LyrArc Article Gist
In this WSJ report a top American Defense Department official before resigning says- "I have no problem with feeding China or trading with China. I have a problem with arming China." Advanced or sensitive manufacturing technology is still being approved for export to China says this report in WSJ, even as the US perceives this to be a national security threat. Experts say the Commerce Department report approval process needs overhaul and the US needs close coordination with the European Union on this process. Of the total US $124 billion in exports to China in 2020 only half of one percent needed a license Commerce Department data reviewed by WSJ shows. Of that small fraction of one half percent Commerce Department approved 2562  applications or 94%. This even includes array of semiconductors, aerospace components, artificial intelligence technologies that could be added to China's military. This means that even towards the end of the Trump administration with its talk about national security threats, through the four years 2016-2020, nothing much happened in this important field.  The difficulty that the Trump administration faced and America faces is putting company and business interests first or American security interests and retaining competitive technological advantage interests first. American administrations and business have consistently failed to follow what plain ordinary Americans understand by America first. Even when it is clearly evident that America is handing over sensitive advanced technologies with very little in return, and creating out of nowhere competition that poses serious risks for the national interest, business and administrations operate indifferent to the national interest. Even right into the period when this is making the world a riskier and more dangerous place.   This is the state of affairs today, and the situation is not about Congressmen visiting Taiwan or ships going through the seas in that region, or international law. All that is American policy  and is well known and well understood. What is missing is the right action and the right determination behind other action that is sending a different message at the same time -that the US is oblivious to its own interests. That administrations, even those such as the recent Republican one under Mr. Trump, see a higher priority in following American business wherever it goes in pursuit of individual company interests alone, even if it does not accord with the national interest. Lobbying groups distort what policy should be in the public interest and in the interest of both countries, leading to a breakdown in the whole process itself whenever governments surrender their role of protecting the public interest.  Outshoring manufacturing was bad economically at the level of communities across the US, leading to divisions that weakened the country in the last decade, it was also bad for the economy of the country with loss of the best manufacturing jobs, beyond what economists in their ignorance of the big picture sought to show was the consumer- often the same person who lost a job or stopped seeking work- paying less. It was bad also for China as it created the hyper growth that rapidly contaminated land, air and water and created an inherently unstable relationship in trade with destruction of jobs at a pace that America had not faced with Japan and with which it could not cope. Could a pace that worked for both nations have worked? At the root is the notion that business knows best even if it is in plain sight to every plain American that the country's most advanced technologies are being shipped out. Governments do not fulfill their responsibilities and fail when they fail to tell business what rules are in the public interest, as it was never in the first role of business to protect the public interest. That the European Union has simply followed the US in this has created a problem for both the US and the European Union of deviating from what plain Americans or Europeans see as abundantly clear.  Even in plain dollars and cents business and economists fail to grasp the true cost for the whole country or whole people compared to the benefit for an individual or an individual company. The cost of wars even small wars can be be trillions of dollars which are borne by the whole country or people, and most of it by the middle and less economically well off classes in a country. Creating a belligerent competitor in world affairs and the risk of conflict and war is to lose trillions of dollars when the benefit to an individual, groups, or individual companies is no more but a tiny fraction of that trillion dollar cost, not including what all the plain people pay in human lives. It is not that anyone benefits as the people in the belligerent competitor country follow the same pattern of loss that would happen in the US. One should ask is it not a loss for China also? The example of Imperialist Japan is not so far off in time for Americans or Asians including the Chinese and Japanese people who suffered so greatly to forget. Business remains oblivious to the public interest not just for America but for the world, individual companies do not see it as their role beyond that of pursuing individual company interest. Is it not then for the government to set the rules. Is it alright for government to not fulfill its responsibilities? Even when this pushes the world faster to into conflicts as technologies take the place of exercise of wisdom in conflict, and even when there are unmet challenges such as climate change that affect the whole planet.  ...

LyrArc Article Gist
Carrie Lam's withdrawal announcement for the extradition bill that sparked the protests comes after 3 months of protests in which Lam could have started conversations and dialogue with protesters. This is now not likely to end the protests as a number of issues have emerged including social, political and economic issues and police action. For China it also raises questions of relations with major trading nations such as the U.S. With the stalled talks on trade and tariffs, and a slowing economy, the last thing China needs is for this to overshadow the bigger issues of economic growth and continued development of its economic potential. Lam's withdrawal decision is received with much skepticism in Hong Kong as this report in the Guardian shows. Coming earlier it could have some meaning, there is now a wider gap in the perceptions of both sides. Beijing sees itself a s wary of Taiwan, Hong Kong, and Macau, as Mr. Xi points out, and the protestors in Hong Kong not sure of Beijing's intentions. ...

