The Pentagon conducted a flight test of a prototype conventionally-configured ground-launched ballistic missile at Vandenberg Air Force Base in California on Dec. 12. (Photo: Vandenberg Air Force Base)
Arms experts warned of negative global implications after the Pentagon on Thursday test-launched a second missile that would have been banned under a Cold War-era treaty that U.S. President Donald Trump ditched in early August.
Trump ignored concerns about the impacts on global security and formally withdrew from the Intermediate-Range Nuclear Forces (INF) Treaty after suspending U.S. obligations under the deal in February and giving Russian President Vladimir Putin six months to destroy weapons that the U.S. government and NATO deemed noncompliant with the bilateral agreement. The deal outlawed land-launched missiles with a range of 500–5,500 kilometers or about 310–3,400 miles. Continue reading →
Universal Postal Union headquarters in Berne, Switzerland. Photo: UPU
Thousands of absentee ballots could be uncounted in upcoming elections thanks to President Donald Trump’s objection to a treaty which governs the international mail exchange for nearly 200 countries.
Citing disapproval of shipping rates it says unfairly favor China, the White House is weighing a potential withdrawal next month from the Universal Postal Union (UPU), a United Nations agency which allows for global postal service. Continue reading →
Thousands of pro-democracy protesters effectively shut down Hong Kong International Airport on Monday, the fourth day they have occupied one of the world’s busiest airports as part of the mass demonstrations—against police brutality and a controversial extradition bill—that have rattled Hong Kong since June.
The protests were initially spurred by a bill that, NPRexplained, “would have allowed people in radHong Kong to be sent to mainland China to face trials in courts controlled by the Communist Party, sparking fears of politically motivated prosecutions targeting outspoken critics of China.” Although Hong Kong Chief Executive Carrie Lam quickly suspended the measure and later declared it “dead,” demonstrators continue to demand its full withdrawal and Lam’s resignation. Continue reading →
During the South Sudanese Civil War, which has claimed nearly 400,000 lives, the United States helped the main belligerent in the war continually acquire arms through Uganda, a close U.S. ally in the region. For years, the Ugandan government channeled arms, ammunition, and military aircraft to the regime of President Salva Kiir, according to multiple reports by Conflict Armament Research and the U.N. Panel of Experts on South Sudan.
“Uganda remains the main transit point and facilitator for arms and ammunition to the regime,” former U.S. diplomat Payton Knopf reported in September. Continue reading →
Then-President George W. Bush looks on as Justice Anthony Kennedy swears in Brett Kavanaugh to the U.S. Court of Appeals for the District of Columbia on June 1, 2006. (Photo: Eric Draper/White House)
The media, Congress, and the American people continue to fix to their attention on Brett Kavanaugh and today’s hearings regarding allegations of sexual assault and harassment against him. While these are serious issues and should not be taken lightly, there are numerous other developments that are falling by the wayside as the national conversation remains preoccupied with the Supreme Court nominee. Continue reading →
In response to accusations of encouraging “debt trap” diplomacy in Africa, Chinese President Xi Jinping said the announced aid package is not “a scheme to form an exclusive club or bloc against others. Rather it is about greater openness, sharing and mutual benefit.”
Chinese President, Xi Jinping addressing African Leaders during the 2015 China-Africa summit held in South Africa. Photo: ICiR
Chinese President Xi Jinping has offered a $60 billion aid package to African countries over the next three years, in response to the continent’s increasing debt distress — with no strings attached.
China’s investment plans include $5 billion in African exports, $10 billion for development, and $15 billion grants and interest-free loans. A $20 billion credit line will also be included, as well as emergency food aid, scholarships and vocational training, and increased agricultural development. Continue reading →
An Iranian man reads a copy of Iranian daily newspaper Arman with a picture of US President Donald Trump on its front page with the title in Persian that reads ‘Crazy Trump and logical JCPOA’ on display in Tehran, Iran. (Photo: EPA)
“Together, Europeans and Americans have proved that a strong and united transatlantic partnership can bring about a coalition extending to Russia and China, endorsed by the international community,” the lawmakers write. “But this coalition is now at risk, as the U.S. government moves towards abandoning the [Joint Comprehensive Plan of Action] without any evidence of Iran not fulfilling its obligations.” Continue reading →
On Thursday, President Trump flipped his position on the Trans-Pacific Partnership trade agreement, suggesting the U.S. might want to rejoin the pact. His announcement sent Wall Street indices shooting upward in jubilation and angered labor leaders. It left China—which has been sorting out how to respond to Trump’s announced steel and aluminum tariffs—even more bewildered as criticism grows of its “Made in China 2025” initiative to dominate the high-technology sector.
