Trump’s Brainiac on US-China Geopolitics

Steve Bannon and Kyle Bass discuss America’s current geopolitical landscape regarding China. Bannon and Bass take a deep dive into Chinese infiltration in US institutions, China’s aggressiveness in the South China sea, and the potential for global conflict in the next few years. The interview was filmed last year in October at an undisclosed location.

My comment: Steve Bannon, by far the most clever guy behind the Trump campaign and the Trump phenomenon itself, talks geopolitics and economics. As any good, proud, Christian Zionist, he sells mixtures of reality and sophistry; and Bannon knows to mix them and to sell them better than anybody else. I’ll tackle first the hawkish, geopolitical issue, then the economic problem. I encourage the reader to first see the interview, to make it easier to digest what I’m about to say.

Steve Bannon’s suggestion to the Trump Administration is to give China an ultimatum of 72 hours, to get all their military assets off those tiny islands [stationary weapons platforms and airfields] in the South China sea, otherwise the US navy will take it out for them. Kyle Bass labels this as Bannon wanting to go ‘kinetic,’ and Bannon disagrees with the characterization – then deflects the issue of war by saying that what the Chinese have done is illegal under international law; but Bannon makes no mention of bringing the issue to the UN and resolving it there diplomatically. Instead, what he’s arguing is for more unilateralism; the same type of gung ho, ruinous behavior responsible for Afghanistan, Iraq, and other places. To his credit, Kyle Bass poses a different scenario to Bannon – how about the US simply packs up and leaves? Bannon makes it clear that’s not an option. To argue his position, he invokes the USA’s history as a Pacific power, plus the need to defend US allies in the region. I ask, why not give the means for these allies to defend themselves? Also, did nuclear warheads suddenly vanish off the face of the earth, after the USSR imploded? No. Bannon’s arguments are just excuses, excuses which don’t match reality – they only match the warped reality the hegemon tries to push on the rest of the world, bust mostly on US citizens.

This type of behavior in foreign policy is a characteristic of both the non-mainstream right and left. For instance, Noam Chomsky stated his opposition to the US leaving Syria, by invoking the humanitarian issue of the Kurds – saying that if the US leaves, the Kurds will fall prey to Assad and to Turkey, emphasis on Turkey. He [rightly] received a backlash for it among a good portion of his following.

To call it what it is, Bannon’s “Economic Nationalism” has nothing to do with the USA defined in Westphalian terms as a nation state, but everything to do with the empire state, with America-First hegemony. Bannon cannot escape hypocrisy on this issue. He basically says US hegemony good, Chinese hegemony or wannabe hegemony bad. Just like the mindless liberals meme ‘Orange man bad,’ so do the likes of Alex Jones and Steve Bannon, Zionist-backed [just like Breitbart] demonize China and promote US manifest destiny [to manifest itself all across the world]. Meanwhile, the darling US-ally Israel gets away with selling military tech to the godless, totalitarian, repressive Chinese communists, but you’ll never hear Trump or his backers criticize Israel or Netanyahu for it.

Returning to the question of nationhood vs empire – the interests of the nation state and that of the empire are inimical to each other, given their radically different nature. No sovereign nation wants an empire to come in and diminish her ability to run her own affairs. And no empire feels content with being surrounded by sovereigns, it’s only content if it’s surrounded by vassal states. Not receiving tribute from these nations is viewed as a declaration of war. Nationalism, again defined in Westphalian terms, is incompatible to empire – whether this empire takes the form of an ethnic, supremacist dominion or that of [neo] feudal masters. Nationhood was birthed in opposition to feudalism, and real nationalists, real patriots will always be opposed to that scourge of nations and races called empire – in our days – the feudal dominion of international shareholders. It’s in the interest of peace, justice, and prosperity for all sovereign nations to make sure that none of them rise at the cost of someone else’s injury. For that is how empires are born and how nations succumb to thralldom and are reduced to mere territories. Steve Bannon serves the interest of the US empire state, and thus, works against the interest of the US nation state and all other sovereigns.

The shameless indulgence in hypocrisy peaks in Bannon when he accuses the Chinese of investing too much in their military, which is unproductive. By far, the biggest unproductive military in the world is that of the USA. Subsequent administrations have spent far too much capital on so-called defence, a war budget really. And I’m talking about physical capital, materials and equipment, which could have been used for civilian production.