LyrArc Article Gist
This picture essay in The Guardian shows the 700,000 additional people displaced inside Afghanistan in 2021 in addition to the 2.9 million displaced people by 2020. The British stayed out of Afghanistan except for brief forays from concern about Russia entering close to British India. Not much happened till Zahir Shah, the King of Afghanistan was seen as not doing much for a famine that struck the country in 1972. Drought struck much of the country in 1972 leading to the deaths of over 100,000 people from starvation. The King had ruled since 1933. And for a brief period his cousin and brother-in-law Daud Khan had actually run the administration between 1953 to 1963, before being dismissed with a new constitution adopted not allowing the royal family to rule the country without consulting parliament. The poor handling of famine relief led to the fall of the government appointed by King Zahir Shah in 1972. In 1973 Daud Khan violates this constitution and assumes control of the country. British India was in 1972 the India of the Nehru period, with his daughter Indira Gandhi the democratically elected prime minister. India fought a brief war with Pakistan in 1971 that set up the new nation of Bangladesh from territory of East Bengal. India preoccupied with Bangladesh refugees did not do what the British had done to keep outside powers out of Afghanistan and maintain a stable monarchy. Daoud Khan's repression of Communist party leaders led to Communist party military factions in the army taking over the country in 1978. The Afghan military led by officers in the army's Communist factions had little support in the traditional Islamic nature of the countryside for their land reforms. Leading to a rebellion and entry of Soviet troops under a friendship treaty signed in 1978 with Soviets under Leonid Brezhnev. It is this disrupting of the stability of the Afghan monarchy or the entry of Soviets or Americans or any other foreign influence that was carefully prevented in British India by Britain's India policy, which resulted in a period of peace and stability in that region. The events of 1974 with the fall of the monarchy, and the entry of Russia in 1978 broke two of the main rules the British had observed from 1750- a stable monarchy and no outside influence in Afghanistan. A policy the British also followed for Tibet. When China entered Tibet in 1950 Nehru was too preoccupied with the millions of refugees from Pakistan and failed to prepare in the years 1947-50 for following British policy on Tibet by preparing or anticipating the entry of foreign powers. The entry of China into Tibet in October 1950 led to the Sino India border war of 1962, and led to the current situation of India facing a Chinese army all along the border of Arunachal Pradesh, Ladakh, Nepal and all the way in the Himalayas to Kashmir. The result has been billions of dollars spent by the US every week starving domestic priorities, as president Biden observed this week, and a burial place for empires. Ten years for Russia, and twenty for the US with the same result. It has left the whole region poorer and in humanitarian crisis for 50 years, and created crises for Russia, Pakistan, India, and the US. ...

LyrArc Article Gist
This WSJ report sees Angela Merkel as leaving an international legacy of cooling relations with America. It says Angela Merkel turned down US president Biden's first call after his election as president because she was going to her cottage in the country that weekend. This report says after 4 terms Merkel is to be seen as dramatically increasing her country's economic dependence on China, pushing through a energy deal with Russia, joining France in challenging US political influence in Europe, rejecting American requests on economic policy and setting Berlin's openness to Chinese technology.  What happened with her youthful fascination with America during the years growing up in East Germany asks the WSJ? It also says of the Bush years of unregulated banking leading to the 2009 US banking crisis- that left her with a distaste for Anglo-Saxon banks and Wall Street lobbying. Of the Obama years it says Merkel found Obama unsteady, verbose, and sometimes meddling, with the spying on Merkel's phone also giving her a sense of disrespect to Germany. The result was that Merkel increasingly was fascinated by the Chinese experiment in development, visiting China 13 times while in office, studying Chinese history, politics and economics.  Merkel over this period met with the Dalai Lama and had questions about one party rule by CCP. Yet she became more and more resigned to Germany as a country of 80 million, not the EU and Europe as one group united in vision with a population of about 500 million, larger than America that could be a force for good in its own right. She said "we can be as hardworking, awesome,  as super as we like, but as a country of 80 million we won't be able to prevail if China ever decided that it no longer wants to have good relations with Germany." She ignored the experience of Sweden and Scandinavian countries in their relations with China. In saying this she ignored the potential of India and its neighbors in south-east Asia that make up about 2 billion people or about twice the population of China. She also seemed unaware of the role Woodrow Wilson, FDR, have played in realizing the democratic vision of the German revolutionaries of 1948 who failed to bring democratic government to Germany. And she had forgotten of the role Harry Truman, the commoner president of the US, who played a major role in establishing German democracy and its dignity during the Berlin Crisis after the blockade of Berlin by the Soviets in 1948. The mediocrity of presidents from Bush to Trump has bothered Merkel. Yet it may very well be that there is nothing mediocre about Mr. Biden and America's vision about its future as it grapples with the social and economic problems of the last three decades, as it has done before in its history and come through. ...

