The China Questions

The trade war with China is heating up, so the usual suspects are now turning up in the media to pronounce on the issue. There is the sense that many of the pundits are relieved to take a break from discussing the culture war that surrounds the Trump presidency and the Progressive response to it. Talking about trade and global economics feels like old times. Here is a longish post from David Goldman, the man behind Spengler of the Asia Times, addressing the trade war.

As is always the case in these matters, the Michael Crichton observation about the media should be kept in mind. The growing rift between China and the United States is a complicated matter by itself. The impact it will have on global trade, the US economy and geopolitics is even more complex. Even people paid to risk real money in these areas don’t have a firm grasp of all the moving pieces. The people posting in the media know even less. Often they know nothing at all.

That does not mean there is nothing we can know. The first question, in any heated trade dispute between two countries, is “who is buying and who is selling?” and the related question is, “What is being traded?” In this regard, trade disputes are not a lot different from disputes between customers and vendors. How they proceed and how the end is entirely controlled by the relationship and the products in question. That determines who has the most leverage in the dispute.

In this case, the relationship is easy to sort. U.S. imports from China totaled $539.5 billion in 2018. U.S. exports were $179.3 billion. That export total is about 7% of all U.S. exports for 2018. Put another way, the U.S. market is about 5% of the Chinese economy, assuming the fake Chinese economic numbers are even close to reality, which is surely not the case. The Chinese market is less than one percent of the U.S. economy in 2018. Imports are about 3% of the U.S. economy.

Right away, the relationship between China is the U.S. is not an equal one, in terms of dollars, but also in terms of impact. Then there is the nature of trade between the two countries. Almost all of the U.S. exports to China in 2018 were aircraft parts, electronic components and car parts. In many cases, these are either high precision items the Chinese cannot produce or they have intellectual property that the Chinese will try to steal, so they are made in the U. S. and sent to China.

This is why Trump is playing hardball. He believes he has far less to lose than the Chinese in a trade war. Even if all trade with China comes to an end, the cost to the U.S. economy is not going to be devastating. In fact, it will be hardly noticed. Much of that trade will be replaced with other cheap labor countries, as it is not really trade in the conventional sense. America’s economic relationship with China is about off-shoring manufacturing to dodge labor, tax and environmental laws.

This is a point that cannot be made enough. When American producers sell good to Canada, and Canadian producers sell good to America, that’s trade. When American producers move manufacturing to Mexico, then bring those goods back home under a tariff free regime, that’s not trade. China is not selling the world anything the world does not have or cannot make. What China is selling is a safe haven to avoid the labor, tax and environmental laws that exist in the West.

That does not mean there can be no impact. That’s the other set of questions that can be examined from the outside. China can play a long game, as the Chinese leaders are not facing annual elections and endless media scrutiny. The West, particularly Trump, are in an endless election cycle. Any little blip in the economy is magnified by the media and then fed into the political calculus. While this trade war will inflict more pain on China, they have a much higher pain threshold than Trump.

That’s the theory. It is not all that clear just how much pain Trump will suffer from this standoff with China. The timing actually works in his favor. The slow buildup not only gives American business time to adjust, it gives the political class time to cast it as the typical good guy versus bad guy story. Xi Jinping is not exactly a lovable Jackie Chan type of guy, so casting him as a villain will be easy. In other words, Trump may be trading a little economic capital for a lot of political capital.

Then there is the question of just how much pain China can take and for how long. It is just assumed by Western analysts that the Chinese can absorb any amount of suffering for as long as it takes. After all, China weathered the Cultural Revolution without a mass revolt by the people. Mao had to die before the party moved to end the madness. Why would the Chinese people revolt over a slight down turn in the economy? Why would the party move against Xi Jinping, if the trade war contracts her economy?

No one can know this, but we do know that wealthy people are far more sensitive to small changes in the economy than poor people. We see this in the West. A small down turn has the middle class turning against their party, but a generation long depression in coal country has not caused a revolt. That same reality may be true in China. There are a lot of people living bourgeois lifestyles along the Chinese coast, all financed by one-sided trade with the United States and her allies.

While all of this economic 4-D chess will occupy the pundits, there may be a simple answer to what is going on with China. It could simply be that China has become a liability to the West. The benefits of moving manufacturing to China has been consumed at this point. What’s left is the liability, which is currency manipulation, IP theft, espionage and financial shenanigans. China is running out of friends in Western capitals. The appetite for tolerating this stuff may be waning.

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109 thoughts on “The China Questions

  1. Great article. FYI: in 2003, an American spy attended a meeting between China and Russia. The main topic: the take over of America. Russia was not interested in occupying the mainland; they merely want Alaska and Canada. China, realizing their inhabitable land is dwindlng and that America is similar to China, desperately want to conquer and occupy this great country! China and Russia have a pact against a common enemy, the USA. Then, there’s Isalm, an ally of Russia, otherwise known as the Red/Green axis of evil. At one time the goal of Islam was to conquer America, and the West, by force: jihad. However, they have discovered that they can gain control legally by running for government office. We already have 5 muslms in high government positions, not to mention the DOJ, FBI, CIA, HLS, etc. I have heard no less than 100 muslims will be running for office in the next election cycle! May JEHOVAH GOD have mercy on us! Yours truly Zman1.

  2. One doesn’t need to look far to find that the Chinese are, to a very large extent, terrible people (their treatment of animals makes me STRONGLY desire to nuke their country from end to end). This, in spite of the fact that their IQ’s are high, and Jews are few and far between. I’m wondering, does this count as evidence against those who would attribute the West’s woes to the JQ and white dysgenics?

