Why Obama is on the Offense in Ohio

September 19, 2012 By Leave a Comment

Want to know why President Obama has just gone on the offensive on China trade policy?   See the results of this just released Zogby poll commissioned by Death By China Productions.  The poll shows Obama faces a huge “soft on China” gap relative to Mitt Romney in the key swing state of Ohio – and some very interesting findings as well.

 

New Zogby Poll in Crucial Ohio Swing State

 

  • Obama and Romney in Statistical Dead Heat
  • Obama Faces Large “Soft on China” Gap
  • The Best Jobs Program is Trade Reform With China
  • Ohioans Overwhelming Support a Boycott of Made in China.

 

President Obama may have opened a lead in national polls, but it remains a statistical dead heat in the crucial swing state of Ohio.  In the latest Zogby Poll of 601 likely voters conducted by JZ Analytics, President Obama’s lead of 45%.3 to 43.2% over Mitt Romney is well within the statistical margin of error.

 

Candidates take note:  An overwhelming majority of Ohioans — 80% — agree that “the single most important issue in the 2012 Presidential race is jobs.

 

50% of Ohio respondents believe that the best jobs program for America is “cracking down on China’s unfair trade practices like currency manipulation, illegal export subsidies, and counterfeiting and piracy” while only 22% favor more government stimulus; and these results are consistent across liberals, moderates, and conservatives.

 

This finding is particularly bad news for President Obama as he faces a double digit “soft on China gap” relative to his opponent.  Fully 43% of Ohioans believe Mitt Romney is more likely to crack down on China’s unfair trade practices compared to only 30% for Obama.  Among independents where the largest bloc of undecided votes remains, this gap holds at 35% to 26% in favor of Romney.  (This finding may also help explain why Obama has recently ratcheted up his tough on China messaging.)

 

56% of respondents also believe “Americans should boycott Made in China products because of China’s unfair trade practices and human rights abuses” while only 19% are against the boycott.  This result is consistent across party affiliation, indicating the issue of China is an American issue, not a partisan issue.

 

If Obama is to win in the crucial swing state of Ohio – and thereby likely win the election — he would do well to try to close his very large “soft on China” gap not by attacking Romney for being soft on China – Ohioans won’t believe that.  Rather, Obama should carry the slogan “the best jobs program is trade reform with China” and lay out very specific policy actions that will curb China’s cheating.

 

For his part, Romney would do well to further press his “tough on China” advantage in Ohio by extending his campaign talking points significantly beyond his promise to brand China a currency manipulator on his first day in office.  Clearly, China’s cheating is a flashpoint for Ohio voters who have seen whole factories uprooted and replanted in China.

The Zogby Poll was commissioned by the filmmaker of Death By China Peter Navarro to benchmark attitudes of Ohioans on the China question.  Navarro is traveling throughout the state showing the film and conducting town hall meetings, with stops in Youngstown, Akron, Dayton, Cleveland, Cincinnati, Columbus, Toledo, Mansfield, Portsmouth, Sandusky, Athens, and Findlay.

 

 

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A Sign of the Times

August 11, 2012 By 1 Comment

reposted from: Greg Autry

Found this Fellow on Santa Monica Blvd., leaving a talk in Beverly Hills last week.

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Greg Autry serves as Senior Economist with the American Jobs Alliance and is the co-author of the book Death by China, now a documentary film directed by Peter Navarro and narrated by Martin Sheen.

Please follow Greg on Facebook at: http://www.facebook.com/gregwautry

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The Honorable David Kilgour on China

August 11, 2012 By Leave a Comment

Reposted from: Epoch Times

PROMOTING BETTER GOVERNANCE IN CHINA DURING  LEADERSHIP TRANSITION   

     Hon. David Kilgour

  Rayburn House Building, Capitol Hill

Washington

19 July 2012

China has given much to the world during five millennia. My own respect for its people grew during several visits to the country; it was an honour to represent some Canadians of origin in the Middle Kingdom for many years in Parliament.

 

Democratic governments and their peoples, legislators and civil societies should be as actively engaged as feasible during the current leadership transition. Democracy with Chinese features is probably closer than many think.  We should never forget in this that the values we seek to encourage are universal ones, including dignity for all, the rule of law, multi-party democracy, corporate social responsibility and the need for good jobs for everyone, including Americans and Canadians. (A useful handbook on democracy development by the Council for a Community of Democracies can be accessed at http://www.diplomatshandbook.org.)

 

To illustrate the difficulties of such engagement with Beijing, take the case of Bo Xilai, whom many democratic governments and business people courted even after it was clear that he was on his way out of the Party. Canada’s prime minister met with him in Chongqing city on Feb. 11, nine days after his former police chief, Wang Lijun, sought refuge in the U.S. consulate in Chengdu. Bo and Wang had earlier been among the most brutal persecutors of Falun Gong practitioners.

 

Premier Wen Jiabao was so troubled by Wang’s conduct that his rhetorical question to Party members appears to have been leaked from a closed meeting on March 14, “Without anaesthetic, the live harvesting of human organs and selling them for money-is this something that a human could do?” Wen also used the many lawsuits launched against Bo in 13 countries for his role in organ pillaging  to have him removed as Commerce Minister in 2007.

 

Bo, Wang and others were members of former president Jiang Zemin’s faction in the Party, who rose because they supported Jiang’s brutal persecution of Falun Gong ongoing from mid-1999 to the present day. Your State Department, for example, has known about the pillaging of organs from Falun Gong at least since 2006, but only in May, 2012 acknowledged the well-documented crime against humanity in its human rights country reports.  Democratic governments should be supporting Wen and reform-minded party members on this and a host of governance issues.

 

 

 

 

  Political Maoism Ending?

