eurasia

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Should Obama and Congress Be Arrested Under the NDAA?

Should President Obama (alongside Lindsay Graham and John McCain) be wearing an orange jumpsuit?

Welcome to the beautiful and surreal reality of life under American corporatism, under a Congress that churns out thousands  and thousands of pages of (often contradictory) legislation a year.

If providing material assistance to al-Qaeda is illegal under the National Defence Authorization Act (2012), and Obama and Congress are sending $25 million of aid to al-Qaeda-affiliated Syrian opposition, aren’t Congress and President Obama violating their own law? Should Obama (or at least the Justice Department) not be using “all necessary and appropriate force” including “the power to indefinitely detain” to prevent Obama and Congress from assisting al-Qaeda? Did anyone in Congress or the Obama administration even bother to read the law that they were signing? Do Federal laws no longer apply to lawmakers?

The only question left from this abrupt and absurd turnaround — from funding bin Laden’s mujahideen thirty years ago, to ten years ago declaring war on al-Qaeda, to today sending them material assistance — would appear to be whether or not Obama will pull a 1984 and claim that “we have always been at war with Eurasia“.

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The Beauty of America

Eric X. Li writes the most controversial piece of the year thus far, in which he concludes that democracy is a problem for the West:

Many have characterized the competition between [America and China] as a clash between democracy and authoritarianism. But this is false. America and China view their political systems in fundamentally different ways: whereas America sees democratic government as an end in itself, China sees its current form of government, or any political system for that matter, merely as a means to achieving larger national ends.

In the history of human governance, spanning thousands of years, there have been two major experiments in democracy. The first was Athens, which lasted a century and a half; the second is the modern West. If one defines democracy as one citizen one vote, American democracy is only 92 years old. In practice it is only 47 years old, if one begins counting after the Voting Rights Act of 1965 — far more ephemeral than all but a handful of China’s dynasties.

Why, then, do so many boldly claim they have discovered the ideal political system for all mankind and that its success is forever assured?

The answer lies in the source of the current democratic experiment. It began with the European Enlightenment. Two fundamental ideas were at its core: the individual is rational, and the individual is endowed with inalienable rights. These two beliefs formed the basis of a secular faith in modernity, of which the ultimate political manifestation is democracy.

In its early days, democratic ideas in political governance facilitated the industrial revolution and ushered in a period of unprecedented economic prosperity and military power in the Western world. Yet at the very beginning, some of those who led this drive were aware of the fatal flaw embedded in this experiment and sought to contain it.

The American Federalists made it clear they were establishing a republic, not a democracy, and designed myriad means to constrain the popular will. But as in any religion, faith would prove stronger than rules.

The West’s current competition with China is therefore not a face-off between democracy and authoritarianism, but rather the clash of two fundamentally different political outlooks. The modern West sees democracy and human rights as the pinnacle of human development. It is a belief premised on an absolute faith.

China is on a different path. Its leaders are prepared to allow greater popular participation in political decisions if and when it is conducive to economic development and favorable to the country’s national interests, as they have done in the past 10 years.

However, China’s leaders would not hesitate to curtail those freedoms if the conditions and the needs of the nation changed.

The fundamental difference between Washington’s view and Beijing’s is whether political rights are considered God-given and therefore absolute or whether they should be seen as privileges to be negotiated based on the needs and conditions of the nation.

Li has made a staggering error: he has conflated individual rights with democracy. These are actually two separate ideas. In fact, the two notions can sometimes be opposed: in a pure democracy, 51% of the population could successfully vote to cook and eat the other 49%. That is where the notion of individual liberty and creator-endowed rights come in: while some democracy is tenable, the actions of a democracy that would be damaging to an individual’s liberty are deemed to be unconstitutional. This was the shape of America’s constitution after the revolution.

So Li is correct — America was not at its birth a democracy. America was set up as a constitutional republic. Its constitution was designed to protect individual liberty (even if it has not always been entirely successful at doing so). The Constitution is written very simply and beautifully. Here’s the First Amendment:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

Simple, specific, categorical. No ifs, no buts. Other nations have paid lip-service to fundamental human freedoms, but they always wrapped themselves up in fineries. Here’s Europe’s attempt:

Everyone has the right of freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without inference by public authority and regardless of frontiers. This Article shall not prevent States from requiring the licensing of broadcasting, television or cinema enterprises.

