Beijing is prepping for a massacre in Hong Kong: time for the West to put human rights ahead of free trade

New York Post

A man shouts a slogan about holding a strike at a protest held by civil servants in the Central District of Hong Kong.

After eight weeks of huge Hong Kong street protests against Beijing’s rule, the People’s Republic is massing police and soldiers just across the border. 

Message: If the protesters don’t quit, a bloodbath is coming.
Beijing has also started denouncing the protests as the work of American provocateurs. 

That’s so the regime can paint its Tiananmen Square-style crackdown as a battle against “foreign influence,” not a smashing of Chinese people who decided all on their own that they’d rather be free.
A quarter-century ago, the West wagered that welcoming China into the world economy would seduce the Communist Party into allowing ever-more freedom. 

That bet’s been lost.
There’s precious little ideology to China’s “communism” anymore and no hint of seeking economic justice. 

But the party will allow no challenge to its rule. 

Since Xi Jinping took over as president in 2013, he’s rolled back freedom after freedom.
Christian churches are smashed and worshippers jailed; Xi has even bullied Rome into letting him choose Catholic bishops in China. 

Concentration camps house 1 million Uighers in a province teeming with hi-tech surveillance. 

Twelve million other Muslims suffer stepped-up repression and systematic abuses, notes Human Rights Watch. 

Members of the Falun Gong movement pack prisons that provide involuntary “organ donors.”
And Hong Kong’s promised “high degree of autonomy” has become a joke.

The mainland has even begun to databank its residents’ biometrics (DNA, fingerprints, voice samples, etc.), the obvious basis for eventual Big Brother surveillance.
Secretary of State Mike Pompeo said recently that “protest is appropriate” and “we hope the Chinese will do the right thing,” but Team Trump overall has muted criticism as trade talks continue.
Hard as it might hit the stock market, maybe human rights should become the issue in those negotiations: In the long run, America doesn’t win by trading freely with a nation run by monsters.

Chinese Fifth Column

Beware effects of Chinese interference in Canada
By Mike Blanchfield

GUANGZHOU, China -- He was a curious 23-year-old in a bustling train station somewhere in China, at the height of its busiest season, Chinese New Year. 

He and his two friends didn't have tickets, but it didn't matter.
"It was wonderful," Prime Minister Justin Trudeau said this week in Beijing as he recalled his first adult excursion to the country. 

He'd been to China before, of course -- as a child, with his father visiting on official political business -- but this trip was different.
"The landscapes I got to see, the discovery of myself through travelling through China was extraordinary for me."
Trudeau referenced the formative influence of his backpacking experiences in China repeatedly this week as he tried to sell the merits of doubling the number of Chinese tourists next year. 

With his pursuit of free trade, it is one part of a major plan to deepen relations with the economically ascendant People's Republic, the country Pierre Trudeau established relations with the year before he was born.
The attempt to create a tourism boon comes amid concern over a more malevolent form of cross-cultural influence -- a deliberate and unprecedented effort by Xi Jinping to project the power of his country in ways that some say amounts to international political meddling.
"China does have a strategy for influencing public opinion and political opinion in other countries on issues that are important to China," said David Mulroney, a former Canadian ambassador to China and a senior national security adviser.
Under Xi, China has undertaken a co-ordinated campaign known as the "united front" to influence events in foreign countries, including Canada, said Mulroney.
That includes mobilizing Chinese students and tapping the diaspora in Canada. 

During past visits by Chinese leaders to Ottawa, the Chinese embassy has bussed in students from Kingston and Montreal to counter the inevitable demonstrations against the Chinese government.
The protests are commonplace, ranging from the treatment of religious minorities in Tibet to allegations of organ harvesting.
"The Chinese communist successfully links patriotism to support for the party and the government," Mulroney said. 