 

Jung Chang and Jon Holliday end their 2006 biography, Mao, The Unknown Story, by stating, “Today, Mao‘s portrait and corpse still dominate Tiananmen Square in the heart of the Chinese capital.  The current Communist regime

declares itself to be Mao’s heir and fiercely perpetuates the myth of Mao.” Many historians include him with Stalin and Hitler as the three worst mass murderers of the 20th century.  Chang-Holliday note, “In all, well over 70 million Chinese perished under Mao’s rule in peacetime.”

The methods of Mao did not perish with him in 1976. In 2003, for example, the Party sought to hide the impact of the deadly SARS virus. Only when a doctor  sent to foreign media the actual numbers of Beijing residents struck by SARS did the party-state launch quarantine measures. The same indifference to the public good recurred in 2008 over the Sanlu dairy tainted milk supply scandal, which caused sickness or death to some 300,000 Chinese babies. There is a myriad of other examples.

 

The Party still uses overwhelming force to suppress voices advocating the rule of law. One is Gao Zhisheng, a thrice Nobel Peace Prize-nominated lawyer.  A decade ago, he was named one of China’s top ten lawyers.  Party wrath was released when he decided to defend Falun Gong. It began with the removal of his permit to practise law, an attempt on his life, a police attack on his family, and a cessation of his income. It intensified when Gao responded by launching nationwide hunger strikes calling for equal dignity for all. One of his communiques described more than 50 days of torture in prison.

 

Trials in China are theatres.  The deciding ‘judges’ usually don’t even hear evidence given in ‘courts’. Canadian Clive Ansley, who practised law in Shanghai for 13 years, explains the fate of Gao and so many others by observing: “There is a … saying amongst Chinese lawyers and judges who truly believe in the Rule of Law…(which) illustrates the futility of attempting to ‘assist China in improving its legal system’ by training judges. It is: ‘Those who hear the case do not make the judgment; those who make the judgment have not heard the case’….  Nothing which has transpired in the ‘courtroom’ has any impact on the ‘judgment’

 

Tibet and Dalai Lama

 

Another important instance of misgovernance is Tibet and the Dalai Lama. As the spiritual leader of Tibetans, an honourary Canadian citizen, and respected world leader, His Holiness is a new government in Beijing’s best hope for a peaceful resolution of the Tibet issue. Advocating Tibetan autonomy under Chinese rule, he disavows violence, does not favour secession and has this year turned over the political role to democratically-elected men and women. When His Holiness

 

 

spoke to a large audience in Ottawa earlier this year, he indicated that he felt the Chinese people generally would accept a degree of autonomy for Tibet if aware

that this is all that is being sought. He also mentioned the tragic loss of now almost 30 Tibetan lives to self-immolation.

Natural Environment

 

Three decades of ‘anything goes’ economics have done major harm to the Chinese people, the natural environment, neighbours and the world as a whole. Consider:

 

  • Nearly half a billion Chinese citizens now lack access to safe drinking water; many factories continue to dump waste into surface water.

 

  • A World Bank study done with China’s environmental agency in 2007 found that pollution was causing 750,000 premature deaths a year.

 

  • Coal now provides about two-thirds of China’s energy and it already burns more of it than Europe, Japan and the U.S. combined.  Emissions from Chinese coal plants are now reaching well beyond China’s borders, yet the Party has failed to achieve anything substantive concerning the protection of water, air and soil.  Many experts conclude appears that China cannot go green without political change.

Public Health/Safety Nets

 

The state of public health across China today is highly worrisome. There is no health system for rural people and those not on state payrolls. Under the new privatized model, doctors, hospitals and pharmacies were made ‘profit centres’ and expected to finance their activities through patient fees. Less than a fifth of Chinese workers have pensions; even less are covered by unemployment insurance. The party-state meanwhile sits on trillions of dollars in foreign exchange holdings.

‘Ponzi Capitalism’

Jonathan Manthorpe, long a close observer of China, wrote last year in the Vancouver Sun,

 

What one is seeing in China is variations of what can only be called a Ponzi scheme.  A local government, without a functioning system for raising tax revenue—and… riddled with corruption…sells development land to garner cash… (first getting) rid of (farmers) living on the land… The land will then be sold to a development company … owned by the local government…(T)he municipality has the power to instruct banks to lend the development company the money for the sale.  So the local government gets its cash, the municipally-owned company gets to build a speculative residential or industrial complex, and all seems well.

 

A related item on the housing bubble appeared in the Financial Times. In the coastal city of Wenzhou, luxury apartments are to be built for as much as 70,000

Yuan ($11,000) a square metre, which is about twice the annual income of the average resident. To finance a 150 square metre apartment in the building would consume every penny of a typical resident’s income for 350 years.

A Way Forward

 

There were 180,000 “mass incidents” in China in 2010, everything from strikes to riots and demonstrations, twice as many as in 2006.  The regime continues to rely on repression and brutality to maintain itself in power. Universal values must be asserted continuously in dealings with Beijing.

 

There are lessons to be applied in China from the non-violent civic resistance which has occurred in many nations. Each was different in terms of boycotts,

mass protests, strikes and civil disobedience.  In all, authoritarian rulers were delegitimized and abandoned by their sources of support.

 

An interesting post- Taiwan election (Jan 2012) piece appeared in the New York Times. It noted that the Chinese party-state news agency, Xinhua, avoided the words “president” and “democracy”, presenting the election as a merely local one. A businessman from China who had observed the election, however, noted, “This is an amazing idea, to be able to choose the people who represent you. I think democracy will come to China. It’s only a matter of time.”

 

A democratic China would not murder Falun Gong citizens in forced labour camps or engage in any of the other acts of gross misgovernance discussed above.