    On the other hand, both the elite and masses of China seem to be nationalistic (exactly how common is the term “baizuo” I wonder?). I’m quite certain that adopting America/Western style liberal democracy is not the answer to their woes. An authoritarian Right traditionalist model, following Dugin’s Fourth Political Theory, is what I would advise for them. In addition, China becoming fully integrated into the global Western liberal system would make the liberal elite that are in charge over (and wholly devoted toward destroying) the West that much more difficult to dislodge. The spread of their plantation only increases their wealth and power.

    My only personal experience with Chinese came in the 00’s when I was in college. I worked an unskilled manual labor job at a large factory. To provide bodies, young people from around the world, who wanted to visit America, were brought in for a few months at a time. A couple of young Turks were among them; the one was very nice and wasn’t bothered when I continually asked him about Byzantine ruins left remaining in Turkey. The other was not so nice, and when he made me angry once, I managed to raise his eyebrows when I suddenly and angrily asked him, for the first time and out of the blue, what remnants of Byzantium remain in his country.

    Anyway, the young, kind, bookish Chinese college student I worked with for a time was a VERY passionate nationalist (as were his friends back home). He was happy that I was interested in and respected his ancestors, and was amused when I warned him that economic development is not everything, that Westerners are in fact quite miserable, and that our civilization is on its way downward. His English was excellent, but I was still using, and explaining to his satisfaction, words that he wasn’t familiar with, and he told me that I should go to China and teach English. Before he left, he gifted me with a Chinese renminbi (dollar bill), with a picture of Mao on it (something, he said, to help me remember him). To be honest, I felt a greater understanding and bond with him than I have with 99% of white people. It’s pretty humorous that a (mostly) German blooded, devoted traditional Catholic (at the time, but still implicitly, more or less, today) could bond so well with a devoted child of “atheist communist” nationalist China. My explanation: we both believed in closed societies, in duty toward, in dignified and self-sacrificial fighting on behalf of, one’s people.

  3. Z Man, your observation is pretty spot on except one major point, stuff that China makes today at the price it sells and at the scale it delivers cannot be replicated anywhere, this is why all the fat cats in US are extremely worried that they may have to forgo some of their stock option gaines in future years to pay for higher labor cost and disruptions. Think of the year China really took off, around 2002 in my books (thanks to the traitor Bush family), we already had NAFTA for a few years, deindustrialization had started but leveled off as American companies found out the hard way that Latin Americans don’t show up to work the day after they get their paychecks often. Then China joins WTO and deindustrialization wave gets turbocharged in 2000’s, masked mightily by the housing boom created by Bush and Rove. This idea of going to Walmart or any other department store and practically finding 100% of the crap we buy there as Made in China is only 15+ years old, prior to that you find a mix of Made in China, Mexico, and good old USA. The job losses in manufacturing in 2000’s were really crippling to small towns in Ohio, Indiana, Missouri, and Illinois, I sadly had a first-hand view to several instances back then.

    Today American companies are frantically searching for other locations, but I can tell you from first-hand experience that there is nothing comparable, maybe Vietnam but it’s size limits what it can take.

  4. China hardlining is the one thing I never see Trump’s detractors attacking him for. It suggest that even the elite is starting to fear the prospect of a country w 4 times the people starting to get its act together. It does not take a Clausewitz or Sun Tzu to see that if they really did that, the US cannot stand up to it in the long run.

    But there is another interesting possibility. As any dictator worth his salt knows, nothing unites a nation, otherwise fractured or not, so much as an external enemy or threat. The US was was tight fist during WW2, and I think that war actually helped push Irish and, ironically, Italian Americans the last bit into general acceptance as ‘ordinary white Americans.’ The Soviet Union, w its thousands of nuclear missiles and bellicose statements and behavior, was also very healthy for American unity (not counting possible Soviet role in the spread of various cultural marxist insanities). When the Soviets went, the US slowly started to become a cat-herding circus. And that just spiraled and spiraled until… It is possible China is starting to have a similar effect.

  5. I’m reading a few Chinese law blogs, a decade ago they were still giving legal advice on how to enter China, today they give advice how to leave without getting kidnapped in the process, because you can actually be held against your will as a western manager, if your Chinese business partners (which you have, since it’s all joint ventures) claim something is unsettled or unpaid, hence winding down is becoming a cloak-and-dagger operation.

  6. Most of the Chinese crap I bought has proven to be made of inferior materials and methods. I can see why we only use them to assemble our goods. They can’t be trusted. If they go away, I won’t miss them.

    • We should be making everything we want here in the U.S. anyway. To hell with these people crying about their intellectual property being stolen by the Chinese who are manufacturing it. Make it all in the U.S.A.

  7. We are a consumer economy. Domestic supply lines were ripped out of this country by the 90’s. While we can go back to manufacturing our own things, the path won’t be easy and will involve a significant amount of pain. This is good pain, but it is nonetheless pain. Even then, places like Vietnam will inherit the windfall.

    An economy where the average American has no savings and 7 year auto loans are the thing to do, even small price increases of Chinese goods will be felt. Moderate and large increases in product cost will not go unnoticed. The economy is poised for a massive recession anyway, so this is as good of an excuse as any when we get there.

    California is poised to handle this gracefully as our felony grand theft laws now $950 per incident, so you can go through store after store at the mall, stealing $800 at a time, all day long, and it’s still not grand theft. Store managers are trained to let you do it. Petty theft. What a great way to combat the coming price increases.

