Friday Reads: Chaos and Corruption Edition (sigh) again and again and againPosted: April 6, 2018
Good Morning Sky Dancers!
I’m going to share linky goodness on three story lines today. The first is the tit for tat tariff war with China. Don’t forget Hair Loser told us that “winning trade wars is easy”. Unfortunately, he ignores those of us that practice the economic dark arts of econometrics!
This minor trade war could escalate into something far worse. We have had the tit-for-tat: China has responded with its own list of tariffs to America’s so-called 232 measures (on steel and aluminium). We have had the same relatively proportionate exchanges on America’s 301 actions (on technology). In each case the steps have been modest. Economists estimate that America’s more extensive list, which omits key consumer items such as iPhones, will add just $12.5bn to the roughly $500bn in Chinese annual imports to the US. This is small potatoes. If Washington and Beijing simply stopped here, the world could carry on as normal. But dynamic situations do not normally halt of their own accord. That is why the markets have reacted so badly. They see the potential for escalation. A Chinese official was quoted as saying: “It is only polite to reciprocate”. Whatever Trump does, China will match. The ball is now in Trump’s court, which is never an ideal place for it to be. For more, readers should go to Shawn Donnan’s always excellent “Free trade” newsletter.
So, let’s look at Hair Loser’s blatherings on his ongoing list of Making America Gilded Again. This one is from CBS: “Trump says trade war is “already lost,” and he “probably won’t” attend White House Correspondents Dinner”. And is it his fault? Ohhhhh, of course not.
President Trump said in a radio interview aired Friday that the U.S. isn’t in a trade war because the trade war is “already lorst,” and said he “probably won’t” attend the White House Correspondents Dinner in Washington later this month because the press is “so fake.”
Mr. Trump made those comments in an interview with WABC’s “Bernie and Sid in the Morning,” taped Thursday. The interview took place before the president’s Air Force One comments denying any knowledge of a hush money payment by his lawyer to porn actress.
Mr. Trump explained why he is going after China on tariffs. On Thursday night, Mr. Trump announced he has directed the U.S. Trade Representative to considerin new tariffs on China, in response to China’s decision to slap $50 billion in tariffs on U.S. imports. China’s $50 billion was a response to the White House’s announcement of $50 billion in tariffs on China. But Mr. Trump insisted that the U.S. isn’t in a trade war — in the past he has called trade wars “good, and easy to win” — because the U.S. already “lost” a trade war.
“Well, fellas, we’ve already lost the trade war,” the president said. “We don’t have a trade war. We’ve lost the trade war because for many years, whether it’s Clinton or the Bushes, Obama, all of our presidents before, for some reason it just got worse and worse. And now it’s $500 billion in deficits and a theft of $300 billion in intellectual property. So you can’t have this.”
The president said the stock market might take a bit of a hit in the short term —— but the country will be stronger in the long run, he insisted.
“Now we could—the easiest thing for me to do would be just to close my eyes and forget it,” Mr. Trump said. “If I did that, then I’m not doing my job. I’m not saying there won’t be a little pain but the market’s gone up 40 percent, 42 percent—so we might lose a little bit of it—but we’re going to have a much stronger country when we’re finished. And that’s what I’m all about. We have to do things that other people wouldn’t do.”
Of course, he also denied we were in a trade war with China. Hair Loser has such mental acuity! Why, he’s a stable genius!
“We are not in a trade war with China,” President Trump tweeted Wednesday morning.
The president is correct. What looks like a trade war is really a struggle for the control of the technologies that will dominate coming decades.
The trade war narrative seems at first glance to fit the facts. On March 8, the United States, pursuant to Section 232 of the Trade Expansion Act of 1962, imposed tariffs on steel and aluminum from China and other countries.
On March 22, President Trump issued a memorandum directing Lighthizer to consider 301 tariffs on China. Beijing, within a few hours, announced tariffs of its own on $3 billion of U.S. goods.
This Wednesday, Beijing made another announcement, this time proposing tariffs on $50 billion of imports from America.
This looks frightening because no one knows what happens when a dispute engulfs the planet’s two largest economies. As Neil Irwin of The New York Timeswrote Thursday referring to China, “a trade war with such a major trading partner is without precedent in modern times.”
President Trump, whether he ends up in a trade war or not, has zeroed in on the core of the competition between China and the U.S. Lighthizer’s proposed tariff list Tuesday includes duties on some mundane items but especially goes after the Chinese aerospace, information and communications tech, and robotics sectors. As Zhou Hao of Commerzbank in Singapore told Bloomberg, “The U.S. list suggests that the government is targeting the ‘Made in China 2025’ initiative.”
That initiative, announced in 2015 by China’s State Council, seeks to make that country nearly self-sufficient in 10 crucial industries, including aircraft, robots, electric cars, and computer chips. Beijing has set out specific goals for market shares by industry.