 

Conclusion

 

Democratic governments and their business communities should examine why they are supporting the violation of so many universal values in seeking to increase trade with China. For years, this has resulted mostly in our jobs being outsourced to China and continuous increases in our bi-lateral trade deficits. Do those in our business communities overinvested in China feel no responsibility to the employment needs of fellow citizens? Are the rest of us too focused on access to inexpensive consumer goods and essentially ignoring the human, social and natural environment costs paid by Chinese nationals to produce them?

 

Peter Navarro, a professor at the University of California, asserts that consumer markets worldwide have been “conquered” by China largely through cheating.  Navarro has various proposals intended to ensure that trade becomes fair. Specifically, he says all trading nations should:

 

• define currency manipulation as an illegal export subsidy and add it to other subsidies when calculating anti-dumping and countervail penalties;

 

• ban the use of forced labour effectively-not merely on paper as now- and provide decent wages and working conditions for all;

 

• apply provisions for protection of the natural environment in all trade agreements in order to reverse the ‘race to the environmental bottom’ in China and elsewhere.

 

The party-state in Beijing is making major changes in its senior personnel. Those appointed should seek dignity for all Chinese if they wish to achieve sustainable prosperity at home. Its current roles in Syria, Iran, Nepal, North Korea, Sudan, Taiwan, Zimbabwe and elsewhere will also require significant reform if the new government’s goal is to build international harmony with justice for all.

 

The people of China want the same things as the rest of us: respect, education, safety and security, good jobs, the rule of law, democratic governance and a sustainable natural environment. If the party-state ends its violations of human dignity at home and abroad and begins to treat all members of the human family in a justly, the new century can bring harmony for China and the world.

 

Thank you.

(www.david-kilgour.com)

 

David Kilgour is a retired Member of the Canadian Parliament, former Canadian Secretary of State for Asia, a Nominee for the Nobel Peace Prize, and an unwavering voice in support of truth and human rights in many arenas. 

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What you See is, What you Get: On UFOs, Unicorns, Bigfoot, and Comparative Advantage

August 11, 2012 By Leave a Comment

Reposted from Greg Autry

Sometimes I think it’s a sin, when I fell like I winnin’, but I’m losin’ again.

-       Gordon Lightfoot, Sundown

As a lecturer and a PhD student, I’ve taught David Ricardo’s theory of Comparative Advantage to hundreds of MBA students. This is the brilliant little economic model that demonstrates how when each nation focuses their resources on the work they are best at – even if they are not better than all others – production will be maximized and consumers will benefit. In its pure, abstract form, Comparative Advantage represents an unarguable truth. There is a beautiful, transcendental moment when a business student suddenly “gets” the simple mathematical model and sees the nearly magical benefits Ricardo’s model offers to “all trading nations.” It’s comparable to the experience of an undergrad sociology student encountering Karl Marx for the first time. Suddenly the world is brilliantly clear and the solutions are so simple, if only everyone could be compelled to embrace them.

As different as Riardianism is from Marxism, the two economic theories share a common theme – they sound swell, but fail completely when faced with the reality of human behavior. The problem is that both of these grand ideas require that individuals or nations, respectively, repress their natural inclination to act in a self-interested manner, for the promise of a mutual beneficial outcome.

In the real world, we know this promise never works. Letting individuals pursue their own, inefficient, unplanned, selfish economic courses actually works out better than getting smart folks to organize them for the greater good – the free market has trumped socialism in every sad empirical test of Marx’s dream.

The ideology derived from Comparative Advantage that has erroneously been labeled “Free Trade” actually involves the same logic as socialism – that free nations subsume their national desires for control of their jobs and strategic resources to a greater global interest, which promises to benefit their consumers as well. Even more curiously, the strongest supporters of individual freedom are the first to villainize anyone who suggest “protecting” a domestic market for the benefit of their nation. They then invariably drag out the ghost of David Ricardo to explain to us simpletons that becoming the world’s trade bitch will be good for us. China’s 25% tariff on U.S. cars vs. our 2.5% tariff on their imports is no problem becauseAmerican consumers benefit from low prices when American producers shut down!

However, the empirical evidence is again, perfectly clear: nations that pursue the acquisition of technology and capital, fight for high-value manufacturing jobs, and seek smart trade advantages increase their national wealth and individual prosperity. Naïve countries that actually practice, “free trade” spiral into decline and unemployment. There is no better example of this than 19th century Britain, the first nation to embrace Ricardo’s crazy idea.

After the brilliant theoretician sold Parliament on his simplistic theory, the UK went on a free trade frenzy. During the next century the United States, operated on Hamilton’s “American System” featuring very high tariffs, and an active industrial policy geared toward rewarding production, building infrastructure and developing markets. America gutted England’s manufacturing base. Despite controlling a third of the world’s resources Britain entered a slow decline. Only those Brits involved in investing capital elsewhere gained real wealth. Building a welfare state became unavoidable to avoid revolt. Meanwhile, the U.S. developed a vibrant middle class and rose to global prominence.

However, in the last century smart leaders in Japan, Korea, Taiwan and others have followed the American System to perfection, while giving “free trade” the appropriate lip service for a senile America. The results were absolutely predictable to anyone with common sense.

In most ways, China’s rise has been no exception. It isn’t that the Communist Party has been run by brilliant new thinkers (the last really new thing out of China was probably gunpowder), it is simply that they steal good ideas and have belatedly copied a proven economic formula. China’s leaders have followed a policy of pure self-interest while mumbling all the right words in public as they dance their way through the free trade tango with skill. If they’d actually had good sense they would have done this fifty years earlier and spared the Chinese people decades of misery.

The exception with China is, of course, that the Communists never have any concern for personal misery. Their goal is nothing but building greater power for those at the top of the Communist Party dog pile and economic planning is just a tool to achieve that. That’s why handing over the torch of global leadership this time is a very different thing than it was with the UK-U.S. transition last century. Supporting the U.S. to Communist China power transfer is tantamount to endorsing a new Dark Ages for humanity.