    • Can confirm. They have this down to a science – hit the store, grab Item A, or Items B/C/D to hit the mark, cased out beforehand. Stores have tried to harden the targets, make them less accessible, armed security, behind-the-counter or warehousing, but it’s a losing battle, You can devise all the elaborate laws and security systems you like, but when the system refuses to lock up repeat misdemeanor offenders, you’re going to have a shitload of $800 thefts,

      If you’re planning on visiting, don’t bring anything you can’t afford to have stolen. And bring sensible shoes, ladies – it’s safer to walk barefoot in the woods than on the sidewalks.

      Bonus anarcho-tyranny: CA’s the poorest nu-stat state, most billionaires. Brazil is the future, and the future is now.

  8. My problem with Goldman’s analysis is we don’t have reliable numbers about China.

    I visited Shenzen in the late ‘80s, and while the buildup of the city was underway by then (there were truly massive numbers of bicycles though), five minutes outside the city limit one still saw farms being worked with oxen.

    A visit to several of the Chinese megacities a couple years back showed amounts of outwardly-visible advancement in 30 years that is truly mind boggling. But it can’t help but be a hollow advancement, it all happened too fast.

    Something working in our favor IMO is the numbers of Chinese that are now well-accustomed to the amenities of modern life, and utterly unwilling/unable to work fields with oxen. (But there are still many who will stop this 6’+, silver-haired American for a photo because he looks like a circus animal they’ve never seen before.)

    Net: China is a weird place, and any non-Chinese who claim to understand it is lying to you.

    • When we’ve been there on business, they tend to take a LOT of pics of my 6’2, 260 lb hubby & they also have this weird habit of wanting to touch/rub his very hairy forearms, lol. That’s also happened in S Korea, as well. I’m 5’2 so I don’t draw much attn other than I’m about 25 lbs fatter than your avg Asian.
      Pretty amusing stuff. 1

    • “any non-Chinese who claims to understand it is lying”
      Are you familiar with Sidney Rittenberg??
      his autobiography is “The Man Who Stayed Behind”
      He emigrated back to the US in the early ’80s, with his Chinese wife and 4 kids.
      His son got a job working at a McDonalds in the Bronx. His other kids are doing well in the US too.

  9. The key point for me is that all of this is over the 3% of the economy that is what we import. In the big scheme of things, 3% is a rounding error. As Ant Man Bee pointed out, we are giving away our way of life for these imports (and the export of the jobs, the pollution, the intellectual theft, and so on). China and others have deftly identified the individuals who have the juice to allow things to happen, and also can be cheaply bought off (the Clintons and Biden, to name a couple).

  10. thezman said: “That does not mean there is nothing we can know. The first question, in any heated trade dispute between two countries, is “who is buying and who is selling?” Here’s a cute little cartoon vid on trade imbalance called ” Thriftville vs Squanderville.”
    Think us and China.

  11. You didn’t mention the Fentanyl that has killed several times as many Americans as the various terrorists have. 23,000Kg was seized at a Mexican port. WMD is an act of war, and we went into Iraq for far less. Then there’s China’s human rights violations.

    But, EXACTLY!:

    “This is a point that cannot be made enough. When American producers sell good to Canada, and Canadian producers sell good to America, that’s trade. When American producers move manufacturing to Mexico, then bring those goods back home under a tariff free regime, that’s not trade. China is not selling the world anything the world does not have or cannot make. What China is selling is a safe haven to avoid the labor, tax and environmental laws that exist in the West”.

    The Irony is the Liberal virtue signalling about how Americans deserve a high minimum “Living Wage”, and health care, etc. which we used to be able to easily afford via blue collar jobs until the Wealth Extraction Wall Street people engaged in Bain Capitalism to make themselves rich while making people poor – Sorry you lost your $40/hr factory job, but at least cheap plastic bowls cost have what they did!

    All that said, my worry is that China will make a huge mistake. Sun Tsu said know yourself and know the enemy to win. The only thing worse than not knowing is “knowing” something wrong. I think Xi has already erred by pushing Trump. It would have worked with Jeb!. A billion to the Clinton foundation would get Hillary to cooperate. Trump doesn”t like dishonesty in negotiations, the “smile and lie” technique. Xi has unnecessarily created a real enemy who will fight back.

    This is the difference in culture – China nibbles – you will get your shipment, but 3% will be defective, conveniently in one box, and this is how things work there. (see poorly made in China and What’s wrong with China). The west is high trust but with a threshold – and will overlook and ignore things until they go ballistic when someone takes advantage of that trust

  12. thezman said: “Why would the Chinese people revolt over a slight down turn in the economy? Why would the party move against Xi Jinping, if the trade war contracts her economy?” Well, according to this article in the Atlantic from Jan 5, 2012 . There’s a lot of crap goes on in China that most people aren’t aware of. I’m not so sure China is as strong as the financial media would have us believe.

    ” How China Stays Stable Despite 500 Protests Every Day.”

      • bilejones said: “Ever wondered why there’s so much media coverage of unrest in China and none on the Gilet Jaunes in France?”
        The corporate media’s sins of commission or omission no longer surprise me in the least. That’s their job.

    • “That could pit the Communist Party against some of the Chinese firms and individuals who have been enriched (and have entrenched their influence accordingly) by three decades of export-led growth. It’s not clear whether CCP will be able to take on these Chinese economic interests.”

      That is a very dangerous situation for the political elite.

      Honest question: who, in the long-run, are more likely to be concerned with the well-being of the Chinese people, the CCP men, or China’s Money class?

  13. Someone should point out to The Orange Man that the major import that should be taxed when it comes to the States is people.

