Wednesday, December 30, 2020

Dealing With China - Biden Is Compromised

In 1972, when President Nixon went to China as the first American President ever to go there, China was a very poor country.  They were no military or economic threat to the United States.  They represented a market with a billion people that basically needed everything that we had to sell.  So normalizing relations with China that had been non existent for the prior 20 or more years clearly made sense.  There was a hope that exposure to Western values, capitalism and people might just turn China into a more democratic country ending years of totalitarian rule that resulted in the deaths of millions of their people.  

And, since we saw China as a very poor country, the thinking was giving them trade advantages might help them grow their economy so that in the end they could buy more goods and services from Western and other Asian countries. I remember the talk about the Chinese taking one aspirin a day would result in selling a billion aspirins every day to China.  Western and Asian companies multiplied this concept related to everything they were producing in the United States, Europe and Asia seeing nothing but upside to dealings with China.   

Unfortunately, it did not work out quite the way the Elites thought it would.   The Chinese to their credit and in view of their history, were determined not to allow Western and Asian countries to take advantage of them.  Since they were a Communist controlled state economy in a position to manipulate their currency, which is not convertible,  they required companies selling to them to manufacture in China and to turn over their technology as a condition for entering their markets.  Within 10 years of doing so, Chinese companies were now making the very same products subsidized by government financing competing with Western and Asian companies, but at lower prices.  The Chinese focused on each industry as they determined that they wanted goods and services sold in their market produced by Chinese owned companies often controlled by the Communist government.  They also now had the manufacturing prowess to sell products around the world. 

Then the Chinese went one step further.   If technology was not given to them as a condition for entering their market, they developed the means to use the Internet to steal Intellectual Property including getting the plans to produce the ships, planes, tanks etc to build up their military and all sorts of other products.  So today, China is a manufacturing power house with a growing and very strong military.   While about half the people are still poor, the country is not poor.  In fact, China is a very rich country using its money to buy influence around the world.  In addition, China now has a blue water navy and is using it to project military power on all continents.  Shortly, the GDP of China will surpass the GDP of the United States to become the largest economy in the world.  However, in comparing US GDP, it is important to recognize that China has about 1.2 billion people producing the same GDP as the US with 350 million people so on a per capita basis, the US is still better positioned.  

In any case, US Presidents of both political parties for the past 30 years have attempted to jaw bone China into playing by the rules related to opening up its markets and ceasing the Intellectual Property Theft and currency manipulation.  China has played lip service to our complaints; but done nothing to address them because the largest global companies in the world did not want Western and Asian governments rocking the boat.  These companies were stooges of China because they were benefiting from the relationship at least for some periods of time.  It was after all global companies headquartered in the US that shuttered more than 70,000 factories and shipped about 5 million manufacturing jobs to China and other countries.   In their defense, these companies were just following the economics because high corporate taxes and crazy regulations made it easier to do business overseas than in the United States, Western Europe or Japan.  

And, then along came Donald Trump who gets it and was willing to play hard ball with China for the first time.  Trump fully understood that the US needed lower taxes and less regulations to bring manufacturing jobs back to the US.   So Trump got that done first.  Further, Trump recognized that jaw boning with China produced nothing in 30 years.  So Trump imposed tariffs on Chinese goods coming into the United States as the way to get them to the table.  It worked to produce the first favorable trade deal with the US.  This is the reason China supported Joe Biden.  The last thing they wanted was another Trump term to finish the work that he began. 

Sadly, Joe Biden is compromised by the Pay to Play schemes his family has done with China and other countries.  The Biden family are millionaires because of the deals they did with China, Ukraine and Russia.  Joe Biden is China's Butt Boy.  Stupid Joe will have to do as directed by China, or they will leak more details of their deals, which will force Biden to resign in his first year in office for corruption.  So shortly, Biden will end the tariffs on China, which big business will applaud.  Biden will also re-impose job killing regulations, which will push more manufacturing jobs to China and other countries.  Joe Biden is the Manchurian candidate owned lock, stock and barrel by China.  Just wait and see, we are going back to the future of the bad old days with China before Trump.  

No comments:

Post a Comment