LyrArc Article Gist
Nathaniel Tapin says about China's debt laden economy and struggling property developers that this has been seen before. What matters most is the confidence household borrowers have in the country to buy homes and spend versus putting more money into savings. And this confidence that that has been the strength of the economy for three decades is fading. About 12 million jobs in the internet platform economy were lost in 2020-2022. This absorbed a fourth of the Chinese graduating from colleges each year. The manufacturing sector is affected by declining demand overseas and cannot pick up for this. Much of this is a result of Xi's government efforts to tamp down debt of housing developers, to reduce housing speculation, to limit the power of internet companies, and develop a fairer economy, and these were policy decisions not easily reversed. A pervasive pessimism is leading to a disinclination to spend or buy a house. Surveys of Bank of China show inclination to save increased by 15 percentage points to 58% in second quarter 2023. In the past Chinese put money in homes as a way to deposit money in a savings account, homes were sold even before they were built. This cash was passed on to property developers and in turn the local governments benefited by selling the land to property developers. After property developers could not pay interest on debt and collapsed the households decided to pay down their mortgages and $28 billion went to pay down residential mortgage debt in first 6 months of 2023.  ...

LyrArc Article Gist
Two divergent approaches to the coronavirus are shown in this report in the WSJ. One in Italy which relies on quarantine and lockdown and mandatory social distancing, and the other on keeping borders open and aggressively tracking down the infected using data and testing. In South Korea infections have stabilized at 8000, and in Italy the are rising at 15,000. The divergent approaches and the results vary with the people's history, culture and recent experience. The cultural difference in Asian societies with people willing to cooperate and work together with health authorites for the social stability and good of the country is different from the more individualistic nature of western societies. In addition Italy has a long period of foreign rule of Hapsburgs nd French that has created an attitude of working around authority, the tendency to being furbo which prime minister Conte referred to in a nationwide address.  South Korea and Taiwan also have experience with the SARS and MERS virus during which public health regulations were instituted and comprehensive databases setup that are now being used to combat the new health crisis by tracking down people with health needs. The precedents have taught people in South Korea and Taiwan of how serious this kind of crisis can become, which was absent in Italy in the early stages. Both South Korea and Italy are democracies. The difference being that one has experience with public health crises from experience with SARS, MERS, H1N1, and has developed policy tools, broadened public support and increased state powers in anticipation of such crises. In South Korea there were fines of $8300 for those not willing to be treated and the government aggressively tracked down people. Public support and awareness also helped in controlling the situation. Taiwan has done better than South Korea as covered in a separate article in the WSJ, and shown here, controlling the situation from the beginning including shutting down flights from China early because of its close proximity to China.  ...

LyrArc Article Gist
U.S. president elect Trump meets with the heads of tech businesses on Dec. 14, 2016. CEO's of Amazon, Facebook, Google, and Microsoft were present. Trump was exuberant about the advantages secured by U.S. tech companies in global business, saying- "there's nobody like you in the world. Anything that the government can do to help this go along, we're going to be there for you." The discussions covered need for more vocational education, advantages and disadvantages of trade with China, and immigration. Quarterly meetings of this type are now planned with a smaller group organized by Jared Kushner to cover immigration and education.  Jeff Bezos of Amazon described the meeting as "very productive." Bezos says he told the group that the best way was to use innovation to create jobs outside of tech in agriculture, infrastructure, manufacturing elsewhere, to create large number of jobs. Ginni Rometty, CEO of IBM, and other executives are part of the Strategic and Policy Forum set up to provide business input to the president. ...

LyrArc Article Gist
"We will never abandon the American worker and her community wherever it is located," says president Biden's head of the Council of Economic Advisers (CEA). He tells the Economic Policy Institute that many economists had questioned the policies that hurt American workers even as early as 1996. He joined EPI in 1992 and says he has followed the trade debate since then and heard the warnings as China entered the WTO in 2001 after years of negotiations in the last year of the Clinton administration.  Common sense questions were asked- Why asked Thea Lee now at the Labor Department is it good to have protection of intellectual property rights but not labor rights under NAFTA. On TPP and FTA's or free trade agreements in general he who writes the rules gets to benefit from them. Free trade having far less to do with free trade as generalized is the first thing he noticed when coming to Washington. Certain business groups captured the task of writing the rules in TPP  to benefit them.   ...

