if the experience and tenacity gained from competitive hard work coerced through cut throat employment is lost to leisure activities? The old puritan work ethic must be upheld! The whole seems nuts to me, especially the good old USA. Heck we won everything, we have everything, but somehow we’re always victims. Whats good is bad, everything gets turned around inside out without propper context. Good luck

  19. RBHoughton

    It was greed that got western manufacturers into China in the first place. We had existing markets based on the manufacturing cost in North America and Europe. Then China offered the chance to collapse those cost prices whilst preserving the selling prices.

    There was always likely to be a downside and now its coming into focus we squeal.

    What we really want is the Japanese co-prosperity sphere. China’s cheap labor and minerals creating our expensive manufactures.

  20. John R.

    I had stock in American Superconductor AMSC some years ago. They had software controlling wind turbines and were working with a Chinese company. Their technicians discovered the software where it should not have been. AMSC did good detective work and the Austrian employee who supplied the code ended in jail very quickly. Years later, still in Chinese courts; the Chinese company was affiliated with the son of the premier at the time. AMSC recently sold their real estate, probably to stay alive.

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