Chinese students often bristle at reading criticism about their country when abroad and feel embattled, so it can drive them to be "super patriots."
It has similarities to what Canada does in the United States by reaching out to Congress, business leaders and others to sell the merits of NAFTA -- with one key difference.
"We do that above board, we do that publicly. Where China differs is its willingness to use diaspora groups, people who have an economic stake in China to work behind the scenes," Mulroney said.
"That's a form of interference in Canadian affairs."
Despite the new assertive Chinese posture under Xi, Canada still has no choice but to engage and attempt to deepen relations even if there are some serious implications, said Paul Evans, a China expert at the University of British Columbia.
China has decided it will project itself as a "great power" in the world and "that's a phrase the Chinese have not used in my lifetime."
Mulroney said that effort includes putting pressure on academics and journalists to write favourably about China, he said.
During Trudeau's trip, the Communist-run Global Times ran a scathing editorial that lashed out at the Canadian media's coverage of China.
"The superiority and narcissism of the Canadian media is beyond words," the editorial declared. "This is the most genuine attitude of Chinese society."
It said that China should "not (be) in a rush to develop its relations with Canada. Let it be."
The editorial was not an isolated incident. 

As Trudeau arrived at Beijing's Great Hall of the People this week, security staff tried to prevent Canadian photographers from shooting his arrival by blocking their view -- a move that surprised some journalists based in Beijing. 

On a visit to Ottawa last year, the Chinese foreign minister berated reporters for asking a question about human rights.
And in a Canadian Press interview this summer, Chinese ambassador Lu Shaye blamed an "ill-informed" Canadian news media for forcing human rights onto the bilateral agenda for the Liberal government to confront. 

Lu said it was the role of the media "to lead and mobilize people for a common cause."
Before departing China this week, Trudeau delivered what amounted to a sermon on press freedom -- clearly destined for his hosts, as well as local media -- when asked about the Global Times editorial.
"You play an essential role: a challenge function, an information function," the prime minister told the gathered reporters.
"External factors make your job difficult. But it's an essential role that you play in the success of the society. That is my perspective. That is a perspective shared by many, and it's one that I am very happy to repeat today."
The Chinese use less hostile approaches to get their message across -- pressure Mulroney has experienced first-hand as Canada's ambassador to China from 2009 to 2012 under former Conservative prime minister Stephen Harper.
Before big visits, Mulroney said he got positive and negative approaches from his Chinese counterparts. 

He would be told, "'You've got to make sure the prime minister doesn't raise the following things"' -- a suggestion that would have gone nowhere with Harper.
"It never stops," said Mulroney. 

"It's like a warm bath they immerse you in."
Trudeau was subjected to a more benign version of relentless Chinese messaging off the top of a meeting with the secretary of the Communist Party for Guangdong province, Li Xi on Guangzhou's picturesque Shamian Island.
Instead of the usual minute of small talk that usually opens the photo-ops for such meetings, Li welcomed Trudeau with a 15-minute monologue about his province's priorities and aspirations.
Trudeau sat patiently listening, occasionally smiling and nodding, his eyes fixed straight ahead at Li.
When he was finished, the prime minister thanked his host for the warm welcome and remarked how vividly he recalled walking the tree-lined cobblestone streets of the neighbourhood they were in his halcyon backpacker days.
This time, Trudeau need not have mentioned his formative busman's holiday.
Li made sure to include that too in his welcoming monologue.

Germany wants more guarantees from China over 'Silk Road' trade plan

Germany has warned that EU countries are not yet prepared to sign a joint statement on China's "Silk Road" trade initiative. Economy Minister Brigitte Zypries has called for more free trade guarantees from Beijing.
DW

German Economy Minister Brigitte Zypries on Sunday warned that Germany and other EU countries would not sign a joint trade statement at China's Belt and Road Forum unless they received more guarantees from Beijing on free trade, environmental protection and working conditions.
"So far, the demands of the EU countries in areas such as free trade, setting a level playing field and equal conditions have not been met," she said in a press briefing on the sidelines of the summit in Beijing. 

"If these demands are not met, then we cannot sign. We'll see what happens tomorrow."
A communique is expected to be published on Monday at the end of the forum, at which China is seeking support for a new "Silk Road": a trade and infrastructure project linking China with countries in Central and Southeast Asia, Europe, the Middle East and Africa.
Officials from more than 100 countries are attending the two-day forum to promote the initiative. Those present include Xi Jinping, Russian President Vladimir Putin, Turkish President Recep Tayyip Erdogan and UN Secretary General Antonio Guterres.Zypries: "There is still a problem between our states"

European misgivings
However, western European countries have tended to send ministers or lower-ranking officials to the forum in a sign of their unease about the plan, which some see as an attempt to promote Chinese global influence. 