The plan aims for near self-sufficiency in components by 2020 and materials five years later. Moreover, Beijing, stepping into trade-violation territory, wants Chinese industries to possess 80 percent of their home market in the listed sectors.
CM2025, as the initiative is known in China, calls for jumbo-sized, low-interest loans from state investment funds and development banks, aid for the purchase of foreign competitors, and research subsidies.
Raise your hand if you think Hair Loser knows anything about the details of CM2025. He may know enough to think if they’re getting out of those import areas to be more secure, maybe he can riff on that idea too! But, better he should focus on a cyber wall. The literal stuff only makes us weaker. From The Hill: “Trump says ‘pain’ from China tariffs will make US ‘much stronger’”. Feel the pain!!!! Are we winning now? Are we great again?
President Trump says in a new interview that tariffs targeting China over intellectual property theft could cause some “pain” in the U.S. economy, but promised that America would emerge stronger as a result.
“I’m not saying there’s not gonna be any pain,” Trump said Friday in an interview with “Bernie & Sid in the Morning” on 77 WABC in New York City.
He also acknowledged the initial reaction from markets is likely to be negative.
They “could lose a little bit,” he said
Dow Jones industrial average futures plummeted on Thursday after news broke that Trump has asked officials in the administration to prepare tariffs on another $100 billion of imports from China, escalating a fight with Beijing.
Futures on the index fell 222 points, suggesting the market would open down 271.22 points on Friday, CNBC reported.
A relatively poor jobs report released Friday that found the nation added 103,000 jobs in March is also likely to push markets lower, but Trump said he was not worried about a negative reaction from his move on trade.
“We’re gonna be much stronger for it,” he added later in the interview.
China has responded to the latest round of tariff plans with a statement threatening an all-out trade war.
“We do not want to fight, but we are not afraid to fight a trade war,” China’s Foreign Ministry said in a statement.
Oh, wait, that sounds more like losing again. So, let’s head over to Trump’s Best and Brightest and Most Corrupt Cabinet. Pruitt is now labelled as “too corrupt to be corrupted” by Ryan Cooper at The Week.
As defined by Congress, the EPA is supposed to protect the health of Americans by enforcing environmental law, but Administrator Pruitt’s tenure has been focused almost entirely on dismantling as much of the existing architecture of environmental protections as possible. More than any previous EPA head, he has worked to accomplish the exact opposite of the intended purpose of the agency. He has rolled back President Obama’s automobile efficiency standards, the Clean Power Plan, and stacked scientific advisory boards with science deniers and partisan hacks. Overall there have been 41 instances of EPA deregulation under Pruitt as of early February alone. His EPA insists that a gigantic toxic waste dump in Puerto Rico is fine, despite the fact that it was badly flooded during Hurricane Maria and many locals have suspicious illnesses.
And where he can’t simply torch regulation (because it’s often wildly illegal), he’s stalled implementation as long as possible, through administrative delays, legal red tape, and simply refusing to staff tons of positions.
Perhaps most deviously, as Emily Atkin writes, he recently changed the scientific basis for EPA rulemaking to disqualify any research not based on public data, following a trail blazed by notorious climate change denier Rep. Lamar Smith (R-Texas). That superficially reasonable-sounding policy rules out most air quality research of any kind, which are based on medical datasets that are not public because of federal privacy law.
The objective, obviously, is to come up with any sort of pretext to make it easier for polluters to pollute. This one places a handy Catch-22 in the face of nearly anybody who wants to do serious science on pollution and health.
Oh and also Pruitt has an unprecedented 24/7 squad of bodyguards, a $25,000 secret phone booth in his office, spent $9,000 sweeping his office for surveillance bugs, and took multiple charter, private, and first-class flights costing at least $163,000 in total.
If there’s one silver lining to Pruitt’s effort to leave no American child brain un-poisoned, it’s how he demonstrates the extent to which a committed ideologue can bend an agency to his will. The EPA is supposed to follow the latest science in carrying out its legal mandate, but by tendentiously disqualifying science that doesn’t reach a prearranged ideological conclusion, Pruitt has effectively gutted the Clean Air and Clean Water Acts.
Navarro, who kept accidentally calling Steve Mnuchin Steve Munchkin,” noted that Pruitt’s problem is that his flubs aren’t happening in a vacuum, other cabinet secretaries are doing the same.
“There is one more chapter in this telenovela,” she said. “In the sense that we’ve heard about excesses by Ben Carson, by Munchkin-Mnuchin-whatever. It is $130,000 doors or $130,000 lunch tables or jetting around to see an eclipse. This is one more instance of what we’re seeing after Donald Trump promised to be different, and the Republican Party again and again looks the other way. Whether it’s Stormy Daniels or tariffs or deficits or overspending. They look the other way. If this were a Democratic administration, people would be brought in to testify and there would be investigations.”