In my next posting, I’ll address the theoretical weaknesses that cause comparative advantage to backfire in the real world. In the meantime, understand that counter-intuitive economic theories are always the rage with academics and pundits that need to sound cleverer than the average citizen. Remember, these are the folks that sold us the “we can borrow and spend our way to prosperity” theory under the label of Keynesianism. When something looks like economic slight of hand to you it probably is; and whenever you encounter an ideology-driven economic theory fiercely supported by a cadre of closed-minded, true believers run!

Empirical evidence should trump theory. When medical researchers see that an experimental treatment appears to be actually killing their patients they halt the research and re-evaluate, regardless of how good the thing looked on paper. This common sense protocol should apply to U.S. economic policy – where we only have one patient. If the theory is obviously not delivering economic benefits STOP! Instead, while we congratulate our self on the victory of free trade our trade deficit soars, unemployment skyrockets, GDP plummets, and a staggering debt accumulate. The true believers tell us to close our eyes and stay on course, because the enormous Chinese market is just about / very soon / any day now going to usher in a new generation of prosperity. Sure, right.

In my next post, I’ll address the theoretical problems with Comparative Advantage.

 

Greg Autry serves as Senior Economist with the American Jobs Alliance and is the co-author of the book Death by China, now a documentary film directed by Peter Navarro and narrated by Martin Sheen.

Please follow Greg on Facebook at: http://www.facebook.com/gregwautry

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The Chinese Dress Code

August 11, 2012 By 1 Comment

reposted from Greg Autry

On July 20, the Wall Street Journal ran an apologist editorial on the front page of the Marketplace section entitled Does it Matter China Made the U.S. Olympic Uniforms?  This sanctimonious piece by John Bussey condemned Senator Harry Reid and Rep. John Boehner for questioning the Olympic Committees outsourcing of more U.S. jobs. The Senator and Congressman were right-on. It does matter. It matters quite a bit.

It matters because the Olympics is a show and everything about it is politically symbolic. At its best Olympic symbolism is about bringing together diverse people from around the globe to compete on a fair playing field, founded on the democratic traditions of ancient Greece. At its worst, the symbolism glorifies a totalitarian regime as in Hitler’s 1936 Nazi pageant and Hu Jintao’s 2008 Communist blow out.

While that over-the-top Chinese carnival offend the senses, under its saccharine coating lurked the usual Communist grime. With the world carefully distracted by astounding fireworks displays, the repression of the Falun Gong, the razing of Christian churches, the brutalization of peaceful Tibet, and organ harvesting for profit continued unabated.

Thousands of Beijingers were forced to relocate to build the Olympic facilities. The month before the spectacle, I took this picture. Here you see the last home still standing; its owner having plastered every wall with Communist flags and portraits of the Chinese Communist Pantheon in hopes of keeping the bulldozers at bay. That brave man understood the power of symbolism.

Meanwhile, the broadcast media, papers, and Internet were more restricted than ever and political protests were still aggressively squashed – despite a very public promise made to the international community that turned out to be just another convenient Chinese Communist lie.

Beijing also a high bar for cheating, typical for a government that has never recognized any rule of law beyond what power can get away with. Watching twelve-year-old girls used as props to boost the commie medal count was as symbolic as it gets. The Chinese government even forged passports to keep the charade going. After the Olympics ended, it was even reveled that a Chinese government run hacking ring had infiltrated the I.O.C., the World Anti-Doping Agency, and a number of national Olympic committees. This, like the Tiananmen massacre, should have told us something about how far China can be trusted in trade and military agreements – not one bit.

So what does a naïve American Olympic Committee do? Buy Chinese uniforms! And what does the co-opted U.S. media do? Tell us it doesn’t matter! If China lies, cheats, steals its way through the Olympics, why would the WSJ expect China to adhere to WTO rules? In reality that paper, like most of business press and lobby groups, simply doesn’t care about honesty in trade, because the multinational firms that support these institutions profit immensely from China’s cheating and abusive labor practices.

The Journal and their sold-out buddies at the U.S. Chamber of Commerce tell us that lost American jobs are OK, because we are all benefiting from the unseen miracle of Ricardian comparative advantage. Now, that’s a insidious abuse of economic theory that will require a whole ‘nother post to unravel, but let’s just say if you can’t see it, it probably doesn’t exist. During thirty years of empirical testing of that theory with China, American incomes and unemployment have risen in lockstep with our growing Chinese trade deficit. That is not a coincidence.

The Journal also dredges up a discredited report from two European economists at the Federal Reserve (see my piece here) as a further distraction. That report brutally twists trade data to, again, convince you of something that disagrees with your own vision: that only a tiny portion of our purchases are going to China. The bottom line is that China’s imports to the U.S. always outstrip our exports and the growing difference is now about $300Billion a year! That is an economic leakage that now accounts for nearly 2% of our GDP. If American had 2% more GDP, we’d be on easy street.

Reading the Journal article I choked on the line, “The Chinese are really good at producing low-cost uniforms.” A remarkably arrogant quip, since these little Ralph Lauren pretties cost $2,000 a piece. Maybe that’s cheap by Wall Street standards.  Its all part of turning a pump that brings in short term Wall Street profits in exchange for the transfer of our capital and technology to a regime that is both the largest abuser or human rights and America’s rising geopolitical enemy.  How dumb is that?

The good news is that in London, the demonstration of a free people celebrating both a culture and a government worthy of their pride will wash away the soot of Beijing. It’s too bad that America’s athletes won’t get clean uniforms for the games, it’s even worse when our free press dismisses legitimate concern for our unemployed and the prosecuted people of China as symbolic grandstanding.