  14. Good analysis. It gets even more disturbing when you go one level deeper, or if you are just frank about it.

    You ask, What is being traded? At bottom, what is being traded is our way of life. We are the Indians selling Manhattan Island for blankets and trinkets. We are selling the American way of life in exchange for cheap rubber and electronic garbage. We are selling our own entire country out from under our children’s feet, because we have nothing else left to sell, except access to American social capital, American infrastructure, and the best real estate on the planet, which we give away without a fight to anyone who simply begs or wheedles or angrily demands it loud enough.

    To the Chinese, we are also selling seats at the table of our overlord class. Look at the composition of the top kingmaker universities, esp the STEM grad schools. Your children will be working, that is if they work at all, for the Chinese graduates of American universities which were built to train the American ruling class, but the seats of which were given away to alien enemies because of some piffle about high test scores.

    In exchange for giving away all of this in “trade,” the American people get… nothing.

    In fact they get less than nothing, they are slandered and belittled in their own (((culture))) non stop at every turn, they are raped and assaulted and murdered every single day by feral savages who have no business here, their housing stock in their own cities is unaffordable because the price is driven up by the nonstop mudslide of foreigners, the schools and hospitals which they built are unusable by them, their culture is degraded into a repulsive slurry of loud, pulsating nonsense, and now they are even banned and censored from complaining about this on the very same Internet which their tax dollars created, and total control of which fell almost overnight into the hands of (((Guess Who))), who basically scooped the whole thing up for free.

    Soon the Chinese will own most of the U.S., Canada and Australia, and White Westerners will be left sitting on giant garbage heaps of use plastic crap they bought on credit, wondering what the &@$! happened.

    And somewhere, the (((Council of Chosenites))) will be rubbing their hands together fast enough to travel through time.

    • ‘At bottom, what is being traded is our way of life.” Applause,

      Z and others have written about the strip mining our our local social capital to benefit global corporations and foreigners.

    • You need to take all the land between the Rockies, Red River , and Appalachian Mountains and declare an independent country. I don’t think anybody will fight against you or have the will to do anything.

  15. Damn, now that Trump has stolen the left’s issue, they are no concerned about us peons except when we would like less government and tax cut or less importation of the turd world into our communities.

    I guess I’ll have to pay an extra nickel or dime at Harbor Freight for a few items I buy once in a while. I don’t really buy electronics all that much. Bought a small TV in clearance isle at Best Buy. Other than, it’s a used desktop or laptop for me.

    • I like to remind my lefty acquaintances that in 2009-10 they used to say “I’d gladly pay 10% more for a can of soup so everyone can have health insurance.”

      Well, they can pay 10% more for their phone/tablet to have it made in Nebraska/Ohio, etc.

  16. Xi Jinping is not exactly a lovable Jackie Chan type of guy, so casting him as a villain will be easy.

    I suspect that the experienced fiction writers in the media can recast any villain as a hero, and any hero as a villain. Trump is always the villain in the CFU (CultMarx Fictional Universe™.)

    I’ve actually done some business in China. Total nightmare. They don’t just try to cheat and wheedle, they try to humiliate you in every deal. Make you lose face. It’s part of their thing. Not just in business–in daily interactions. I lived there for a couple of years in a near-constant state of fury.

    The fact that you have to go hat in hand to these people if you want to manufacture almost any physical object, and then they just use designs taken from western countries anyway, is one of the reasons I dropped out of the free-trade lolbertarian clown college.

  17. US national debt is about 100% of GDP; high but manageable in current low interest environment. China is at 300% of GDP!? And their economy is contracting.

  18. From personal experience I know that China does not respect the idea of intellectual property. That alone is reason enough not to do business with them. That brings me to my favorite misogynistic question. ” What does that have to do with the price of naked chicks in China?” The answer is nothing. Forgive me. I say these things for my own benefit.

    • I’ve done work for American firms operating in China. My work was entirely focused on thwarting Chinese theft and Chinese forgeries. A trick China loves is to put low quality forgeries of a product in the market. This damages the reputation of the maker, which China is happy to address for a fee. Alternatively, they will pollute the market so a Chinese firm can gain market share.

      China is a bandit economy.

      • The will work overtime to reverse engineer any complicated electronic component semiconductor or display. These items are beyond most of their technical expertise.

          • To the idiot who downvoted me – the context of my comment was JMDGT’s contradicting statements of being able to simultaneously copy something and lacking knowledge in how to do so.

          • Reverse engineering something and being able to develop the components independently on your own are two different things. Reverse engineering does not necessarily constitute technical savvy or expertise.

        • 25+ years ago, both Jeep and Briggs & Stratton found out that having a plant in China was the very best way to have the product stolen. And the damn fools CONTINUED to operate there.

      • Do you think you will ever be in a position to do something quasi auto-biographical? Seems like you have seen some things.

      • thezman said : “China is a bandit economy.”
        People are always complaining about President Trump wanting to be more protectionist. But China is the master of it.
        Here’s an artical intitled: “China’s Digital Protectionism and Mercantilist Policies Rank Among the World’s Worst for Sixth Consecutive Year, Undermining Trade and Competition in Key Tech Sectors.”

      • I have been importing steel from China for 2 decades. Amazingly, the steel coils that I and my fellow buyers reject, somehow end up in Canada where the ‘made in China’ label gets scratched off and replaced with a big ol’ maple leaf before being sold to America as, you guessed it, Canadian steel.
        Over the last 10 years, most of my purchases are now coming from S Korea. Much better product, less BS.