The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary.

In Europe, you have a right to free expression at the discretion of the democratically-elected authorities. And that’s not really a right at all. It’s a semi-right; a right with a whole lot of strings. You have the right to life — so long as the other 51% don’t vote to cook and eat you. 

But America’s constitutional republic is a long-gone ideal. America’s Congress pumps out a wealth of legislation not specifically authorised by the Constitution. The first breaches were done with the best of intentions: the Fourteenth Amendment applied the Bill of Rights to the states, albeit shredding the Ninth and Tenth Amendments. The Civil Rights Act gave racial minorities equal accessto public and private facilities, thereby ending the right of property owners to discriminate against whomever they chose. I am broadly supportive of those measures. But later breaches have been much more dangerous.

Corporations are now routinely bailed out, destroying the market mechanism and creating an aristocracy of “systemically important” corporations with access to Uncle Sam’s chequebook. The power to coin money has been delegated from the Treasury to a private cartel known as the Federal Reserve, allowing the private bankers to create massive and dangerous credit bubbles. The PATRIOT Act, and the NDAA of 2011 shredded the Fourth Amendment and ended the ancient right to Habeas Corpus. Presidents since the Second World War have routinely gone to war without an express declaration authorised by Congress. Obamacare has created a healthcare mandate, compelling American citizens to buy a commercial product — health insurance. Even the First Amendment has been turned upside down — corporations (who are not people) can spend limitless money on political campaigns, while political protestors (who are definitely people) are now confined to caged “free speech zones”. And that’s just from the top of my head.

So it is important to remember that criticisms of America today are criticisms of the present politics of America, and not of the ideals of constitutionalism, or of individual liberty.

It is certain that America today is in dire straits: deeply indebted to the rest of the world, heightened unemployment, the world’s largest prison population, a broken and zombified financial system stripped of the market mechanism, a huge swathe of citizens without access to medical treatment, tent cities.

And it is also certain that America’s welfarism has contributed to its debt. But that is more the fault of large corporations, farmers, and the military industrial complex who suck up subsidies and then call it “profit”, than it is the poor who without subsidies probably could not eat. But certainly all the subsidies have come out of America’s newfound democratic status. Give people the ability to vote for more free stuff (and lobbyists the ability to lobby for more free stuff) and more often than not they’ll take that chance. After all, who doesn’t love a free lunch?

But it is totally foolish to blame these problems on “too much liberty”.

In fact, right now it is China that seems more libertarian — at least in purely economic terms. As I wrote last month, China’s economy consists of just 20% of federal government spending, whereas America’s consists of 37%. China is more of a market economy, while America is more statist. So while China’s leaders might have taken a more “flexible” approach to individual liberties, at least when it comes to economic liberty, they are practically way ahead of America. And maybe that’s why China is doing so well economically — the freedom to do business, to create, to produce.

When it comes to social and cultural freedom, America is way ahead of China — and unsurprisingly, America is still the world’s cultural powerhouse.

What if this little thing known as liberty — and these little things known as unalienable rights are far more important than Li recognises? What if they are the driving energy that underpins innovation, that underpins economic prosperity, that underpins a robust economic system?

America was once the richest and most productive nation on the planet (and by certain measures she still is). This was a direct product of a system of cultural and economic freedom. People were free to think differently, to act differently, to create new businesses, new products, new techniques and this ultimately led to the greatest sustained period of wealth creation in history. They didn’t have to ask the permission of a feudal lord or monarch or commissar. They didn’t have to kowtow to an aristocracy. Only now — since America has adopted statism and bureaucracy — has America begun to fall behind.

So Li’s conclusion is right, but only in a twisted and roundabout way:

The West seems incapable of becoming less democratic even when its survival may depend on such a shift. In this sense, America today is similar to the old Soviet Union, which also viewed its political system as the ultimate end.