Greg Autry serves as Senior Economist with the American Jobs Alliance and is the co-author of the book Death by China, now a documentary film directed by Peter Navarro and narrated by Martin Sheen.

Please follow Greg on Facebook at: http://www.facebook.com/gregwautry

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Chinese Communism and America’s Free Traitors

June 11, 2012 By Leave a Comment
Some thoughts on how some misguided libertarians have been lured into supporting the enemy of everything they claim to cherish. Reposted from Strike the Root 

 

Say it is a dictatorship, but we want to be associated with it. Say it is worthwhile being associated with the devil, as Churchill said, in order to defeat another evil which is Hitler. There might be some good argument made for that. But why pretend that Russia was not what it was?
~ Ayn Rand, testimony to HUAC, 1947

 

America has been lulled into the proud and pleasant delusion that Ronald Regan defeated communism a generation ago and that with the fall of the Soviet Union, our nation faces no external threat more serious than cave dwelling extremists with a homemade WMD. The age of nation-state geopolitics and the fear of strategic nuclear warfare seem buried, as the entire world embraces “free trade.” Yet, somehow, while we were celebrating the fall of the Berlin Wall, we missed those tanks emblazoned with red stars rolling over democracy advocates in Tiananmen Square.

 

Communism remains alive and well in China, though the dubious looks I often get from those I warn about it make me feel like Harry Potter yelling, “Valdemort is back!” I know my admonitions sound shrilly discordant against the chorus of media pundits praising the efficiency of Chinese “state capitalism” and the politicians who daily prophesize Beijing’s “peaceful rise.”

 

However, if you harbor any doubts about the nature of Beijing’s dictatorship, your must read “5 Myths about the Chinese Communist Party (CCP)”, an excellent article in Foreign Policy by Richard McGregor. The former Beijing bureau chief for the Financial Times begins:
If Vladimir Lenin were reincarnated in 21st-century Beijing and managed to avert his eyes from the city’s glittering skyscrapers and conspicuous consumption, he would instantly recognize in the ruling Chinese Communist Party a replica of the system he designed nearly a century ago for the victors of the Bolshevik Revolution.

 

Or just take Premier Wen Jaibao’s word for it when he says, “We must make best use of the socialist system’s advantages, which enable us to make decisions efficiently, organize effectively, and concentrate resources to accomplish large undertakings.” For Wen, market forces are just another weapon in the Communist Party’s arsenal of economic policies, a powerful tool when conducive to Party goals and one to be repressed when deemed inconvenient or dangerous.

 

Most Western writers, corporate executives, and politicians (including the ubiquitous Mr. Kissinger) experience China through carefully managed meetings in fine offices, restaurants, and nightclubs in modern Shanghai and Beijing. From those venues, it’s pretty hard to imagine that the Hammer and Sickle still rules with an iron fist. As a Chinese dissident friend of mine explained, “There are two views of China: the one where the CCP has tortured you with an electric baton because you support freedom and the other one.”

 

You can find the real China if you look. Visiting a Chengdu College last year, I was greeted by the Communist Party Secretary who runs a parallel administration dedicated to ensuring the political correctness of faculty and the students. Traveling in Yunnan with a charity, I dined at a fine restaurant while Party members who run healthcare explained, between many rounds of drinks, that China has no money to help kids who need heart surgery. That’s progressive thinking from a socialist dictatorship that has accumulated trillions in foreign reserves while growing their military and security apparatus faster than GDP.

 

Big Chinese companies also have political minders – picture Tim Curry’s role in “The Hunt for Red October” – while loyal Party members run the “joint partnerships” that multinationals like GM must use to access Chinese markets. No surprise that Cadillac sponsors a film called “Birth of a Party” (how ironically fitting) praising the Chinese Communist Party’s 90th anniversary.

 

With China’s leaders fully committed to Marx and Mao, we have to wonder what’s with that “vibrant market economy.” It is a lot less of a market than most Americans think. When Hu Jintao says that the Chinese Communist Party “loves capitalism,” file it with: “China’s currency is fairly priced” and “Tibetans love China.”

 

Despite the horde of small Chinese firms feeding, remora-like, off slain Western economies, real financial power remains in the hands of huge State-Owned Enterprises (SOEs). The top 20 firms in China are SOEs, as are all the big banks, the major energy and resource firms, the telecommunications firms, the big aircraft, auto, and ship builders, and even China’s largest retailer.

 

Further, though the stock of many of these firms is publicly traded– and probably in your 401(k) – the Central Organizing Committee of the Communist Party appoints the CEOs and runs the show. This control extends to many seemingly private firms since everyone who is anyone in China is either a member of the Party or beholden to it. As Richard McGregor explains in The Party, “The idea that the boards really run companies is basically as credible as the constitutional guarantee of free speech and religious freedom in China. It does not happen in reality.” Worse, the state sector is growing in what’s called “Guo Jin, Min Tui” (“The State Advances and the People Retreat”).

 

Sadly many of America’s strongest defenders of freedom have come to worship a logical Möbius Strip that twists the support of economic liberty into a rationale for funding totalitarians. Libertarian media and think tanks aggressively defend the “right” of multinationals to nourish China’s dictatorship via “free trade” no matter how much contempt Beijing shows for human rights, how much damage their mercantilism does to our economy, and how obviously they prepare to attack Asian democracies and gear up for eventual conflict with America.

 

While profiting off the back of labor coerced by others has been a successful business tactic since “free trade” England ran its mills on the cotton of American slavery, conducting business with criminals is no ethical “right.” Funneling commerce and capital to an avowed enemy of our most cherished principles is more like being an accessory to crime.

 

Ironically, the mercantilist trade of 19th Century America subsequently crushed both England’s mills and its economy. Now as “free trade” America meets a similar fate, the freedom-loving Cato Institute celebrates the communist victory by proclaiming “the world should rejoice in China’s becoming the world’s largest exporter.”