LyrArc Article Gist
India says China carefully prepared an attack on Indian soldiers in the Galwan Valley mountain ridges, at Ladakh's border with China. 20 Indian soldiers were killed and 76 injured. This report in the Guardian shows satellite images of the Galwan Valley taken by Planet Labs, an imaging company. The images show that days before the clash there was increased activity on the Chinese side, including the damming of a river and the movement of troops and machinery close to the disputed and poorly demarcated border. Australian Strategic Policy Institute says its analysis of satellite images shows PLA Chinese forces regularly crossing into Indian territory temporarily on routine patrol routes. Indian officials also say commanders from both sides met on 13 June and agreed to each retreat back 2 kilometres in the Galwan Valley and Pangong Lake area. For unknown reasons Chinese troops instead of retreating as agreed erected a tent on disputed territory close to Patrolling Point 14. India's 16 Bihar Regiment led by Col Santosh Babu, dismantled the structure in an attempt to push back the PLA troops. According to accounts given to the Hindu newspaper cited here in the Guardian, Babu and his troops later went to the Chinese side to challenge the refusal to retreat, they were ambushed by Chinese forces on the steep mountain precipice. Chinese PLA troops allegedly unblocked the dammed river, releasing a rush of water to destabilise Indian soldiers, and attacked with stones and makeshift spiked weapons. ...

LyrArc Article Gist
Peter Navarro points out the problem with textbook economics and concepts such as comparitive advantage. Many economists from elite universities ignored for a long time the distortions in world trade arising from state subsidies as they used textbook economics without looking at what was happening in practice. Even as the U.S. runs a trade deficit of $ 1 billion a day with China such text book economists ignored for too long the advantages of state directed industries and state directed investments in creating distortions in trade patterns, and not creating a level playing field for the U.S. Here Peter Navarro desceibes what he calls afaux comparitive advantage built on high nontariff and other barriers. Auto tariffs of China are 10 times that of the U.S. Other barriers are intrusive licensing requirements and foreign ownership restrictions. With subsidized land and capital, export subsidies, and tax preferences, unfair trade advantages can be gaine d in many industries leaving the U.S. in a disadvantaged position. Mr. Navarro is assistant to the U.S. president on trade and manufacturing policy, and director of the White House National Trade Council. ...

LyrArc Article Gist
It is not a story that most people grasp or understand- the long term effects of the US immigration surge of 2023 and its source mostly from Venezuela. The  US Congressional Budget Office says labor force in 2033 ten years from now will be larger by 5.2 million people and younger as a result of the immigration surge in 2023 from about 1 million immigrants each year in the 2010's to 3.3 million. About 2.5 million crossed the southwestern border in 2023. Much of it the result of the collapse of the Venezuelan economy and its middle and upper classes leaving the country. This was worsened by the US sanctions on the Maduro government including under president Trump, say experts in an adjoining NYT article on the 7 million people who left Venezuela to go to Colombia, Peru, Ecuador and Chile since 2012, then making their way up the Darien Gap to the US. Something that could have happened under a Republican president if the US Congress could not reach bipartisan agreement on correcting asylum and parole policy. As a result of this surge US Gross Domestic Product  in 2033 will be 3% larger. When the large Asian economies are seeing a aging workforce, Japan for the last decade and China now following Japan, the US labor force will be younger than it would be without this unusual surge in immigration of the last 2 years. The federal deficit will be smaller at 6.4% instead of 7.3% in 2033 as immigrants will pay taxes on income. Another aspect of this larger infusion of immigrants is that after the pandemic shut down immigration entirely there were severe shortages in the hospitality and restaurant, construction, healthcare industries. And with the trillions of dollars in investment that the Biden administration is making with more factories - this will absorb most of the immigrant surge by 2033. With some positive effects in the competition with rising Asian economies China and India. Particularly consider with the younger demographic India of 1.4 billion people. It will mean more factories can be built in the US and there will be workers for these factories in the US at wages that keep the US economy competitive years from now in 2033. This is a sobering aspect of the current situation viewed from what will be seen by America's younger generation. And under the bipartisan compromise in Congress correcting asylum and parole policy that was shut down by the former president, Republican senators understood very well that the immigration surge of 2023 would have some constructive effects for the long term, while its effects on the short term would be mitigated by Biden's commitment to close the border in 2024. This did not happen, yet the future for America's younger generation is bright under the Biden plan for massive investment in manufacturing and jobs in the US, and with the millions of immigrants needed to fill the jobs that investment will create by 2033. It will make America with a younger work force than Europe or China, only India having a younger workforce in 2033. ...