History does not bode well for the American way. Indeed, faith-based ideological hubris may soon drive democracy over the cliff.

Yes — ideological and faith-based hubris may soon drive America off a cliff. But that ideological and faith-based hubris that we find today in American government and in the American intellectual elite is not for America’s constitution, nor for individual liberty. Instead it is for statism, for big government, for surveillance, for authoritarianism, for central planning, for endless war and imperialism. The zeal that will drive America off a cliff is exactly what Li advocates more of.

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A Time for War?

Arch-neocon Charles Krauthammer — and Secretary of Defence Leon Panetta — say that Israel is ready to strike Iran:

Our own secretary of Defense has said it’s highly likely and he gave a timeframe — April, May, June — which means the Israelis think that the moment, the zone of immunity where they can no longer attack successfully, is approaching.

On the other hand, I am becoming more sceptical of such actions by the day.

Both China and Pakistan have given assurances of some kind of support for Iran, if attacked. Why would Israel choose direct and open warfare against Iran and risk provoking a wider conflict when they can instead engage in a much less risky covert war of subterfuge, sabotage and assassination?

Furthermore, why would the US Secretary of Defence go on the record to divulge Israeli military plans? Frankly, it sounds like Panetta’s vocalisation is a decoy to keep Iran edgy, and try to incite Iranians on the ground to rise up in revolt and overthrow the regime, as a path to avoiding war.

While I have already given a pretty comprehensive breakdown of the Western motivations for such a war, the simple truth emerging is that the risks of wider trouble and blowback are too big, and outweigh all the prospective benefits. American and Israeli policymakers may have finally realised that the West just has too much to lose from antagonising China and Russia even more. And, as I have clearly drawn out, the risks to Israel and to the West from an Iranian nuclear weapon are relatively small. Furthermore, the Israeli intelligence community is not overwhelmingly committed to such an action.

The only people who seem committed to such action are the rabid neocon wing of the Republican party: people like Rick Santorum.

From Haaretz:

Republican presidential candidate Rick Santorum on Thursday accused President Barack Obama of actively seeking ways to allow Iran to gain a nuclear weapon and suggested that the administration had betrayed Israel by publicly disclosing what may be a plan to attack the Muslim nation.

The bottom line is that there is very little reason to believe that America or Israel will openly engage Iran before the Presidential election. There will be a continued war of stealth, continued drone surveillance, continued cyber attacks, continued assassinations, and a continued blockade — all aimed at provoking an Iranian revolution. I could be wrong, and the situation could change, but as more anti-American rhetoric streams out of Eurasia, as Iran enriches more uranium, as the American national debt creeps higher, the prospects of a war grow more distant.

A zealous theocratic warmonger like Santorum in the White House would change all of that..

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Who’s the Communist Now?

I’d like to draw readers’ attention to a statistic I flagged up a few weeks ago that I don’t think I emphasised sufficiently. I was writing about America’s current tax burden, its deficit, and the stark choice that Americans — and also the rest of the people of the world — face:

America spends 24% 39% of its GDP as government spending. Other nations spend far more than America, but they also tax more. 52% of French GDP, 37% of Japanese GDP, 47% of British GDP, 18% of Thai GDP, 32% of Swiss GDP, 78% of Cuban GDP, 27% of Indian GDP and 17% of Singaporean GDP is government spending.

Most interesting by far is “communist” China. Only 20% of Chinese GDP is government spending. 

Nihao, Capitalists!

That’s right: “communist” China is now less statist — at least in economic terms — than “free” America.

Meanwhile at Davos, the West’s “economic leaders” pillory capitalism as worsening inequality.

From the BBC:

Growing inequality should now be the priority for leaders after the economic crisis, senior economic figures at the World Economic Forum have said.

They insisted that more needed to be done to tackle excessive pay, poverty and unemployment.

The discussion, hosted by BBC World in the Swiss ski resort of Davos, was held as figures showed almost half of young Spanish people are out of work.

Economist Nouriel Roubini warned inequality threatened social stability.

“We are in a very fragile world,” said the economist, dubbed Doctor Doom because of his predictions leading up to the 2008 financial crisis.

