Tag Archives: defense policy

A Mistake

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The Trump administration may be getting soft on Iran, at least relative to past positions by then- and now-President Donald Trump (R).

US special envoy Steve Witkoff said that the Trump administration is prepared to allow Iran to enrich uranium at a low level if it is subject to stringent verification, a significant shift from the White House’s initial demand that Tehran’s nuclear program be dismantled.

Witkoff said

They do not need to enrich past 3.67%. This is going to be much about verification on the enrichment program and then ultimately verification on weaponization.

This is the mistake. Iranian insistence on enriching past 3.67%–to 60% and above, with that 60% level just a kitten’s whisker way from bomb-grade purity—and its history of requiring weeks to months of advance notice on inspections, interfering with inspections, outright barring inspectors’ access, and its development and maintenance of secret sites outside the reach of inspectors demonstrate that the Iranian government cannot be trusted with uranium at any level.

The only appropriate level for Iran’s uranium enrichment program is 0.00%, with no notice inspections at any location the inspectors choose. Otherwise, the only legitimate solution is kinetic obstruction of Iran’s nuclear weapons—and its nuclear, generally—programs.

Bargaining Chips

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The People’s Republic of China is avidly intent on keeping its bargaining chips, of which two truly important ones are its TikTok app and its port businesses at each end of the Panama Canal.

What gets lost, even ignored, in this, though, is that bargaining chips have only the value the bargainee assigns to them, not what the holder of the chips claims to be their value. Not a red sou more than that.

TikTok, for instance, can be viewed as utterly without value as a chip to be played: current US law requires it to be shut down entirely and banned from the US unless and until it is sold in toto to an entity not under the control of the PRC. The only thing standing in the way of that way is the law’s provision that the deadline for sale can be moved back if our Federal government deems negotiations for the sale to be making sufficient progress. That’s where things stand under President Donald Trump, and that confers exactly zero value to the app as a PRC chip.

So it is, nearly, with those PRC businesses that are Panama Canal bookends. A BlackRock-led group has concluded a deal to purchase those two port businesses along with a number of others around the world from CK Hutchison Holdings, a PRC-domiciled (Hong Kong) company. The PRC is actively interfering to delay and potentially prevent that deal from coming to fruition. The appropriate response here is for the US to restrict, even block as far as may be, the ability of those two ports to get any business from the US or any other nations. That would deny those ports any value as PRC chips.

A Thought on Trade Deficits

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Set off by a post on Shrewd’m, which contains a plethora of useful discussion boards, including mechanical investing conversations.

Americans benefit from importing cheaper and/or better goods, which enhance our quality of life in myriad ways. Moreover, trade is part of a circular movement not only of goods but also of money. The US trade deficit of $918.4 billion last year was the mirror image of a $918.4 billion capital surplus, or infusion from overseas.
Sooner or later, all of the net $918.4 billion that Americans spent on foreign goods was invested in American capital assets such as stocks, real estate, bonds, or short-term assets such as Treasury bills.

That’s one of the problems with running a trade deficit, or “investment surplus,” which the poster suggested as an alternative term. It’s certainly true that in Ricardian fashion, truly free trade makes everyone financially more prosperous by letting those nations that do a few things better than others get the production trade and sell their goods to other nations in return for money or products that those other nations do better than anyone else. Financial prosperity is very good for all of us.

However, that sword has another edge, too. [A]ll of the net $918.4 billion that Americans spent…was invested in American capital assets such as stocks, real estate, bonds, or short-term assets such as Treasury bills. Not on manufacturing or on producing and processing the raw materials necessary for manufacturing in general. Especially not on manufacturing or on producing and processing the raw materials each category of which is a Critical Item for our defense establishment, our national security—our ability to secure ourselves from being dictated to by militarily superior enemies.

There were massive job losses in those manufacturing and raw materials production and processing industries, too, and those people are worse off for it, regardless of the injunction from some that these folks should learn to code.

Worse, those hard goods/raw materials producing companies have been closed long enough that we’ve lost the factories, mining, and personnel expertise central to those Items. Now, we’re dependent on other nations—including enemy nations—for raw materials like the rare earths that are specific Critical Items for our computers, communications, and weapons systems we need to maintain our freedom of action. We’re dependent on other nations—including enemy nations—for processing those rare earths and other materials (like graphite, another Critical Item) that we already produce some of for ourselves.

Our dependency on enemy nations is demonstrated by the People’s Republic of China’s restricting shipping to us rare earths and processed rare earths, both of which the PRC produces in ample quantities in response to the tariffs President Donald Trump (R) has applied to the PRC. Had we been producing and processing our own—and which we have ample quantities domestically but have chosen to leave them unmined and so have no processing capability, also—the PRC’s move would have been toothless. I’ve written about a similar situation a while ago.

Now a regionally militarily superior PRC is pressing its threats against the Republic of China and is in a position to cut the sea lines of commerce on which the Republic of Korea and Japan are utterly dependent and through which trillions of dollars of trade pass enroute to our own west coast. And we’ll soon—that cutoff of militarily critical rare earths—be helpless to stop them.