Trump’s about-face is especially striking given that exiting the TPP was a crucial plank in his economic agenda on the campaign trail and one of his first acts as president. That pledge played well to the frustrations of people who know the global economy is ripping them off and are understandably angry. Continue reading →
The tariffs are meant to address two problems: intellectual property theft by China and a steep and persistent trade deficit.
As an economist and expert in international trade, I don’t see how the proposed tariffs will resolve either one. In fact, it’s more likely that they will create two new problems by hurting both consumers and businesses.
IP theft and trade deficits
The administration formally justified its tariffs by invoking Section 301 of the Trade Act of 1974, which allows the president to impose tariffs on countries in violation of international trade deals.
Intellectual property theft has been a major complaint of American companies doing business in China for decades. Sometimes this theft occurs through illicit means, such as industrial espionage. It also occurs through legal channels, such as when U.S. companies are forced to form a joint venture with a Chinese business. In other cases, technology transfers are a precondition of doing business in China.
The other problem that has long irked the president is the significant trade deficit. Since the U.S. normalized trade relations with China in 2000, the deficit ballooned from less than $84 billion to over $375 billion in 2017.
This “China shock” of cheap goods has caused considerable disruption in the U.S. economy. The labor market has been surprisingly slow to adjust, leading affected workers to earn far less money over a lifetime.
The wrong solutions
It remains to be seen, however, whether the tariffs will alleviate either problem.
The administration’s calculation seems to be that China will back down on intellectual property theft if faced with less access to U.S. markets.
But China is less dependent on U.S. trade now than it was a decade ago, making its economy resilient to these sorts of punitive measures. The U.S. accounted for 18.4 percent of Chinese exports in 2016, down from 21 percent in 2006.
The U.S. likely would have better luck resolving this problem at the WTO, which China joined in 2001 and must abide by its rulings. The best part about a WTO ruling is that it would affect all of China’s exports, not just those to the U.S.
The U.S. personal savings rate has fallen steadily since the late 1970s. At the same time, the government has run persistently large budget deficits, both of which have increased the level of borrowing in the U.S. economy.
As a result, foreign investment, particularly from China, has become increasingly critical to financing U.S. economic growth. This is great news in terms of helping Americans buy cheap Chinese goods and the government finance its budget deficit. But all that foreign cash going into the financial market isn’t being used to buy the stuff Americans are producing, like Harley Davidson motorcycles and Iowa corn.
This results in lower exports and a higher trade deficit. Tariffs will not change this reality.
Two new problems
While the full details of the tariffs have yet to be released, it’s clear they’ll cause at least two immediate problems.
One is that U.S. consumers will be hurt. The typical consumer has about $260 in extra purchasing power as a result of trade with China. Those benefits, which disproportionately go toward working-class Americans, will fall due to the U.S. tariffs, as American importers will pass some of their increased costs along to consumers.
Particularly vulnerable to Chinese retaliation are the pork and soybean industries, which are concentrated in the Trump-friendly Midwest. This list could grow if a trade war with China escalates.
A broader concern is that, by acting unilaterally, the Trump administration is undermining the broader system that has facilitated the growth of international trade and adjudicated grievances between countries since World War II.
While far from perfect, organizations such as the WTO have limited the scope of trade wars since the chaos of the 1930s. Failing to uphold these institutions could have major consequences in the future.
It is becoming increasingly more common for the corporate media to pay attention to the dollar’s dying status as the world reserve currency. The media can no longer realistically ignore developments that ultimately chip away at the dollar piece by piece considering Russia, China, and Iran have become brazen about their intentions to erode the dominant currency in the not-too-distant future.
While Anti-Media has documented the decline of the dollar throughout the course of the year as a result of a number of significant geopolitical decisions, there is still one major elephant in the room that needs to be addressed. Once it is, it should shed some light on just how detrimental these recent developments are to America’s status as the global authority. Continue reading →