LyrArc Article Gist
About $200 billion in speculative or hot money entered China and landed mostly in bank deposits which pay 4% interest rate compared to 2% for dollars in the USA with the idea of profiting from the interest rate and the appreciation of the yuan, in the first 5 months of 2008, according to economists at Logan Wright, an economics research firm and at Beijing University's Guanghua School of Management. Beijing's foreign exchange reserves are at 1.8 trillion dollars at the end of May 2008 so even if their is an abrupt reversal of flows of this hot money China would not be protected but an abrupt outflow could hurt the banking system. Amore relevant fear is that this speculative inflow will raise inflation in China as the central bank prints more yuan to buy dollars and keep the yuan from appreciating and then sterilizing the excess liquidity by issuing bills or increasing bank's reserve requirements. Sterilization is now upto its limit and the central bank has raised the reserve requirement 16 times since January 2007 from 9% to 17.5%. The Peoples Bank of China, China's central bank only pays i.9% on reserves so this hurts bank profits and there is a limit to raising reserve requirements also. This leaves one time appreciation of the yuan but this would have to be of some magnitude about 20% to stem the speculative inflows of money trying to take advantage of the appreciation of the yuan. Another problem this situation presents for the central bank is making monetary policy tools like increasing interest rates to calm inflationary expectations not available as the increase in interest rates would only increase the profit to be made in bringing in speculative money into China. So where does this leave the Chinese economic policy managers? Monetary policy will continue to be losse and with large amounts of speculative inflows in the rest of 2008 and into 2009 inflation is likely to continue its upward climb. Inflation was at an annual rate of 7.7% in May. 2008....

LyrArc Article Gist
This WSJ report on developers and home buyers in Tianjin show how the government policy of controlling speculation in housing prices affects ordinary home buyers when prices drop. A homebuyer from Hebei province hoped to find a better life in Tianjin, better education for her children. She used her entire savings and borrowed from relatives to pull together funds to buy an apartment for 1.5 million yuan. She is desperate paying the mortgage of 3700 yuan, works several part time jobs, and is mortified at the drop in price of the apartment, in this report. For decades housing prices were going up, now the government has sent clear messages that housing speculation has to stop and home prices for the first time are moderating to increases of about 4% a year and are falling in some cities including Beijing, Tianjin, and Guangzhou. The governments message is that people should use apartments for living, not for speculative price increase and profit. Local governments have their own reasons to prop up this speculation as they have for decades now depended on land sales to meet economic growth targets, a situation unique to China, which has financed a lot of the local infrastructure including overspending. ...

LyrArc Article Gist
History will see the lack of working on a bipartisan basis from the beginning of the Trump and Biden terms to stop illegal migrants and fight CMC (Canada, Mexico and China) on fentanyl flows as a blot on both parties. A remarkable change has happened in a matter of 100 days in Canada's stance on immigration and fentanyl flows. Trudeau now calling for eradication of fentanyl, his deputy prime minister saying Canada has more fentanyl deaths per capita than the US because of smaller population, and the need to wipe it out off the face of North America. The Canada Conservatives generally support DJT. The Trudeau Liberals have shifted policy to support DJT policies on immigration and fentanyl flows. In general Canada is making a pronounced shift towards support of the US position on immigration.  It is not just DJT policy as closing the border was part of the agreement agreed by Biden in 2024 with Republicans in Congress led by Lankford-Graham-McConnell which was not passed because it was too close to the election. One can only say the Covid pandemic, vaccination shortfalls, failures of supply chain distracted Biden from acting early and similar to DJT on the first phase of immigration action on illegal migrants committing offenses. The release of illegal migrants across the US is something that Democrats will years from now see as a major error in its policies. History will see the lack of working on a bipartisan basis from the beginning of the Trump and Biden terms to stop illegal migrants and fight CMC (Canada, Mexico and China) on fentanyl flows as a blot on both parties. ...

LyrArc Article Gist
Victor Cha, a professor at Georgetown University, describes China's foreign policy committment to maintaining a divided Korea becacuse of fears of a unified pro-western neighbor to the south. He sees the need for China to change its policy and work with the U.S., South Korea and Japan for a lasting solution for North Korea. Also absent from the calculations of the countries involved is the future of the North Korean people, emphasized in the editorial by the editorial Board of the Washington Post on Dec. 20, 2011.

LyrArc Article Gist
France's Foreign Minister Ayrault says of Boris Johnson: "He lied a lot to the British. Now, he is the one with his back against the wall." He sees missing in Johnson the "clear, credible and reliable" person with whom he can negotiate. Ray Stegner, deputy chairman of Germay's Social Democrat Party says "May looks weaker after such a choice of personnel. Now he is negotiating Brexit. Enjoy the trip." In China he is seen as a celebrity not a serious person. Bildt, ZDF, see in this a part of British humor. Jurgen Hardt, foreign policy spokesman for Christian Democrats Party in Germany had a different take on Johnson- seeing this as an astute move because if the government one day comes to conclude that Brexit should not be completed then having Johnson on board to explain it to the people would guarantee support in her party and with the people of England. In her first speech May emphasized that she was a "Unionist." Her first important meeting was with Nicola Sturgeon of Scotland and made Scotland's agreement necessary before invoking Article 50. Her talk of "burning injustices" for the poor and the underprivileged also goes to address the root of the problems behind the Leave vote. By having Johnson on board she can focus on the issues that really matter and which were on the minds of people in England, Wales, Scotland and Northern Ireland- to ensure that the economic system works for all.   ...