Fiscal prosperity is a Critical Item for our nation, and Ricardo was right on how to achieve that. Trade deficits, per se, are nothing about which to worry. But more so is military capability, without which we have no freedom of action and so no prosperity or even freedom. We need to redevelop our own manufacturing and raw material production and processing capability, even if we continue to source much of those outputs from overseas, and even if it’s more expensive to do so than getting them all from overseas.

The higher cost for such a domestic core production capability is part of the cost of our national freedom, and it’s far less than the cost of having our activities dictated to us by militarily superior enemies.

Golden Dome

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William Forstchen, historian, author, and reputed EMP expert, wants us to build President Donald Trump’s (R) golden dome, an evolution of former President Ronald Reagan’s Strategic Defense Initiative which was designed to destroy incoming ICBMs before they could reach their detonation locations in an attack on the United States. He’s right, but his emphasis is too narrow. His concern:

We have to defend the United States against an EMP attack, which could destroy us in a matter of minutes.

He cited studies, as summarized by Fox News, some statistics:

Congressional reports from 2002 and 2008, said that 80%-90% of Americans would be dead a year later if an EMP strike happened.

That would result from energy and water distribution network failure, power failure, financial system failure, transportation failure, and the resulting lack of food in the cities and the lack of water in urban areas from small to large.

The problem that’s not being addressed, though, is that an EMP does not need a nuclear detonation to generate it. Small EMP devices can be built relatively easily, and our destruction can be achieved with a collection of these small devices being used to destroy our financial and communications data centers, nodes in our energy distribution networks, nodes in our water distribution networks, nodes in our mass transportation and shipping centers.

All of these would aggregate to a nuclear EMP in their end result, and these smaller devices are much harder to detect. The several Departments in our Federal government and the several private companies in our tech industry need to get seriously involved, both in partnership with each other and separately, in figuring out how to detect and neutralize these devices, also.

What the President’s Staff Thinks about our Allies

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The Wall Street Journal‘s editorial panties are at it again. Now the undergarments are in an uproar over the Signal chat wherein some aspects of an attack on Houthis were discussed just before the attacks went in. The discussion certainly presents bad optics for the administration, and maybe it shouldn’t have been done on Signal.

However.

A real security scandal is that the Signal chat apparently included Steve Witkoff, Mr Trump’s envoy to wars in the Middle East and Ukraine. Press reports say Mr Witkoff was receiving these messages on the commercial app while in Moscow. This is security malpractice. Russian intelligence services must be listening to Mr Witkoff’s every eyebrow flutter.

What the editors chose to omit in their hysteria is that Signal is reputed to a very secure means of group communication; it’s also one explicitly approved for secure communications by the Biden administration. To the extent that Signal is that secure—the editors elide mention of any investigation of this—the Russians could listen in to their heart’s content, but they wouldn’t learn anything, unless they had an agent looking over Witkoff’s shoulder at his phone or laptop.

One more item the editors chose to elide, which came out in so many words in Wednesday’s noon o’clock presser hosted by White House Press Secretary Karoline Leavitt: Witkoff had no personal communication devices with him on his trip to Mocow. He had only a Federal government-provided secure cell phone provided to him explicitly for the trip. I’m frankly up in the air between these editors being that ignorant of the facts or if, given my nearby post, they’re simply that dishonest in blithely repeating the disinformation of “press reports.”

There’s this overreaction, especially:

Yet Vice President JD Vance second-guessed the President’s strikes on the chat because he said only “3 percent of US trade runs through the suez [sic]” canal, while “40 percent of European trade does.” That understates the US interest in freedom of navigation. Mr Vance even suggested his boss didn’t understand that striking the Houthis was at odds with Mr Trump’s “message on Europe right now.” He added that “I just hate bailing Europe out again.” So the Vice President is willing to let the Houthis shut down shipping to spite the Europeans?

This really is a cynically offered overreaction. For one thing, which the editors omit to mention here, that conversation occurred shortly before Trump made his decision and ordered the strikes to go in. This is staff—Vance—doing its job of devil’s advocating a decision that’s still only potential, even arguing seriously against it while it’s only potential. The editors also omitted to mention that, in that same chat session, Vance said he supported the President’s decision to go ahead: once the boss’s decision was made, argument stopped, and it became everyone’s duty to get behind it and make it work.

For another thing, how well has Pretty Please worked over the last 70 years, or so, in getting Europe to see to its own responsibilities instead of relying primarily if not solely on American blood and treasure for its economic, even political, welfare? Recall that Europe’s NATO members only started getting serious about honoring their commitments to NATO after Trump threatened to leave the organization during his first term, and today a third of Europe’s NATO members continue actively to betray their fellow members with their refusal to honor their duties to the organization. The matter of the Houthis in this conversation is only tangentially related to the overall principle of freedom of navigation.

Vance is far from the only American who’s sick of bailing out Europe. The continent needs to learn, and apparently the only way they will is if they suffer real harm from their determined dependence.

The editors’ remark about being willing to let the Houthis shut down shipping is just cynical exaggeration. The Houthis may be able to severely impact shipping to-from Europe via the Red Sea and the Suez Canal, but that shipping is easily rerouted, and has been, to go around Africa. That’s a route that only a few days longer, and those few days are significant only for shipping from India, Pakistan, or eastern Africa. From farther Asia, which is the bulk of commerce into Europe other than from the United States, the added days are an insignificant delay—and they avoid the toll Egypt charges for the use of its canal.