Western diplomats also have reservations about the initiative's lack of transparency and formal structure.
Zypries on Sunday called for more transparency in tenders for projects related to the initiative, and insisted that it should conform to international trade standards.
"Germany does want to take part, but tenders need to be open to everyone; only then will German companies take part," she said. 

"It must also be clear what is actually going to be built. At this point, it's not clear."
A draft of the communique that is meant to be issued on Monday says the initiative intends to uphold "the rules-based, transparent, non-discriminatory, open and inclusive multilateral trading system with the WTO (World Trade Organization) at its core."
India has boycotted the forum to indicate its displeasure that part of a planned China-Pakistan corridor will run through the disputed Kashmir region.

Rogue Nation

China tech plan threat to foreign firms
By JOE MCDONALD

China is violating its free-trade pledges by pressing foreign makers of electric cars and other goods to share technology under an industry development plan that is likely to shrink access to its markets, a business group said Tuesday.
The report by the European Union Chamber of Commerce adds to mounting complaints Beijing improperly shields its fledgling developers of robotics, software and other technology from competition.
Technology is a growing flashpoint in trade tensions with Washington and Europe, which worry their competitive edge is eroding as Beijing buys or develops skills in semiconductors, renewable energy and other fields.
European companies express frustration Chinese enterprises have been permitted to acquire technology leaders such as German robot maker Kuka while most of China's assets are off-limits to foreign buyers. 

In December, Germany blocked the Chinese purchase of a chipmaker, Aixtron, after Washington objected on security grounds.
The European chamber warned tactics Beijing is using to carry out its "China Manufacturing 2025" initiative might inflame sentiments in Europe and the United States in favor of trade controls.
The plan calls for China to be able to supply its own high-tech components by 2020 and materials by 2025 in 10 industries from information technology and aerospace to pharmaceuticals. 

A broad outline was issued in 2015 and officials have been gradually releasing details.
Suppliers of electric cars and other goods are under pressure to hand over technology in violation of Beijing's World Trade Organization commitments, the European chamber said. 

It said that also contradicts the ruling Communist Party's repeated promises of equal treatment and to give market forces a bigger role in the state-dominated economy.
That strategy "is in fact a large-scale import substitution plan aimed at nationalizing key industries, or at least severely curtailing the position of foreign business in them," the chamber said.
In a possible response to such criticism, China's top economic official, Li Keqiang, promised in a speech Sunday foreign companies would receive "equal treatment" under the manufacturing plan. 

He gave no details.
Foreign suppliers of technology from X-ray scanners to wind turbines to bank security software complain they face growing official obstacles to making sales in China. 

Those range from controls based on national security concerns foreign suppliers say might be exaggerated to procurement rules that encourage hospitals and other customers to favor Chinese suppliers.
Beijing has clashed repeatedly with Washington and Europe since the 1990s over its efforts to induce foreign companies to hand over encryption and other technology.
In November, Chinese legislators approved a cybersecurity law business groups warned would hamper access to technology markets. 

They said a provision requiring security technology to be "secure and controllable" might require providers to disclose how products work, raising the risk trade secrets might be leaked.
In electric cars, where Beijing sees major opportunities, the manufacturing plan says two of the top 10 global brands by 2025 should be Chinese, the European chamber said. 

It said that rules out joint ventures created by foreign companies with Chinese partners.
The chamber appealed to Chinese leaders to discard quotas and other controls and focus instead on encouraging basic research and improving their manufacturing base.
"Perfecting the market would do far more to ensure that China reaches its full potential for economic development and innovation than more old-school, expensive industrial planning ever could," the chamber said.

The just war: Donald Trump is right to take action against China

Using the rules of the World Trade Organisation to combat Chinese mercantilism is not protectionism

By David Green

It’s a mistake to think of Donald Trump as a protectionist, as Boris Johnson will have discovered during his recent visit to New York.

Theresa May has said that some protectionist instincts are starting to creep in and that the UK should be a champion of free trade. 

Her remarks are widely interpreted as a reference to policies planned by Donald Trump, but his plans can just as easily be seen as a defence of a rules-based international trading system. 