“The issue of distorted pay is not being addressed, banks that were deemed too big to fail now becoming even bigger,” he said.

I think there is a very strange psychological trend occurring here, and it’s actually one I recognise in my younger self. I was born in 1987, and grew up in the shadow of the 1990s, long after Deng Xiaoping, long after the “End of History”, long after the end of the “Red Menace” that was the Soviet Union. Long after the West really felt any need to differentiate itself as “capitalist” against a background of growing statism. Instead, the growing statism was in the West, even in spite of the legacy of Reagan and Thatcher — two leaders who both managed to spew a great deal of pro-freedom rhetoric, while at once greatly expanding the scope and shade of government.

This psychological trend can be summed up as the idea that the first recourse for social and economic problems is more government action. Too much inequality? Regulate against it. Too little innovation? Legislate for it. Too little demand? Stimulate it. Too much bad government? Elect a better one, who will do more of the things we “love”, and less of those we “hate”.

The idea, in the simplest terms, is that changes to society should come from the great overhanging monolith, and not from the little individuals on the ground. No, we are just fish swimming in an ocean of dialectical chaos. We are just flecks of paint on the great canvas of humanity. No, let us not agitate or gravitate. Instead, we must “co-ordinate” and “unite” under the aegis of government; the blind painter.

The climax of this bizarre psychological trend was the election of Barack H. Obama. After all the misdeeds of Bush and Cheney, he would be the one to restore government to its “proper” role: “helping the people”, “creating a better America”, “investing in tomorrow”, etc, etc, etc, blah, blah, blah.

This is a licence for more central planning and more government largesse. There are two problems here:

  1. Regulatory Capture: As David Rothkopf has argued: “Geography, pedigree, networking and luck unite a superclass of 6000 individuals that possess unparalleled power over world affairs.” Obama’s top contributors are the same old people. Obama appointed more ex-Wall Street figures to his administration than anyone before him. Ultimately, the people chosen as central planners have a track record of enacting policies that enrich themselves more than everybody else. The people lining up at Davos calling for a new system, i.e. more government, are the same elite who have ruined the old one. As Jonathan Weill writes: “It’s becoming hard not to suspect that the annual gathering in Davos has become a conclave for global elites to promote crony capitalism and state-backed enterprise, ensuring that national coffers remain available to be tapped for private gain.”
  2. Unintended, and Unexpected Consequences: Central planners are often pretty bad at the job. Bernanke and Yellen failed to predict the end of the housing bubble (that their predecessor Alan Greenspan helped create) with terrible consequences. Tim Geithner lashed that there was “no chance of a downgrade” right before S&P downgraded US Treasuries. Angela Merkel demands austerity from a frail and ailing Greek economy suffering from a severe contraction that is only worsened by austerity. The Iraq and Afghani wars created more terrorists than they killed, and added a multi-trillion dollar shackle of debt to the American government. America’s deindustrialisation (in the name of cheaper Chinese goods) has created huge unemployment in America, as well as making the American economy ever more dependent on the fragile flow of trade for components and energy. History is dominated by black swans — and the history of  central planning is dominated by unintended consequences. We just don’t understand reality well enough to centrally plan it.

Of course there is a bigger concern here, and one that I have written about before: central planning kills the market mechanism. It kills market evolution and creative destruction, and gives life to absurdities — like the current global financial sector — that could never live under pure market conditions:

Capitalism means both successes and failures. It is a fundamentally experimental system, with a continuous feedback mechanism — the market, and ultimately profit and loss. Ideas that work are rewarded with financial success, and ideas that don’t are punished with failure. With capitalism, systems, ideas and firms that fail to produce what the market wants fail. They go bankrupt. Their assets, and their debt is liquidated.

When that mechanism is suspended by a government or central bank that thinks it knows best — and that a system that is too interconnected to fail is worth saving at any cost — the result is almost always stagnation. This is for a number of reasons — most obviously that bailouts sustain crippling debt levels, and are paid for through contractionary austerity, which is what Salmon was getting at. But it is larger than just that.