        • I used to buy 1/4″ thick aluminum sheets, made in Russia, 10-15 years ago. (bought through a local NYC distributor). When we cut them up, there was always some sort of very fine grit inside, which made a funny noise and wore out the bandsaw blades.

        • When the new Milwaukee Brewers’ stadium was built, the owners went cheap and specified I-beams made in Red China.

          Every damn one had to be re-done at a local facility. Nothing raises costs faster than doing the same job twice.

      • I worked with trademarks in a law firm and was told that the Chinese would forge a product right down to the packaging, sell it as the real deal but that the Chinese courts didn’t care. China and Russia were also classified as “emerging markets.”

  19. China apparently wanted three bases in … Greenland and Trump forced Denmark to renege on the deal they had made with Xi. China has made no secret of its ambition to own pretty the entire Pacific right up to the California coast. Meanwhile half of Western Canada and Southern California are owned by China. Half of Irvine CA is nothing but Chinese owned empty apartments.

    The security establishment is now in panic mode knowing that offshoring manufacturing has allowed China the ability to have drones, thinly crewed ships and subs to match the US Navy in maybe 10-15 years.

    And American money and wealth is merely the financial instrument of American military power. Without military dominance in the Pacific, what is the US dollar worth really?

    The crushing of the Hong Kong protests Tianmen style, and mass killings, etc. while Dems push hard for China led by Joe Biden (his son has some big Chinese money deal) should prove interesting.

    The fracture in the ruling class is that the National Security group led by Lockheed/Boeing/GE etc. fears being dismantled to pay for the Diversity crowd led by Silicon Valley and BLM. Google famously declined to work with the Pentagon but is cooperating with military AI with China’s PLA. Peter Thiel has charged that Google is a wholly owned subsidiary of the Chinese Military. This matters as there is an entire generation of military officers who have their payout working for Boeing or Lockheed or GE etc. If that goes away they end up working at Wal-Mart for minimum wage. The Peter Strozks are all set — but not the military guys.

    The reason Trump has not been removed already is his support among the military faction. The Secret Police want him gone — they are aligned with China/Dems/BLM/Hillary. [Odd how Obama just vanished from any political interest or influence from his Party. Its like he was never even President.]

    • you are wrong about so much; I guess not being able to get laid does that to a fellow. I can tell you with absolute certainty, that Irvine is not half empty apartments. just fukking shoot yourself and spare the rest of the world your eeyore view of things.

    • If the Chinese will let us have our country back and expel our current foreign occupiers, I’ll happily pledge allegiance to the Little Red Book.

        • >>>Murdoch-Murdoch “Yellow Dawn,” catch that fever…<<<

          Their best episode in quite a long time, that was.

          Whenever a commenter here repeats stale, GOPe talking points, I hear it in R/The Donald’s voice.

  20. I wonder how US domestic taxes, policies, rules, laws, regulations, etc., plays/played a role in US companies establishing production facilities in other lands.
    I can’t help but believe that it’s a significant factor, but that’s a wild guess on my part.
    Anybody have any ideas??

    Also, Germany is one of the world’s largest exporters, yet producing anything there (I speak of German domiciled firms) is really expensive.
    So how is it that their export products are so competitive??
    Any ideas, anybody??
    Does the German govt. give their firms tax breaks for stuff exported?

    As for China, all one can predict is that the US stock market will take off if any sort of deal is arranged.

    • There’s some tongue-fu with VAT’s and trade rules that give Germany “shadow” duties and tariffs and functional export supports – Buchanan went over some of it in Great Betrayal and Republic and I think it’s still in force. The EU also functions as a captive export market for Germany. There’s an old saw about the EU that it was formed to give Germans a market and let French farmers play bocci all day.

      US domestic labor and tax policy has always been a huge driver for the Open Door. The guys selling us the libertarian snake oil about GDP and comparative advantage didn’t mention that they were putting Americans in a Darwinian race to the bottom of standards of living they were willing to tolerate in order to buy cheap shit at Wal-Mart. 2019 result – a two income 1 child at age 40 family taking side jobs with Uber to barely afford an apartment and day care rather than a 1960 one-income family with 3 kids at 25 with a 3 bedroom house they’ll own in their 50’s driving 2 cars and putting money in the bank for college and retirement.

    • One clear example of business-killing regulation is California’s mandates regarding electricity distribution. To promote carbon neutrality that counteract “climate change”, electricity must be a mix of certain minimum percentages of wind, solar and other green energy sources. This minimum threshold increases to 100% by 2045. It is the predominate reason that California has some of the highest national costs for electricity per KW. Ironically, the area around northern CA that could use 100% hydroelectric power from Shasta Dam cheaply, must still purchase relatively more expensive wind and solar generated electricity to comply with the regs. Insanity!

    • here’s a hint about German exports: they aren’t shitty BBq’s and toxic kids toys. Here’s another hint: rhymes with “bercedes”.

    • German cost of production is high, but the quality of its manufactured goods is also high. Much of their industry includes so-called “Mittelstand” firms, medium sized and often privately or family owned enterprises. Even BMW is 50% owned by 3 individuals. The Mittelstand companies are therefore immune from the whip of the financier driving them to cut quality and squeeze the loyalty out of their employees.

      This probably has something to do with their success in exporting.

    • US laws and regs surrounding labor, enviro, safety, and taxes are killers. In a well-run manufacturing business, the cost of direct labor is only about 5-6% of the total cost-of-goods sold. In the USA, there’s overtime cost, health-insurance cost, retirement-bennies cost, OSHA cost, all of which have to be added to “direct labor” numbers.