LyrArc Article Gist
Haruhiko Kuroda, 68 years old, a senior finance ministry expert who ran the ministry's currency policy as vice finance minister for 4 years in the early 2000's, is prime minister Abe's nominee for central bank chief. He lectured at Hitoshibashi University for two years before becoming the head of the Asian Development Bank. His book "Success and Failure in Fiscal and Monetary Policy," is critical of the Bank of Japan for mistakes in being first too accomodative in monetary policy to set up the 1987 crash, and then tightening too quickly leading to the deflation and recessions of the last two decades. By choosing an expert with a long experience in the field of monetary policy and a vigorous advocate of getting things right to shake off the deflationary trends, Abe is sending a strong signal to financial markets. Kuroda says he is looking at a shorter time frame to achieve a 2% target for inflation- about two years. In essence Kuroda is taking a page from the policy book of a small group of MIT trained economists, Bernanke at the U.S. Federal Reserve, Draghi at the European Central Bank, and Mervyn King at the Bank of England to boost domestic economies in the context of increasing global growth. The yen weakened to 94.77 to the dollar on Feb 25, 2013, after the announcement. Abe's nominee for one of two deputy governor appointments is Kikuo Iwata, a 70 year old economist who was also critical of Bank of Japan monetary policy since the 1990's. The Abe administration has also carefully communicated this message. Speaking at the Centre for Strategic and International Studies in Washington D.C. Abe said Japan's goal was to increase exports, but at the same time it will increase imports which should benefit the U.S., China, India and other countries. He described a recovery in Middle America from the Dakotas to the Carolinas and sees something like this happening also in Japan. Even the appeals to nationalist sentiment are also coupled with the message to China and S. Korea of not climbing up the escalation ladder and seeking good relations to promote mutually beneficial development. Abe's focus is on building the U.S.- Japan relationship....

LyrArc Article Gist
Zhang Juwei of the Chinese Academy of Social Sciences believes that the overall fertility rate is at most 1.6. A recent report by CASS says the figure of 1.8 used by the government is an overestimation. CASS says its data shows the fertility rate for migrant workers is about 1.14, much lower than people think. The policy for one-child only was introduced 30 years ago, when the fertility rate was close to 3, having fallen to that level from close to 6 in 1960. Does the policy serve China well in the future as China's population ages and there are more older people for younger workers to support, is a question raised by critics in the Chinese media. China's government family planning officials say it applies to 40% of the people, considering the two child policy operating in some areas of the country.

LyrArc Article Gist
How will posterity view Angela Merkel. As she ends a fourth term this BBC News report says it will remain a contested legacy. Much of what went right has already been written. A woman, a pragmatic scientist who hewed to the center not just as a scientist but with a knack for politics. Much of her early period in office was one in which she had to tackle the eurozone crisis. The euro's weakness had its roots in the way Mr Kohl allowed eurozone membership for countries such as Greece without adequate entry requirements. Some of the other problems were also left behind by an overzealous mentor Helmut Kohl who pushed for German reunification that never really happened in terms of bringing all east Germans into the idea of the Federal Republic. These problems in a neglected eastern part of Germany around Dresden were never tackled by Merkel. They were social issues that Merkel's pragmatic thinking failed to grasp. Letting in migrants from Arab and African countries was a move that Merkel made without realizing the full implications. This policy was reversed but led to the emergence of extreme right wing sentiment in parts of the country. It is left to a future German leader to tackle the social and economic disparities that affect Germany today. As time passes people reflect and a more careful view prevails. Dr Rudiger Schmitt-Beck reflects this when he says that the Merkel years were about  a bizarre mix of modernization and backwardness. Merkel rejected nuclear energy after the events at Fukushima nuclear plant in Japan. As a scientist she was able to tackle such issues. Yet on the major social issues of the day Prof. Schmitt-Beck of the University of Mannheim, says she left Germany "grotesquely behind"- on child care, climate policy, digitization, infrastructure building, on demographic change. These are the issues that the Social Democrats and the Greens are standing up for today. Ironically Merkel may be remembered more for something that is not even mentioned in this BBC report. This is the European solidarity shown by action to financially support all EU countries including Italy with EU funding during the coronavirus pandemic.  This may be her biggest achievement because it will be lasting. Without it Europe would not be the better place it is today, resilient in the face of the pandemic.  Seen from outside Merkel will be seen as a German leader who failed to see the potential for India and other Asian countries with almost twice the population of China. Fascinated with 13 visits to China she studied Chinese history, politics and economics, says the WSJ. And did too little to balance Germany's close business and trade ties with China, with efforts in India and other countries. Seen from America as pointed out in the WSJ front page on September 23, Merkel made no effort to rebuild US relations with the Biden administration after the tumultuous period under presidents Obama with spying on her phone and with Mr. Trump over the EU's participation in NATO defense. She seemed resigned to a view that America had seen her best years, a belief that today does not exist anywhere in America. US president Biden's first phone call to Merkel was put off for a few days says the WSJ, and Merkel continued to build close ties with China, ignoring the fact that this was a new administration closer to that of presidents FDR and Harry Truman who did so much for Germany. And a president very different than any of Biden's five predecessors. ...