On the economic question, again Steve Bannon mixes fact with mythology. First, he equates the presence of Chinese investment in Africa and South America to the Chinese version of the British East India Company. However, Chinese money into these regions didn’t come via gunboat diplomacy. For more info on what the Chinese have been doing in African countries, as opposed to the British Empire, see these articles: China’s Africa and Why Africa loves China. To qualify this particular segment, Bannon is engaging in fake news and spreading Sinophobia – just as liberals spread Russophobia.

One thing Bannon gets right is that the [bipartisan] elites – what he calls the Party of Davos – absolutely betrayed the US working class when they achieved their deals with the Communist leadership of China. This graph makes it abundantly clear. However, what Bannon didn’t say, was that, while the Chinese went along with the Western neoliberal consensus, the US was encircling them militarily. While the Chinese were using their hard-earned US reserves to purchase US treasuries [among physical goods and technology legally available for them to buy], the hegemon was busy working to contain China. Yes, there has to be a geopolitical counter to China’s rise, but I wish that counter would be diplomatic, instead of hawkish, unilateralist, and downright syphilitic. Every country that grows in power has a tendency to project influence, and to financialize [other states]… military imperialism is a consequence of the former.

On the subject of tariffs and protectionism I’ve written before; and I’ll try to condense and better explain the solution to the Chinese trade problem [for the US]. Instead of replying to economic warfare with kinetic means [outright war], like Steve Bannon wants to do, it’s much better to shoot financial bullets instead of live rounds. Washington can progressively hike tariffs on Chinese goods, practically taxing the US dollars the Chinese Central Bank holds in checking and saving accounts at the Federal Reserve, and leaving the Chinese with fewer dollars with which to purchase output. While this is going on, something else has to happen. Washington needs to plug the gap in Chinese imports to the US with goods from other countries – but the safest approach would be to plug that gap with as many goods from domestic production as possible. On the other side of the equation lies the demand for US products overseas, which will take a huge hit, since their access to China’s home market will collapse. Washington has to ensure that this fall in demand is replaced. It can be done via state contracts for domestic producers and through bilateral loan accords. The latter isn’t outrageous or experimental and it bypasses the debt ceiling rule. It’s what the US did with Western Europe and with Japan after WW2. Loan dollars to a partner country, so that country is able to absorb US exports. The old comedy show Yes, Minister detailed this mechanism in one of its episodes [The Official Visit] from 1980. As for addressing the issue of rising prices for consumers… what does it matter if you are able to achieve and maintain full employment through a comprehensive scheme of nation-wide state-led investment [investment in the real, physical economy, which creates good-paying jobs]. Bannon has a problem with demand; he rarely mentions it. In fact, a year ago speaking at Black Americans For A Better Future Summit, he was constantly stressing the need to ensure access to capital to new entrepreneurs. A youth spoke out on this issue, basically saying what about securing some demand, access to customers? Bannon skillfully dodged the point. I think the youth in question no longer has any hopes out of the Trump presidency [if he had any to begin with] on this particular issue.

No matter how much Bannon stresses the words “populism” and “economic nationalism,” his words ring hollow. No matter how much he tries to blow smoke up the president’s ass, Trump hasn’t made it better for working people in the States, nor has he outlined any plan for doing so, he didn’t even build a mile of new wall [a key promise to his core base]. All Trump has done in this sphere is to feign economic populism, simulate fights, while giving more boons to rent-seekers, usurers, and war profiteers.

All in all, I enjoyed this interview, done by Kyle Bass, and I applaud Steve Bannon for his skills as an agent of manipulation. Israel is certainly most proud of him. Out of all the rest, Bannon really knows what he’s doing.

Hong Kong Protests & the CIA

My comment: Even if the protests have CIA money behind them, the central grievance is shared by many people in HK. They don’t wish to be extradited to the mainland to face trial and sentence; and their motivations are completely reasonable, given the oppressiveness and lack of transparency of the Chinese state. The Communist Party will have to make serious reforms before the people of HK will trust their law enforcement, their magistrates, and prison conditions. I’d like to praise the people of HK for their civic spirit, which far surpasses anything in the West. That same civic spirit [principle and discipline] was displayed a few years ago in South Korea and it was called the ‘candlelight struggle.’