      In Communist China, none of the above have to be added, and that “direct labor” number might be much less than 5-6%. Slavery is good, ya’know.

      • Don’t forget affirmative action, which is a huge extra cost. It forces you to hire and keep incompetent people on staff, paying them as much as you pay the competent people who fix their screw-ups. In China, underperforming employees can be summarily fired without making a federal case out of it.

    • Taxes, policies, rules, and other stuff are straight up excuses for hiding the elephant in the room when offshoring/outsourcing happen, WAGES.

      • Really? I’ll repeat myself for your benefit:

        In a well-run manufacturing business, the cost of direct labor is only about 5-6% of the total cost-of-goods sold

        Was that slow enough for you?

  21. I hope Z’s right about Woke Capital fatigue with China. As with almost every one of our other struggles, the China trade problem would be much easier to solve if some of our billionaire class simply instructed their hirelings in Congress and throughout the U.S. government/media/academic complex to solve the problem.

    In the case of Congress, detailed instructions would be required, but there are plenty of smart guys on their payrolls that already write everything the Congress legislates or even says in public anyway.

    90% of our present populist discontent is simply the result of the elite class roadblocking the public will using a system with multi-layered checks and balances to subvert, deflect, redirect or simply obstruct and defy both the Left and Right base.

    In the case of the hollowing of American industry and lopsided China “trade,” most American workers know that Pat Buchanan has been right for 30+ years. Offshoring isn’t “trade” and the “service economy” is a scam to profiteer from the fire sale of America’s economic and social capital. It’s a democratically-camouflaged, slower-frog-boil version of what guys like Summers, Browder & Magnitsky did to Russia in the 90’s. This is why the 2016 Rust Belt voted Trumplican for the first time in many voters lifetimes. However, it’s now clear that Team Davos had a Plan B and C in case this rude assertion of proletarian interests mangaged to Arkancide Plan A.

    Whether Trump was himself a contingency plan or the victim of one is now of secondary importance. We need to focus on the fact that we’re in a hybrid race/class war and the rich are on Team Anti-White. We need to recognize that our interests are not best defined by Red Team v. Blue Team anymore (if they ever were). The plutocrats aren’t good guys b/c “not government.” Capitalism is now a Port Royale for privateers commissioned by gubmint to do the things our Magic Paper and other pesky traditions still prevent them from doing.

    Pareto wisely stresses that elites will always be with us in any mass movement, and the hope for non-elites lies in “circulating” the elites. “Meet the new boss, same as the old boss…” is a proletarian version of Lord Acton’s “power corrupts.” Our present elites could use some circulation. They’ve grown decadent and corrupt and no longer have any institutional sense of noblesse oblige.

    We need class traitors in the vanguard of our new elites, How many times have we said “if only some guy like Thiel would put Soros-size money behind Our Thing…?” Trump’s appeal (and genuine triggering of many fellow rich swine) came from the sense he was on our side, not theirs. In order to provide rich guys like Yang the incentive to jump the pirate ship and switch to our side, we first need to learn how to take our own side. Elites join populist movements when the populists offer a decent shot at toppling the present establishment. We need to recognize our own interests and organize around them, past ideologies be damned, If we build a movement, we provide opportunities for ambitious Davos-class traitors to carve out a new power structure. Free your minds and our asses will follow. Send the Red-Blue kosher sandwich back the deli and demand a “Beefsteak Populist” sandwich – brownshirt on the outside, red on the inside, Demand a system that promotes a safety net close to your home and neighborhood and leaves you free of distant social control by strangers. We can have both if we stop seeing everything through rose and azure colored glasses.

    I’m hoping Yang’s just the tip of an iceberg that Z may have spotted off the port bow – second-tier plutocrats looking to putsch their way into the top tier. We’ll still win with or without mega-rich collaborators, but every one of them shortens our time to victory, potentially by generations.

      • Yang’s not the main issue, he’s just the best example we have so far in this election. The main point is to stop framing everything in Left-Right and form a movement based around our own interests.

        The present frame gives “the Right” muh tax cuts but makes them live with Tranny Story Hour, and gives “the Left” muh social justice but makes them live with 3 roommates while pushing coffee 20 hours a week

      • ““Where did America go wrong?” many will ask, searching out some terrible error from the recent past in the hope of applying a remedy. An observer might feel as if he has been sucked into an absurd alternate reality similar to the narratives of popular science fiction. In the second installment of the ‘Back to the Future’ films, hero Marty McFly finds his hometown, the quaint Hill Valley, in a state of anarcho-tyranny under the control of idiot-villain Biff Tannen. Marty’s antagonist managed to make himself a wealthy national icon through time travel and ruled his empire from the casino Biff’s Pleasure Paradise. Today we recognize the Pleasure Paradise as our own society, as large swathes of the country resemble a crime-ridden theme park of strip malls featuring taxpayer-funded Goodwill centers, massage parlors, liquor stores and check-cashing outlets. Yet there is no readily convenient culprit to accuse, no Biff to confound in order to make things right again. The elites of Washington, Wall Street and Hollywood are villainous to the core, but their ascent was guaranteed by the very tenets of American civic religion.

        “Degeneration is America‘s destiny; no other outcome is possible when a polity embraces the toxic, nation-destroying ideals of liberty and equality.”

    • When I look at the Imperial Capital, I see men in their 70s lording over men in their 50s. The ancient lead the aged.

      Such an affair chafes. Only a whipped dog would want to wait decades for a chance at the crown.

      The Yugoslav revolution wasn’t just a communist revolution, but one where the youth overthrew their elders and the age of leadership fell below 30.