 

As Lenin was said to have remarked, “The capitalist will sell us the rope with which we will hang them.”

 

Greg Autry is co-author of Death by China and serves as Senior Economist with the American Jobs Alliance
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Memorial Day

May 27, 2012 By Leave a Comment

Dear Lord,

Lest I continue
 my complacent way,


Help me to remember that somewhere,
 Somehow out there


A man died for me today.


As long as there be war,
 I then must
 Ask and answer


Am I worth dying for?

- Wartime Prayer by Eleanor Roosevelt

 

Let’s consider Mrs. Roosevelt’s question this Memorial Day and take a moment to remember the “forgotten war” of Korea. Sixty years ago 36,940 Americans (along with many brave Korean, Canadian, UK and other allied soldiers) died fighting Chinese communism in cold and miserable conflict. In Death by China, we shared Marine Lee Bergee’s memory of Frozen Chosin, “We all have memories of buddies killed, of the hordes of Chinese assaulting our frozen lines, and the long dangerous walk out . . .”

Today, most Americans don’t even know that we fought a war with China in the recent past and they are even more oblivious to the fact that we are losing a bigger one right now. That horribly cold war is still in progress, both technically and literally. Technically we are still at war in Korea because the Armistice Agreement of 1953 never progressed into a full-fledged peace agreement. And we are literally in a Cold War as China actively supports a nuclear dictatorship in North Korean, undermines our economy, corrupts our political system, infiltrates our educational system, steals our technology, buys up our land and businesses, and openly prepares for battle with the U.S. seventh fleet.

Every time we go into WalMart and pick up a Chinese product when we could have made another choice we are selling out the brave young men who gave their all to uphold freedom and liberty and the answer to Mrs. Roosevelt’s question is, “NO, we not worth dying for.”

 

-Greg Autry, Senior Economist with the American Jobs Alliance

 

 

photos: Greg Autry Korean War Memorial, Washington DC, February 2012

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The Time Has Come – BOYCOTT

May 15, 2012 By Leave a Comment

The American Jobs Alliance and TAP America have joined in calling for a BOYCOTT of China. Further announcements of support and events will be forthcoming. It’s time for American Consumers to alert American Firms to the market risk they face when they cooperate with and support the Communist Government of China and its mechanisms of repression!

Read about it at Business Week:

http://investing.businessweek.com/research/markets/news/article.asp?docKey=600-201205150753MRKTWIREUSPR_____887428-1&params=timestamp%7C%7C05/15/2012%207:53%20AM%20ET%7C%7Cheadline%7C%7CTAP%20America%2C%20American%20Job%20Alliance%20and%20Made%20In%20the%20USA%20Foundation%20Form%20National%20′Buy%20American’%20Coalition%7C%7CdocSource%7C%7CMarketwire%7C%7Cprovider%7C%7CACQUIREMEDIA

Complete Text of the Press Release:

TAP AMERICA, AMERICAN JOB ALLIANCE AND MADE IN THE USA FOUNDATION FORM NATIONAL ‘BUY AMERICAN’ COALITION

Organizations Partner to Promote Job Creation & Encourage Boycott of Products Made InChina

 

SEATTLE, WASH. – May 15, 2012 – TAP America, a non-profit organization dedicated to strengthening America, Made In the USA Foundation and the American Job Alliance today announced the ‘Buy American Coalition’ to stimulate our national economy, protect our nation’s values and weaken authoritarian regimes abroad that violate human rights.

 

The formation of the ‘Buy American Coalition’ comes on the heels of the latest troubling news out of China. Customs officials have seized thousands of pills made from the flesh of dead babies, the product of the Chinese Communist Party’s forced abortion policy.  The Chinese dissident who fled to the U.S. Embassy, Chen Guangfeng, was imprisoned and persecuted by Communist officials for protesting this inhuman practice.

 

TAP America Founder Mark Bloome said, “The ‘Buy American Coalition’ is of great importance to our country now more than ever. We are seeing our jobs being hollowed out in America by unfair competition from China. Working with both the American Jobs Alliance and Made In the USA Foundation, we believe that this issue is large enough to require examination by multiple organizations. We at TAPamerica.org are leading thecharge.”

 

The China Threat

The Buy American Coalition calls on citizens to buy American and boycott China. This grassroots action sends a clear message that Americans believe that our people and our nation prosper when we adhere to traditional values of liberty and human dignity, not when we abandon them to appease foreign tyrants.

 

China’s authoritarian regime is critically dependent on American cash and investment to fund its machinery of repression.   “When consumers buy American-made products they put Americans to work and starve the Chinese Communist Party of resources.  This is a double victory – for American workers and American values,” said Greg Autry, Senior Economist with the American Jobs Alliance.  “It is not possible or even necessary to completely shun Chinese-made products to have a positive impact.   Even the threat of a substantial boycott would change the behavior of corporations that benefit from China’s exploited labor and mercantilist trade behavior,” Autry notes. “A 20% drop in imports from China would easily destabilize Beijing.  Buying American will make U.S. firms appreciate that.”

 

“For decades the US government has said that doing business with China would bring democracy and human rights to the Chinese people, but it is now clearer than ever that buying up their cheap prison-made goods has only strengthened the Chinese Communist Party,” said Harry Wu, Human Rights Activist and Founder of the Laogai Museum in Washington D.C. the first U.S. museum to directly address the human rights issues in China. “This imbalanced relationship is hurting the American people too, as they see their health threatened by unsafe Chinese products, their jobs lost, and their economy undermined. If governments do not insist that the repressive Chinese regime abide by fair trade practices, then it is up to American corporations and consumers to hold China accountable for its prison slave labor, lack of compassion for other workers, and countless human rights violations.”