LyrArc Article Gist
Business looks for taxes to be tackled first before tariffs. DJT policy sets it the other way in second term tariffs first, then taxes. Tariffs are about fentanyl flows and stopping illegal migrant drug trafficking, for investment in US manufacturing and fair trade, in the DJT second term. To get a sense of what discussion is taking place. Former VP Pence and officials in the DJT first term debate with Scott Bessent at Treasury on policy- Former VP Pence says trade has lifted America's standard of living, but it ignores the loss of manufacturing base America needs for supply chain security and for its national security, and for jobs that maintain the standard of living. Treasury's Scott Bessent said in a podcast- "VP Pence's  ‘let them eat flat screens economic policy’ isn’t what people want. They don’t want baubles from China.” "The American dream is more than the access to cheap goods."   ...

LyrArc Article Gist
A less known political leader, Albert Hernandez, who teaches university law classes, is now set to become the next president of Argentina. He has worked with Peronist party under the Kirchner administrations and quit Christina Kirchner's administration after some disagreements on policies.  He is so far ahead of president Macri- sixteen points in the primary, that it is seen as too much of a gap for Macri to reverse. Hernandez is seen as a pragmatic leader and has as his running mate Christina Kirchner. Ms. Kirchner says she supports Hernandez as he can bring together all the Peronist factions. Mr. Hernandez is 60 years old and has worked with Peronist leaders in government from the 1990's who supported free market changes and with the Kirchner administrations when Argentina was recovering from economic collapse. Hernandez says he is learning from the mistakes made by Christina Kirchner. During the administration of Nestor Kirchner, Christina's husband, Hernandez, who was chief of staff, acted as a key problem solver. Argentina faced a crisis in debt accumulation and defaulted on the debt during that period around 2003. Argentina recovered from that crisis with the help of a commodities boom and demand from China. Mr. Hernandez was also chief of staff under Christina Kirchener who followed her husband as president, but resigned early because of differences on economic policy. Today debt accumulation is again a problem, with debt built up under the Macri administration and errors in policy of Mr. Macri. Christina Kirchner asked Hernandez to lead the ticket after it was clear that Peronist factions who did not support her could only come together if Mr Hernandez was the candidate. As a moderate without ideological tendency Mr. Hernandez was able to lead a broader coalition after errors in economic policy made by Mr. Macri leading to high inflation and a declining economy. Mr. Hernandez says he would renegotiate a deal with the IMF for a $57 bailout, which was signed by Mr. Macri to tackle a currency crisis. He also plans to take a new look at the trade deal with the European Union. Today both Brazil and Argentina are mired in economic crisis. Brazil through extravagant spending including on pensions, that left basic sanitation services, transport services, health care  poorly funded. Argentina has gone from prosperity to crisis, before 2003 during the first Kirchner administration, and now under Mr. Macri in 2019. Recurrent economic crises are a regular pattern in the region since 1950, with the region dependent on commodities exports and failing to build manufacturing industries.   ...

LyrArc Article Gist
Young people in Taiwan voted against the Koumintang party government's policy of building stronger trade ties to China. This has weakened the administration of president Ma Ying-jeou, and turned it into a lame duck administration till presidential elections in 2016. Voters focussed on income inequlaity and wage stagnation. The issue of ties with China also were part of the campaign. DPP party won 13 of 22 seats for city and county heads in the election.