  22. As more videos get out of entire cities being built in China that are literally empty, with row after row of poorly built skyscrapers (unfinished on the inside) going unused become common knowledge in the west, I think it will wake up the most ardent “pro-China” hacks in the US to the fact that something is really, really out of wack.

    When China can make the pre-2008 US housing market look sane, you know you’re in big trouble.

    • Was watching a vblog post of this brit who has been living in china (shinjzen) for 12 years. showed how even in the lived in buildings, they aren’t doing any maintenance on the shared spaces, with lots of decay and things breaking down. and this was in expensive buildings. also, they always use poor quality materials and fittings — even in expensive buildings. the entire country is one giant con. just like Spengler.

    • You might read Godfree Roberts over at UNZ.
      He persuasively debunks the anti China propaganda spoon Fed to the western peasantry. His paragraph of the Empty Cities meme is worth reading

  23. America is no more free than China and in many ways much less free.

    In america you can criticize government but if you talk about race, gender, IQ differences you will lose your job and be unemployable forever. even with being able to criticize government, if you criticize the left your social media accounts will be banned or shadow banned in conjunction with the left in government . The USG records every single electronic communication you make, which can and will be used to blackmail or embarrass you at any time, and there is enormous propaganda fed to you by media and education complexes. Also, if you cross the Deep State they will destroy you no matter what laws are on the books. Men can’t even chase after women in normal ways, always being worried about sexual harassment claims or worse, and divorce laws are horrendous to men.
    In Russia and China you can talk about race, sex, IQ differences without any fear of punishment whatsoever, and in Russia at least you have freedom to criticize the government more or less. Russia’s surveillance state is also much weaker than the US’s. In both China and Russia men are free to be men.

    • Each country (China, Russia, US) has its own form(s) of censorship and coercion. “Free speech” in the US means you can criticize, insult, and expose powerful people…but you cannot make any hay of their ethnicity. In China, you cannot criticize, insult, or expose powerful people in public…but casual prejudice and racism is rampant and tolerated. (Russia, which I know less about, is probably closer to China in this way.) In the US, elites fear that racialism will lead to societal disorder; in China, elites fear that exposing party leaders will lead to societal disorder. It’s very interesting how the US, and the West in general, has this primal fear of racialism. China has never been multi-culti so they probably don’t consider racial issues like the West does, and Western elites, despite pushing multi-culti stuff, obviously have a great fear it will backfire.

      • >>>Then move to China if it’s such a paradise.<<<

        China is the ethnic homeland of the Han. It is for the Han, by the Han, and of the Han.

        I almost feel bad calling out a Boomerpost this retarded, because there are some really awesome individuals of that generation who post here. That being said, Murica!posting is just a cope and I hope that all of us, regardless of age, can move away from that sort of nonsense.

        This is the land of my ancestors. I want it back.

        • Correction: Eastern China – specifically East-Central China – is the home of the Han. Southern China is arguably Han. But the vast northern and western regions of China are not. China, remember, is an expansionist, authoritarian state. The “Han homeland” would be a mere slice of China.

  24. I don’t know who will win but I know who deserves to win: China, because it actually cares about promoting its majority Han population at the expense of others, while the US cares about promoting anyone at the expense of its white majority. This is barbarity against nature in its most basic form.

    • Agree strongly. Their politicians haven’t sold out to the zmans new best friends, the jews and clearly prioritize their people’s welfare first.

    • This is not really even a contest. In twenty years China will still be China. The country we now call the United States will be Mexico Norte. Demographics is destiny.

      All China has to do is wait and avoid getting sucked into a shooting war. I think it can manage that.

      • Lotta truth in that, but China still has a long climb and they’re sensitive to quality of leadership issues due to centralization. If I had to bet, you’re calling the right shot. Average IQ 106-ish, no major distribution skew or other funny-math ( They’ve historically avoided major external conflicts and are known for playing the long game with a lot of irons the fire at once. The people betting on them to collapse b/c cooking the books are taking the longer-shot gamble.

        • “…they’re sensitive to quality of leadership issues due to centralization. ”

          Indeed. They might ultimately decide to move to liberal democracy, i.e. fake democracy, themselves, to secure their position better. When the peasants get angry, and when the liberal elite class’ propaganda efforts aren’t quite effective at getting the masses to believe the “correct” things, the liberal elite can move new politicians into place in order to placate them, then work behind the scenes to ensure nothing “unreasonable” occurs. The peasants get the illusion of “equal recognition”, i.e. that they are free and equal to all other men in society, and the liberal elite can run their plantation in relatively safety, and in obscene opulence. It really is one of the most brilliant and effective scams in human history.

          I haven’t read this book yet, but these men make the case that segments of the old elite of the Soviet Union dismantled the Soviet system themselves, believing their own power and wealth would ultimately benefit from it:

          Interestingly, an amazon review of the original version of this book states:

          “Simple Chinese translation version of this important book has been published by Renmin University of China Press in 2014, and it has been listed in the Key Publication Project of the Twelfth-Five-Year-Plan, which is the top plan compiled by the Central Committee of the CCP for the entire country every five years, covering major aspects of social, economic, political, and cultural development. Books written and translated in this field has attracted a great deal of attention from all walks of Chinese society, especially from the elites, who have been encountering the similar situations since the great Chinese reform was launched in late 1970s.”

          That such a thing could occur seems entirely possible to me, and China could itself fall to this (with help (i.e. manipulation) from the murica liberal elite, of course). My worry is that Russia and East Europe will collapse into liberal disintegration, as Ireland has in the last 20 years, once men reared under “communism” like Putin and Orban die off.