I find it interesting that Trump didn’t have much to say about the protests, other than deeming them “very sad to see.” I also disagree with Rick Sanchez on trade with China. Trump didn’t lose with Xi, neither did Xi lose with Trump. Huawei received some space to maneuver in commercial operations, and so did US farmers. The fact that the trade war between China and the US did not escalate after the G20 summit is a victory for both countries.

The Duran: Trump gives Huawei some space, US-Chinese talks resume

Alex Christoforou and Alexander Mercouris discuss the G20 Osaka compromise between President Trump and President Xi, to pause the ongoing trade dispute and continue negotiations for a deal between their countries. Trump agreed to allow US companies to sell parts to Huawei, while not excluding the firm from the Government’s blacklist. Trump told reporters that “US companies can sell their equipment to Huawei,” providing that equipment poses no “great national emergency problem.” Trump’s ‘backtracking’ was criticized by the establishment media and many members of Congress.

My Comment: Trump’s [minor] concession to the Chinese was in exchange for Xi’s promise that China will import more food from the US. Trump’s supporters among farmers will no doubt be glad. The President’s decision not to levy higher tariffs on Chinese goods shows just how important trade relations between China and the US are. Even though the US has the know-how and the capital and the land and the skilled labor necessary to be self-sustainable, the short term belt tightening and higher prices required for such a dramatic course of action is – given the present political situation – simply untenable. Chinese goods and Chinese demand for US output aren’t going away any time soon.

A good deal can and will be reached between Xi and Trump, but once signed it has to be maintained – and it will be maintained only if geopolitical tensions won’t escalate. And I’m not referring just to the South China Sea, but to Venezuela and Iran as well.

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Apples of Discord, RT Documentary

Russia’s 2014 embargo on European food imports cut European farmers out of their second biggest export market. At first, they hoped the measure, taken in response to Western financial sanctions following Crimea’s adherence to Russia, would be temporary. Five years down the road, the consequences for farmers throughout Europe are dreadful. RTD travels around the continent to meet Spanish, Italian, French, Polish, German and Dutch farmers and Farmers’ Union Reps. They explain how the embargo dramatically hit their turnover and bargaining power. They worry about whether they still have a future in agriculture and question the European Union’s response to the crisis.

This particular situation is the best argument, I think, for bringing back the tradition of buffer stock policies. This prudent custom had been scrapped in favor of neoliberal market reforms; but we all know that foreign interests don’t necessarily coincide with the national interest. The role of a buffer stock policy is to ensure an acceptable base level price for both consumers and producers, irrespective of the business cycle. During times of exceptional harvests, when supply exceeds demand and prices favor consumers to the detriment of producers, the Government steps in with a bid to purchase this excess. It’s not mandatory for them to sell the unsold produce they have left, so the Government’s action in this sense cannot be labeled as coercive. The opposite occurs during periods of poor harvests. The Government steps in to sell from its stockpiles to cover the gap in supply and, in so doing, normalize prices. It’s not a silver bullet policy by any stretch of the imagination, but it’s better to have a safety net for consumers and producers.

Another good policy for agriculture, set in a fully phased in Land-Value Tax [LVT] system [also known as the single tax system], land taken out of production for soil or water regeneration purposes would no longer be considered productive land and would be exempt from the LVT, thus helping disadvantaged farmers and protecting nature at the same time. Under the present system, however, it’s the norm for farmers to put all their available land under cultivation just to pay the bills. For more info on the subject of agriculture under the LVT system, see this short video.

Prudence should come before ideology; and make no mistake, many of these trans-national accords are based on ideology. The EU political class must come to grips with the fact that European geopolitics cannot ignore the fate of neighbouring countries, unlike the US geopolitical mentality, based on the island nation context. And making bad decisions on Washington’s behalf hurts not only Russia, but the EU states as well.

Reply to Grace Blakeley’s Post-Brexit UK measures

by Serban V.C. Enache

In this article, Grace Blakeley outlines the economic and financial plights of the United Kingdom, how Globalization failed the working class and her proposed solutions for a post-Brexit UK.

I do not agree with some of her assumptions, nor with her policy prescriptions.

For starters, Continue reading “Reply to Grace Blakeley’s Post-Brexit UK measures”