In nature, ideas and schemes that work are rewarded — and ideas and schemes that don’t work are punished. Our ancestors who correctly judged the climate, soil and rainfall and planted crops that flourished were rewarded with a bumper harvest. Those who planted the wrong crops did not get a bailout — they got a lean harvest, and were forced to either learn from their mistakes, or perish.

These bailouts have tried to turn nature on its head — bailed out bankers and institutions have not been forced by failure to learn from their mistakes, because governments and regulators protected them from failure.

The darkest side to this zombification is that it takes resources from the productive, the young, the creative, and the needy and channels them to the zombies. Vast sums spent on rescue packages to keep the zombie system alive might have been available to increase the intellectual capabilities of the youth, or to support basic research and development, or to build better physical infrastructure, or to create new and innovative companies and products.

Zombification kills competition, too: when companies fail, it leaves a gap in the market that has to be filled, either by an expanding competitor, or by a new business. With failures now being kept on life-support, gaps in the market are fewer.

Japan has experienced twenty hellish years of zombification, all because they suspended capitalism in favour of systemic stability and creditors getting their pound of flesh. America did virtually the same thing, and the result has been three years of stagnation.

That, is more or less why I believe government should stay out of central planning altogether, and instead should stick to the role intended for it by U.S. Constitution — protecting life, and liberty, administering the due process of law, and undertaking great projects like the Apollo missions beyond the reach of private enterprise. Will the central planning addicts at Davos get the message? I doubt it. After all, their entire worldview is predicated on the notion that they “know better”.

The irony is that — at least in terms of economic affairs — the Chinese “communists” seem to have gotten it.  After the awful experience of huge famines, they finally accepted that they did not “know better”. Perhaps it would take a cataclysm of similar magnitude for the West for us to realise that we do not “know better” than nature either…

UPDATE: It seems like I was wrong about US government spending. It’s actually 39% of GDP, not 24% as I first reported. That’s higher than the 34% of Vladimir Putin’s Russia.

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Palestine: Obama Plays With Fire

Barack Obama discovered very early in his Presidency that in spite of his campaign promises he cannot be all things to all people. And, with the UN gearing up to a highly-charged vote over whether or not to recognise Palestine as a sovereign state, the future status of Palestine, Israel and the Middle East lies with the Obama administration, which is expected to veto any such proposal.

From the BBC:

Barack Obama has told the UN General Assembly the Palestinians deserve their own state, but that this would only be achieved through talks with Israel.

The US president’s speech came as diplomatic efforts for Palestinian UN membership intensified, while thousands rallied in the West Bank.

“Peace will not come through statements and resolutions at the UN,” he said.

He added there could be no “short cut” to peace, and is expected to urge the Palestinians to give up the initiative.

Mr Obama is holding talks with Israeli Prime Minister Benjamin Netanyahu, and is to meet Palestinian leader Mahmoud Abbas later.

Mr Abbas is set to launch the statehood bid on Friday, after his address to the UN General Assembly, with a written request to Secretary General Ban Ki-moon.

If his request is approved by Mr Ban, the Security Council will then examine and vote on it. In order to pass, the request must get the votes of nine out of 15 council members, with no vetoes from the permanent members.

If America vetoes this resolution, global opinion — which is broadly favourable to the Palestinian cause — may treat Obama and America rather unkindly. The middle east has recently seen a wave of revulsion toward Israel, including frenzied mob attacks on embassies in Jordan and Egypt. Turkey has cooled relations with Israel. Globally India, Russia and China have all expressed support for the resolution.

If America vetoes this resolution against the global consensus, Israel and America will simply be alienating themselves from other nations, by pursuing a widely detested course that puts all of the power in the hands of Israel.

And alienation is bad, both for Israel and for America, because they are both dependent on imported energy, imported natural resources, and imported goods. America spends trillions of dollars a year on military hardware, manpower and infrastructure to police the world and keep the global infrastructure stable. Why would Obama choose to stir the hornets’ nests by going against the wishes of the world? Certainly, the American political system and the Obama administration is influenced by Jewish interests who have no wish to see a Palestinian state.