      • I dunno. China is getting old fast, and has a major male/female imbalance. They have a smarter homogenous population, but they have to steal our ideas due to their lack of creative geniuses. Doesn’t make the US forecast any rosier, but we both have our problems.

        • plus they are committing ecocide (air, water, and land pollution). losing tons of farmland to desertification. and then there are all the weird and deadly disease bubbling up all over the place. not a bright future at all.

        • China had a huge male/female imbalance in past Imperial times due to widespread female infanticide and the propensity for wealthy men to scoop up many of the remaining females.

        • China has had the run of all our gov, univ and private labs for at least 3 decades. They’ve ripped us blind and they’re still doing it.

  25. Too bad Teaparty Doc isn’t around to confirm this, but I read that people tend to revolt when things had gotten better — then start slipping back again. And that is what is happening in china.

    Spengler should just fukking move to China he washes their shriveled balls so much; “muh calculus!”. He is a pompous fraud and very safely ignored. Unsurprisingly, all he sees and cares about is money. Absolutely no sense of manufacturing being a strategic and national security issue. You get the sense he would enjoy negotiating the surrender of the West to China.

    One point I haven’t seen mentioned elsewhere, is that by taking on China and Xi so visibly, Trump is maneuvering the Dems into taking the pro-china position publicly.

    • Spengler and Thomas Friedman should be forced to hold a public Chinese ball washing contest to settle once and for all, who is the king.
      My money may be on Friedman.

  26. China has been at war with the US since 1950. The US politicians who pushed to let them into the WTO should be tried as traitors and hung.

    • And recall that prior to WTO accession China’s MFN status required annual renewal by Congress. The cynic in me likes to think there’s too much money to be made in China for multinational Equestrian corporations with no national allegiance to not be there, even with things such as IP theft. It is just a cost of doing business. On the other hand, maybe people will wake up to SOE control of essentially every critical sector of the Chinese economy: banking, manufacturing, raw materials, telecomms and agriculture.

  27. Quote:

    “The appetite for tolerating this stuff may be waning.”

    Corporate/Globalist Media, the GOPe, and the Democrats are 100% behind tolerating this stuff.

    • I don’t see the evidence of that. I see an endless appetite for Trump bashing, but the China defenders are thin on the ground. Notice China never comes up in the Democrat debates. It’s as if Trump stole their issue, so they refuse to discuss it.

      • Exactly. Democrats used to own the protectionism issue, as well as advocating laws protecting labor and the environment. Look at all the liberals who refuse to shop at Walmart because of the Chinese made products. And look whose IP Trump is defending – primarily silicon valley, Hollywood and the music industry. But instead of supporting Trump, they sound like Milton Friedman.

        • We need to steal those issues from them. For example, we can carve off the mostly White workers-first rump wing of Dems and leave them hand-raising for illegal health care while we’re providing it to citizens only. We can force companies like Amazon to pay taxes again, closing the offshore loopholes. Make them pay back the money they scam from welfare by using taxpayers to subsidize their coolie labor. Plenty of opportunities here if we break the Red/Capital, Blue/Commie frame.

          • There’s definitely a working class mandate for a political party of covert (and eventually perhaps overt White nationalist) policies and gun rights along with economic policies of protectionism, limited trade with other Western nations, “socialism lite”, and opposition to imperial invite-the-world/invade-the-world foreign policy.

            That the democrats manage to retain any of the old union types and that the republicans can still pull off the grift of being the traditional values and patriotism party is one of the tragic and comical ironies of our time. I had rather hoped that Trump would either start an intra party war to turn the repubs into that party or found such a party of the GOPe forced him out. The latter could still happen I suppose.

      • Trump completely stole their issue from the sense the Democrats are the party of the working man or whatever they’re marketing themselves as these days. I’m pretty sure I’ve heard some leading Dems give Trump some kudos for the tariffs. (e.g. Schumer) The problem the Democrats have is that, more than the GOP, they are the party of our Great Borderless World Eurozone Future where the country formerly known as the United States is simply the North American Global Economic Zone 6 run out of Brussels. Hillary Clinton gave a not-much-covered speech during the 2016 campaign where she basically said as much. This Trump business with China is just part of the ongoing political realignment in the country.

        Trump is on very solid ground. The American People don’t like China all that much. China, for its part, does little to endear itself to Americans with all their threats to vaporize Los Angeles and their continued (and current) use of North Korea to be its angry barking dog on the world stage. The “trade war” panic plays well for the media, but if you’re buying stocks, every little ripple is an opportunity to buy low and sell high. They all keep predicting a crash, which is mainly 2020 electioneering disguised as economic analysis. Trump is also working in an area that he knows quite a lot about, so his decision-making is much less susceptible to internal shenanigans by the usual troublemakers in the Permanent War Party.

        All in all, this is going to play well for the USA. Nobody actually believes all that “free trade” talk any more. That’s been really the biggest victory by Trump on this: the end of the strange-hold the “free traders” have had on the USA. You can’t have free trade with a dictatorship that uses slave labor and steals all your IC. The tariffs are just a dictator tax. The stuff in Hong Kong shows that China is economically weak. Ordinarily they’d drive the tanks in there and just murder all the troublemakers, which is the Chinese way. Very little US business is going to be disrupted. We’ll find new markets and new suppliers. There are already manufacturers looking to move outside of China to avoid the tariffs. Nothing made in China is only able to be made in resource-poor China.

        It’s great to live in a country that actually doesn’t just grab its ankles. This will be the Democrats’ biggest problem heading into 2020.

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