One of the 28 pledges made in his Contract with the American Voter was to ‘identify all foreign trading abuses that unfairly impact American workers’ and to use ‘every tool under American and international law to end those abuses immediately’. 

Using the rules of the World Trade Organisation (WTO) to combat Chinese mercantilism is not protectionism. 

Nor is his promise to declare China a currency manipulator on his first day in office.
Free trade is defended because it can be mutually beneficial but, rather like toleration, it only works if everyone plays by the same rules. 
Toleration of aggressively intolerant groups gives them an advantage.
In the same way, free trade only makes everyone eventually better off if we are all looking for mutual benefits.
The outcome will not be beneficial to everyone if one nation treats trade as a kind of substitute for war and aims to gain advantage at the expense of others in order to achieve economic and military superiority. 
Historically this attitude was called mercantilism.
Is it correct to describe China as mercantilist?
Economists argue that prosperity comes from a combination of the division of labour and trade between independent firms.
They claim the same for the international division of labour, but often forget the preconditions for their model to work.
Companies must be genuinely independent, which means they must make ends meet and so must be efficient to survive.
Competition encourages a search for efficiency.
Some argue that world prices are the measure of efficiency but this claim ignores today’s realities. Often world prices are not market prices and this is especially true of Chinese export prices.
China manipulates its currency by forcing exporters to save their US dollars in the form of Chinese government bonds denominated in dollars. 
The dollars are used to buy US Treasury bonds and other US assets, thus pushing up the exchange rate of the dollar. 
China prevents the free negotiation of wages; indeed it represses trade unions. 
Its companies do not meet international accounting standards, which are designed to promote transparency. 
It subsidises exports, contrary to WTO rules, and it imposes import tariffs contrary to WTO rules. 
It has weak environmental regulations, thus reducing its costs. 
It has weak health and safety laws that, despite their inadequacy, are frequently not enforced. 
It has state owned companies that subsidise exports, directly and indirectly. 
It has state owned banks that provide undisclosed subsidies. 
Its government offers land at low undisclosed rents. 
Private companies are not genuinely private, but require a political patron to survive.
The aim of the system is to bolster the power of the Communist party, a brutal authoritarian dictatorship. 
This is the exact opposite of America, where private wealth helps to empower opposition to the government of the day.
For example, Jeff Bezos, the founder of Amazon, recently bought the Washington Post newspaper, which campaigned against Donald Trump.
If he had tried to do the same thing in China he would be lucky to still be alive.
There is not the slightest chance in China of building up a media group to criticise the government, let alone to create a viable government in waiting.
It’s true that money can be used in America to cajole public opinion and ‘buy’ votes, but not just for one party.
In the West, wealth upholds freedom and democracy.
China is not a free society. The more economically powerful it gets the more it threatens the free world. If its firms are not state owned they are state dominated.
There is no genuine private ownership; there is state authorised discretion.
The aim of economic activity is to keep power in the hands of the Communist party. 
There are no checks and balances.
The more we promote Chinese prosperity at our own expense the more we endanger liberty itself.
Currency manipulation is a longstanding problem. 
Keynes warned of the dangers during the long negotiations leading up to the Bretton Woods agreement at end of World War Two. 
His warnings were ignored and by the 1980s there was strong concern about Japanese currency manipulation.
In 1985, under the Plaza Accord, measures were taken to force up the price of the yen.
Today it’s China that is getting away with it and action is long overdue. 
No one who advocates free trade should ignore this problem. 
Some economists talk as if world prices are the result of competition between independent organisations in a rules based system, when they are not.
Calling for free trade while ignoring economic realities is like calling for deregulation of financial services before 2008. 
It’s what led to the 2008 crash.
The problem is not just low-wage competition.
Chinese cheating also takes market share from low-wage countries. 
Today the problem we face in the West is not competition from low-wage economies but mercantilism, and the challenge is how to make a reality of the rules-based order we have.
That is what we should champion.
Not the pretence that all we need to do is eliminate barriers.
It is misleading to portray free trade and protection as the only two alternatives.
The top priority is to act against nations with long-standing trade surpluses that are the result of mercantilist manipulation.
The UK’s policy towards China is an economic and political blunder.
Theresa May has been talking about a ‘golden era’ for China-UK relations and has promoted investment by Chinese companies in the UK as if it were like any other inward investment.
The reality is that no company in China is genuinely private. 
Any chief executive who fails to comply with the wishes of the Communist party will soon find the secret police calling. 
Any significant private organisation in China can only function with a political patron. 
Letting Chinese companies take over UK businesses is like letting the Chinese government take them over. 
We don’t want our own Government to nationalise our companies, because we fear the abuse of power, and yet we stand by and clap our hands when the Chinese government takes them over. 
Even Germany has become alarmed at the extent to which China is taking over its famous Mittelstand of high-tech world-beating companies.
The German government recently stopped the takeover of the technology company Aixtron, when it looked as if one Chinese company cancelled an order, which pushed down the share price of the German supplier, so that a second Chinese company could buy Aixtron for less.
The German economics ministry has warned that in 70 per cent of the twenty largest recent takeovers, the purchasing Chinese company was majority-owned by the Chinese government.
The Government showed awareness of the dangers when it suspended the decision on the Hinkley Point nuclear reactor, but its determination lasted about five minutes.
We should now stand shoulder to shoulder with the Americans to uphold the rules-based system of international trade and act against currency manipulation.

