What China wants — and doesn’t want — from a Trump-Kim summit

“Beijing’s security interests will be served if a potential agreement weakens the U.S. alliance with South Korea, reduces the U.S. military presence in Asia and limits the threat of refugee flows on Chinese borders, according to The Atlantic Council.”

From CNBC:

Next month’s milestone summit between North Korea’s Kim Jong Un and President Donald Trump has major implications for China, which has geopolitical and security interests at stake on the Korean Peninsula.

“Lurking in the background as a potential spoiler or helper in this drama is Chinese leader Xi Jinping, who sees both opportunity and peril,” Fred Kempe, president and CEO of foreign policy think tank Atlantic Council, wrote in a recent note.

The world’s second-largest economy has long supported a nuclear-free region but strategists say its greatest priority is preventing North Korean regime collapse — if the rogue state falls under the weight of sanctions, that could send a flood of citizens to China.

For Beijing, “the right sort of peace deal could weaken the U.S. alliance with South Korea, reduce the threat of conflict and refugee flows on Chinese borders, and ultimately lead to the withdrawal of American troops from South Korea,” said Kempe.

Ending the U.S. military presence in South Korea — a major prerequisite for Kim’s administration to relinquish nuclear weapons — is expected to boost China’s goal of minimizing America’s influence in Asia.

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New admiral in the Pacific, and he’s got his eye on China

“The incoming commander of US Pacific Fleet issues a warning about growing Chinese ambitions while taking charge of the world’s largest fleet.”

From Breaking Defense:

As the world’s largest fleet met its new commander on Thursday, he offered a stark warning to adversaries like China and Russia, who have emerged as major strategic competitors in the Pacific.

“A great power competition has reemerged as the central challenge to security and prosperity against our nation,” Adm. John Aquilino said. “Nowhere are the stakes of that great power competition higher than here in the Indo-Pacific region. To any potential adversary that wishes to challenge us, the Secretary of Defense said it best, ‘You can have no better friend, or you can have no worse enemy’ than the U.S. Pacific Fleet, that choice will be yours.”

Aquilino’s comments came the same day China announced its strategic H-6K bomber landed on one of Beijing’s artificial islands in the South China Sea, a clear signal that the Chinese military is willing and able to use its far-flung holdings as military bases. (China, of course, had told the world their fake islands would not be used for military purposes.)

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Donald Trump goes to bat to save jobs — in China

“The question will be if Trump is more effective at saving jobs for a Chinese company, than he has been for those companies he promised, and failed, to save in the US.”

From Daily Kos:

Donald Trump has vowed to directly intervene in US-China trade to benefit Chinese phone manufacturer ZTE. ZTE is currently banned from selling US technology after it violated sanctions on selling US-made gear to Iran and North Korea and lied to investigators looking into the issue.

ZTE is one of several large Chinese manufacturers of mobile technology. Over the last three years, the company managed to do something that few other Chinese companies have done — leave their home market and make significant inroads in the United States and Japan. Other Chinese brands, like Vivo, show big numbers on the worldwide sales charts, but that’s pretty much all domestic sales within China.

But ZTE’s global outreach also included sales to Iran and North Korea. Since at least 2011, the US has been looking into ZTE’s sales to Iran, which included US-made technology used in surveillance gear. Not only did investigations show that ZTE had made such sales, it also turned up the sales of US-made equipment to North Korea. And ZTE both lied to the Department of Commerce about it’s actions and actively tried to interfere in the investigation.

Ultimately, ZTE was given a record $1.2 billion fine for its actions. It also agreed to take internal action at the company to penalize those officers and workers who had knowingly worked to defy the sanctions and make other moves to safeguard against such an event happening again. It didn’t. So earlier this year, the United States banned sales of US hardware and software components to ZTE.

In response, ZTE warned that the company could no longer operate. Even the phones it sells inside China depend on Google’s Android operating system and use chips designed by California-based Qualcomm. ZTE protested the ban, but the Commerce Department made it clear that ZTE’s violations were blatant and the ban would not be lifted.

But now, Donald Trump is coming in to save a Chinese phone company that clearly broke US law … because that’s how things are done in an age when diplomacy is nothing more than personal relationships.

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Lindsey Graham helped Trump intimidate Chinese by warning them POTUS is ‘crazy, volatile’

Graham told the Chinese ambassador, “If you don’t think Trump’s crazy, then you’re crazy.”

From The Western Journal:

During the 2016 Republican primary season, most of the GOP presidential candidates were not big fans of then-businessman Donald Trump, and South Carolina Sen. Lindsey Graham was certainly no exception.

Since Trump won the election and took office, Graham has come around somewhat and has been fairly supportive of the president’s agenda, though he still offers up softened criticism of Trump’s words and deeds at times like many other members of the Republican establishment.

