Tag Archives: foreign policy

Nice Things

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President Xi Jinping and his cronies in the People’s Republic of China government look like they’re settling in for a long trade war with us. The claim, too, is that deteriorating relations with us, and allowing them to deteriorate further, are a sign of Xi’s strength as a leader of the government and of the Communist Party of China.

This misunderstands, though: those deteriorating relations are a good illustration of Xi’s weakness as a leader, not his strength. It takes strength, mind you, to be willing to change course when the chosen one proves…inopportune.

There’s this, too, from Shi Yinhong, Director of the Center on American Studies at Renmin University in Beijing:

Trump’s actions have seriously agitated the Chinese leadership, who now realize that there’s no chance of reaching a fair deal with the US.

Right.  Because it’s unfair of us to demand the PRC stop stealing our intellectual property and our technological secrets. It’s unfair of us to object to the PRC extorting tech transfers and domestic “partnerships” and requiring backdoors into proprietary operating software, all as a condition of doing business in the PRC.

Even the PRC’s wartime decision to devalue its currency, intended to counter the effect of tariffs on its exports to the US, cannot work well over the intermediate- to long-term. That devalued currency serves to make imports into the PRC—things like oil and natural gas both as energy for production and as fuels for home heating, transportation, marine shipping and things like components for assembly into larger components or finished products in PRC factories—more expensive, it lowers the return on US and other dollar-denominated debt instruments, and through those, it drives up the cost of domestic products that depend on those imports.

It also encourages capital flight into a host of suddenly more valuable currencies—primarily dollars, but yen, won, euros, and pounds, also.

And: whether tariffs cost us more than the PRC’s counters cost them remains to be seen. However, that’s not a matter that can be assessed solely in dollars or yuan. Our economy is much larger, wealthier, and more diverse than is the PRC’s; we can absorb more such costs than it can.  And I haven’t gotten to the costs of military buildups.

Finally, there’s this on the PRC’s trade war: as companies continue to move their supply chains away from the PRC in response to the stress of this war, as sellers (including farmers) find other markets than the PRC for their goods and services (and crops), the PRC’s war is weaning these enterprises off the PRC market, which can only work to the PRC’s long-term detriment.

All of this illustrates why the good citizens of the PRC can’t have nice things.

Germany…Dithers

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…on the matter of helping protect freedom of shipping through the Strait of Hormuz and, presumably, up into the Arabian Gulf.

Great Britain, in an effort that parallels the US’ efforts, is proposing a European naval mission to the region to protect European oil tankers.  Germany isn’t sure.  On the one hand, Norbert Röttgen, Bundestag Committee on Foreign Affairs Chairman, says

Our prosperity lives on free shipping.  And we have to make clear that we stand alongside our British friends, partners and allies who are affected. There must be joint European action.

But the US might be involved, so he dithers:

Unfortunately, there are fundamental differences in Iran policy with the US, which is why we can’t cooperate with the US just like that.

No, can’t have that.

The Social Democrats are more open about their reluctance to participate. Karl-Heinz Brunner, SPD member of the Bundestag Committee on Defense:

A German participation is currently neither necessary nor opportune. Of course, securing free trade routes is extremely important, but I am convinced that this would also be possible by diplomatic means. In the current situation, military options could contribute to further destabilization.

Yeah, Iran is open to diplomacy—so long as everyone does exactly what Iran diplomatically says.  Besides, if we took concrete action to defend German or European interests, we might angrify the pirates.

Can’t have that, either.

‘Course, Germany really doesn’t have a dog in this hunt, anyway—it gets most of its oil from Russia.

Update: Germany has decided not to join any coalition ensuring free sea navigation in the Strait of Hormuz or the Arabian Gulf.  Foreign Minister Heiko Maas:

“Germany will not take part in the sea mission presented and planned by the United States,” Maas told reporters during a trip to Poland.
The German government said it remains in close consultation with France and the UK over a European approach to the freedom of navigation crisis in the Persian Gulf.

Close consultation. Chit chat. I’ve already pointed out whence German oil comes.

Trade Talks

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The People’s Republic of China wants to slow-walk these negotiations in the expectation that their delay will get them better terms.

Beijing, while wanting to appear willing to negotiate, thinks it can extract better terms by not hurrying into concessions, according to Chinese experts and others briefed on the talks.

The PRC’s attitude, though, seems counterproductive.

Since negotiations faltered in May, Chinese officials have said that for any eventual trade deal, the US must be reasonable about the amount of goods China can purchase and must remove all the tariffs placed on Chinese exports in the dispute.

“Being reasonable:” we can remove tariffs when the PRC stops subsidizing its domestic production to yield artificially low prices on its exports.  We can remove tariffs when the PRC stops stealing our intellectual property and technologies and stops extorting technology transfers as a condition of doing business with/in the PRC.  We don’t have to sell anything to the PRC, and the PRC doesn’t have to purchase anything from us.  They constitute a very large market, to be sure, but what’s the value of that market when they’re just going to rip us off with those practices?  And then threaten us and our allies and friends militarily and politically—and economically—with the result of those thefts?

But sure, the PRC can go slow. After all, the longer the PRC stalls, the more time there will be for producers to move their PRC production facilities to other, cheaper and more flexible venues.  The longer the PRC stall, the more time there will be for sellers—like our farmers—to sell into markets other than the PRC.

The longer the PRC stalls, the more time there will be for its economy to slow.

The longer the PRC stalls, the more PRC governance failures—Hong Kong, PRC concentration camps for Uighurs, overt threats against the Republic of China, seizure and occupation of other nations’ South China Sea islands and of the Sea itself are just a few—will dominate the public discourse, exposing PRC government “trustworthiness.”

And the harder the terms from the US will become.

Responsibilities

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Iran, as I write this (Monday), has rejected efforts to defuse the situation in the Arabian Gulf, a situation it has created with its piracy of and extended threats toward oil shipping in the Gulf and transiting the Strait of Hormuz.  Indeed, in response to a planned British redeployment of a couple of small combat ships to the Gulf to add to the protection of British tankers, Iran had this:

But Mr [Ali, Iranian government spokesman] Rabie warned Sunday that a European military deployment in the Gulf would be viewed as an escalation of the crisis. “Such moves under the current conditions are provocative,” he said, according to IRNA.

Thus, Iran does not want the nations trading in oil to be able to more effectively protect their shipping.  Iran demands to preserve its ability to seize those ships for itself.

This is not the action of a peace-loving nation. Piracy in the Gulf is the responsibility of Iran.

A Foolish Question

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In a piece about British Prime Minister Boris Johnson’s new Brexit architect Dominic Cummings, a question was raised that’s central to the next three months of Great Britain’s future and perhaps to its future’s subsequent years.

The question now is whether he [Cummings] will steer the Johnson government toward swallowing a compromise divorce deal with the EU or prepare it to quit with no deal at all.

This is a foolish question. Not only are they not mutually exclusive, they must be done in parallel—or rather the better question must be done in parallel with the no-deal: steering the matter toward a better compromise from the EU.

The no-deal departure, fully set up, is the only lever the Brits have against a mendacious Brussels.