Here's Why Donald Trump Is Right About China

Chinese imports are killing American innovation

By Chris Matthews

A vendor picks up a 100 yuan note above a newspaper featuring a photo of US president Donald Trump, at a newsstand in Beijing on November 10, 2016.

Once upon a time, it was de rigeur for U.S. politicians to boast of the prowess of the American worker. 

Donald Trump, in his policies at least, seems to be putting an end to that.
“We need not shrink from the challenge of the global economy,” then-President Bill Clinton said in his 1997 State of the Union Speech, when free trade was a much more popular idea than it is today. “After all, we have the best workers and the best products. In a truly open market, we can out-compete anyone, anywhere on Earth.”
Today, this kind of American exceptionalism is harder to justify. 

Many politicians have given up on it altogether. 

Trump gave a hint at the different approach they’d be taking to international economic competition when he met with executives of the heating and cooling firm Carrier. 

“I don’t want them moving out of the country without consequences,” Trump told the New York Times. 

Mike Pence added, contra Clinton, that “the free market has been sorting it out and America’s been losing.”
A Republican Vice President arguing that the White House should interfere with the workings of the free market in order to protect American workers would have been unthinkable just five years ago. But there is increasing evidence that global trade doesn’t work the way that free market fundamentalists have always believed.
In a new working paper published on Monday by the National Bureau of Economic Research, economists David Autor, David Dorn, Gordon Hanson, Pian Shu, and Gary Pisano come to the same conclusion. 

The paper finds that competition with Chinese exporters have had deleterious effects on American innovation. 

To do so, the authors looked at how import competition affects innovation in the United States by studying the effect of increased import competition on American manufacturing firms’ R&D spending and issuance of patents. 

“Our results suggest that the China trade shock reduces firm profitability in U.S. manufacturing, leading firms to contract operations along multiple margins of activity, including innovation.”
This is counter to the popular belief that while specific American workers may be harmed by free trade encouraging low-skilled jobs to move abroad, the American economy would benefit overall by increased competition because competition leads to more innovation and lower prices for consumers.
But this economics-101 conception of the global economy has long since stopped working for the American people, and the political class is finally catching on. 

Last month, the Pew Research Center published two sets of polling results that show that the plurality of Americans believe that “U.S. involvement in the global economy is a bad thing because it lowers wages and costs jobs in the U.S.” 

However, when scholars in international relations at major Universities were asked the same question, 9-in-10 said that it was a good thing because “it provides the U.S. with new markets and opportunities for growth.”

This likely shows the disconnect between the theoretical foundations of how international trade works and the practical and anecdotal effects of what average people see everyday. 

In theory, international trade makes everyone richer as countries shift production to goods and services they can produce most efficiently. 

But this increased wealth is of little consequence to average folks if it captured by the lucky few.
One of the more perceptive observations of the Donald Trump campaign was that the political and academic class in the United States had overlooked these effects, while many Americans have not.