According to Mediaite, Graham appears to have delivered a grab bag of criticism and praise of the president during a speech to the Columbia Rotary Club on Monday.

The remarks from the senator on a variety of topics were documented in a handful of tweets from a local reporter in attendance at the speech, Andy Shain of The Charleston Post and Courier.

At one point Graham related how he had told the Chinese ambassador, “If you don’t think Trump’s crazy, then you’re crazy.”

While on it’s face that may come across as criticism, consider how that actually may have proven helpful to the bigger picture of Trump’s agenda as it pertains to military and trade relations with China and especially North Korea.

Trump’s bellicose rhetoric toward North Korean dictator Kim Jong Un — which in essence appears to have brought Kim to the discussion table for peace talks — painted the picture that Trump was just “crazy” enough to actually back up his “fire and fury” rhetoric with actual furious fire from the military if Kim continued to threaten the region.

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Is China sabotaging the North Korea denuclearization talks?

Kim’s surprise back-to-back meeting with Xi could mean the Chinese are up to no good.

From the Daily Beast:

Tuesday, President Trump revealed that Secretary of State Mike Pompeo was on his way to North Korea. The trip had not been previously announced.

Just hours before, Beijing reported that Kim Jong Un, the North Korean leader, met with China’s Xi Jinping on Monday and Tuesday, in the Chinese port of Dalian. Trump spoke with Xi by phone Tuesday to discuss Xi’s surprise meeting with Kim.

The Chinese appear to be up to no good. There was, prior to the Xi-Kim meeting, fast progress in American efforts to “denuclearize” North Korea, so the involvement of Beijing, which has periodically supported the North’s weaponization efforts, is unlikely to be beneficial from the Trump administration’s point of view.

Kim’s trip to Dalian was extraordinary. Kim went to Beijing at the end of March. Protocol — the Chinese are great sticklers for it when it works to their advantage — demanded Xi return the visit before Kim returned to China. In fact, in April sources reported the Chinese leader was planning to go to Pyongyang in May or June.

Instead of Xi going to Pyongyang, Kim made another visit to Chinese soil. At least since the end of the fighting in the Korean War, never have there been two China-North Korea summits so close together in time. “It is without modern precedent for a leader to come to China on back-to-back visits as Mr. Kim has done,” said Cheng Xiaohe of Beijing’s Renmin University to The New York Times.

So why did the Dalian meeting occur? “The second meeting demonstrated that North Korea wanted China to play a larger role in the denuclearization process,” Cheng said. “When Kim enters the meeting with Trump, he will feel more confident, simply his positions on a variety of issues were consulted and sanctioned by the Chinese leader.” […]

China is making mischief at a crucial time, when both sides are establishing their initial positions. Kim hoped to “eventually achieve denuclearization and lasting peace on the peninsula,” Beijing’s statement said. To do that, the North Korean was contemplating “phased and synchronous measures in a responsible manner.”

Kim’s position is, at least at this moment, completely unacceptable to the Trump administration. “We will not relieve sanctions until such time as we have achieved our objectives,” Pompeo told reporters on his plane Tuesday while en route to North Korea. “We’re not going to do this in small increments, where the world is coerced into relieving economic pressures.”

Accordingly, Pompeo may have decided to get on his plane to undo Xi’s efforts on Monday and Tuesday with Kim. It’s noteworthy that Pompeo is going to North Korea just as positive momentum in U.S.-North Korea ties is fading. The unwelcome propaganda blast directed at the Trump administration from the Korean Central News Agency occurred over the weekend, just hours before Kim met Xi.

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China’s behavior monitoring system bars some from travel, purchasing property

The Chinese government is assigning each and every citizen “a social credit score, a fluctuating rating based on a range of behaviors,” and rewarding or punishing them accordingly.

From CBS News:

By 2020, China plans to give all its 1.4 billion citizens a personal score based on how they behave. Some with low scores are already being punished if they want to travel. Nearly 11 million Chinese are not allowed to fly and 4 million are barred from trains. Next week, the program will start expanding nationwide.

The government says it is trying to “purify” society by rewarding people who are trustworthy and punishing those who are not, reports CBS News correspondent Ben Tracy. So like the credit scores most Americans have based on how they handle their finances, Chinese citizens are getting a social credit score based on everything from whether they pay their taxes on time to how they cross the street to what they post online.

When Liu Hu recently tried to book a flight, he was told he was banned from flying because he was on the list of untrustworthy people. Liu is a journalist who was ordered by a court to apologize for a series of tweets he wrote and was then told his apology was insincere.

“I can’t buy property. My child can’t go to a private school,” Liu said. “You feel you’re being controlled by the list all the time.”