But should those interests be of more importance to Obama than the wishes of global powers like China, India, Russia, and the European Union?

The real question is what impact these events will have on regional power. Does the Arab world have the chutzpah to bend Israel to its will? Or will Israel take stronger action to meet its interests?

UPDATE:

Ehud Olmert states this is the last chance left for the two state solution. From the NYT:

AS the United Nations General Assembly opens this year, I feel uneasy. An unnecessary diplomatic clash between Israel and the Palestinians is taking shape in New York, and it will be harmful to Israel and to the future of the Middle East.

I know that things could and should have been different.

I truly believe that a two-state solution is the only way to ensure a more stable Middle East and to grant Israel the security and well-being it desires. As tensions grow, I cannot but feel that we in the region are on the verge of missing an opportunity — one that we cannot afford to miss.

The Palestinian president, Mahmoud Abbas, plans to make a unilateral bid for recognition of a Palestinian state at the United Nations on Friday. He has the right to do so, and the vast majority of countries in the General Assembly support his move. But this is not the wisest step Mr. Abbas can take.

The Israeli prime minister, Benjamin Netanyahu, has declared publicly that he believes in the two-state solution, but he is expending all of his political effort to block Mr. Abbas’s bid for statehood by rallying domestic support and appealing to other countries. This is not the wisest step Mr. Netanyahu can take.

In the worst-case scenario, chaos and violence could erupt, making the possibility of an agreement even more distant, if not impossible. If that happens, peace will definitely not be the outcome.

The parameters of a peace deal are well known and they have already been put on the table. I put them there in September 2008 when I presented a far-reaching offer to Mr. Abbas.

According to my offer, the territorial dispute would be solved by establishing a Palestinian state on territory equivalent in size to the pre-1967 West Bank and Gaza Strip with mutually agreed-upon land swaps that take into account the new realities on the ground.

The city of Jerusalem would be shared. Its Jewish areas would be the capital of Israel and its Arab neighborhoods would become the Palestinian capital. Neither side would declare sovereignty over the city’s holy places; they would be administered jointly with the assistance of Jordan, Saudi Arabia and the United States.

The Palestinian refugee problem would be addressed within the framework of the 2002 Arab Peace Initiative. The new Palestinian state would become the home of all the Palestinian refugees just as the state of Israel is the homeland of the Jewish people. Israel would, however, be prepared to absorb a small number of refugees on humanitarian grounds.

Because ensuring Israel’s security is vital to the implementation of any agreement, the Palestinian state would be demilitarized and it would not form military alliances with other nations. Both states would cooperate to fight terrorism and violence.

These parameters were never formally rejected by Mr. Abbas, and they should be put on the table again today. Both Mr. Abbas and Mr. Netanyahu must then make brave and difficult decisions.

We Israelis simply do not have the luxury of spending more time postponing a solution. A further delay will only help extremists on both sides who seek to sabotage any prospect of a peaceful, negotiated two-state solution.

Moreover, the Arab Spring has changed the Middle East, and unpredictable developments in the region, such as the recent attack on Israel’s embassy in Cairo, could easily explode into widespread chaos. It is therefore in Israel’s strategic interest to cement existing peace agreements with its neighbors, Egypt and Jordan.

In addition, Israel must make every effort to defuse tensions with Turkey as soon as possible. Turkey is not an enemy of Israel. I have worked closely with the Turkish prime minister, Recep Tayyip Erdogan. In spite of his recent statements and actions, I believe that he understands the importance of relations with Israel. Mr. Erdogan and Mr. Netanyahu must work to end this crisis immediately for the benefit of both countries and the stability of the region.

In Israel, we are sorry for the loss of life of Turkish citizens in May 2010, when Israel confronted a provocative flotilla of ships bound for Gaza. I am sure that the proper way to express these sentiments to the Turkish government and the Turkish people can be found.

The time for true leadership has come. Leadership is tested not by one’s capacity to survive politically but by the ability to make tough decisions in trying times.

