Xi has been brilliant at playing Trump, plying him with flattery and short-term trade concessions and deflecting him from the real structural trade imbalances with China. All along, Xi keeps his eye on the long-term prize of making China great again. Trump, meanwhile, touts every minor victory as historic and proceeds down any road that will give him a quick sugar high.
What world are we in? One in which we’re going through three “climate changes” at once.
- We’re going through a change in the actual climate: Destructive weather events and the degradation of ecosystems are steadily accelerating.
.. while China hails globalization, it imposes a 25 percent tariff on imported cars (while America imposes only 2.5 percent) and 50-50 joint ventures and technology transfers for big companies that want to gain access to China’s giant market. But China gets away with it.
.. plowing government funds and research into commercializing 10 strategic industries while creating regulations and swiping intellectual property from abroad to make them all grow faster. These industries include
- electric vehicles,
- new materials,
- artificial intelligence,
- integrated circuits,
- biopharmacy,
- quantum computing,
- 5G mobile communications, and
- robotics.
.. And Trump? On the change in the climate, he’s promoting coal over clean energy, like wind and solar, and has appointed climate-change deniers to all of his key environmental posts. While China is run by engineers, Trump doesn’t even have a science adviser.
.. “This will be wounding to one of America’s gems,” its institutions of higher education, Drew Faust, the president of Harvard, said to me. And it’s basically being done to cut taxes for the wealthy.
.. the Chinese are focused on the giant winds of change, and Trump is betting on his gut and a grab bag of tax cuts based on no take on the world, other than dubious trickle-down economics.
.. When you don’t know where you’re going any tax cut will get you there, any replacement for Obamacare will get you there, any wall will get you there, any trade concession will get you there.
.. I’m certain our economic system is better than theirs — in theory.
But China, with its ability to focus, is getting 90 percent out of its inferior system, and it has brought China a long way fast. And we, with too little focus, are getting 50 percent out of our superior system.
Trump was an election surprise. Expect more.
The Trump election likely signals a new era of extreme voter discontent and improbable national election results. Why? Because the so-called American Dream — that each generation would live better than its predecessor — has ended for most of our citizens. Half of the young adults in this country will earn less over their lifetimes than their parents did. Indeed, the whole idea of rising living standards, which defined this country for so long, is a thing of the past for most Americans. More and more voters realize this and are angry about it.
.. Are wages rising? Looking back over the past 40 years, the answer is no.
According to the Hamilton Project, overall U.S. wages, adjusted for inflation, are essentially flat over this period — registering about 0.2 percent growth. Which means that purchasing power, a good proxy for living standards, is flat, too.
.. The 2016 Federal Reserve Board survey of household well-being found that 46 percent of U.S. adults could not meet a $400 emergency expense without borrowing or selling something they owned.And a stunning one quarter of adults cannot pay their monthly bills in full... A series of powerful, entrenched factors have brought the American Dream to an end. Economists generally cite
- globalization,
- accelerating technology,
- increased income inequality and
- the decline of unions.
What’s noteworthy is that these are long-term pressures that show no signs of abating... there continues to be a debate among political scientists and sociologists as to whether these income pressures or cultural factors such as a rebellion against the establishment contributed more to the Trump upset. But, in reality, the two factors are interrelated. Household financial troubles increase cultural resentment and the sense that there are two Americas. Especially with the share of national income going to the lower 80 percent of earners at a 100-year low.
Study: Blacks’ Median Wealth Will Be Zero in 2053
That racial stereotyping hides the real cause and scale of economic damage to blue-collar and white-collar Americans families amid the rising wealth of the technocratic globalized elite which dominates the Democratic Party and at least half of the GOP.
.. That government failure is exemplified by the housing bubble, which destroyed a huge percentage of wealth held by black Americans.
A 2011 report by the Pew Research Center showed that the median wealth of black American households dropped by 53 percent because of the property bubble. The mid-point median of black American wealth crashed from $12,124 in 2005 to just $5,677 in 2009, according to the Pew report.
.. White Americans suffered far less from the bubble because many had already paid off their mortgages, because their debts were a small percentage of their income, and because whites had more assets in the stock market and other sectors outside the housing market. Still, the median wealth of white households also dropped by a huge 16 percent, from $134,992 in 2005 to $113,149 in 2009.
.. Meanwhile, wages for all men have remained flat for the past 44 years since 1973, according to the Census Bureau.
.. when Obama settled into the White House during the housing implosion, his economic policies helped very clever people invest their way back up to more wealth. The New York Post described the process:
The years 2008 through 2015 should be known as the Great Fleecing.
