Foreign Business Inside the PRC

The Qualcomm’s acquisition of NXP Semiconductors is supposedly in jeopardy as the People’s Republic of China threatens approval of the acquisition in its prosecution of its long-term trade fight with the US.

But wait—Qualcomm is an American company, and NXP is a Dutch company.  Why does the PRC even have a say in this?

[The PRC] is the last of nine markets where Qualcomm and NXP need approval from competition authorities….

Auto Tariffs Revisited

EU Trade Commissioner Cecilia Malmström says the EU will respond to any increase in US tariffs on imported autos and auto parts with its own tariffs on autos and parts imported from the US.

And,

The EU cannot offer a bilateral deal only on autos, Ms. Malmström said, to address Mr Trumps complaints about the 28-member bloc’s 10% car tariffs—which are quadruple the US rate.

Never mind that applying its own auto and auto parts tariffs to imports from the US is precisely such a bilateral action.

Auto Tariffs

Auto makers, parts suppliers, and dealers are joining forces to push back against the Trump administration’s proposal to apply tariffs of up to 25% on vehicles and components imported into the US….

The auto industry is aiming at the wrong target.  The German auto industry and the US have already agreed in principle to a regime of no auto tariffs at all.  It’s the German government that’s waffling and the EU that’s ignoring the matter altogether.

These domestic execs need to be asking the German government and the EU why they’re so disinterested instead of whining about domestic matters.

An Example of Irrationality

Here’s Donald Trump decrying Germany’s willingness make itself dependent on Russian energy supplies by pushing for Nordstream 2, which will mean that Germany will get 60% of its natural gas from Russia, to go with the 40% of its oil imports that already are from Russia.  Aside from becoming so dependent on an enemy for its energy, Germany will be paying Russia billions of euros for the privilege.

I have to say, I think it’s very sad when Germany makes a massive oil and gas deal with Russia, where you’re supposed to be guarding against Russia, and Germany goes out and pays billions and billions of dollars a year to Russia.

Not Far Wrong

In an interview with the British newspaper The Sun, President Donald Trump said that Prime Minister Theresa May’s Brexit “blueprint” for Brexit would likely kill any opportunity for special trade deals with the US.  A critical part of that blueprint would have Great Britain

stick[ing] to a common ­rulebook with Brussels on goods and agricultural produce in a bid to keep customs borders open with the EU.

Free Food Stamps

The House passed a farm welfare bill that includes a requirement for food stamp recipients to work for their welfare payouts last month, and the Senate passed its version—carefully without that requirement for actual work. Or perhaps just timidly passed, since Senate Agriculture Chairman Pat Roberts (R, KS) was intimidated by Progressive-Democrat Ranking Member Debbie Stabenow (D, MI) and couldn’t find the backbone to oppose her.

Now the two bills go to conference for resolution, and the outcome doesn’t look promising for work.

In today’s tight employment environment, that work would be easy to find, too, and in light of that, The Wall Street Journal‘s Editorial Board made the comment

Protecting US Technology

The Trump administration is moving toward a set of rules that would heavily restrict the People’s Republic of China’s ability to acquire American technology-developing companies and American technology.

Of course, there are objections to protecting our stuff.

Industry groups…are mainly concerned that the export controls could negatively affect their businesses by preventing them from using their technological edge.

If such groups were truly serious about this, they’d be truly serious about hardening their member companies’ facilities against hacking.

And

While many object to the investment restrictions, they are seen as having less practical impact because Chinese investment has fallen off so drastically.

Bad Bonds?

Recall that Michigan State University agreed to pay $500 million to victims and associates of Larry Nassar’s sex abuse victims while he was pretending to treat our women gymnasts’ injuries.

Now the school intends to float bonds to raise the money to pay the bill.

Were I an investment advisor—which I’m not, nor do I play one on the radio—I’d advise against buying these bonds; I’m not satisfied Michigan State will be able to pay them off in the end, even with OPM.

AHPs

Association Health Plans are new plans that, by regulation, allow small businesses to band together across industries and state boundaries to form health insurance buying consortiums.  Using this larger size-generated buying power, they should be able to acquire cheaper, better tailored, more flexible plans for their employees, plans that those employees actually will want.

However.

The left says association plans are junk insurance that will blow up ObamaCare.

Some AHPs likely will be; that’s a fact of life in any market, free or centrally planned. However, a free market is self-regulating and quickly so; junk plans will be few and far between.  Blow up Obamacare?  That’s win-win.

Heads Up

As the People’s Republic of China responds to President Donald Trump’s tariffs, motivated in part by the PRC’s cyber-theft of American technology and proprietary information and the PRC’s extortion of the same and its demand for backdoors into foreign business’ (including especially American) core software as a condition of doing business in the PRC, buckle up, indeed, as the article at the link above suggests.

The PRC will do far more than this, though, as it attempts to coerce the US in the pursuit of its Warring States strategy.