When I addressed international forums as prime minister, the Israeli people expected me to present bold political initiatives that would bring peace — not arguments outlining why achieving peace now is not possible. Today, such an initiative is more necessary than ever to prove to the world that Israel is a peace-seeking country.

The window of opportunity is limited. Israel will not always find itself sitting across the table from Palestinian leaders like Mr. Abbas and the prime minister, Salam Fayyad, who object to terrorism and want peace. Indeed, future Palestinian leaders might abandon the idea of two states and seek a one-state solution, making reconciliation impossible.

Now is the time. There will be no better one. I hope that Mr. Netanyahu and Mr. Abbas will meet the challenge.

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American Infrastructure Is Being Built By The Chinese

Just how dependent is America on Chinese labour, manufacturing and supply chains? Decide for yourself.

From Addicting Info:

San Francisco is getting a new bridge connecting to Oakland. But it’s not being built by American workers. It’s being built in China and shipped back to America for assembly. But that’s not the only infrastructure project being built by the Chinese, and it’s not just being built in China. It turns out, the state-owned Chinese contractors are being hired out to build American infrastructure right here in the United States.

According to Engineering News Record, five of the world’s top 10 contractors, in terms of revenue, are now Chinese. One of them, China State Construction Engineering Group, has overtaken established American giants like Bechtel.

The Chinese contractor has already built seven schools in the US, apartment blocks in Washington DC and New York and is in the middle of building a 4,000-room casino in Atlantic City. In New York, it has won contracts to renovate the subway system, build a new metro platform near Yankee stadium, and refurbish the Alexander Hamilton Bridge over the Harlem river.

But why are we hiring contractors from China to build American infrastructure, when we have a perfectly good workforce here in the states? The answer is profit, and it’s the reason why Republican politicians and many corporations do not support infrastructure projects that would put millions of Americans to work. Because the Chinese contracting firms are government owned, they are able to bid for contracts at very low prices. In other words, the labor is cheap. American companies don’t want to hire Americans to do the work when they can call up Communist China to come do the work instead.

Continue reading →

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China Beats War Drum Over Taiwan?

As I have stated before, China has no reason to be belligerent to America, or to accelerate the death of the dollar as the global reserve currency. Firstly, this is because the current world order is strengthening China, and weakening America. Second, this is because China has accumulated a huge swathe of American debt, and wants to use it to acquire American (and global) productive assets and wealth.

America on the other hand, as the declining power, has every reason to be belligerent to China.

From the Economist:

An new book, discussed in this week’s Economics focus, by Arvind Subramanian of the Peterson Institute for International Economics argues that China’s economic might will overshadow America’s sooner than people think. Mr Subramanian combines each country’s share of world GDP, trade and foreign investment into an index of economic “dominance”. By 2030 China’s share of global economic power will match America’s in the 1970s and Britain’s a century before. Three forces will dictate China’s rise, Mr Subramanian argues: demography, convergence and “gravity”. Since China has over four times America’s population, it only has to produce a quarter of America’s output per head to exceed America’s total output. Indeed, Mr Subramanian thinks China is already the world’s biggest economy, when due account is taken of the low prices charged for many local Chinese goods and services outside its cities. China will be equally dominant in trade, accounting for twice America’s share of imports and exports. That projection relies on the “gravity” model of trade, which assumes that commerce between countries depends on their economic weight and the distance between them.

So should it come as no surprise that America continues to arm and train China’s enemies.

From Reuters:

China’s top official newspaper warned on Friday that “madmen” on Capitol Hill who want the United States to sell advanced weapons to Taiwan were playing with fire and could pay a “disastrous price,” as the Obama administration nears a decision on a sale.

The People’s Daily, the main paper of China’s ruling Communist Party, said the United States should excise the “cancer” of the law which authorizes Washington’s sale of weapons to the self-ruled island of Taiwan that China considers its own territory.

Taiwan’s biggest ally and arms supplier, the United States is committed under a 1979 law to supply it with the weapons it needs to maintain a “sufficient self-defense capability.”

Is America making a mistake? Should they instead be looking to integrate with the rest of the world, so that the necessity of a shared future means that war, threats and belligerence are in nobody’s interest?

I think so.