 

The coalition will explore the foundations of America’s chronic joblessness and rising underemployment with the goal of finding actionable solutions.  Important issues under consideration include: international trade, geopolitics, currency devaluation, product safety and compliance, human rights, resource availability, and consumer interest in American products. The coalition is already experiencing broad, non-partisan support from many individuals and organizations. It does not endorse any political party, candidate, union, trade association or corporation.

 

The ‘Buy American Coalition” is comprised of:

·       Mark Bloome, Founder of TAP America

·       Richard Tso, Executive Director of TAP America

·       Greg Autry, Senior Economist for the American Jobs Alliance

·       Curtis Ellis, Communications Director of American Jobs Alliance

·       Joel Joseph, Founder of Made In the USA Foundation

 

“Our organization is all about creating jobs for Americans,” said Curtis Ellis, Communications Director with the American Job Alliance. “Forming this coalition aligns our organization with TAP America so that we can tackle the issues preventing job creation in the United States.  High on the list are the predatory trade practices of the Chinese Communist regime.  We can put our money where our values are by buying American at every opportunity.  Our ancestors built this great country by doing what was right, not what was easy.  We must follow their example to rebuild the country.”

 

“There are three main causes of our trade deficit:  trade with China, imports of automobiles and imported oil,” said Joel Joseph at Made In the USA Foundation. “The deficit with China is the most dangerous because many Chinese industries are owned by the People’s Liberation Army, and American consumers are thus funding a military force that poses a significant danger to the well-being of the United States.”

 

TAP America recently announced their TAP Certified Merchant program to encourage stores to stock at least 20% ofU.S. goods and to increase their American made inventories by just 1% per month. As incentive, businesses who sign up are featured in news articles, included in the TAP online business directory, and are featured in a Groupon-like service called AmeriCoupon that helps people find deals on products made in America. TAP Merchant Filson was recently awarded the TAP America Loyalty to America Award for its commitment to keeping over 70% of manufacturing in the United States.

 

Since launching in January of 2011, TAP has created national awareness campaigns aimed at promoting tolerance, encouraging people to stay physically active, and to purchase products made in America. For more information about TAP America, to volunteer or to make a donation, please visit www.tapamerica.org.

 

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Still Commies After All These Years

May 1, 2012 By Leave a Comment

It being International Worker’s Day and all it seemed like a good time to review the anachronism that is the Chinese Communist Party. In the Western World, particularly in board rooms, the halls of academia, and shallow business bestsellers it has become popular to repeat the favorite CCP propaganda line that Deng Xiaoping sent China on an irreversible path toward a modern, free market economy. Many Americans who’ve toured Shanghai and Beijing think they are seeing an open economy with a vibrantly growing private sector. Of course, like a lot of things that come out of China these days, the facade of Capitalism quickly falls apart upon closer inspection. This isn’t real Chinese capitalism like you’d see in Taiwan or Hong Kong.

(photo – Greg Autry, 2010) 

Some Facts:

The State Sector Accounts about HALF of China’s GDP – According to most economic analysis State Owned Enterprises are responsible for between 45-50% of China’s economy. Consider this recent testimony to the US China Commission by Andrew Szamosszegi

Far from privatizing, the State Owned portion of the economy has been INCREASING in recent years as corrupt officials use their inside track with China’s huge State Owned Banks to corner all the ready capital. Moody’s analytics calls this process a “two-speed economy.”

The size of State Owned Companies is increasing far faster than private firms as the government sheds its smaller, non-profitable enterprises and concentrates resources in heavy industrialized firms. These big SOEs also attract $billions in U.S. joint venture capital from the likes of General Electric and General Motors. Meanwhile the size of private firms has hardly progressed at all. On average SOEs are 13x bigger than China’s nominally private firms.

China’s response to the economic crisis was to dump even more money into the state sector driving a process the Chinese call “Guo Jin, Min Tui” (国进民退) or “The State Advances and the People Retreat.”

Maoism and old fashioned Marxist-Leninism has been enjoying a renaissance in China, as evidenced by the spectacular rise of hardline communism advocate Bo XiLai to a position where he threatened the very security of the state. Even members of the intellectual elite have embrace the “New Left.”

In China it has always been hard to draw a firm line between an SOE and private firm or even tell how involved the Party controlled military is in a business. Huawei being a notorious example of that.

 

Finally, let’s look at the reality of what are some of the good, ‘ol fashioned Communist firms:

All of China’s Big banks

All Important Resource Companies

All Big Military Suppliers

China’s Biggest Airlines

China’s Biggest Retailer  – yes, ironically even China’s biggest retailer isn’t WalMart, but a State Owned Chain who has used its connections to make life hell for the American firm and other Western competitors.

 

This List Doesn’t Lie
When some buddy of yours cracks “China’s economy is more open than America’s” or the next time you get stuck in a plane seat next to a meathead in a suit  who just bought some blather by Thomas Friedman in the airport “book store” and starts praising the “new”, “modernizing”, “liberalizing”, and “efficient” Chinese economy, hand that fool this list and ask them “Is this what a vibrant Capitalist Economy looks like to you?”

