Discussing Biden's Potential China Policy

When it's starting to get reported by local news, it means it's going to happen. I was originally expecting tariffs lifting after the Nov midterms to have more political autonomy for Biden, but since the inflation situation is so dire (risk of recession too), they are forced to move earlier before midterms. Still going to be a bloodbath for Democrats, but atleast Biden is finally making moves on this tariffs. Katherine Tai just needs to listen to her white masters. If I was Katherine Tai, I would welcome this, because she can shift blame/responsibility to recession/inflation. It's not like Liu He was going to give her any concessions, so if I was Katherine Tai, I'd take it and run with it (while pretending to be tough on China).

Now finally Biden himself has admitted they are seriously discussing dropping US trade tariffs on China.

American media wants it to appear like there is a thoughtful vigorous debate, but the decision has already been made.

Also, look at the power disparity. The Treasury Secretary (3rd ranked official) exerts way more power than friggin' USTR cabinet official. Listen to your white masters, Katherine. Leave the "Strategic Lens" thinking to your white masters.

Phead128 said:

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American media wants it to appear like there is a thoughtful vigorous debate, but the decision has already been made.

Also, look at the power disparity. The Treasury Secretary (3rd ranked official) exerts way more power than friggin' USTR cabinet official. Listen to your white masters, Katherine. Leave the "Strategic Lens" thinking to your white masters.

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What a group of clowns, the house has been burning for 6 months and is only left with "The divide between Yellen and Tai is likely to force Biden to make a decision by mid-summer, according to one person in touch with administration officials."

Here is the first of warmonger by CGTN

Phead128 said:

Quite surprising! US Deputy National Security Adviser Daleep Singh recommends lifting Tariffs to combat Inflation and supply chain concerns.

This Indian dude was the Biden's Architect of the Russian Sanctions. It is also the the same Indian dude that Biden sent to India to lecture them about Russian oil purchases (probably secretly bashed China there too?)

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The tariffs matter less for China than the US at the moment. Since China's trade surplus and exports to the US continue's to grow despite the tariffs. For the US now facing decades high inflation lifting the tariffs is being seen by some as a potential way to offset the "growing cost of living crisis" in the US.

But I agree with the people who say that lifting the tariffs is not going to solve America's inflation problem. And raising interest rates won't help either. The problem is that during the pandemic the Federal Reserve has increased the M1 (base) money supply by 500% and the M2 (broad) money supply by 50%. As long as the money supply doesn't come down inflation will continue to blight the US economy.

But if they try to bring the money supply down they will trigger a financial and economic crisis that has no precedent in history. Because its the cheap money coming from the Federal Reserve that is the only thing keeping the debts from defaulting and the markets from crashing in the US.

So they are stuck!

And with widespread destruction of savings in America today because of artificial low rates those trade deficit numbers are only going to get worse for the Americans. And not only with China but with the rest of the world as well.

Franklin said:

The tariffs matter less for China than the US at the moment. Since China's trade surplus and exports to the US continue's to grow despite the tariffs. For the US now facing decades high inflation lifting the tariffs is being seen by some as a potential way to offset the "growing cost of living crisis" in the US.

But I agree with the people who say that lifting the tariffs is not going to solve America's inflation problem. And raising interest rates won't help either. The problem is that during the pandemic the Federal Reserve has increased the M1 (base) money supply by 500% and the M2 (broad) money supply by 50%. As long as the money supply doesn't come down inflation will continue to blight the US economy.

But if they try to bring the money supply down they will trigger a financial and economic crisis that has no precedent in history. Because its the cheap money coming from the Federal Reserve that is the only thing keeping the debts from defaulting and the markets from crashing in the US.

So they are stuck!

And with widespread destruction of savings in America today because of artificial low rates those trade deficit numbers are only going to get worse for the Americans. And not only with China but with the rest of the world as well.

Click to expand...

At the end of the day, modern monetary theory is what got these people into this mess and it is going to take basically doing the right thing to get these people out of this jam but the biggest problem here is, well the fed had been doing money printing for so long that well, they simply cannot do the right for fear that the crash will basically destroy the nation and ensure that the nation cannot stand after that crash due to the debt owing. The only reason that the USA can continue this routine printing is due to its dollar status and military but should the dollar get the boot (which is happening due to Russia demanding rubles for it commodities which the EU desperately need despite their bullshit), this will ultimately feed into the military power by making it impossible to pay its forces and for their equipment which means sooner or later, many nations are going to be demanding their money back, whether it is gold or point of flesh and many of their previous Allies will not be aiding them due to also wanting their money back. In the end, the USA is on borrowed time, I wonder if Biden can comprehend they possibility that America can fall in his lifetime although his dementia might blunt the blow but I wonder if the same can be said for Trump should he get in again

emblem21 said:

At the end of the day, modern monetary theory is what got these people into this mess and it is going to take basically doing the right thing to get these people out of this jam but the biggest problem here is, well the fed had been doing money printing for so long that well, they simply cannot do the right for fear that the crash will basically destroy the nation and ensure that the nation cannot stand after that crash due to the debt owing. The only reason that the USA can continue this routine printing is due to its dollar status and military but should the dollar get the boot (which is happening due to Russia demanding rubles for it commodities which the EU desperately need despite their bullshit), this will ultimately feed into the military power by making it impossible to pay its forces and for their equipment which means sooner or later, many nations are going to be demanding their money back, whether it is gold or point of flesh and many of their previous Allies will not be aiding them due to also wanting their money back. In the end, the USA is on borrowed time, I wonder if Biden can comprehend they possibility that America can fall in his lifetime although his dementia might blunt the blow but I wonder if the same can be said for Trump should he get in again

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The US economy was in trouble long before Modern Monetary Theory came in to view.

The first domino to fall for the US economy was back in the 1950's and 60's because of the Cold War. When the US was spending about 10% to 15% of GDP on defense. This has robbed the civilian industry of both financial and human resources to develop, grow and compete on the international market. By the 1970's the Germans were making better machines and the Japanese were making better electronics and both of them where making better cars. That was already the first sign of economic decline that you no longer make the best stuff out there. Your competitors have overtaken you and they are not looking back. And in the following decades America was no longer making most of the stuff either. A new phase in the US economy began from the early to mid 1980's where asset price inflation began to displace production as the main source of economic growth and wealth creation. This has been made worse by the massive arms buildup by Ronald Reagan in the 1980's. Where as American capital and talents were making better weapons. Japanese and German capital and talents were making better products for the world markets. And American industry began to loose out on the world markets and Japanese and European economic concessions to America couldn't turn the tide.

By the late 1990's asset price inflation driving growth has further accelerated and now it has completely taken over the US economy.

The evidence that asset price inflation has replaced production as the main source of economic growth is what happened in 2020 during the pandemic.

It didn't matter that the economy was shutting down, it didn't matter that there was more than a thousand people dying a day from the coronavirus, it didn't matter that the supply chain has shutdown and was broken, it didn't matter that shops and stores had to close, it didn't matter that there was violence on the streets, it didn't matter that the election was chaotic, it didn't matter that the Capitol Building was being stormed, as long as the Federal Reserve keeps the easy money coming the markets was going up and making new all time record high. And in the second half of the year the US economy recorded positive growth.

Good op/ed from Ken Moak Asia time

Biden will not succeed​

However, history and China’s growing power trajectory suggest that Biden’s efforts to stifle China’s rise will not succeed. Trump’s tariffs on Chinese goods backfired: Instead of reducing the trade deficit and bringing manufacturing home, the excise taxes not only had the opposite effect but also exacerbated the inflationary spiral.

So if the US government has not been able to stifle China’s rise up to now, it will be considerably more difficult to do so in the future. Judging from US media and intelligence reports, China’s economic, technological and military prowess are growing by the day. In spite of the “doom and gloom” picture that some Western analysts painted for China’s economy, it is poised to grow by around 5% in 2022.

I think the tariffs had the effect of more quickly moving production of labor intensive products out of China and into other countries in Southeast Asia and Mexico. But that was already happening. Had been for like a decade. One example is shoes and clothing which had been moving towards Bangladesh and Vietnam for about that long and away from China. As China itself moved up the value chain and salaries increased in China the production was moving there already. What the US tariffs led to was things like moving production of solar panels to Vietnam and Malaysia. Of course moving production facilities entails costs even if salaries are cheaper. But I think the major reason for the US inflation was not Trump's tariffs but the Fed printing money. I also think the trade balance got worse because of the way the government decided to support the population with cash handouts. I would not have done any cash handouts. I would have just passed a moratorium on loan payments, mortgages, and rents for the duration of the lockdowns. i.e. freezing the velocity of money and the economy not increasing it.

The tariffs would have never brought manufacturing into the US given the way they were structured. And with NAFTA being in place there is no way manufacturing would go to the US. Even if the US put tariffs on all international trade of said goods, production would just move to Mexico. Since the tariffs just applied to China, production moved to other countries in Southeast Asia which were close to the rest of the supply chain and where the main market is.