The list is now getting longer as every Chinese citizen is being assigned a social credit score, a fluctuating rating based on a range of behaviors. It’s believed that community service and buying Chinese-made products can raise your score. Fraud, tax evasion and smoking in non-smoking areas can drop it. If a score gets too low, a person can be banned from buying plane and train tickets, real estate, cars and even high-speed internet. […]

China’s growing network of surveillance cameras makes all of this possible. The country already has an estimated 176 million cameras. It plans to have more than 600 million installed by 2020.

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US Admiral warns: Only war can now stop Beijing controlling the South China Sea

“While Australian warships were being challenged, a top US admiral was telling Congress Beijing now controlled the South China Sea.”

From news.com.au:

The island fortresses are built. The airfields are ready. The harbours are open.

All China needs do now is move in the warships and combat jets.

The chief of US Fleet Forces Command has told US Congress that Beijing has built up enough military infrastructure in the South China Sea to completely control the disputed waterway.

“Once occupied, China will be able to extend its influence thousands of miles to the south and project power deep into Oceania,” Admiral Philip S. Davidson wrote.

“The PLA will be able to use these bases to challenge US presence in the region, and any forces deployed to the islands would easily overwhelm the military forces of any other South China Sea-claimants.

“In short, China is now capable of controlling the South China Sea in all scenarios short of war with the United States.”

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A $150 billion investment chief explains why he’s so nervous about the ‘wild card’ trade war

From Business Insider:

US stocks have been on a violently rocky ride for the past few weeks as the prospect of a global trade war has moved toward becoming a reality.

The market has been through plenty of turbulent periods before, but Brad McMillan, the chief investment officer at Commonwealth Financial Network, a $150 billion firm, says that “this time, things really are different.” […]

Unsurprisingly, Brad McMillan, the chief investment officer of Commonwealth Financial Network, is troubled by what he has seen unfold. He views the imminent global trade war — stoked by the US and China in recent days — as a nearly unprecedented occurrence, and he’s not sure the market is ready for it.

“You can say this time is different, and it ends up not being so — but this time, things really are different,” McMillan told Business Insider by phone. “It marks a departure from what we’ve seen for the last 30 years. It’s the unpredictability and uncertainty that has people so worried.”

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Tariff fight could hit GOP in key Senate states

From The Hill:

Democrats see President Trump’s escalating trade war with China as an opportunity that could help them win several Senate races in states where a trade fight would damage local economies.

States that rely on agriculture could be hit particularly hard by retaliatory tariffs from China. That could give Democrats in states like North Dakota, Montana, Indiana, Missouri and Florida — all of [which] are represented by Senate Democrats up for reelection this year — a new argument to make against the president and his allies in Congress.

The administration launched the first wave of tariffs last month on steel and aluminum, but tensions rose this week when the White House announced $50 billion in tariffs on a variety of Chinese electronics and other goods.

China responded with a broad list of U.S. goods that would face $50 billion in tariffs as well — a response that prompted a White House threat to add $100 billion in new tariffs to Chinese goods.

The Chinese tariffs target a smattering of U.S. goods, including soybeans, cotton, corn, pork, chemicals, plastics, cattle, wheat and tobacco.

China is one of the biggest markets for American export goods, and a top recipient of American agricultural products like soybeans, corn, grains and pork, according to the United States Trade Representative.

Soybeans and hogs are major cash crops in states like Minnesota, Indiana, North Dakota and Missouri. Corn is a major crop in Nebraska, Minnesota and Indiana. And Nebraska, Missouri, Wisconsin, Montana, Minnesota and Florida all feature large cattle industries.

All of those states will see Senate races in 2018, with several Democratic incumbents on the ballot in states Trump won in 2016. Republicans are warning that the economic impact of tariffs could be felt hardest in key Senate states if the trade war continues.

“The economic pain that people will feel from tariffs will be a good reminder of how important free trade is to the economy,” said Alex Conant, a GOP strategist who’s served as a top aide to Sen. Marco Rubio (R-Fla.).

“The people most at risk are the people in disproportionately red states who voted for Trump,” he said, adding that the “coincidence of the cycle” is that those states are also home to Democratic incumbents targeted by the GOP.

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Conservative Koch brothers network breaks with Trump over brewing trade war with China

From CNBC:

President Donald Trump is so far unwilling to back down from a trade war with China, but that may change as pressure mounts from the influential political and donor network backed by the conservative billionaire Koch brothers.

Executives at Americans for Prosperity, just one part of the ever-growing Koch influence empire, said that tariffs will only hurt American consumers and possibly cancel out positive effects from the Republican tax cut bill passed in December.

“From the beginning we’ve said that tariffs and protectionism is a bad idea,” Tim Phillips, president of Americans for Prosperity, said in an interview Friday. “It’s a tax on American consumers because a lot of the product they’re buying will cost more and it hurts American industries when countries retaliate.”

The group has also expressed its concerns directly with the White House.

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