 

Top 20 Chinese Firms (according to Fortune Global 500) :

1. Sinopec (CNOCC) – State Owned oil company

2. China National Petroleum Corporation (PetroChina) – State Owned oil company

3. State Grid Corporation – State Owned utility

4. Industrial and Commercial Bank of China – State Owned bank

5. China Mobile – State Owned telecom provider

6. China Railway Group – State Owned railroad

7. China Railway Construction – State Owned railroad builder

8. China Construction Bank – State Owned bank

9. China Life Insurance – State Owned issuance (Nationalized, the “real” China Life is in Taipei)

7. Bank of China – State Owned bank

10. Agricultural Bank of China – State Owned bank

11. Bank of China – State Owned bank

12. Dongfeng Motor[1] – State Owned car company

13. China State Construction Engineering – State Owned construction firm

14. China Southern Power Grid – State Owned utility

15. Shanghai Automotive – State Owned Car company

16. China National Offshore Oil – State Owned colonial style oil exploration firm

17. Sinochem Group – State Owned Chemical company

18. China FAW Group – State Owned truck and bus firm

19. China Communications Construction – State Owned telecom construction

20. Baosteel – State Owned steel founder

It is often tricky to figure out that a firm like China Life, China Telecom, or Shanghai Auto is State Owned because the Chinese run a scam they call an “IPO” and sell powerless, minority shares in these opaque state monstrosities to naive Western investors and unscrupulous mutual fund managers. If you’ve got some sort of “Global Growth Fund” or “Asian Opportunity” B.S. in your 401k, you’re probably loaded with this crap. The fact is that these are nothing like public companies. Their CEO’s are appointed by the Central Organization Department of the Chinese Communist Party, not by the token board of directors and your shares have exactly zero real voting power. When the CCP decides your shares are worthless, they will be. Check out “The Party” by Richard McGregor for the whole horror show on this.

If you go to the Fortune site, you can just click on each firm in the list and look down to see if its ownership is “50% or more government owned.”

Even most large nominally “private” firms are headed by a Party member or even the princeling grandkid of some old Commie who slogged through the Long March with Mao and his harem. They all work together in one of the world’s most closed good ‘ol boys club behind their great wall of Guanxi (关系). By the way, don’t let any Chinese tell you that word means “friendship.” The literal translation is more like: “to block a connection” and in the real world of Chinese business Guanxi most often used to define a social network setup to screw outsiders;  and that’s exactly what the Communist Party’s Guanxi system has been doing to the West for a generation.

While the luxury loving leaders of the “People’s Republic” do trample all the well meaning, albeit naive, qualities of Marxism – like wealth redistribution and social equality – the China body politic remains pure Leninist, with the usual back room dog fights, purges, censorship, propaganda and a brutally repressive police state.

Bottom line: When it says “Communist” right on the label, it probably is.

 

Greg Autry serves Senior Economist with the American Jobs Alliance and is co-author (with Peter Navarro) of Death by China: Confronting the Dragon – a Global Call to Action. He blogs regularly with Navarro on the Huffington Post.

 

[1] Note: Noble Group of Hong Kong omitted since it is not a PRC firm, but a legacy Hong Kong company.

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Human Rights Activist? What Human Rights Activist? Oh, THAT Human Rights, Activist! Well, um . . .

April 30, 2012 By 1 Comment

Responding to the heroic escape of blind Chinese rights activist, Chen GuangCheng from brutal house arrest, the best comment a White House spokesman could muster on Sunday was that that the Obama administration hopes to “balance” its commitment to human rights with its commitment to maintaining the economic and strategic relationship with China’s dictators. In other words our former activist President is saying, “Human rights just doesn’t trump money and power.”

Sadly, this should come as no surprise, given the way this administration and its predecessors have dealt with China. Throwing Tibetans, Chinese Christians, Falun Gong, and democracy advocates under the bus in order to appease the Boys from Beijing and keep them funding Washington’s reckless spending has been the most successful bi-partisan policy this decade. Keeping WalMart’s aisle stuffed with undervalued Chinese goods has been important in both buying off consumers –who’ve lost their jobs to China’s predatory trade behavior – and in driving up profits for the multinational corporations that fund the campaign machines.

So, while President Obama was happy to endorse China’s non-democratic succession process by welcoming dictator-in-waiting, Xi Jinping to the White House, having one brave, blind man show up at the U.S. embassy in Beijing asking for refuge has created a political nightmare.  While nobody in the government has officially confirmed that Chen is in the embassy, the fact that they have also refused to deny the rumors makes it pretty obvious, that they are true. The silence over this issue has made the administration’s discomfort, palpable.

Mr. Chen’s case has handed Mr. Obama’s Republican opponents the ripest of tomato’s to toss at the administration’s appeasement policy.  Mitt Romney quickly called on the administration to “take every measure” to protect Chen and Congressman Chris Smith of New Jersey has written Secretary of Sate Clinton urging her to, “raise the issue of all harassed, arrested, disappeared, and disbarred human rights lawyers and defenders with the Chinese Government on an on-going basis and link this issue to the United States’ interests in the rule of law and respect for human rights generally in China.”

Of course, that is exactly what Mr. Obama and Mrs. Clinton do not want to be doing on the eve of an economic and strategy summit with China’s oligarchy. That sort of talk could disturb the very cozy status quo that America’s crony capitalists have struck with Beijing’s corrupt communists. Threatening the flow of profits to multinationals like General Electric and banks like Goldman Sachs, could reveal just how weak this supposed economic recovery is and would surely mean a drop in contributions to Obama friendly PACs during the most expensive Presidential campaign in history.

Coming at this critical juncture in Chinese and American politics Chen’s case offers the perfect opportunity to disrupt the current paradigm. It’s time for all the interested parties to come together and say “Human rights, jobs, and peace are more important than low prices and WalMart and next quarter’s stock indices.”  Boycott China! Do your best to avoid Chinese goods until there is regime change in Beijing along with a change in attitude in Washington and in America’s boardrooms. I call on every decent free person to commit to reducing their purchases of Chinese products by 20% until blind men no longer have to escape beatings by crawling over walls and swimming rivers to hide, unacknowledged in an American embassy.

Greg Autry serves Senior Economist with the American Jobs Alliance and is co-author (with Peter Navarro) of Death by China: Confronting the Dragon – a Global Call to Action. He blogs regularly with Navarro on the Huffington Post.

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