During that time, the greatest transfer of wealth in the history of the world occurred. Some $4.5 trillion was given to Wall Street banks through its Quantitative Easing program, with the American people picking up the IOU … Who did this help? The 1%, and pretty much only the 1%.
.. The report does not discuss how technology is concentrating wealth among higher-skilled people, and it omits any talk of globalized outsourcing. It also avoids family stability and it ignores the topic of immigration, which has flooded the nation’s marketplace with cheap labor that effectively imposes a 5 percent tax on labor — and then transfers $500 billion a year to company owners and investors.
.. the report then lists a series of unrealistic demands, including a massive tax increase on the wealthy, a massive financial grant to children that could be spent when they become adults, more house-buying aid for poor people, a higher minimum wage, and “a federal jobs guarantee [that] would function similarly to the Works Progress Administration of the 1930s.”
.. But many people of all colors who cannot get through college are falling behind because technology, work, and business are becoming more complex. This increasing complexity ensures that an increasing share of income and wealth goes to people who are smart enough to arbitrage the increasing social and technological diversity, regardless of color.
.. the Democratic elite prefers to import foreign voters rather than accept the equal social status of all blue-collar Americans... four million Americans turn 18 each year and begin looking for good jobs. However, the government imports roughly 1 million legal immigrants to compete against Americans for jobs... That Washington-imposed policy of mass-immigration floods the market with foreign labor, spikes profits and Wall Street values by cutting salaries for manual and skilled labor offered by blue-collar and white-collar employees. It also drives up real estate prices, widens wealth-gaps, reduces high-tech investment, increases state and local tax burdens, hurts kids’ schools and college education, pushes Americans away from high-tech careers, and sidelines at least 5 million marginalized Americans and their families, including many who are now struggling with opioid addictions.
The Coming War on Business
In a series of essays for conservative magazines like Chronicles, Francis hammered home three key insights.
The first was that globalization was screwing Middle America. The Cold War had just ended, capitalism seemed triumphant and the Clinton years seemed to be an era of broad prosperity. But Francis stressed that the service economy was ruining small farms and taking jobs from the working class.
- His second insight was that the Republican and conservative establishment did not understand what was happening. He railed against the pro-business “Economic Men” who thought G.D.P. growth could solve the nation’s problems, and the Washington Republicans, who he thought were infected with the values of the educated elites.
- Francis told Buchanan. “Go to New Hampshire and call yourself a patriot, a nationalist, an America Firster, but don’t even use the word ‘conservative.’ It doesn’t mean anything anymore.”
- .. His third insight was that politics was no longer about left versus right. Instead, a series of smaller conflicts — religious versus secular, nationalist versus globalist, white versus nonwhite — were all merging into a larger polarity, ruling class versus Middle America.
“Middle American groups are more and more coming to perceive their exploitation at the hands of the dominant elites. The exploitation works on several fronts —
- economically, by hypertaxation and the design of a globalized economy dependent on exports and services in place of manufacturing;
- culturally, by the managed destruction of Middle American norms and institutions; and
- politically, by the regimentation of Middle Americans under the federal leviathan.”
appalled by pro-corporate Republican economic policies on the one hand and liberal cultural radicalism on the other. They swung to whichever party seemed most likely to resist the ruling class, but neither party really provided a solution.
The Buchanan campaign was the first run at what we now know as Trumpian populism.
.. “The ‘culture war’ for Buchanan is not Republican swaggering about family values and dirty movies but a battle over whether the nation itself can continue to exist under the onslaught of the militant secularism, acquisitive egoism, economic and political globalism, demographic inundation, and unchecked state centralism supported by the ruling class.”
.. Francis was a racist. His friends and allies counseled him not to express his racist views openly
.. in 1994 Francis told a conference, “The civilization that we as whites created in Europe and America could not have developed apart from the genetic endowments of the creating people, nor is there any reason to believe that the civilization can be successfully transmitted to a different people.”
.. When you look at today’s world through the prism of Francis’ work, a few things seem clear: Trump is not a one-time phenomenon; the populist tide has been rising for years. His base sticks with him through scandal because it’s not just about him; it’s a movement defined against the so-called ruling class.
.. Trump may not be the culmination, but merely a way station toward an even purer populism.
.. Trump is nominally pro-business. The next populism will probably take his ethnic nationalism and add an anti-corporate, anti-tech layer. Google, Facebook, Amazon and Apple stand for everything Francis hated — economically, culturally, demographically and nationalistically.
.. As the tech behemoths intrude more deeply into daily life and our very minds, they will become a defining issue in American politics. It wouldn’t surprise me if a new demagogue emerged, one that is even more pure Francis.