“I will say to you, the problem with that [Scott Pruitt] interview is — I mean first of all, it was so bad it made Betsy DeVos look like Albert Einstein,” she continued. “But more than that, he went around the White House to give his buddies and cronies a huge pay raise despite the White House was saying not to do it. That should really bother us, as republicans, as Americans, as taxpayers. That is our money that he is misspending and it should bother all of us despite partisanship.”
Pruitt definitely acts like a worse demigod than Trump. My guess is Hair Loser wants no competition from jerks like him.
Several weeks after taking the helm of the Environmental Protection Agency, Administrator Scott Pruitt was running late and stuck in Washington, D.C., traffic. Sources tell CBS News that he wanted to use his vehicle’s lights and sirens to get to his official appointment, but the lead agent in charge of his security detail advised him that sirens were to be used only in emergencies.
Less than two weeks later that agent was removed from Pruitt’s detail, reassigned to a new job within the EPA.
Still, recently Trump has shown more preference to Pruitt over Sessions even suggesting he might replace Sessions with Pruitt.
President Donald Trump floated replacing Attorney General Jeff Sessions with Scott Pruitt as recently as this week, even as the scandal-ridden head of the Environmental Protection Agency has faced a growing list of negative headlines, according to people close to the President.
“He was 100% still trying to protect Pruitt because Pruitt is his fill-in for Sessions,” one source familiar with Trump’s thinking told CNN.
Though the President has, at times, floated several people a day for multiple positions in his administration that are already occupied, the proposition reveals just how frustrated Trump remains with Sessions because of his decision to recuse himself from overseeing the Russia investigation more than a year ago, while signaling how confident he has remained in Pruitt despite a dizzying number of ethics issues.
So, the third headline comes from the US Treasury and sanctions imposed on Russian Oligarchs. We’re waiting for Hair Loser’s pissing wisdom on this via Twitter.
The Trump administration announced new sanctions on Russian tycoons, companies and key allies of President Vladimir Putin, hitting the crucial energy sector and adding to a flurry of moves by Western powers against Moscow in recent weeks.
“The Russian government operates for the disproportionate benefit of oligarchs and government elites,” U.S. Treasury Secretary Steven Mnuchin said in a statement Friday. “The Russian government engages in a range of malign activity around the globe, including continuing to occupy Crimea and instigate violence in eastern Ukraine, supplying the Assad regime with material and weaponry as they bomb their own civilians, attempting to subvert Western democracies, and malicious cyber activities.”
Those penalized include seven Russian oligarchs, 12 companies and 17 senior government officials under provisions of a law Congress passed last year to retaliate against Moscow for meddling in the 2016 U.S. presidential election.
Among the most prominent Russian tycoons identified Friday is metals magnate Oleg Deripaska, the billionaire founder and majority shareholder of En+ Group. Deripaska, 50, made headlines last year due to his links to Trump’s former campaign manager, Paul Manafort. The tycoon has had difficulties in the past in getting a U.S. visa.
Friday’s announcement builds on a string of punitive actions taken by the U.S. against the Kremlin. Congress and Trump’s national security advisers have pushed for tougher sanctions against Russia for its interference in the 2016 U.S. election and its prolonged, destructive cyberattacks in Ukraine and elsewhere.
But in a farewell speech at the Atlantic Council in Washington this week, Trump’s outgoing national security adviser, H.R. McMaster, said the U.S. has “failed to impose sufficient costs” on Putin’s government for its military and political aggression worldwide.
The Kremlin continues to call for dialogue with Trump. Speaking in Moscow Thursday, Russian Foreign Minister Sergey Lavrov complained about America’s increasingly hostile diplomatic stance towards Russia but expressed hope that Trump and Putin could conduct a “broad dialogue” so long as it does not “fall victim to domestic political intrigues” in Washington.
Other individuals targeted on Friday include members of Putin’s inner circle, some of whom are under scrutiny from U.S. investigators for activities related to the 2016 presidential election.
Among them are Suleiman Kerimov, a top Putin adviser; Kirill Shamalov, who married Putin’s daughter in 2013; and financier Viktor Vekselberg, who attended Trump’s presidential inauguration.
Sanctions target Alexander Torshin, deputy governor of the Central Bank of the Russian Federation, who reportedly is under investigation in the U.S. on suspicion of funneling money to the National Rifle Association to assist the Trump campaign.
And, just in case you missed it … “EXCLUSIVE: Saudi crown prince bragged that Jared Kushner gave him CIA intelligence about other Saudis saying ‘here are your enemies’ days before ‘corruption crackdown’ which led to torture and death”
What’s on your reading and blogging list today?