LyrArc Article Gist
Bret Stephens of NYT shows a lack of knowledge of European history and remains oblivious of the disastrous consequences of Reagan's policies that he lauds. He cites Reagan as saying to his own audience - "My idea of policy towards the Soviet Union is simple, some would say simplistic. It is "We win, you lose."  The US did not win through Reagan policies, it began three decades of US involvement in wars in Iraq, Afghanistan, the Middle East, with Iran, that have wasted trillions of dollars and many lives, a period in which it created space for the emergence of China as a world power with newer infrastructure built in a period in which China could quietly rebuild and modernize while the US frittered away its vital resources to the point that funding was missing for vital infrastructure rebuilding and education was not financed by the government as it had done in the early postwar years. The classic European History book by Cambridge historian Brendan Simms, "Europe- The Struggle for Supremacy 1453 to the Present" shows that every time any country became too powerful, the others regardless of religion, old ties or other affiliation joined together to counterbalance and restore the balance- Britain, France, Russia, Austria-Hungary were never allowed to become too dominant. The idea that the Soviet Union collapsed because of Reagan's policies is incorrect- it would have collapsed a decade later without Reagan as by the 1980's the people running the government and the ordinary people had realized the system was not meeting the aspirations of Russians. By buying into this myth Americans were embroiled in useless wars and in so doing probably destroyed more wealth in a short time than any period in world history- the trillions of dollars of oil wealth transferred not to countries such as China or India that had to pull themselves by the bootstraps but to Arab desert regions that were itself not benefitted because they went to fight wars and destruction. ...

LyrArc Article Gist
WSJ looks at the 75 years of the US Saudi Arabia relationship that started when US president Franklin Delano Roosevelt met Saudi king Ibn Saud at Bitter Creek, Egypt, on a US Navy destroyer ship in 1945. It has gone through many phases over this period and mainly involved the Saudi kingdom maintaining its supply of oil to the US and Western Europe. This relationship went through an oil embargo during tense periods of Israeli Palestine conflict as in 1983 with an oil embargo that pushed up oil prices. What is different this time is the situation in Yemen where Iranian supported Houthi rebels near the border with Saudi Arabia are engaged in a conflict with the Saudis. Democratic administrations under first Obama and Biden today support reaching a deal with Iran on nuclear weapons development and limit US military support for the war in Yemen. The Saudis for their part are not keen on a regional war and turned down efforts by president Trump to respond to attacks from Yemen. Mr. Biden's envoy has arranged for a deal to reduce tensions between the Houthis in Yemen and Saudis. The diplomatic impasse in relations stems from the Kashoggi incident and president Biden's concern for the human rights situation in Saudi Arabia. Other factors making relations difficult are the economic interests of the two countries diverging. The relationship Roosevelt started in 1945 has changed in its fundamental character. Oil supplies for imports into the US is no longer a factor for the US which was the original interest of president Roosevelt in Saudi Arabia. This changed by 2015 as the US fracking industry enabled US to become self sufficient in oil and able to supply LNG to western Europe. Instead of the US Saudi oil now goes to China. Russian oil also goes to China as its industry expanded with American investment. This has led to a new Saudi relationship with China which has changed the dynamic of the American Saudi relationship. Some of the new aspects of this can also be seen in Saudi relationship with South Asia. Saudi ties have increased with India and India in 2021 was the first country to provide vaccine supplies to Saudi Arabia. Saudis, Qatar, United Arab Emirates are building relationships with India as a close neighbor in the region. Relationships are in some ways improving in the Asian region compared to the period when oil was simply exchanged as a commodity for defense supplies from the US without regard to cultural, educational and other changes in Saudi society. In a sense US and Western Europe paid little attention to the huge democracy of over 1 billion people right in the middle of Asia and followed policies that led to major investments in China and little or no investment in India, and without realizing it followed a policy that the British had pursued in the British Empire of treating different communities and religions as separate as opposed to one community of people in South Asia that were engaged in modernizing, building infrastructure and changing centuries old ways of living. The British Empire was sustained by this kind of thinking, and as long as Indians were complacent and lacked the will to make their aspirations for a better life and infrastructure for modernization this kind of thinking prevailed. The economic crises in Asia have reinforced the idea that there is one community entirely focused on development and modernization in South Asia. The people in South Asia care most about the cost of living and the infrastructure and services for the quality of life they live and their children can aspire for- same in European Union that chose the Greens and chancellor Scholz, and same in the US that chose president Biden to invest infrastructure and people, the same in China and the same in India and the rest of Asia. This is the situation that the US and Britain, and the European Union are now beginning to learn and adapt to that is a constructive aspect of these changes to rebuild the connections and supply chains that were sorely neglected before now. ...

LyrArc Article Gist
Wilbur Ross talks about the need for an industrial policy in energy and other sectors to keep the US from falling behind other countries like China. He sees the need for tax cuts for the middle class for incomes below 250,000. He would like to see more spending on universities and on research and development to rebuild America.